Aeon Supplier Code of Conduct (CoC)

Aeon Supplier Code of Conduct (CoC)

AEON is committed to safety and security for our customers. To this end, we believe that we must fulfill our social responsibilities in the manufacturing process, and in 200 AEON 3 we established our own AEON Supplier Code of Conduct (AEON Supplier Code of Conduct). AEON Supplier Code of Conduct has asked its suppliers to comply with the policy of "producing products in a safe and healthy work environment that guarantees a safe and healthy work environment that protects the human rights of employees and appropriately considers stakeholders and the environment."

Expanding the scope of AEON Supplier Code of Conduct

In March 2019, we revised AEON Supplier Code of Conduct. The revised code emphasizes that each organization in the supply chain must request that the organizations with which they have connections address these issues. If each organization addresses these issues, it will lead to the manufacture of safe and reliable products, and will also earn the trust and peace of mind of stakeholders.
The AEON Group also has a variety of businesses and services.
We will continue to promote and implement human rights due diligence, and intend to fulfill our social responsibilities through this Code in related supply chains as well.

Aeon Supplier Code of Conduct (CoC)

1. Laws and Regulations

Shall comply with all applicable legislation, bylaws, and regulations of the countries and regions in which business is operated. Shall also demand that all of your suppliers, subcontractors, and contractors comply with legislation, bylaws, regulations, and our supplier Code of Conduct.

2. Child Labor

There shall be no use of, or support of use of a child who is not yet the older of either age 15 or the age at where a child is allowed to be used in that country. For individuals who have not yet reached the age of 18 or who are at or above the age at which it is legally permitted to use or employ them, education shall be given priority where there are compulsory education laws, and they shall not be placed in a situation where they would be subjected to physical or mental health or developments risks or danger.

3. Forced Labor

The use and employment process shall not be forced or be complicit in force that is against a employees’ will by means of violence, intimidation, restraint, mental or physical means or of unjustly limiting their freedom of conduct.

4. Working Hours

Shall comply with legislation relating to working hours, breaks and holidays and other industry standards. Overtime work must be voluntary, and should not be demanded regularly. In terms of work exceeding statutory working hours, a determinate overtime allowance shall be paid.

5. Wages and Benefits Package

Shall comply with legislation on national wages and benefits. Wages and various benefits shall be paid and deducted in accordance with the relevant legislation and records shall be kept. Wages shall be in excess of the amount required to meet employees’ basic needs. The paid wages shall include overtime allowances and shall be described in a manner comprehensible to employees.

6. Abuse and Harassment

Shall not engage in, have any involvement in or be complicit in any punishment of employees, use of mental or physical force or use of abusive language. Shall not permit any acts of harassment including gestures, language or physical contact in any workplace within the business activity.

7. Discrimination

Shall not discriminate or be complicit in employment discrimination relating to recruitment, wages, promotion, training, termination or retirement on the grounds of race, nationality, ethnicity, gender, age, origin, religion, academic background, physical or mental disability, sexual orientation or gender identity. All decisions pertaining to employment shall be based on criteria relating to the ability to accomplish the required task.​ ​

8. Freedom of Association and the Right to Collective Bargaining

Shall respect employees’ right to organize, join and manage a labour union chosen by the employees themselves, and for the employees’ representative to enter into collective bargaining with the company. Where there are legal and regulatory restrictions imposed on the right to freedom of association and collective bargaining, shall establish as an alternative measure, a complaint handling system where management and employee representatives can take their concerns and to respond in good faith.

9. Health and Safety

Shall provide employees with a safe and healthy working environment compliant with applicable legislation, in addition to providing effective steps to prevent disease including accidents, injuries and emotional issues relating to potential health and safety. Shall apply similar health and safety standards to dormitories and cafeterias provided to employees.​ ​

10. Environment

It shall not be sufficient to only comply with all legislation relating to the environment of the nation and the region in which manufacturing is being undertaken, instead maximum consideration shall be given to the environment. There shall be confirmation that the raw materials and the products used conform to the legislation of the nation and region from which they are obtained, that international treaties and protocols are being applied and that the environmental policies specified by Aeon are satisfied.

11. Business Transactions

Shall comply with the laws relating to the country of origin of final product and its components and of business transactions of the exporting country and region.

