The DENSO Group’s Procurement Policies

Basic Stance

As a global corporation with operations in 38 countries and regions, DENSO aims for optimum procurement and purchases components, materials, and equipment worth ¥2.0 trillion from some 5,600 suppliers each year (with a local procurement rate of about 70%).

DENSO has established five policies, shared by all Group companies, based on the principle of open, fair, and transparent transactions in the DENSO Group Declaration of Corporate Behavior. Accordingly, DENSO has made an explicit commitment to an “open door policy” that provides opportunities for suppliers to participate in its business in a fair manner without regard to national origin, company size, or previous transaction history. DENSO is also committed to undertaking efforts to realize mutual development by designating suppliers as equal business partners and to comply with Japan’s Act against Delay in Payment of Subcontract Proceeds, Etc. to Subcontractors and the laws and regulations of each country and region in which the Company is active.

Basic Approach to Procurement

  1. Open door policy
  2. Mutual growth based on mutual trust
  3. Promotion of green procurement in consideration of the environment
  4. Promotion of local procurement aiming to be a "good corporate citizen"
  5. Permeation of compliance with laws and regulations and confidentiality

Promotion Structure

As the global procurement Head Office, DENSO CORPORATION coordinates with the procurement departments of each overseas regional headquarters to promote local procurement.

Number of Regional Suppliers/Local Procurement Rate

Specific Initiatives

Strengthening partnerships with suppliers

DENSO uses its corporate website, the General Meeting of Suppliers, and other means to share information on procurement and other policies in order to facilitate mutual growth with our suppliers in the midst of global competition. The Company has also created the Constitution Assessment Program for Suppliers in an effort to strengthen partnerships. DENSO utilizes this program to help suppliers reinforce their business structures and to recognize outstanding supplier performance.

At overseas Group companies, the procurement departments of each regional headquarters are playing a central role in working through the General Meeting of Suppliers and discussions with individual suppliers to deepen mutual understanding and establish policy to further the development of all parties.

Constitution Assesment Program for Suppliers(Overview)
General Meeting of Suppliers
Attended by about 340 foreign domestic principal suppliers each year

TOPICS: 2018 DENSO SUPPLIERS CONVENTION

On May 14, 2018, the 2018 DENSO SUPPLIERS CONVENTION was held at Nagoya Tokyu Hotel, with a total of 357 suppliers  invited, including 10 from outside Japan. Under the theme of this year’s meeting “TSUNAGARI, ties between suppliers and DENSO”DENSO shared its continued commitment to manufacturing; strengthened its partnerships with suppliers; and pledged to promote initiatives for global change together. An awards ceremony was also held at the General Meeting of Suppliers to celebrate exceptional suppliers.

Comment of the award winner

Supplier of the Year: Fujikoki Corporation

I, along with all of my fellow employees at Fujikoki Corporation, am honored and delighted to receive this award. What we value when working with our business partners is forming a trust-based relationship. By pursuing collaboration with these partners from the stages of product planning, we are able to develop products under an extremely positive relationship. Going forward, to help the automotive industry overcome this period of significant change, we will further enhance our advanced technologies as a manufacturer to remain one step ahead of the competition. At the same time, we will strive to create brand-new products in the future unlike anything the industry has seen before.

Takayoshi Yokohama, President & CEO
Top Performance Award: A-Tech Solution Co., Ltd.

While we have received awards similar to this domestically, this is the first time we have ever received an international award, and everyone at the company is extremely delighted. In the development of resin-based concave mirrors used for head-up displays, which were the deciding factor for our winning this award, there were a great deal of things we learned through our interactions with DENSO. Going forward, we hope to provide DENSO with not only components but also finished products. We also hope to focus our efforts on introducing smart factories (automated production lines, worker-friendly factories, etc.).

BumKyung Lee, Vice President

Ensuring that procurement departments practice open, fair, and transparent transactions

At DENSO, to instill a mindset that supports open, fair, and transparent transactions, procurement departments are engaging in awareness-raising activities such as distributing and sharing the Code of Conduct for DENSO Group Associates, which outlines such a mindset as well as standards of behavior among all employees involved with procurement.

Future Initiatives

Going forward, we will make efforts to strengthen partnerships with suppliers and continue to offer customers fulfilling products and services through the procurement of parts,materials, equipment, and services that are superior in terms of quality, technology, cost, time to delivery, and environmental and safety compliance. In these ways, we will work toward mutual growth with our suppliers.