Human Rights Policy
The Chiyoda Corporation Group (hereinafter referred to as the “Chiyoda Group”) regards respecting human rights as one of the important elements which acts as a solid foundation for its business activities.
We have established Chiyoda Group Code of Conduct / Chiyoda Group Conduct Guidelines (hereinafter referred to as the “Code of Conduct”) that prescribes the importance of respecting human rights, prevention against acts of violation of human rights, and respecting international human rights standards. We also established “Human Rights Policy” in September 2018 in order to clearly express our commitment to comply with the “Code of Conduct” and fulfill our responsibility to respect human rights.
The “Human Rights Policy” was revised in April 2021 to further promote human rights initiatives in response to growing social demands for respecting human rights in corporate activities. In this revision, it clearly states the Chiyoda Group’s compliance with international law and norms regarding human rights such as United Nations “Guiding Principles on Business and Human Rights”; our continuous implementation of Human Rights Due Diligence; and our priority issues regarding human rights.
The Policy covers all the individuals and groups that may be affected by the Chiyoda Group’s business activities and business relationships.
The Policy also applies to all officers and employees of the Chiyoda Group. We continue to encourage all of our business partners including suppliers, and other related parties involved in our business activities to understand and follow the Policy. The Policy was established and revised by the resolution of board of directors with advice from an external consulting firm, J.S. Held Japan LLC (*1).
(*1) J.S. Held Japan LLC： a global consulting firm providing comprehensive business intelligence and solutions for business risks. They have over 100 offices worldwide, and over 1,500 experts with various backgrounds coming from government organizations, regulatory agencies, journalism, major consulting firms and others. They globally provide environmental, social, and governance (ESG) advisory services including independent recommendations, risk research, business intelligence, quantitative due diligence, corporate research, human rights due diligence, to global companies, government organizations, financial institutions, leading law firms, regulatory agencies and others.
The Chiyoda Group pursues initiatives for human rights through the Operational Framework for Sustainability. The Sustainability Committee is chaired by the Chairman of the Board, President & CEO as the Chief Sustainability Officer (CSO).
Under the Committee, we engage in intensive discussions continuously in a medium- and long-term perspective on how we take care of various issues including priority issues to reflect the outcome to our business strategies.
The Committee is an advisory organization to CSO and typically meets twice a year. The Committee established a system whereby it makes a report to and consults with an/the external sustainability advisor, and then reports the outcome to the Board of Directors to seek their appropriate supervision.
Additionally, ESG Working Group of the Sustainability Subcommittee, an organization under the immediate control of the Sustainability Committee, discusses and examines priority issues regarding sustainability including human rights, and encourages each division to raise awareness and to do practical actions.
Human rights issues cover various ones such as discrimination, harassment, forced labor, child labor, respect of diversity, work-life balance, occupational safety and health, working hours and wage. The targets for efforts should cover overall business enterprise activities, including the ones in which external business partners are involved such as supply chain activities. Therefore, our efforts to respecting human rights have been taken care of by divisions/departments/sections in charge (Sustainability Section, Compliance Section, HR Section, SQEI Section, Procurement & Construction Division) in cooperation with related divisions/departments/sections and the companies of the Chiyoda Group in Japan/overseas.
Human Rights Due Diligence
The Chiyoda Group has established a mechanism for human rights due diligence in accordance with the processes detailed in the United Nations Guiding Principles on Business and Human Rights while holding dialogue with stakeholders and cooperating with external experts. Human rights due diligence refers to an ongoing process undertaken by business enterprise to identify and assess adverse impacts on human rights in their supply chain, to implement appropriate measures to address such adverse impacts, and to account for and disclose progress and results of such measures.
Impact Assessment on Human Rights
Identification of Human Rights Issues
In preparation for revision of the Human Rights Policy, the Chiyoda Group assessed the potential adverse impacts on human rights by our business activities and identified priority issues regarding human rights(*2).
In fiscal year 2022, reflecting the reality that circumstances surrounding human rights is subject to constant change, with cooperation from an external expert (J.S. Held Japan LLC), the Chiyoda Group conducted a review of each group company’s business activities as well as the countries/regions where they do business, based on the latest information such as reports, white papers and other documents published by United Nations, government organizations and research institutions from each country.
The review showed that no change of priority issues regarding human rights was required at this point.
(*2) 1) Elimination of Discrimination and Harassment; 2) Prohibition of Forced Labor and Child Labor; 3) Respect for Diversity and Work-Life Balance; 4) Occupation Health and Safety; 5) Working Hours and Wage; 6) Respect for Basic Labor Rights; 7) Harmony with Society.
