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With the growing concern on climate change, deforestation from conversion to farmland has been gaining greater attention. While tackling illegal logging has long been the focus of our timber procurement initiatives, in our three-year-midterm management plan in 2019, we introduced the goal not to procure timber and wood products that may contribute to deforestation, and one of the initiatives was to remove the so-called “conversion timber” from the supply chain. We began communicating our intention to set the goal with our suppliers even before we made that commitment public. You can see the criteria for our “sustainable timber” at “Policy on Sustainable Timber and Wood Products” on our website, and we trade according to our internal procurement guideline by conducting rigorous due diligence to ensure that the procurement is performed in a sustainable manner with consideration of human rights, labour practices, biodiversity conservation, and local communities, needless to say the legality.

https://sfc.jp/english/information/society/business/distribution/procurement.html

All of our imported plywood for concrete formwork used in the facilities related to the Tokyo 2020 Olympic and Paralympic Games are certified by Indonesia's SVLK (Timber Legality Verification System). SVLK is a certification system to enforce legality for the timber trading and that all related operations from forestry management, harvesting and manufacturing are conducted with consideration to environmental and social issues through annual third party audits. The system was approved by the VPA (bilateral agreement) based on the FLEGT (Forest Law, Enforcement, Governance and Trade) Action Plan established by the EU in 2016, and we believe it adds reliability to the country's certification system.

We received confirmation from the Tokyo Olympic Organizing Committee that the plywood products based on SVLKs meet the sustainable sourcing code for timber established in 2016 as being certified by the third-party (EU).

It is always our policy to engage with our stakeholders in open and sincere manner and when we received an inquiry from RAN back in May 2021 we promptly responded within one-week deadline with all necessary information and requested further communication as the listed log suppliers did not much our record.

We also fully cooperated with the Tokyo Metropolitan government and the Tokyo Olympic Organizing Committee when they prepared responses to the RAN inquiries. While we are not in a position to know their actual responses and communication to RAN back in 2018 nor this time, we provided information that the products are in compliant with the sourcing code.

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