12. Integrity and Transparency

Shall never be involved in unethical actions such as bribery, falsification, manipulation or concealment of records, evidence or testimony in any business activity. Information relating to business activities shall be correctly disclosed in accordance with the applicable regulations and standard business practices.

13. Engagement

Shall integrate the requested content of Aeon’s suppliers Code of Conduct into their own company or their own organisation’s management system, and work throughout the entire organization to resolve social issues occurring throughout the whole supply chain.

Aeon Supplier Code of Conduct

The AEON Supplier Code of Conduct is available in the following languages:
・Japanese ・English ・Chinese (Simplified) ・Vietnamese ・Myanmar/Burmese ・Cambodia/Khmer ・Bangladeshi/Bengali
・Chinese (Traditional) ・Thai ・Nepali ・Hindi ・Lao ・Spanish ・Portuguese ・Italian
・Indonesian ・Malay ・Korean

You can watch the explanatory video for AEON Supplier Trade Code of Conduct here

AEON Supplier Code of Conduct is made up of two parts: Part 1 and Part 2. Explanation of the Code of Conduct. It is available in Japanese, English and Chinese.

Human rights due diligence system initiatives

AEON (hereinafter referred to as "the Group") recognizes that "respect for human rights" is important to practice "customer first" under the basic philosophy of "pursuing peace, respecting human beings, and contributing to local communities with customers as the starting point," and considers it a matter of course not only for its own Group employees but also for its supply chain.
AEON In our Code of Conduct "Partners and AEON", AEON respects our business partners who place the highest priority on safety and security for their products and services. AEON The company expects its business partners to comply with and practice international standards. As stated in the "Partnering with Suppliers" section of the Code of Conduct (), we are working with our business partners (suppliers) to implement a human rights due diligence cycle to reduce the negative impacts of our business activities and to curb their occurrence.

Progress of supply chain human rights issues

Auditing and Communication with our Suppliers

As suppliers of our private brand "Topvalu" are particularly important business partners, we explain AEON 's philosophy to them and receive their approval.
We then check the status of compliance with AEON Supplier Code of Conduct through audits and other means, and we ask suppliers to make continuous improvements to any non-compliant items in order to fulfill our social responsibilities together.
Currently, AEON conducts external audits, second-party audits, and first-party audits.
AEON trains auditors from among Group employees, and in second-party audits in particular, we not only confirm conformity or non-conformity, but also communicate and partner with contractors and manufacturing plants to meet customer expectations for safety and security.

Supplier CoC

Informing business partners about AEON Supplier Code of Conduct

Briefing session for new suppliers

For suppliers who are doing business with AEON for the first time, we hold information sessions to ensure their understanding and cooperation with the importance of respecting human rights and the AEON Supplier Transaction Code of Conduct. Previously, these sessions were held face-to-face, but due to the spread of COVID-19 and advances in communication infrastructure, we have changed to conducting these sessions on demand.
At the briefing session, in order to realize our policy of growing together with our partners in response to social issues, we will explain corporate social responsibility in the supply chain, AEON 's initiatives, specific procedures for applying for audits, and contact points for inquiries.
After viewing the briefing session, we ask suppliers to understand the content and then outsource production to those who have committed to complying with the AEON Supplier Transaction Code of Conduct through contracts and audits.
In 2021, 20 companies that are doing business with us for the first time are watching the program.

Briefing session for agricultural suppliers

January 2021: We explained AEON Supplier Code of Conduct of Conduct to agricultural product suppliers who are directly or indirectly connected to producers, including information on producers' working hour management and the employment of foreign workers. 106 people from 76 companies participated.

Declaration of compliance

In order to protect human rights in the supply chain, AEON requires all suppliers who manufacture Topvalu products to declare their adherence to the AEON Supplier Transaction Code of Conduct. We ask that our suppliers understand AEON 's policy and pass it on to their raw material suppliers and procuring sources.

External Audits

In order to conduct objective evaluations, we outsource audits and evaluations to overseas Topvalu production factories to external auditing organizations. The factory creates an improvement plan for any issues discovered during the audit, and six months after the audit, AEON 's certified auditors visit the factory to check whether the improvements are progressing according to the plan.
The attached policy is sent to the target factories in advance and signed back as a condition for applying for an audit.

