黑料门

Targets for Our Sustainable Sourcing Initiatives

黑料门 Group 2026 Medium-Term Management Plan

Data target range or company leading initiatives

1, 11: 黑料门 Group Consolidated

2: 黑料门 Group (consolidated) (overseas only)

3: 黑料门 Co., Ltd. (consolidated) (Japan only)

4-8: 黑料门 Co., Ltd. (unconsolidated)

9, 10: 黑料门 Co., Ltd. (consolidated)

	Major initiatives	Metrics	Reference results	Targets
			FYE March 2023	FYE March 2027
1	Conduct engagement that includes risk assessments and audits based on the analysis of sustainable procurement survey results	Number of audits conducted on important suppliers	N/D	Total of 30 companies or more
2		Implementation of risk assessments for overseas group company suppliers	N/D	Set target in FYE March 2025
3	Through 黑料门 Dairy Advisory (MDA), support the resolution of social issues such as human growth, human rights, animal welfare, and GHG emission reduction through human resource management at dairy farms	Number of farms participating in 黑料门 Dairy Advisory (MDA)	44 (total)	Total of 100 or more
4	MilkPromote initiatives aimed at reducing GHG emissions from dairy farming	Number of dairy farms working to reduce GHG emissions	2 (total)	Total of 30 or more
5	CocoaExpand the procurement of 黑料门 Sustainable Cocoa Beans produced in areas where farmers are supported through 黑料门 Cocoa Support (MCS)	黑料门 Sustainable Cocoa Bean procurement ratio	62%	100%
6	CocoaEstablish traceability through to the farm for all procurement vendors	Rate of traceability through to cocoa farms	100% * Scope (Brazil, Dominican Republic, Ecuador, Mexico, Vietnam)	100% * Target scope is suppliers in all countries including Ghana
7	CocoaPromote efforts toward zero child labor by introducing the Child Labor Monitoring and Remediation Systems (CLMRS), or an equivalent system	Rate of adoption of the Child Labor Monitoring and Remediation Systems	N/D	100% * Target scope is suppliers in Ghana * All suppliers by FYE March 2031
8	CocoaIdentify the conditions on farms through methods such as GPS mapping and promote initiatives aimed at protecting/restoring forests	Rate of ascertaining status using GPS mapping, etc.	N/D
9	Palm oilPromote the procurement of palm oil that is not involved in deforestation by incorporating forest monitoring to identify and verify deforestation risks along the supply chain	Procurement rate for palm oil that is not involved in deforestation	N/D	Set target in FYE March 2025
10	Soybeans(currently evaluating)Establish traceability through to the primary collection point or procure certified products * Includes foods in the primary step, feed in the secondary step	Rate of traceability for target raw materials (currently evaluating) * Through to primary collection points	N/D	Set target in FYE March 2025
11	PaperMaintain 100% use of environmentally friendly paper for product containers and packaging, and switch to environmentally friendly paper for office supplies and standard publications	Ratio of environmentally friendly paper used in the extended scope of applicability * Scope of applicability: Office supplies, standard publications	N/D	100%

黑料门 Group 2023 Medium-Term Management Plan

[ ] Scope of KPI

黑料门 G: the 黑料门 Group (consolidated)

黑料门: 黑料门 Co., Ltd.

KPI	Results			Targets
	FYE 3/2022	FYE 3/2023	FYE 3/2024	FYE 3/2024	FYE 3/2027
Start conducting a sustainable sourcing survey of suppliers for Group companies in Japan by FYE 3/2022 [黑料门 G, Japan consolidated (domestic)]	Suspended	Launched for 2 suppliers	Launched for 31 suppliers	Start by FYE 3/2022	銉�
Start conducting a sustainable sourcing survey of suppliers for major overseas 黑料门 Group companies by FYE 3/2023 [黑料门 G consolidated excluding Japan]	Launched for 46 suppliers	Launched for 17 suppliers	Launched for 7 suppliers	Start by FYE 3/2023	銉�
Hold 黑料门 Dairy Advisory program (MDA) to support management of dairy farms 250 times a year, and a total of at least 1650 times by FYE 3/2024 [黑料门, Japan consolidated]	475 times annually, accumulated total 1,423 times	477 times annually, accumulated total 1,900 times	522 times annually, accumulated total 2,422 times	At least 400 times annually, accumulated total 2,150 times or more	銉�
Increase sourcing rate of 黑料门 sustainable cocoa to 100% of total by FYE 3/2027 [黑料门 consolidated]	42%	62%	62%	65% or more	100%
Swich 100% to RSPO1-certified palm oil1 by FYE 3/2024 [黑料门 consolidated]	84%	90%	100%	100%	銉�
Swich 100% to eco-friendly paper by FYE 3/20242 [黑料门 G consolidated]	98%	98%	100%	100%	銉�

