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Sustainability Material Issue 8 Respecting Human Rights
Objective
Ensure respect for the human rights of all stakeholders affected by Group business activities, in line with the LION Human Rights Policy
| Indicators (2030) | Human rights due diligence implementation for material human rights issues ⇒100％ |
|---|---|
| Progress (2023 results) |
Human rights due diligence implementation Lion Group: 100% Suppliers: 87% |
| Globally Common Measures to 2030 |
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The Lion Group, in order to take responsibility for identifying, preventing, mitigating and addressing negative human rights impacts caused or contributed to by its business activities, established the Human Rights Review Committee, a cross-departmental organization that takes the lead in promoting human rights due diligence*through the following process based on the UN Guiding Principles on Business and Human Rights while also engaging in dialogue with stakeholders involved with the Group’s business, including employees and temporary employees, business partners, suppliers, communities, consumers, external experts and organizations related to human rights.
Recognizing that human rights risks may change as the Lion Group’s business activities, social conditions and human rights conditions evolve, we will seek better ways to enhance the effectiveness of our efforts, such as by regularly implementing each step of the Human Rights Due Diligence Process, including the human rights impact assessment.
* Corporate measures to avoid causing human rights violations and provide remediation for the victims of such violations
The Group’s main business encompasses the development, manufacture and sale of household products. Among these, we notably handle many cleaning products, including laundry detergents. The surfactants that comprise the washing ingredients of such products are derived from such raw materials as palm oil, palm kernel oil and their derivatives. The main production areas for palm oil and palm kernel oil are Malaysia and Indonesia, and we recognize that these countries and areas as well as the commodities themselves bear relatively high human rights risks and pose problems regarding sustainable procurement, including human rights based on data provided by international human rights organizations and Sedex. Specifically, human rights risks such as overwork, the use of child labor and smoke damage from illegal slash-and-burn forest clearing are assumed for stakeholders who may be placed in vulnerable positions such as palm plantation workers.
Corrugated boxes used to package and transport household products use a large amount of paper and pulp as packaging materials, which may pose environmental human rights risks due to inadequate forest management and other factors.
In addition to palm oil and palm kernel oil and paper and pulp suppliers, we secure the cooperation of a wide array of raw material manufacturers and production contractors in procuring raw materials and other aspects of our manufacturing processes. If human rights risks in procurement become apparent due to transactions with suppliers that are not fully committed to sustainable procurement, including human rights, this could lead to business risks related to the supply of products and impact the reputation of the Group.
Furthermore, with regard to planning, manufacturing and sales of household products, we have multiple points of contact in and outside Japan with stakeholders, starting with Lion employees, temporary employees and business partners throughout the value chain, including those working in planning, procurement, research, production, sales and administration. Each point of contact has the potential to cause or encourage human rights risks such as discrimination and harassment on the basis of race or gender, overwork and excessive working hours. When expanding contacts with consumers as a result of changes in business structure, we must be more vigilant regarding privacy rights, including the management of personal information*.
* Refers to the International Trade Union Confederation (ITUC) Global Rights Index, etc.
In order to further clarify the potential and actual human rights risks that may occur in the value chain in the countries and areas where the Group operates, we have identified as relevant to the Group’s business activities the following human rights issues* from the International Bill of Human Rights, the Ten Principles of the UN Global Compact, the ILO Declaration on Fundamental Principles and Rights at Work, the Children’s Rights and Business Principles and other international standards related to human rights.
In extrapolating human rights issues, we have referred to the social context surrounding business operations and human rights, the United Nations Environment Programme Finance Initiative (UNEP), guidelines on human rights formulated by the Japan Business Federation and advice from external experts.
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Extrapolated Human Rights Issues
Forced and coerced labor; freedom of movement and residence; child labor; right to an education; rights of young workers; freedom to form and join trade unions; equal pay for equal work; discrimination in hiring; discrimination in the terms and conditions of employment; discrimination in opportunities and evaluations; protection of motherhood and childhood; harassment; freedom of thought and religion; overwork and excessive working hours; right to rest and leisure; just compensation and living wages; freedom of employment and unemployment insurance; right to safe and healthy working conditions; right to a decent standard of living and health; right to social security; right to privacy; impacts on the lives of local residents; access to water; environmental management; consumer safety and health
The Lion Group identified certain human rights issues as potential challenges to its business activities through an assessment of potential and actual impacts on our stakeholders: our employees and temporary employees; business partners, including contractors; suppliers; communities, including indigenous peoples; and consumers.
Based on the United Nations Guiding Principles Framework and other guidelines on human rights, we assess the scale of human rights violations, the scope of those violations, the likelihood of occurrence and the possibility of resolution. This task was undertaken mainly by persons responsible for the relevant departments as well as an investigative committee on human rights, who after making a comprehensive judgment based on such factors as changes in business and society and the opinions of stakeholders, including external experts, created a risk map based on the results of the Human Rights Issue Check Sheet, which identifies outstanding human rights issues as priorities for the Company.
