Human Rights
We support and respect international rules relating to human rights, and have developed the Kao Human Rights Policy, which is based on the United Nations (UN) Guiding Principles on Business and Human Rights, and are working to achieve zero human rights violations in all of our corporate activities. The Kao Human Rights Policy was first published in 2015, and was revised in 2021 with the approval of the ESG Managing Committee, which is supervised by the Board of Directors, to reflect social trends and express Kao’s commitment more strongly. The policy targets all business activities, including M&A and new projects. Visit our global site for more information on our policies on respecting human rights.
Response to The California Transparency In Supply Chains Act of 2010
Kao Corporation, parent company to Kao USA Inc., is a participant in the United Nations Global Compact which has the goal of eradicating slave labor and human trafficking throughout the world. Kao USA Inc. supports this goal and will seek to eradicate any forced labor in our supply chain. Kao USA Inc. policies, as well as those of our parent company, require our employees to comply with all laws. We will not continue to do business with a supplier who we know to be using forced labor. Those within the company who are responsible for supply chain management are trained and aware of their responsibility to comply with all laws and Kao USA Inc. policies.
We provide the following information in response to the items of The California Transparency in Supply Chains Act of 2010:
a) Engages in verification of product supply chains to evaluate and address risks of human trafficking and slavery. The disclosure shall specify if the verification was not conducted by a third party.
EACH NEW SUPPLIER OR SUPPLIER OF A NEW MATERIAL TO KAO USA INC. MUST CERTIFY DIRECTLY TO KAO USA INC. THAT THEY AND THEIR SUPPLY CHAIN DO NOT UTILIZE HUMAN TRAFFICKING, SLAVERY OR FORCED LABOR. IN ADDITION, OUR DIRECT SUPPLIERS ARE ASKED TO CERTIFY THAT THEY AND THEIR SUPPLY CHAINS DO NOT UTILIZE HUMAN TRAFFICKING, SLAVERY OR FORCED LABOR ON A PERIODIC BASIS.
b) Conducts audits of suppliers to evaluate supplier compliance with company standards for trafficking and slavery in supply chains. The disclosure shall specify if the verification was not an independent, unannounced audit.
KAO USA INC. ROUTINELY VISITS DIRECT SUPPLIERS ON A RANDOM BASIS; HOWEVER, KAO USA INC. BELIEVES UNANNOUNCED AUDITS OF SUPPLIERS WOULD BE UNDULY DISRUPTIVE AND HAS NOT CONDUCTED UNANNOUNCED AUDITS. OUR DIRECT SUPPLIERS ARE ASKED TO CERTIFY THAT THEY AND THEIR SUPPLY CHAINS DO NOT UTILIZE HUMAN TRAFFICKING, SLAVERY OR FORCED LABOR ON A PERIODIC BASIS.
c) Requires direct suppliers to certify that materials incorporated into the product comply with the laws regarding slavery and human trafficking of the country or countries in which they are doing business.
EACH NEW SUPPLIER OR SUPPLIER OF A NEW MATERIAL TO KAO USA INC. MUST CERTIFY DIRECTLY TO KAO USA INC. THAT THEY AND THEIR SUPPLY CHAIN DO NOT UTILIZE HUMAN TRAFFICKING, SLAVERY OR FORCED LABOR. IN ADDITION, OUR DIRECT SUPPLIERS ARE ASKED TO CERTIFY THAT THEY AND THEIR SUPPLY CHAINS DO NOT UTILIZE HUMAN TRAFFICKING, SLAVERY OR FORCED LABOR ON A PERIODIC BASIS.
d) Maintains internal accountability standards and procedures for employees or contractors failing to meet company standards regarding slavery and trafficking.
IN THE EVENT KAO USA INC. BECOMES AWARE OF THE USE OF SLAVERY OR HUMAN TRAFFICKING AT ANY POINT IN OUR SUPPLY CHAIN, WE WILL IMMEDIATELY WORK TO ERADICATE THE CAUSE, WHICH MAY INCLUDE TERMINATION OF OUR RELATIONSHIP WITH THE VENDOR AS SOON AS POSSIBLE, IN ACCORDANCE WITH THE UNITED NATIONS GLOBAL COMPACT.
e) Provides company employees and management, who have direct responsibility for supply chain management, training on human trafficking and slavery, particularly with respect to mitigating risks within the supply chains of products.
THOSE WITHIN KAO USA INC. WHO ARE RESPONSIBLE FOR SUPPLY CHAIN MANAGEMENT ARE TRAINED AND AWARE OF THEIR RESPONSIBILITY TO COMPLY WITH ALL LAWS AND KAO USA INC. POLICIES.
See our Modern Slavery Statement.