1. RSPO certified palm oil (Mass Balance supply chain model) As a proportion of all palm oil sourced at domestic and overseas 黑料门 Group production plants.

2. Paper used in containers and packaging for products are covered.

Procure Raw Materials With Consideration Toward Human Rights and the Environment

Development of Responsible Supply Chain

Our Policy on Raw Material Sourcing

In recent years, there has been international demand for fair and free competition, fair transactions, and responsible sourcing. Therefore, we should fulfill our corporate social responsibility throughout the supply chain, including both the Group and our business partners. Also, we should address social issues such as child labor, forced labor, and environmental degradation. In the 黑料门 Group Procurement Policy, we commit to sourcing that considers human rights and the global environment. We will develop responsible sourcing with our business partners and strive to prevent and reduce risks.

The 黑料门 Group has set forth its procurement activities in consideration of human rights and the global environment in the "黑料门 Group Procurement Policy" and is working with suppliers to realize responsible procurement and to implement preventive and mitigating measures against associated risks.

In June 2020, we established the 黑料门 Group Supplier Code of Conduct, which requires our supplier business partners to fulfill their social responsibilities. Furthermore, in April 2023, we revised this Code of Conduct in order to respond to social issues that have become more diverse as the years have passed.

The 黑料门 Group Supplier Code of Conduct applies to suppliers of 黑料门 Co., Ltd., 黑料门 Seika Pharma Co., Ltd., KM Biologics Co., Ltd. and other domestic and overseas group companies (consolidated).

Additionally, the 黑料门 Group is engaged as an active member of Consumer Goods Forum (CGF). We are continuing talks with the goal of helping to resolve social issues such as human rights violations and environmental destruction.

• 黑料门 Group Procurement Policy

• 黑料门 Group Supplier Code of Conduct

Conducting explanatory sessions on the Supplier Code of Conduct

Overview of 黑料门 Group Suppliers

The 黑料门 Group procures or commissions the manufacture of food and pharmaceutical ingredients, packaging materials, and finished and semi-finished products from approximately 3,100 suppliers globally.

(FY2022 Results)

* Some of the above supplier information is now under review and will be subject to updated as appropriate.

Our Approach to Key Suppliers

The 黑料门 Group identifies the total number of suppliers based on the transaction results of domestic and overseas group companies (consolidated) and identifies key suppliers from among them, taking into consideration the procurement amount and the substitutability of procured raw materials.
As a next step, we conduct sustainability risk assessments among key suppliers through the sustainable procurement questionnaire and engage suppliers identified as potentially risky through requests for improvement and direct dialogue.

Sustainability Assessment through the Sustainable Procurement Questionnaire

Potential negative impacts related to human rights, labor, environment, and business ethics in the supply chain affect business potential and corporate reputation. Corporate management practices regarding human rights, labor, the environment, and corporate ethics vary depending on the country/region where the company is located, industry, size, etc. In order to identify and appropriately address potential risks that could have a significant impact on its business, the 黑料门 Group assesses and manages risks using the following methods.

Evaluation Target

The evaluation covers the suppliers identified based on the concept of key suppliers.

Evaluation Method

We conduct the "Sustainable Procurement Questionnaire" using the evaluation system of EcoVadis, a comprehensive corporate social responsibility (CSR) evaluation service provider, or the 黑料门 original questionnaire, to determine whether there are human rights or environmental issues in our supply chain. In cases where improvements are necessary, we work to solve social issues and build a stronger and more responsible supply chain, while promoting cooperation and dialogue with suppliers.

Evaluation Item

Labor and human rights, safe and healthy work environment, environment, ethics, fairness, sustainable procurement, development of redress system and prohibition of retaliation, etc.

