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Respect for human rights

TOCALO Group Human Rights Policy

The TOCALO Group is a company that sincerely and creatively promotes sound business activities and contributes to creating a flourishing society. The Corporate Code of Conduct stipulates ethical standards that all Group officers and employees are expected to follow.
The Code of Conduct states the Group's basic policy on human rights is to respect for basic human rights, prohibit discriminatory treatment and child and forced labor, and foster a workplace culture that recognizes diversity and individuality.

*Corporate Code of Conduct

In accordance with the Code of Conduct, the TOCALO Group Human Rights Policy clearly states the Group’s responsibility to uphold human rights. The Group recognizes that any of its business activities has the potential to directly or indirectly infringe human rights. The president and chief executive officer are responsible for efforts to ensure human rights are respected for all people involved in its business activities.

1. Respect for human rights

   The Group respects internationally recognized human rights as stipulated in the International Bill of Human Rights and the International Labor Organization Declaration* on Fundamental Principles and Rights at Work. The Group complies with applicable laws and regulations in the countries and regions where we conduct business activities in accordance with the United Nations Guiding Principles on Business and Human Rights.
   We respect the internationally recognized human rights when a contradiction exists between internationally recognized human rights and the laws and regulations of a country or region.
   
   *Includes support and respect for core labor standards for the abolition of child labor, elimination of forced labor, elimination of discrimination, and recognition of freedom of association and the right to collective bargaining.

2. Scope of application

   The Human Rights Policy outlines the Group’s responsibility to implement measures to respect human rights and applies to all officers and employees of the Group. The TOCALO Group expects all of its business partners to follow the policy.

3. Human rights due diligence

   The Group maintains a system for conducting human rights due diligence and identifies and takes steps to prevent and minimize actual and potential human rights infringements in the Group’s business activities and value chain.
   The Group also appropriately discloses information about our human rights measures and their progress on our website and via other means.

4. Correction and remedy

   If it becomes clear that a Group business activity has directly or indirectly caused, promoted, or been involved in a human rights infringement, we will take appropriate internal and external steps to correct and remedy the situation. We will additionally develop effective corrective and remedial mechanisms.

5. Dialogue and discussion with stakeholders

   The Group will engage in dialogue with various stakeholders about ways to improve its efforts to respect human rights based on Human Rights Policy.

6. Education and training

   We will provide Group officers and employees with appropriate education and training to ensure the Human Rights Policy is taken into consideration and effectively put into practice in all of our business activities.

June 23, 2023
Kazuya Kobayashi
Representative Director President and Executive Officer
TOCALO Co., Ltd.​

Identifying and assessing adverse human rights impacts

The Group has established a structure for human rights due diligence and enforcement based on the United Nations Guiding Principles on Business and Human Rights. As a first step of enforcement, in fiscal 2023 the Group identified and prioritized action on potential human rights issues for each business activity.

Human rights risk identification procedure

1. Organize potential business-related human rights issues with reference to the Universal Declaration of Human Rights, OECD Guidelines for Multinational Enterprises, ILO International Labor Standards, SA8000 Standard, Guidelines on Respecting Human Rights in Responsible Supply Chains, and related practical materials.
2. Assess the severity and likelihood of each risk based on internal interview meetings to determine the awareness level of human rights risks; recommendations and requests from NGOs and other organizations; risks considered important by other companies in the industry and leading companies in Japan; and investigations and media reports on human rights issues.
3. Discuss the risks with external experts
4. Review the risks at Sustainability Committee meetings and identify priority risks (approved at the March 2024 Board of Directors meeting)

Human rights risk assessment method

1. Set five general risk categories of occupational safety and health, discrimination, community, information management, and intellectual property, and 28 risk scenarios.

   Category	28 risk scenarios
   Occupational safety and health	Poor working conditions, occupational accidents, rights violations and restrictions, child labor, forced labor, law and regulation violations
   Discrimination	Sex/gender, origin, nationality/ethnicity, ideology/beliefs, medical history/health (including pregnancy), physical/mental disability, employment status, discriminatory language, other
   Community	Planning and technology development, raw material procurement, manufacturing and processing, public relations, sales and after-sales service, disposal
   Information management	Inappropriate use, data leak, legal violations, security, technology/AI
   Intellectual property	Proper compensation, inappropriate use

2. Evaluate and analyze the risks and create a risk map based on (1) severity* and (2) probability of occurrence

   * Based on the scale and scope of the human rights violations and the difficulty to remedy the situation

3. Prioritize addressing high severity risks; when multiple risks of equal severity exist, prioritize by probability of occurrence

Human rights risk map

Future plan

The human rights risk map will be used to recognize the actual current status of human rights in the Group, to formulate procurement guidelines, and to work with the supply chain safeguard human rights.

Other measures

Eliminating discrimination

The Compliance Handbook expressly stipulates that the company shall respect the fundamental human rights of employees and shall not discriminate against or harass individuals for reasons unrelated to the performance of one’s duties. This includes race, nationality, ethnicity, beliefs, religion, age, sex, sexual orientation, physical characteristics, presence or absence of disability, internal position, type of employment, property, place of origin, marital status, or any other reason that may harm the dignity of the individual. Furthermore, instructions have been given stating that reasons unrelated to the performance of duties cannot be made selection criteria during the new hiring of employees.

• Percentage of employees with disabilities
  2.86% (non-consolidated, end of March 2024)

Employee consultation desk

Consultation services concerning compliance violations, including harassment, are available internally and externally (third parties). The consultation services cover a broad range of issues, including mental health issues and employee opinions and requests.

Internal education

We actively seek to increase employee awareness of human rights through compliance training (e-learning) to educate all employees with basic knowledge of the UN Guiding Principles on Business and Human Rights, human rights policy, and approach to respect for human rights. We also regularly conduct training on harassment prevention and corporate ethics awareness.

Proper relations between management and labor

The Company facilitates relations between management and labor and promote its business by holding discussion meetings between company and labor union executives attended by company executives and labor union leaders about six times a year. At the meetings, the Company regularly explains its business plans, performance, and organizational reforms, and holds discussions with the intention of improving the work environment and treatment of employees.