Supply Chain Management

In fiscal 2020, the Group began conducting supplier questionnaires on the status of compliance with the Procurement Guidelines, as well as risk assessment trials and monitoring the status of corrective actions based on the results of the questionnaires.
The Sustainability Committee (chaired by the Nomura Real Estate Holdings president and Group CEO) regularly reviews the status of the trials and monitors the progress of supplier management throughout the Group.

Nomura Real Estate Group Procurement Guidelines

The Group formulated the Procurement Guidelines (Japanese and English versions) in September 2018 and, since then, has been applying them at all suppliers and requiring compliance.
In addition, business consignment agreements and purchase orders (including those for new contractors and renewed suppliers) include a compliance provision. As of March 2024, we have included the provision in the agreements and purchase orders for almost all of our suppliers, approximately 4,600 companies, and they had already been informed of the provision. We also confirm awareness of the guidelines among suppliers through internal audits.

[Nomura Real Estate Group Procurement Guidelines]

Nomura Real Estate Group Procurement Guidelines

Supply Chain Risk Assessment Flow

The Group identifies social and environmental risks, including those related to human rights, throughout its supply chain and conducts risk assessments to avoid or mitigate such risks.
Based on the characteristics of the Group’s businesses and suppliers, we established a system for identifying high risk areas of the supply chain and conducting supplier engagement, including risk assessments, according to the level of risk. Specifically, we conduct risk assessments based on the characteristics of our businesses, such as identifying human rights risks when employing foreign technical trainees and confirming human rights risks, including human rights violations in the development areas, when participating in overseas projects. We connect these risk assessments to risk mitigation along our supply chain. When starting new transactions, we also conduct risk assessments on items listed in our procurement guidelines, such as respect for human rights and consideration for the environment, before commencing the transactions.

Initiatives for New Suppliers

Before starting business with new suppliers, the Group has the corporate department conduct credit checks and has each department and office review appropriateness in terms of quality, price and delivery time (implemented 100%). Contracts are only concluded with suppliers whose risk concerns have been eliminated.
When signing contracts, the Group requires compliance with the Procurement Guidelines and concludes agreements and purchase orders for all new deals that include a provision on compliance with the guidelines.

Promoting Engagement According to Risk Level

In fiscal 2020, we began surveying our supply chain on the level of supplier awareness of and compliance with the Procurement Guidelines. Based on the results of monitoring interviews conducted on a trial basis with ten major suppliers in fiscal 2020, we requested that companies identified as important suppliers of the Group in fiscal 2021 complete a Web-based questionnaire. In fiscal 2023, we expanded the target group of important suppliers to 300 companies, accounting for approximately 70% of the top suppliers, and requested that they complete a Web-based questionnaire; we received responses from 132 of them. In light of the fact that we were unable to confirm the employment status of foreign technical interns at some of the business partners and their supply chains in the fiscal 2023 survey, we designed a questionnaire under the supervision of a consulting firm to deepen our understanding of the acceptance status of foreign technical interns.
In fiscal 2023, through a series of investigations, no suppliers were found to be in violation of laws or regulations.

Reference: Feedback Materials for Companies Responding to the Procurement Guideline Survey

Thank You for Your Cooperation in Completing the Procurement Guideline Self-Assessment Survey

List of Questions and Answers

Overall Trends and Your Company's Responses

Targets, KPIs, and Performance Data

Other Results

ESG Data (Governance)

Results of Procurement Guidelines Engagement

Improving Supplier Capabilities and Enhancing Quality

The Group works to enhance quality throughout the supply chain and raise awareness of the environment by holding Safety Conferences and annual training courses for suppliers. These efforts address concerns related to quality and the environment to encourage suppliers to also disseminate the Procurement Guidelines to their employees and respond accordingly.
To achieve safety and security through appropriate quality control, Nomura Real Estate Development distributes the Design and Construction Standards and quality manuals to construction companies and designers to ensure that they know about and completely understand them.
In addition, Nomura Real Estate Partners holds annual East Japan Supplier Council Meetings on Health & Safety and West Japan Supplier Council Meetings on Health & Safety.

Promoting Use of Wood Products in Hotel Business

As part of its environmental protection efforts, Nomura Real Estate Hotels is switching guest room amenities to biomass and wood products and reviewing in-room items in order to reduce the amount of plastic used. They offer toothbrushes and hairbrushes made from rice husks, a biomass resource, as well as toothbrushes and slippers made from natural bamboo. Since September 2022, the company has been replacing items and amenities in order to gradually reducing the number of items and amenities in guest rooms.

News Release (Japanese text only)

Use of Certified Wood-based Paper and Plant-based Ink in Residential Development

In order to be ever more environmentally friendly with regard to the paper advertising materials used for Proud and other condominium sales business, Nomura Real Estate's Residential Development Division, as a general rule, uses paper made from wood from properly managed forests for all pamphlets, guides, direct mail, drawing collections, inserts and the like. In addition, the ink used is vegetable oil-based, which is more biodegradable than the petroleum-based solutions that have been used traditionally. Printed materials using these papers and inks include logos and wording attesting to the fact of their use. We will continue to use environmentally friendly products and strive to reduce our environmental impact.