For priority issues (salient human rights issues) identified by the human rights impact assessment, we implement the following actions to prevent, mitigate and remedy negative human rights impacts.
| Priority Issues for the Company (Salient human rights issues) | Measures and progress toward preventing, mitigating and correcting negative impacts |
|---|---|
| Suppliers using forced labor or child labor, violating the rights of young workers, imposing overwork and excessive working hours, impinging the right to enjoy safe and healthy working conditions, freedom of residence and relocation, denying the right to education, freedom of work and employment security |
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| Supplier’s local community access to clean water resources, impact on local livelihoods and environmental management |
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| Overwork, excessive working hours and internal employee harassment among our business partners |
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| Consumers’ right to privacy |
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The Group has established the AL (All Lion) Heart Hotline, an internal and external whistle-blowing system, as a grievance mechanism to manage complaints about transgressions of business ethics, particularly those involving human rights.
Under this system, whistleblowers can be stakeholders from outside the Group, like business partners. The privacy of whistleblowers and reported parties informants is safeguarded and secrecy is assured for any investigations. Aside from anonymous reports, etc., all instances are also relayed to all whistleblowers.
For details of the system and the details of consultation and reporting, please refer to the following link on the Company’s website.
Internal and External Whistle-Blowing System (AL Heart Hotline)Each preventive, mitigating and corrective measure is assigned a qualitative or quantitative indicator and the investigative committee on human rights regularly reports the monitoring results for each measure to the S Subcommittee (Social Environment) twice a year.
The status of human rights initiatives, etc. is published on the Company’s website as necessary.
The Company implements annual e-learning training for all domestic employees (including part-time employees) to ensure that the Lion Group Charter of Corporate Behavior and the Lion Human Rights Policy are widely understood and firmly established.
In addition, every year we conduct a Compliance Awareness Survey for all domestic employees (including part-time employees) to quantitatively and qualitatively assess their awareness of compliance, including with regard to human rights and workplace behavior, while providing feedback to each department on the results to raise employee awareness and create a better environment.
In promoting human rights due diligence, we held study sessions and exchanged opinions on business and human rights with directors, Audit & Supervisory Board members, executive officers, managers of divisions with human rights jurisdiction and external experts to deepen understanding of the issues.
The Group also participates in such external initiatives as workshops held by the Human Rights Due Diligence (HRDD) Subcommittee of the Global Compact Network Japan (GCNJ) to promote understanding of social conditions surrounding human rights. The Japan Cosmetic Industry Association (JCIA), to which we belong, has formulated Sustainability Guidelines and, through a social issues subcommittee, held a seminar for its members on advertising expression in consumer goods in 2023.
We regularly conduct hearings with each of our overseas Group company on issues regarding human rights that are assumed to be incorporated into their business activities. During those hearings the Company uses the Sustainability Activities Conformation Sheet, which with the help of external experts, identifies the issues that need to be considered in the countries and areas where we operate with respect to key sustainability issues as a means of ascertaining the status of prevention, mitigation and corrective measures and responses, as well as monitoring the progress of such measures and responses.
For suppliers that conduct business with our overseas affiliates, we use self-checks based on the Lion Group Supplier CSR Guidelines and Sedex’s data analysis to assess the impact of suppliers on matters related to the Group’s Procurement Policy, including human rights and labor.
The Group is taking the following steps to reduce the risk of potential human rights violations along each value chain involving the procurement of raw materials, activities at the Company and use by consumers.
An overall layout of our efforts to prevent human rights violations by value chain and stakeholder
The Lion Group has clarified its stance on sustainability, including legal compliance, environmental conservation and respect for human rights in its Procurement Principles as part of its efforts to prevent human rights violations in raw material procurement. The Group is also evolving its efforts with its suppliers.
We are also promoting the sustainable procurement of palm oil and palm kernel oil, our main plant-based raw materials, as we recognize the importance of such efforts.
| Prevention and Mitigation Measures | Targets and Progress in 2023 |
|---|---|
| Procure third party-certified raw materials → Procure products certified by the Roundtable on Sustainable Palm Oil (RSPO) and Forest Stewardship Council (FSC) |
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| Promote trade with suppliers with the ability to resolve social and environmental problems that may occur in the supply chain → Suppliers that support efforts aimed at zero deforestation |
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| Prevention and Mitigation Measures | Progress in 2023 |
|---|---|
| Regular risk evaluations of the sustainability activities of suppliers | Conducted a self-check based on the Lion Group Supplier CSR Guidelines, and conducted a risk assessment on sustainability at suppliers of Lion, domestic Group companies, Lion Corporation （Korea）, Lion Daily Necessities Chemicals (Qingdao) Co., Ltd. and Southern Lion Sdn. Bhd using Sedex. |
| Identification of high-risk suppliers | Set standards for high-risk suppliers for self-checks based on the Lion Group Supplier CSR Guidelines |
| Audits of high-risk suppliers and formulation of improvement plans | High-risk suppliers were not applicable |
*As of March 2024
As part of our efforts to ensure that our customers can use our products safely and with peace of mind, we have established a Product Management System, a set of rules that defines our business processes and quality assurance at each stage of product development. In addition to complying with the Act on Pharmaceuticals and Medical Devices, the Act against Unjustifiable Premiums and Misleading Representations, the Health Promotion Act, and other related laws and regulations, we have established a representation drafting manual and conduct accurate and moderate advertising and promotions that do not cause misunderstanding or discomfort, taking the customer’s viewpoint into consideration.
In countries and areas where many Muslims live, such as Malaysia and Indonesia, we are working to obtain Halal certification* so that local consumers can use our products with peace of mind.
*Certification under systems for labeling products that have cleared halal certification standards with a halal-certified mark. A halal certificate issued by a certifying body officially recognized by the country’s halal certification authority is required to sell products with a halal-certified mark.
