Increasing demands for disclosure and concerns about the enormous workload involved.

--Could you tell us about the role of the Sustainability Promotion Office and the background of this initiative?

Mr. Ueshima: As a business entity operating in multiple business fields, our company operates in a wide range of areas, from social infrastructure fields such as water and infrastructure to Industry infrastructure fields. The Sustainability Promotion Office is responsible for responding to disclosure requests from society such as TCFD and CDPs, as well as promoting company-wide sustainability activity within the company and disseminating information to stakeholders through integrated reports and other means.

In implementing SAQ, I was primarily responsible for system implementation, drawing on the expertise of experienced senior colleagues to create the overall framework. Miyata, as the main person in charge of SAQ, handled the practical aspects, such as reviewing the survey Contents, actual distribution and collection, and coordinating its deployment to the procurement departments of each business unit.

In recent years, with increasing international demands in the areas of human rights and the environment, we have seen an increase in requests from our business partners to submit SAQs (Sustainable Action Questionnaires). Furthermore, as a group policy, strengthening the risk assessment and management system across the entire supply chain has become an urgent priority. However, we had a strong desire not only to "manage" risks, but also to value our suppliers and partner companies and to "co-create" a value chain together with them.

To: Mr. Yuya Ueshima, Sustainability Promotion Department, Sustainability Promotion Office

── What were your motivations for taking on the task of distributing and collecting SAQ from suppliers for the first time?

Mr. Miyata: Actually, we had been considering and preparing for the implementation of SAQ even before its introduction, but this was the first time we had actually implemented it, including distribution to and collection from our suppliers.

Initially, we considered using the format Create by the Global Compact, sending Excel files, or conducting the survey using web-based questionnaire tools. However, given that the essence of the process lies in collaboratively analyzing responses and developing countermeasures after the questions are asked, and considering the projected decline in the working population, we had strong concerns about the "practical burden" involved. If we were to conduct the survey using Excel, sending request emails to hundreds of suppliers, checking the collection status, sending reminders to those who haven't submitted, and then compiling and analyzing the collected data—all of this done manually was not realistic with our limited resources. Even if we used a web-based questionnaire tool, we would still need to manage recipients and track non-respondents using separate files, and we felt that operational complexity would be unavoidable.

In addition to the need for ingenuity in the operational aspects on our end, we have determined that it is essential to introduce a system that can efficiently and centrally manage information from the outset, rather than simply performing tasks, considering the consideration given to the suppliers who will be providing the information, future due diligence responses, and future expansion to group Company. Therefore, we have begun considering a system.

Currently, we receive 40-50 SAQ (Service Agreement Questionnaire) response requests annually from customers and others, most of which are in Excel format. Depending on the Contents of the questions, the process of requesting responses from various departments, collecting them, and scrutinizing them was time-consuming and challenging. Because we knew firsthand the difficulties faced by those providing the responses, we pondered deeply how we could request SAQs from our suppliers without burdening them, while also building good relationships.

Policy change after dialogue with experts

—Among the many options available, what was the deciding factor in choosing Dataseed SAQ?

Mr. Ueshima: What we were concerned about was that the "collection and reminder" process could be easily completed within the system. Also, the fact that they already had experience implementing the GHG calculation tool "Zeroboard" was a great help in moving forward with internal approval and in terms of future company adoption. Furthermore, their willingness to "work alongside" us in system modifications and question Create was a major deciding factor.

Mr. Miyata: The fact that we could gain expert knowledge was a major advantage. We received advice on key points of the questions that were important to our company and on recent trends, and being able to customize the system to suit our situation allowed us to proceed with the implementation with confidence.

── What kind of support did you receive when actually Create the questions?

Mr. Ueshima: In developing the questions, we had several meetings with experts from Zeroboard. In fact, initially, we had created a "nearly fully customized questionnaire" that incorporated all of our requests. However, our suppliers are diverse in terms of Company size and policies, and some companies are not accustomed to answering SAQs. After receiving advice from experts on how to consider "how suppliers will perceive it" and engaging with them, we decided to put the fully customized version on hold for the time being. We believe that gradually increasing engagement by having them answer in stages will lead to "value chain integration." With this in mind, we restructured the questions based on the SAQ of the "Global Compact Supply Chain Subcommittee," which is easier for a wider range of companies to answer, and switched to a strategy of proceeding in stages, carefully selecting items that are important as risks.

