Special Feature 2

Risk Management Activities Supporting a Changing Business
Aiming to Be a Production Factory Trusted by Customers ーNPT Kaga Factoryー

The Devices business develops film-based touch sensors, which are the key product, force sensors that detect the force of pressure, gas sensors that detect gas, and other such products. These products are used widely in smartphones, tablets, game consoles, industrial equipment, automobiles, and other such products in the global market. It is the biggest of Nissha’s four businesses, accounting for around 60% of overall sales in the fiscal year ended December 2018.

 

Subsidiary Nitec Precision and Technologies, Inc. (NPT) is solely responsible for product development, trial production, and mass production for the business. With four factories in Himeji, Kaga, Tsu, and Kyoto, it is trusted by global customers and is striving to build and maintain a production system that can reliably handle the work.

 

In order to maintain the trust of customers, it is important that our factories not only provide a stable supply of products, engage in efficient manufacturing, and implement thorough quality control but also face challenges such as the environment, human rights, and health and safety head on and engage in ethical operations. NPT has adopted the standards of the Responsible Business Alliance (RBA) Code of Conduct for labor, health and safety, the environment, ethics, etc. in its daily business activities and works continually to improve the level of factory management through efforts including taking corrective action with respect to supplier responsibility (SR) audits conducted by customers.

This special feature highlights the initiatives of the Devices business through a dialog between Masahiro Nishida, Factory Manager of the NPT Kaga factory, and Naoko Emoto of the Corporate Environmental and Safety Management Group of the Nissha Corporate General Affairs, who provides support for the environment and health and safety initiatives at the factory.

Raising the Level of the Factory Through RBA Compliance

Emoto: As one of the main factories supporting the Devices business, the NPT Kaga factory addresses compliance with RBA standards and SR audits by customers on a daily basis.

 

Nishida: The RBA Code of Conduct provides global standards for electronic components like touch sensors as well as automobiles, toys, aircraft, IoT, and other industries. These standards fall into the four categories of labor, health and safety, the environment, and ethics, and require the development of a management system to promote them.

Masahiro Nishida

Factory Manager, Nitec Precision and Technologies, Inc. Kaga Factory
I
n 1984, he joined Nissha and was involved in development of electronic component products at the Central Research Laboratory (at the time). He was transferred to the Industrial Materials Business Unit in 2000 where he was in charge of quality control, design, and technology development. In 2012, he was transferred to the Production Technology Department of the Devices Business Unit, and he started in his current position in 2015.

Emoto: Some of the RBA requirements are stricter than legal standards, aren’t they?

 

Nishida: Yes. The global RBA Code of Conduct has many standards that go beyond what is required by Japanese law. It’s difficult to immediately address all of them, but in order to earn the trust of our customers, compliance with global standards such as this is essential. It’s also a requirement for beginning or continuing to do business with customers.

 

Emoto: Compared to a few years ago, a lot more customers are requiring compliance with RBA or similar codes of conduct. Many of our customers sell finished products, so they are often held responsible not only for internal accidents and misconduct but also for accidents and misconduct that happens at their suppliers. The expectations and watch on companies by non-governmental organizations, non-profit organizations, and regular citizens is growing stricter day by day. It’s not uncommon for a single incidence of misconduct to force the suspension of a company’s operations or bring about boycotts of its products.

Naoko Emoto

Corporate Environmental and Safety Management Group of Corporate General Affairs, Nissha Co., Ltd.

After joining the company, she was transferred from Finance Division to Safety and Health Division, and started in her current position in 2014. She is in charge of a wide range of operations, including workplace safety patrols, internal training (as a lecturer), and responding to customer SR audits. She works on activities to give added value to Nissha’s products and services.

Nishida: You're exactly right. The RBA is an initiative to require safety of the work environment, respect for and dignified treatment of workers, responsibility for the environment, and operational ethics in the electronic component, automotive, and other industries and their supply chains. The Nissha Group complying with the RBA Code of Conduct means that we are a safe and reliable supplier for our customers, and it also increases our chances of being selected by prospective customers.

 

Emoto: That’s why it’s important to implement a management system for continual improvement of environmental and health and safety management, human rights initiatives, and other efforts. I often observe customer audits of factories as the person in charge of Nissha’s Corporate Environmental and Safety Management Group, and there’s a solid sense that the level of efforts and management taking place at all NPT factories is steadily improving.

Consideration of the Human Rights of All Factory Workers

Emoto: The whole RBA Code of Conduct places priority on considering human rights, doesn’t it? I’ve heard that it comes from international human rights standards, including the ILO Declaration and the Universal Declaration of Human Rights.

 

Nishida: Yes. The RBA prohibits forced labor for all factory workers. Not only does it prohibit slavery and human trafficking, but it also requires that all work be voluntary. On top of that, it requires that workers be free to move about the facility where they work and to terminate their employment contract and also prohibits employers from holding onto worker IDs, passports, and other such documents. Moreover, if a worker paid an agent commission when looking for the job, it requires that such fees be returned to the worker by the employer.

 

Emoto: The background behind that is apparently discrimination against and inhumane treatment of migrant and foreign workers. The Kaga factory has accepted technical interns from Vietnam, hasn’t it?

 

Nishida: Yes. Of course, we ensure that our treatment of technical interns is in compliance with the RBA. We’ve put up bulletin boards and informational posters, including evacuation routes, throughout the premises to ensure greater safety and peace of mind in daily operations. Messages on the bulletin boards are, of course, provided in both Japanese and Vietnamese.

A talk with Vietnamese employees

A talk with Vietnamese employees

Building a Foundation Capable of Handling Changes in the Business

Emoto: I see. By managing the factory based on the RBA Code of Conduct, you’ve established a foundation that allows global customers to entrust you with work with peace of mind.

 

Nishida: Exactly. That foundation provides fundamental support to Nissha, which is a manufacturing company. For example, even if there is a change in a product produced at the factory, our customers can entrust us with the work with peace of mind. The foundation of the factory cultivated through RBA compliance is one of Nissha’s strengths.

 

Emoto: Speaking of business changes, I heard that you were involved in development at the Industrial Materials Business Unit prior to being transferred to the Devices Business Unit.

 

Nishida: Yes. At the Industrial Materials Business Unit, I was in charge of development, design, and quality control. I take advantage of that experience in my current job of managing the factory. About 25 years ago, I was involved in development of components for LCD panels in a company-wide development organization. The photolithography process* I worked on at that time are now being applied to the touch sensors we produce.

 

Emoto: You’ve been along for the ride as Nissha has evolved.

 

Nishida: Nissha listens to the needs of changing markets and customers and has grown by creating and delivering products and services to meet those needs. I hope to build an even stronger foundation to continue supporting the evolving business.

 

*Photolithography process: A technology that forms high precision patterns by exposing the surface of a substance coated with photo-sensitive material (resist) to intensive light.

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