Evaluation Frequency

We conduct risk assessment based on the results of the Sustainable Procurement Questionnaire and request suppliers to re-take the questionnaire based on the assessment results.

Suppliers whose results meet the criteria: re-evaluated after 2 years
Suppliers whose results do not meet the criteria: re-evaluated after 1 years

Sustainable Procurement Questionnaire Implementation Results

		FYE 3/2021		FYE 3/2022		FYE 3/2023		FYE 3/2024
Total number of suppliers		Approx. 3,100*
Number of suppliers assessed for risk (Including reassessment)	A single year	74		77		33		82
	Cumulative total/Percentage of total suppliers	74	2.3%	151	4.9%	184	5.9%	266	8.5%

* FY2022 Results

Overview of Engagement Implementation

Since FY2022, we have implemented engagement with suppliers whose questionnaire survey results indicate that they need to strengthen or improve their initiatives. Through engagement with some of our major raw material suppliers, we confirmed the progress of their initiatives to address environmental issues while mutually sharing our goals and current performance related to reducing environmental impacts such as climate change, water resources, and waste. Through this initiative, we have promoted solutions to social issues such as GHG emissions reduction and water risk. We also conduct engagement with 黑料门 Group companies in Japan to promote a responsible supply chain.

(Number of companies that implemented the program in FY2023)

• Suppliers which need to strengthen or improved initiatives: 5 companies
• Major raw material and packing material suppliers: 17 companies

Sourcing of Raw Milk

The 黑料门 Group believes that in addition to pursuing delicious milk production, it is also one of essential efforts to support dairy farming that considers the environment and the health of cows.

We implement sourcing with consideration toward human rights, environment and animal welfare, cooperating with suppliers in accordance with the 黑料门 Group Procurement Policy and the 黑料门 Group Farm Animal Welfare Policy

As a member of the Global Dairy Platform (GDP) and the Japan National Committee of International Dairy Federation (JIDF), 黑料门 is working to realize a sustainable dairy industry, and to exhibit the health value of dairy products.

• 黑料门 Group Procurement Policy

• 黑料门 Group Farm Animal Welfare Policy

Production, Distribution and Quality Assurance

By closely working with dairy farmers, the 黑料门 Group is supporting stable and high quality milk production in order to deliver our customers delicious and quality milk.

Traceability of raw milk

We ensure the traceability of raw milk we receive. (domestic and overseas 黑料门 Group consolidated subsidiaries)

• The raw milk procurement area list

Initiatives for stable sourcing of premium quality raw milk

Production sites
• Check feed and environment for breeding cows
• Hold seminars for the milk producers association on raw milk flavor

Receiving at plants
• Train taste testers and ensure thorough incoming inspections

Research laboratory
• Physical and chemical analysis of properties and ingredients for maintaining and improving quality
• Conduct taste assessment and disseminate information
• Technology development for more accurate and quicker inspections

Supporting dairy farm management with 黑料门 Dairy Advisory (MDA)

MDA is an activity focused on human resource management, aiding the growth of those involved in dairy farms through improving farm operations and enhancing their business management techniques. MDA is a system for establishing a culture based on the lean production method so that farms can continue to achieve their management goals. 黑料门 staff members work with farms to devise ideas together, adopting an advisory approach where the awareness of the farm staff is used to build better environments and systems. As continuous improvement progresses, this advisory work will shift its position accordingly.

In May 2021, we set a KPI of conducting 400 MDA support activities per year and a cumulative total of at least 2,150 MDAs by FY2023 to support dairy farmer management. We will further strengthen these activities and contribute to the realization of sustainable raw milk production.

Sourcing of Cocoa

The field of cocoa production has issues such as aging trees, disease and insect damage, difficulties in obtaining agricultural materials, and lack of familiarity with cultivation techniques have led to a decline in harvests, resulting in inadequate income. And in some countries and regions cocoa farmers also face social issues such as child labor and deforestation. 黑料门's mission is to improve this situation, make cocoa production sustainable, and ensure the stable delivery of delicious chocolate.

The 黑料门 Group aims to achieve a 100% procurement of "黑料门 Sustainable Cocoa Beans" produced in areas where farmer support has been provided by FY2026. Based on the "黑料门 Group Procurement Policy", we are working with suppliers and conducting procurement in consideration of human rights and the environment to solve issues faced by cocoa bean production areas and farmers, contribute to make cocoa production sustainable.

