Declaration of Partnership Building

To build new partnerships by pursuing cooperation, co-existence and co-prosperity with our supply chain business partners and value-creating business operators, we declare that we will prioritize the following items.

1. The co-existence and co-prosperity of the entire supply chain and new collaborations that transcend size and affiliation
By reaching out to the business partners beyond our direct business partners by going through our direct business partners (from Tier N to Tier N+1), we will endeavor to add increased value to the entire supply chain, and build relationships of co-existence and co-prosperity with our business partners through collaborations that transcend existing business relationships and company size. In the course of doing that, we will also provide support such as by giving advice to business partners on introducing telework and formulating Business Continuity Plans (BCP) from the viewpoints of workstyle reform and business continuity during a disaster or other event. We will build a green procurement promotion structure and consider issues such as energy saving, resource saving, chemical substance management and biodiversity conservation as we continually strive to promote the procurement of materials with a low environmental impact.

2. Obeying “promotion standards”
We will follow desirable business practices (promotion standards based on the Act on the Promotion of Subcontracting Small and Medium-sized Enterprises) with large procuring enterprises and subcontractors, and actively work to correct any business or trading practices that interfere with building partnerships with our business partners.

①Price-setting method
We will not make unreasonable demands for cost reductions. When determining transaction prices, if there is a request for discussions from a subcontractor, we respond to the request and discuss matters sufficiently by, for example, considering the effects of rising labor costs so that reasonable profit for the subcontractor is included. For contracts, including the determination of transaction prices, the large procuring enterprise will clearly state and deliver the contract conditions in writing.

② Cost burdens such as mold management
We will conduct mold transactions using the contract template as a reference, and along with encouraging the disposal of unnecessary molds, we will not request that subcontractors store molds without compensation.

③Payment terms for drafts, etc.
Payment terms will be set according to relevant laws and regulations, and subcontract fees in the future will be paid in cash in the following month after the end-of-month acceptance inspection.

④Intellectual property and knowhow
We will conduct transactions based on guidelines and contract templates for intellectual property transactions, and will not conclude unilateral non-disclosure agreements or use our standing in the transaction to disclose knowhow or request the transfer of intellectual property rights without compensation.

⑤ Burdens imposed by workstyle reform, etc.
To enable our business partners to respond to workstyle reforms, we will not place orders with our subcontractors with short delivery times or make sudden changes to specifications that are not accompanied by a reasonable cost burden. During disasters and other events, we will be considerate and avoid forcing one-side transactional burdens on subcontractors, and when business resumes, we will try to continue the business relationship as much as possible.

3. Other
We will engage in fair and impartial transactions throughout the supply chain and work to solve social issues in accordance with the Shindengen Group Procurement Policy and Supply-Chain CSR Promotion Guidelines.

April 3, 2023
Shindengen Electric Manufacturing Co., Ltd
Nobuyoshi Tanaka, President

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