Risk Assessment and Prioritization of the Chiyoda Group’s Businesses/Projects
With respect to the afore-mentioned priority human rights issues identified, with cooperation of J.S. Held Japan LLC, the Chiyoda Group has conducted risk mapping for the countries and business sectors in which the Chiyoda Group operates.
Specifically, based on the 8 elements of SA8000 (*3), we quantified exposure of the human rights risks of the countries where we operate and prepared a heat map to visualize risk levels (high/medium/low).
Additionally, based on a set of 12 elements, which includes 4 important elements newly added to the 8 elements mentioned above, we quantified exposure of the human rights risks of each business sectors and visualize risk areas.
Based on the figures obtained by combining the country-specific risks and operation-specific risks, we identified specific businesses/projects with higher human rights risks.
Then we identified specific businesses/projects for which we should implement the human rights due diligence on a priority basis by taking into account additional elements such as “revenue”, “investment amount”, “number of employees” and others.
(*3) SA8000 is an international standard concerning labor and human rights that the US NGO Social Accountability International has issued. The standard provides voluntary requirements for employers to fulfill, including those concerning workers’ rights in the workplace, the working environment, and management systems.
Initiatives for FY2023
Taking these risk assessment results into account, in fiscal year 2023, we will prepare medium-to-long-term objective and plan for implementation of the human rights due diligence; and then we will review and improve the implementation process of the human rights due diligence and will establish an operational framework for implementation in the entire Chiyoda Group.
Efforts to Prevent and Mitigate Adverse Human Rights Impact
Human Rights Initiatives through the Project Execution
In the execution of EPC projects, which is the main business of the Chiyoda Group, the following efforts are being made as important human right themes, with attention to the human rights of the Chiyoda Group stakeholders, including project-related parties, suppliers (including workers at project sites), and local communities.
Children’s Human Rights
The Chiyoda Group’s project activities and supply chains are all over the world, and protection and respect of children’s rights is a common requirement in global society. In this respect, the Chiyoda Group is committed to eliminating and preventing child labor in accordance with the “Children’s Rights and Business Principles” and states in the Human Rights Policy that it does not engage in or permit child labor. While observing related local laws and regulations, we also investigate and confirm our supplier’s efforts in prevention of child labor.
Human Rights for Migrant Workers and Foreign Workers
Migrant workers and foreign workers are often placed in a vulnerable position due to their language, gender, cross-border work, and non-regular work status, and various human rights violations have been reported.
As many migrant workers and foreign workers are employed at construction sites and in the supply chain of the Chiyoda Group's projects, we have expressed our commitment to eliminate forced labor in the "Human Rights Policy" and have also investigated and confirmed our suppliers' efforts to prevent forced labor. In addition, we are making efforts to take into account the human rights of migrant and foreign workers at project sites in Japan and overseas.
（Examples of efforts to take into account for human rights of migrant and foreign workers）
- Checking and holding interviews on the suppliers' management systems of migrant and foreign workers, support systems including living arrangements, information dissemination status, etc.
- Providing bulletin boards and education on occupational health and safety in multiple languages
- Providing meal menus in consideration of workers' country/region of origin, religion, etc.
- Arrangement of facilities in consideration of workers’ religious beliefs (mosques, churches, etc.)
Human Rights Consideration in Cooperation with Suppliers
Before starting business with suppliers, we check and evaluate the status of their efforts to respect human rights through questionnaires. If any concerns are identified, we communicate with the suppliers and encourage them to take measures to prevent or mitigate such concerns.
In addition, our contracts with suppliers provide clauses to guarantee the efforts to respect human rights. The contracts also provide clauses requiring suppliers to ensure the second and subsequent tier suppliers comply with the clauses to guarantee the efforts to respect human rights.
While these efforts are being made for major overseas projects, we will expand the scope to all projects that are assessed as having a high probability of adverse impacts on human rights in human rights impact assessments.
（Examples of efforts to respect human rights）
Prohibition of forced labor, prohibition of child labor, responsible recruitment activity, prohibition of discrimination, prohibition of harassment, occupational safety and health, wage and remuneration, working hours, anti-bribery, grievance mechanism, etc.
At project sites, we provide training for suppliers on occupational health and safety and workers' welfare.
We also work with our customers to regularly hold "Talk with Workforce" sessions and conduct opinion surveys with on-site workers including suppliers, and link their opinions and survey results to specific actions for improvement.
Employee Safety and Armed Security Considerations for Community
For the enhancement of safety for the employee to be assigned in the project site, the Chiyoda Group implements thorough local surveys before the site work is started. Depending on the results of those surveys, the Chiyoda Group may need to deploy armed security guard under the local laws and regulations. The Chiyoda Group recognizes that the use of security firms carries potential risk of human rights violations due to the inappropriate use of weapons and appoints the security firms that can provide proper managements of firearms handling and the training for security personnel. In addition, the Chiyoda Group only appoints the security firms which not only comply with local laws, regulations and international norms, but also support international agreements such as “UN Global Compact” and “Voluntary Principles on Security and Human Rights”.