Second-party Audits

Second-party audits where Aeon certified auditors conduct audits and evaluations are done for the second audit and after for overseas factories, and for the first time and after for Japanese factories. Aeon certified auditors provide advice and help build a self-sustained management system so that suppliers and factories can take the lead in managing and exerting influence on our supply chain.

First-party Audits

Factories that are able to manage themselves through second-party audits will be asked to move to first-party audits. Suppliers will check the status of their factories by filling out AEON 's questionnaire, and if there are any issues, they will be asked to report improvements. The purpose of the Supplier Transaction Code of Conduct is not to conduct audits, but to have suppliers manage themselves, so this is a system in which suppliers who understand the direction will implement the PDCA cycle in-house.

Auditing standards

Audits are conducted using an audit checklist based on the AEON Supplier Transaction Code of Conduct. It is divided into 13 requirements and consists of a total of 90 check items.
  • Check item risk weight level
    • Serious: 5 places
    • High: 46 places
    • Middle: 23 places
    • Low: 156 places
  • Correction: If the requirements are not met at all and the risk is extremely high
  • Improvement: If the requirements are not met, there are some deviations, and there is a relatively high risk.
  • Recommendation: If there is a small deviation in the required items

Evaluation of audit results

Based on the following rules, 5 grades from A to E Evaluation A No corrective items Improvement items within 5 items Excellent (B with 6 or more improvement items lowered by 1 rank B) Evaluation B Corrective items 1 item Improvement items within 10 items (improvement items 11 items or more are lowered by 1 rank C) Evaluation C Correction items 2 to 4 items Improvement items within 10 items (correction items 4 items, improvement items 11 items or more are lowered by 1 rank D) Evaluation D Correction items 5 items Improvement items 10 items Within (11 or more improvement items are lowered by 1 rank E) Evaluation E Corrective items 6 or more items are re-audited

Number of AEON Supplier Code of Conduct audits (excluding first-party audits)

　 　　 　　 　　 　　 　　 　　 　　 　　 　　 　　 　　 　　 　　
Fiscal year20182019 2020 2021
audit
Number of factories		 Domestic 445 379333292
overseas 397 337385 232
home
New
plant		 Domestic 89 825782
overseas 203 1328068

* In FY2020 and FY21, SAQ, remote interviews, remote audits, and on-site audits will be conducted together.

Response to serious nonconformity cases (external audit)

Correspondence to serious nonconformity cases
Serious nonconformity refers to the state in which manufacturing and sales are suspended until it is confirmed that the organization for correction has been established in the event of a serious incident such as child labor, forced labor, or bribery. In the event of a serious nonconformity, the details will be promptly reported to the supplier CoC secretariat, information will be shared with the transaction management department and the production department, and manufacturing and sales deliberations will be carried out.
Number of occurrences and corrective action
2020
2 cases: falsification of documents, suggestion of bribery; transactions did not start.
2021
0 cases

Establishment of hotline for business partners

The AEON Supplier Code of Conduct connects AEON AEON AEON suppliers to their raw material suppliers and suppliers, building a sustainable supply chain by having each organization in the supply chain fulfill their social responsibility. Human rights violations and deviations from the AEON Supplier Code of Conduct (CoC) occurring in organizations or individuals upstream in the supply chain that have no direct relationship with AEON can be consulted and reported via the "Business Partner Hotline."

Informing employees about AEON Supplier Code of Conduct

Aeon periodically conducts training for its employees, particularly for buyers and those who are responsible for product development. Two training sessions a year are held in coordination with the HR department for new product department employees at Aeon group companies. Because there are more direct production contracts being signed with overseas companies nowadays, we frequently conduct training for foreign sales representative staff too.

In addition, since 2019, we have been providing education on AEON Supplier Code of Conduct at our quality control study group "Terakoya" for product and quality control personnel.

(Photo: Employee training session in Thailand)

Employee education in Thailand

Training AEON Supplier Code of Conduct Certified Auditors

Aeon certified auditors not only conduct audits but also follow up on improvements. In particular, the social environment overseas is changing every year, and the issues vary depending on the country and region. Therefore, we need to build a framework and bring up leaders in each location who can quickly and adequately respond to audit evaluations, auditors, and training to sales representatives.

(Table: As of the end of February 2022)

Japan
8 persons
China
11 people
ASEAN and others
11 people