Fighting Against Forced Labour & Child Labour in Supply Chain Act
KAO USA Inc. and KAO Canada Inc. Joint Report Prepared Pursuant to Canada’s Fighting Against Forced Labour and Child Labour in Supply Chains Act
1. Introduction and Identity
This Joint Report was prepared by KAO USA Inc. and its subsidiary KAO Canada Inc. (collectively, “KAO”, “our”, “us” and “we”) for the financial reporting year ended 2023 (the “Reporting Period”) and sets out the steps taken to prevent and reduce the risk that forced labour and child labour was used at any step in the production of goods in Canada or elsewhere or of goods imported into Canada. KAO USA Inc. and KAO Canada Inc. are the reporting entities for the purposes of the Act.
This Report has been prepared and filed pursuant to Canada’s Fighting Against Forced Labour and Child Labour in Supply Chains Act (the “Act”).
2. Steps Taken During the Reporting Period to Prevent and Reduce Risks of Forced Labour and Child Labour
We recognize that human rights abuses may take many forms such as:
Kao Group’s standard purchase agreement and purchase order template with suppliers has provisions that address issues such as preservation of the environment and respect for human rights, and is used in new contracts or when renewing contracts.
In the financial year ended December 31, 2023, Kao Group conducted a human rights risk survey of companies and plants of the Kao Group worldwide. Kao Group used Sedex (Supplier Ethical Data Exchange) where all 39 plants and 52 group companies completed the Sedex Self-Assessment Questionnaire (Sedex SAQ). After evaluating the answers, Kao Group found no evidence of modern slavery and human trafficking in the above plants and group companies.
3. Structure, Activities and Supply Chains
4. Policies and Due Diligence Processes
The Kao Group of companies, including KAO, operate with the Kao Business Conduct Guidelines as its foundation. The Kao Business Conduct Guidelines set forth our guiding principles with regard to the conduct of our business and incorporate the Kao Human Rights Policy which can be found at https://www.kao.com/content/dam/sites/kao/www-kao-com/global/en/sustainability/pdf/kao-humanrights-policy.pdf
The Kao Business Conduct Guidelines can be found at https://www.kao.com/global/en/about/policies/compliance/business-conduct-guideline/ and apply to all Kao Group companies, including KAO, and include commitments to deal with any illegal or unethical conduct that we become aware of. To deepen understanding of the Guidelines, the Kao Group periodically conducts Integrity Workshops and employees are annually asked to complete a Business Conduct Guidelines’ refresher test and a compliance awareness survey to check the depth of understanding of the Guidelines. Further, case studies are periodically posted on the intranet and messages from the Chairperson of the Compliance Committee of Kao Corporation and a responsible person from the Compliance Division are also shared to develop employee awareness. In addition, the Kao Group has produced a video to disseminate the importance of respecting human rights and posted it on the intranet for the World Human Rights Day in December. Furthermore, group training sessions for newly hired employees and newly appointed managers are held.
5. Forced Labour and Child Labour Risks and Steps Taken to Assess and Manage These Risks
KAO and other Kao Group companies strive to provide employees with a work environment that is both physically and emotionally safe, and we assess the risk level within KAO and other Kao Group companies as low. The Kao Group of companies operate with the Kao Business Conduct Guidelines as its foundation. The Kao Business Conduct Guidelines set forth our guiding principles with regard to the conduct of our business and incorporate the Kao Human Rights Policy.
KAO depends upon its Kao Group suppliers to maintain their supply chains and third party manufacturing in accordance with principles set forth in the Kao Business Conduct Guidelines. Whenever KAO is qualifying a new supplier or vendor, KAO provides such supplier with a questionnaire asking the supplier to verify that their supply chain management (“SCM”) is free from unethical labor practices. Many of KAO suppliers are members of Sedex which requires the suppliers to complete a questionnaire which asks about the supplier’s labor practices and to verify their SCM is free from child labor. While KAO does import some items from Asia, a higher risk region, it is a small percentage of total KAO sourcing volume.
California’s Transparency in Supply Chains Act also requires suppliers to be contacted every two years to verify that their SCM is free from forced and child labor and Kao USA Inc. has been sending this request to suppliers every two years for several years.
6. Remediation Measures
Not applicable
7. Remediation of Loss of Income to the Most Vulnerable Families
Not applicable
8. Training
Not applicable
9. Assessing the Effectiveness in Ensuring that Forced Labour and Child Labour are not Being Used in Entity’s Business and Supply Chain
The efforts referenced above are devised and reviewed at the Kao Group global level and are assessed at least annually to determine their effectiveness and if modification is needed.
10. Approval and Attestation
In accordance with the requirements of the Act, and in particular section 11 thereof, I attest that I have reviewed the information contained in the Report for the entities listed above. Based on my knowledge, and having exercised reasonable diligence, I attest that the information in the Report is true, accurate and complete in all material respects for the purposes of the Act, for the Reporting Period listed above.
Date: 5/29/2024
Signed by Stephen Cagle, President, Functions Operations, Americas who has the authority to bind the corporation.
The Report was approved pursuant to section 11(4)(b)(ii) of the Act by the Board of Directors of KAO USA Inc. by resolution with an effective date of May 31, 2024.