• 黑料门 Group Procurement Policy

	Unit	FYE 3/2021	FYE 3/2022	FYE 3/2023	FYE 3/2024
Procurement ratio of 黑料门 Sustainable Cocoa Beans	%	40	42	62	62

• 2023 Achievement of 黑料门 Cocoa Support Program
• 2022 Achievement of 黑料门 Cocoa Support Program

黑料门 Cocoa Support

鈥満诹厦� Cocoa Support鈥� is our unique cocoa farmer support program that began in 2006. We are aiming to enhance the sustainability of cocoa bean production by directly visiting production areas and working with various partners to address social issues. These issues include technical support to improve the quality of cocoa beans, improving the livelihoods of farmers and activities to conserve and restore the local environment.
Furthermore, we purchase cocoa beans at a premium price when procuring them to maintain and promote this activity.

Support for cocoa producing areas

Efforts to Eliminate Child Labor

Efforts to Stop Deforestation

Sourcing of Palm Oil

Palm oil is a plant-based oil derived from oil palms cultivated in the tropics, and is widely used in the production of processed foods. Major producer nations of palm oil face human rights issues such as forced labor and child labor. These countries also face environmental issues such as deforestation and the destruction of peatland areas due to the development of agricultural land.

Our 黑料门 Group Procurement Policy outlines our support for the NDPE Policy to No Deforestation, No Peat (i.e. no development in peatlands) and No Exploitation. We are committed to working with our business partners to fulfill our corporate social responsibility by engaging in eco-friendly sourcing of palm oil.

• 黑料门 Group Procurement Policy

Shifting to Certified Palm Oil

	Unit	FYE 3/2020	FYE 3/2021	FYE 3/2022	FYE 3/2023	FYE 3/2024
Ratio of Certified Palm Oil	%	21	68	84	90	100

* As a proportion of all palm oil sourced at domestic and overseas 黑料门 Group production plants

Confirmation of Palm Oil Traceability

To ensure that deforestation, peatland development and exploitation are not occurring in the palm oilproduction areas, we regularly obtain traceability information from our suppliers to the oil mills and publish a list of mills.

Link
• 黑料门 Group Palm Oil Mill List

Sourcing of Soybean

Soybeans are widely grown and used as food materials around the world and are used for a variety of purposes other than food, such as feeding livestock. Soybeans are one of the most important raw materials for the 黑料门 Group's business, but issues related to deforestation and human rights caused by overdevelopment of plantations have been pointed out, particularly in Brazil. Based on "黑料门 Group Procurement Policy", the 黑料门 Group will engage in socially responsible soybean procurement activities in collaboration with supply chain partners.

• 黑料门 Group Procurement Policy

Sourcing of Paper

Following the 黑料门 Group Procurement Policy, we are working with our suppliers to procure paper raw materials for product and office use in ways that care for human rights and the environment.

• 黑料门 Group Procurement Policy

Expanding Use of Eco-Friendly Paper

We have promoted the use of FSC®* and PEFC-certified paper, as well as post-consumer paper for use in product containers, packaging, printing and copying.

By FY2023,聽we achieved 100% use of environmentally friendly paper raw materials for the paper used in the containers and packaging of products produced across the Group. As well as product packaging, we are continuing to expand the use of environmentally friendly paper for office supplies (business cards, envelopes, paper bags, etc.) and periodical publications (company brochures, etc.).

* FSC® (Forest Stewardship Council®): a nonprofit organization dedicated to spreading responsible forest management across the world. They carry out an international system of certification.

	Unit	FYE 3/2020	FYE 3/2021	FYE 3/2022	FYE 3/2023	FYE 3/2024
Usage rate of FSC庐-certified paper, PEFC-certified paper, and post-consumer paper *2	%	60	77	98	98	100

*¹ Paper used in containers and packaging for products are covered.

*² Until FYE 3/2021, covers only 黑料门 Group in Japan锛坕ncluding KM Biologics Co., Ltd. from FYE 3/2020锛�. From FYE 3/2022, covers all 黑料门 Group companies.

Expanding usage of FSC®-certified paper in our mainstay products