Initiative in Respecting Employee Human Rights
The Chiyoda Group respects diversity, individuality and characters of employees and has been proactively continuing to create a corporate culture and working environment where employees are motivated to vividly work irrespective of gender, nationality, age, religion, etc. This is based on our belief that a variety of perspectives gained through promoting diversity will strengthen the organization’s flexibility and responsiveness in various situations. Specific initiatives include establishment of a task team to raise and promote awareness, setting up of prayer rooms, and holding briefing sessions for international students to attract global employees.
Promoting Women's Advancement
The Chiyoda Group drew up the “Action Plan to Promote Women’s Advancement” following the enactment of the Act on the Promotion of Women's Active Engagement in Professional Life (Women's Advancement Promotion Law).
Please refer to the following link for the 3-year numerical goals from 2021 April to 2024 March.
We will promote internal reform to create opportunities for women employees who will be the next generation to play an active role in various working environments that accompany changes in times and society, and to maximize the potential of each individual employee.
We will widen the door to women and build an environment where women employees working there can continue to work for a long time regardless of various environmental changes.
Establishment of Health Management & Diversity Promotion Office
The Chiyoda Group highly respects the diversity and individuality of employees and their personalities. In April 2022, we established the Health Management and Diversity Promotion Office within the Human Resources Department. The task team that has been continuously working to raise awareness of women's human resource development and advancement has been active since 2014. Now the task team has been formally established as an Office. With regard to diversity, our main activity will be the empowerment of women at first. But we will aim for the Chiyoda Group where not only women but also various individuals can play an active role. We will continue with our efforts to build the culture to realize Diversity & Inclusion so that the company is not afraid of change and creates innovation by combining different perspectives and ideas.
Occupational Safety and Health
The Chiyoda Group states in the Code of Conducts that it strives to maintain a safe and hygienic work environment to ensure the health and safety of its employees. The Chiyoda Group promotes SQE management based on the "Corporate Safety, Quality and Environment (SQE) Policy". In addition, support for occupational health and safety is identified as one of the important human rights issues in the Human Rights Policy.
We are implementing various initiatives to improve and maintain the working environment in which employees and suppliers can work with peace of mind. For details, please refer to Sustainability > Safety.
We regularly hold dialogues with the labor union formed by our members (labor-management consultation) to discuss labor conditions and other issues. The results of the consultation are reflected in the revision of employment regulations and other measures according to the content.
Prevention and Mitigation Measures within the Chiyoda Group
The Chiyoda Group is working to further disseminate its Group policies such as the Code of Conduct and the Human Rights Policy, and its initiatives to respect human rights, among its officers and employees.
Specifically, we are implementing the following initiatives.
Adaptation of multilingual support is also ongoing for these initiatives.
- The Chiyoda Group Employee Handbook is distributed to employees to ensure that they are familiar with Group policies.
- Each year, we conduct a compliance e-learning program for all officers and employees of the Chiyoda Group. The content includes international norms on human rights, the Chiyoda Group's "Human Rights Policy ", initiatives to respect human rights, prevention of harassment, anti-bribery and corruption, and internal reporting system and others. In addition, our officers and employees pledge to comply with the Code of Conduct. The participation rate in fiscal 2022 was 99%.
- In 2021, we invited an outside expert (Mr. Keisuke Hanyuda, CEO, OWLS Consulting Group, Inc.) to give a lecture titled "Human Rights Issues and Risks in EPC Business". He talked about the growing global demand for respect for human rights and the importance of corporate efforts to respect human rights. In a panel discussion with our employees, we also discussed how to think about and address specific human rights issues in the Chiyoda Group.
- Each year, we conduct seminars on the following human rights issues. We are working to deepen the understanding of human rights among officers and employees, and to prevent and mitigate adverse impacts on human rights.
- Business and Human Rights
- Prevention of Harassment
- Anti-Bribery and Corruption
- Occupational Health and Safety
- Information Security
- Each year, we conduct an organizational culture survey on compliance observance for all Chiyoda Group officers and employees. Specifically, we use anonymous questionnaires to survey items such as the presence or absence of a work environment that hinders compliance observance, management’s recognition to raise compliance awareness, and the credibility of the consultation/ reporting system, in order to identify compliance concerns and issues in each organization in a timely manner. In addition, we are working to strengthen the organizational culture of compliance observance by extracting strengths and issues, feeding the survey results to each organization, and linking them to specific actions for improvement.
