2nd Daikin response re concerns of contract cutting at Malaysian manufacturer where migrants alleged forced labour
Business & Human Rights Resource Centre invited Daikin to respond to concerns from workers relating to the detrimental impacts of buyers' halting sourcing from Kawaguchi and to answer the following questions to understand how this is happening in line with responsible procurement principles.
- Can you confirm reports that your company has halted or will halt sourcing from the factory? If so, please provide
- The date this took effect or will take effect from.
- Which stakeholders (if any) you consulted with and how prior to taking this decision
- Are you aware of reports workers are still owed outstanding wages and unauthorised salary deductions?
- Does your company commit to remediate the unpaid wages and other labour violations for workers? If so, by when is it anticipated this will be complete? ...
Response from Daikin
We would like to share with you the current situation for our response to labor issues at Kawaguchi Manufacturing Sdn. Bhd. in Malaysia.
First and foremost, we view the current situation from a humanitarian perspective and are investigating the appropriate relief measures for the migrant workers and what can be provided by the Daikin Group.
From a business perspective, we are monitoring progress while examining available options...
Unfortunately, in November, DAMA learned during a regular visit to the company that Sony and Panasonic, which account for a majority of Kawaguchi's transactions, were planning to remove their molds and suspend transactions... Under these circumstances, DAMA, which only accounts for 1-2% of Kawaguchi's total transactions, would be unable to support Kawaguchi's operations on its own. Moreover, after taking into consideration its own business risks, DAMA has determined that suspension of its transactions with Kawaguchi may be unavoidable....
Additionally, we have been consulting with NGO The Global Alliance for Sustainable Supply Chain (ASSC) regarding avenues for response to this case and have begun discussions with Sony and Panasonic regarding possible Workers Driven Remedy measures...