We struggled to find the right balance between our own company's circumstances and our consideration for our suppliers. The process of engaging in sincere discussions with experts in this regard proved to be a valuable learning experience for us.

Real-world implementation within the company: The passion behind the "face-to-face tour" of all six business divisions' factories

—Currently, the system is mainly operated by the Sustainability Promotion Office, but as you plan to expand the system to each procurement department in the future, what measures are you taking to gain cooperation from within the company?

Mr. Miyata: I conducted an "explanatory tour" visiting all six factories in our business divisions with a senior colleague who is very familiar with the field. Online meetings are convenient, but we felt that face-to-face conversations were essential to properly convey our enthusiasm and intentions to the people on the ground.

── What message did you convey to the people on site?

Mr. Miyata: The procurement department staff are extremely busy every day, dealing with many suppliers. Therefore, instead of simply saying, "We will conduct human rights due diligence," we emphasized that this initiative is aimed at ensuring the sustainability of our activity and improving corporate value, encompassing not only human rights but also the environment and quality. We carefully explained the benefits, such as how "doing this together will lead to value chain integration and further growth for Kurimoto Iron Works." At the same time, we included past case studies in the materials to help them understand the risks involved if they don't take action, so that they can see it as their own responsibility.

Mr. Keigo Miyata, Sustainability Promotion Department, Sustainability Promotion Office

Implementation Effects and Outlook: Timely Information Disclosure Achieved Through System and Expert Support

── How did the trial operation conducted in fiscal year 2025 go?

Mr. Miyata: In fiscal year 2025, we conducted the survey with approximately 50 companies. To increase the response rate, we experimented with various methods, such as sending individual reminders from our company's email address in addition to notifications from the system. From the perspective of those responding, the format involves answering intuitively with three options, so we feel that it is a system that is easy for suppliers to respond to without any burden.

Mr. Ueshima: On the other hand, there were some areas where we felt the visibility of the analysis screen could be improved. When we conveyed this request to your company, a version upgrade was implemented quickly. The fact that you not only provide a tool but also work together to develop the system from a user's perspective was exactly what we expected when we first implemented it.

— How do you plan to utilize the collected data and implement it within the company going forward?

Mr. Miyata: It's not enough to just collect the results; providing "feedback" to our suppliers is also crucial. While maintaining face-to-face communication, we want to create a system that utilizes the Dataseed SAQ system to facilitate feedback and corrective actions based on the responses.

Mr. Ueshima: We position Dataseed SAQ not as a "one-off questionnaire," but as a "core system for continuously understanding risks across the entire supply chain and using that information to inform management decisions." Furthermore, we will transition to a system where environmental departments and procurement personnel in each business unit directly Action the system, elevating it into a company-wide initiative. By aggregating the qualitative data from SAQ submitted from the field, organizing the Contents, and presenting it in a way that conveys the background and key points, we can achieve more "timely information disclosure that contributes to management decisions." Information disclosure is not only a responsibility to stakeholders but also important for engaging with our suppliers. In the future, we envision disclosing this information in integrated reports, and we hope to continue receiving consulting and advice from the Zeroboard members regarding how to present the output at that time.

-- Finally, do you have a message for companies that are considering implementing SAQ?

Mr. Miyata: I think many companies understand the necessity of SAQ, but are hesitant to adopt it due to concerns about the practical burden and the burden on suppliers. However, by utilizing the system, these burdens can be significantly reduced, and even first-time implementations can proceed smoothly. The collected supply chain data will be used not only for risk management but also as important management information for strengthening the value chain and improving corporate value.

Our company decided to adopt Zeroboard's system because we believe that their commitment to continuous system development, as well as their thorough operational support, will transform our relationships with suppliers into a value chain.

Many industries and sectors expect that adopting the essential SAQ will enhance the quality and value of their operations. Therefore, companies aiming to build sustainable relationships with their suppliers should consider implementing it.

The support Contents will vary depending on the plan and options you choose.
At Zeroboard, we offer a variety of options, including consulting Service, to meet our customers' needs.