Participation in External Initiatives on Human Rights
Global Compact Network Japan
We signed the United Nations Global Compact in 2012 and expressed our support for the 10 principles of the Global Compact.
As part of this effort, we joined in the Global Compact Network Japan (GCNJ), a local network of the UN Global Compact in Japan. We gain knowledge and information through discussions with other participating companies at the following subcommittee meetings, exchange of information on initiatives, and lectures by experts, and link them to the Chiyoda Group’s initiatives.
- Supply Chain Subcommittee (participated as a member since 2014; engaged in the development of the Human Rights Due Diligence Manual in FY2022)
- Anti-Corruption Subcommittee (participated as a member since 2013)
- Human Rights Due Diligence Subcommittee (participated as an observer in FY2022)
Since 2021, the Chiyoda Group has been an associate member of the Building Responsibly (*4) which consists of engineering and construction companies. We participate in regular meetings and various working groups to discuss and exchange opinions with other participating companies on issues related to workers' human rights, linking them to the Chiyoda Group's efforts to respect workers' human rights.
(*4) Building Responsibly: established in 2017, the organization is led by companies in the engineering and construction sectors with the aim to promote respect for the human rights and welfare of workers throughout the industry, to meet stakeholders’ expectations and legal requirements, and to maintain and manage a healthy and productive workforce.
Remedial and Relief Measures
Setting up of the Consultation and Reporting System
- As a grievance mechanism, the Chiyoda Group set up a compliance consultation and reporting system. Besides the officers and employees of the Chiyoda Group, the Group’s business partners can use the system. Anonymous reporting/consultation is also possible.
- For harassment in the workplace, a hotline with external experts was also set up. If the user seeks a specific solution, we will take necessary and appropriate measures after confirming the user's intention based on the contact from the expert.
- In addition, the Chiyoda Group conducts an annual organizational climate survey on compliance observance for all officers and employees to confirm their recognition of the compliance consultation/reporting system. The recognition rate in 2021 was 91% and the recognition rate in 2022 was 95%.
- While we strive to ensure that the consultation/reporting system are thoroughly recognized by the employees, in light of the requirements of the UN Guiding Principles on Business and Human Rights, we are committed to build an effective process and improve the consultation/ reporting system so that victims can receive effective remedies.
Introduction of Application for On-site Workers
In some of our overseas projects, we are working with our customers and partners to introduce an application that allows on-site workers (including second and subsequent tier suppliers) to report human rights concerns and grievances.
Specifically, when a two-dimensional code is read on a smartphone, a report form is displayed, allowing workers to report concerns and grievance. Anonymous report/consultation is also possible. In addition to English, the app supports multiple languages, including local languages of the project sites and the languages of the major countries/regions of origin of the workers.
We promote the use of app through posters, handbooks, morning assemblies and other meetings on the sites.w
（An example of two-dimensional code）
Remedial Status of Human Rights Issues
When human rights issues are identified through human rights due diligence, we work on remediation and improvement of the situation, and provision of remedies to the victims.
In fiscal 2022, the Compliance Consultation/Reporting System received 22 consultations and grievances regarding human rights (including harassment). Human rights violations (including harassment) were identified in 2 of them and remedial measures were implemented.
The following is an example of human rights issue identified through fiscal 2022 human rights due diligence and the remedial status.
It was discovered during regular monitoring that a contractor engaged in a Chiyoda Group project had a child below working age registered as a worker in the human resource database dedicated to the said project.
The Chiyoda Group requested the contractor to terminate the labor contract with the child after paying the child's wages and covering the travel expenses necessary for the child to return home. The Chiyoda Group also confirmed the certificate of payment of wages to the child.
In terminating the labor contract, the contractor explained to the child the reason for terminating the contract and the possibility of rehiring the child when he/she reaches the legal working age, and confirmed that the child is in an appropriate living environment and under the care of relatives after returning to his /her homeland.
As a measure to prevent recurrence, we held a briefing session for all contractors, reiterating the policy of zero tolerance for child labor, requested and issued instructions to ensure that contractors check the age of children using reliable identification documents at the time of employment.
In addition, the human resources database at the project site (all on-site workers, including the contractor’s workers, register themselves in the database at the time of the pre-employment safety training course) was improved and a system to identify child labor was established with alert to set off when a child under working age is registered in the database.
Dialogue with Stakeholders
To ensure respect for human rights in its entire business activities, the Chiyoda Group engages in dialogue with various stakeholders to share and resolve human rights issues.
As mentioned above, we are conducting dialogues with labor unions, dialogues with on-site workers (including suppliers’ workers, "Talk with Workforce"), dialogues at the Building Responsibly, and dialogues with external experts in the field of "Business and Human Rights”.