Toshiba Group Procurement Policy

I. BASIC PROCUREMENT POLICY

Toshiba Corporation and its affiliates (“Toshiba Group”) will comply with all applicable laws and regulations, with emphasis on environmental consciousness, whenever procuring goods and services necessary for the production and supply of products for its customers. Toshiba Group will also promote the establishment of good partnerships with its suppliers based upon mutual trust combined with fair and open business transactions

(A) Compliance with Laws, Regulations & Environmental Considerations [+]
Toshiba Group will comply with the laws and regulations of the countries and regions in which it conducts business. It will also give due consideration to the protection of the environment and to the efficient use of its resources

(B) Fair and Open Transactions [+]
Toshiba Group will provide all of its suppliers and potential suppliers, both in Japan and overseas, with business opportunities on an equitable basis.

(C) Strengthening of Partnerships with Suppliers [+]
Toshiba Group will strive to establish and foster good working relationships with its partners and suppliers, both in Japan and overseas, based upon mutual understanding and trust.

II. POLICY FOR SELECTING SUPPLIERS

When selecting suppliers, priority shall be given to companies satisfying the following criteria:

• The company complies with laws, regulations and places emphasis on environmental consciousness.
• The company has sound business operations.
• The company has the ability to supply goods and/or services to Toshiba Group with emphasis on adequate quality, price and delivery lead-time.
• The company is capable of providing a stable supply of goods and/or services. Also the company must have the flexibility to respond quickly to supply/demand fluctuations.
• The company possesses technology that contributes positively to Toshiba Group products.

III. SUPPLIER EXPECTATIONS

Toshiba Group conducts business globally, involving a wide range of products. In order to be successful in this environment, Toshiba Group must take customers’ requests, concerning the procurement of goods and/or services, into consideration. Therefore, all suppliers are expected to perform the following:

(A) Compliance with Laws, Regulations and Social Customs [+]
Suppliers are required to ensure compliance with laws, regulations and appropriate social customs of the countries and regions in which they operate.

• Ensuring compliance with the laws and regulations in effect in the countries and regions in which they operate include, for example, competition/ anti-trust laws, commercial codes, export control laws, personal data protection laws, copyright laws, etc.
• Prohibition of child and forced labor
• Prohibition against discrimination
• Must maintain a safe and clean working environment

(B) Environmental Considerations [+]
Suppliers are encouraged to engage vigorously in activities to create environmentally friendly products. This is based upon the conviction that humankind has a fundamental responsibility to bequeath the irreplaceable global environment in a flourishing condition to succeeding generations.

1) Suppliers are encouraged to adopt ISO 14001-based environmental management systems and to promote third-party certification.

2) Suppliers are encouraged to utilize Green Procurement, which provides for the procurement of parts and materials that have the smallest negative impact on the environment. Suppliers are also encouraged to reduce or eliminate use of potentially hazardous substances.

3) Suppliers are encouraged to promote environmental protection activities, such as, the establishment of positive environmental policies, the improvement of systems that affect the environment and to provide training opportunities in the area.

(C) Maintain Sound Business Operations [+]
Maintaining sound business operations over the long-term strengthens business relationships. Accordingly,suppliers are requested to disclose their management policies and the status of business operations (including financial statements).

(D) Securing Excellent Product Quality [+]
Suppliers are expected to establish a quality assurance system in accordance with the ISO 9000 family of standards. This system should help improve and maintain the quality of products delivered to Toshiba Group.

1) Compliance with the safety standards of the countries and regions in which suppliers operate (e.g., EN, CE Marking, etc.)

2) Furnishing goods and services on a continuous basis satisfying the specifications and quality required by Toshiba Group.

(E) Offering Goods and/or Services at Appropriate Prices [+]
Suppliers are requested to provide goods and/or services at competitive prices and strive to reduce prices on a continuous basis so Toshiba Group can provide its own customers with products that satisfy them financially.

(F) Firm Delivery Commitment and Establishment [+]
Suppliers are requested to keep delivery commitments. They are also requested to establish a system for the stable and flexible supply of goods and/or services enabling them to successfully respond to rapid supply-demand fluctuations.

(G) Enhancement of Technological Capabilities [+]
Suppliers are requested to continually improve their technological capabilities. This will enable Toshiba Group to provide excellent and safe products to its own customers. Toshiba Corporation Corporate Procurement Div. EU