Mitsubishi Heavy Industries, Ltd.

Based on public information, there is no readily available evidence that the company has published a statement from the Chief Executive Officer or the Chair of the Board supporting the ethics and anti-corruption agenda of the company. TI notes that there are two statements from the President and the Chairman, but they do not reference the ethics and anti-corruption agenda.

Based on public information, there is evidence that the Chief Executive Officer demonstrates a strong personal, external facing commitment to the ethics and anti-corruption agenda of the company. In an interview published in the 2013 CSR report, the Chief Executive Officer mentions the importance of ‘fairness’ and of ‘following rules’. He also mentions several initiatives to combat bribery in transactions with customers from oversea government agencies. The CSR Report 2014 also contains an interview with the CEO, where Shunichi Miyanaga explains his ideas about corporate governance reforms. The company therefore scores 1. To score higher the company would need to provide evidence of at least one more example of such engagement.

Based on public information, there is no readily available evidence that the company’s Chief Executive Officer demonstrates a strong personal, internal-facing commitment to the ethics and anti-corruption agenda of the company, actively promoting the ethics and anti-corruption agenda at all levels of the company structure.

Based on public information, there is evidence that the company publishes a statement of principles representing high standards of business conduct, including integrity, openness, transparency, honesty and trustworthiness. These valuse are briefly explained on the company’s website and in company documents.

Based on public information, there is evidence that the company is a signatory to the UN Global Compact.

Based on public information, there is evidence that the company has appointed a Board committee with responsibility for promoting compliance. The company has a Risk Management & Compliance Committee, which is reponsible for monitoring the company´s compliance with its rules, including the CSR guidelines, and its commitment to promote fair and honest business practices. The Committee reports to the President and Vice-president. The group meets twice a year to develop company-wide compliance promotion plans and monitor progress.

Based on public information, there is evidence that the company has appointed a person at a senior level within the company to have responsibility for implementing the company’s ethics and anti-corruption agenda. The Executive Vice President chairs the Compliance Committee and is responsible for implementing the CSR agenda, including fair and honest business practices. The current Executive Vice President is Atsushi Maekawa.

Based on public information, there is evidence that the Risk Management and Compliance Committee conducts a periodic review of the company’s compliance policies and reports to the President and Vice-president.

Based on public information, there is limited evidence that there is a formal, clear, written plan in place on which the review of the ethics and anti-corruption agenda by the Board or senior management is based. There is evidence of a plan outlining how to review and implement the human rights strategy of the company. This strategy includes reviewing bribery and anti-corruption issues. Further details are not provided and there is no evidence of improvement plans. The company therefore scores 1.

Based on public information, there is no readily available evidence that the company has a formal process for review and where appropriate updates its policies and practices in response to actual or alleged instances of corruption. TI notes there is some evidence of a process to update policies and practices in response to changes in legislation.

Based on public information, there is evidence that the company has a formal anti-corruption risk assessment procedure implemented enterprise-wide.

Based on public information, there is no readily available evidence that the company has a formal anti-corruption risk assessment procedure for assessing proposed business decisions.

Based on public information, there is no readily available evidence that the company conducts due diligence that minimises corruption risk when selecting or reappointing its agents. TI notes that the Company has guidelines for business partners, but there is no evidence of a due diligence procedure.

Based on public information, there is no readily available evidence that the company has contractual rights and processes for the behaviour, monitoring, control, and audit of agents with respect to countering corruption.

Based on public information, there is some evidence that the company makes clear to contractors, sub-contractors, and suppliers, through policy and contractual terms, its stance on bribery and corruption. The company asks its business partners to foster corporate ethics and comply with principles, such as not to give or demand benefits or gifts. The procurement policy states that business partners must comply with rules, regulations and social norms based on the company´s compliance management policy; procurement is only approved if it does not conflict with relevant regulations. However, it remains unclear what the consequences of non-compliance are. The company therefore scores 1.

The company has informed TI that it does not engage in offset contracting.

The company has informed TI that it does not engage in offset contracting.

Based on public information, there is evidence that the company has an anti-corruption policy. However, the company is not explicit about corruption in its various forms. The company therefore scores 1.

Based on public information, there is no readily available evidence that the company’s anti-corruption policy is one of zero tolerance.

Based on public information, there is evidence that the company’s main policy documents on compliance and anti-corruption are publicly available. However, there is no document that presents the company’s policy in its entirety, for example a Code of Conduct. The company therefore scores 1.

Based on public information, there is limited evidence that the company’s anti-corruption policy is understandable and clear. TI notes that principles on anti-corruption are discussed in group meetings and guidelines are handed out as hardcopies to employees and contract workers. However, given very little documentation is publicly available, it is not possible to assess its understandability.

Based on public information, there is no readily available evidence that the company’s anti-corruption policy applies to all employees and members of the Board.

Based on public information, there is no readily available evidence that the company has a policy on potential conflicts of interest.

Based on public information, there is limited evidence that the company takes a stance on gift-giving and receiving, in particular in the CSR Guidelines to Business Partners. However, no sufficiently detailed official statement or policy can be found publicly.

Based on public information, there is limited evidence that the company takes a stance on the giving and receiving of hospitality and entertainment, to ensure that such transactions are bona fide and not a subterfuge for bribery. However, no sufficiently detailed official statement or policy can be found publicly.

Based on public information, there is no readily available evidence that the company has a policy that explicitly prohibits facilitation payments. TI notes that ‘contract payments and soft dollar practices’ are prohibited in the MHI Group ESG Deta. However, this question is assessing an explicit prohibitation of faciliation payments.

Based on public information, there is limited evidence that the company regulates political contributions in order to prevent undue influence or other corrupt intent. The company states that it does not make political contributions beyond the amount stipulated in internal regulations, and that they should be declared. However, there is no further information on guidance or information on the scope of the policy. The company therefore scores 1.

Based on public information, there is no readily available evidence that the company has a clear policy on engagement in lobbying activities, in order to prevent undue influence or other corrupt intent, or discloses the issues on which it lobbies.

Based on public information, there is some evidence that the company regulates charitable contributions in order to prevent undue influence or other corrupt intent. The company engages in community-based donations and keeps a record of the amount given. However, there is no specific evidence of a selection procedure, nor of public declaration of donations. The company therefore scores 1.

Based on public information, there is some evidence that the company provides written guidance to help Board members and employees understand and implement the firm’s ethics and anti-corruption agenda. The compliance principles have been printed on cards and distrubited to employees, including contract workers. Moreover, all employees have received a Compliance Guidelines booklet with specific explanations and the principles have been illustrated with figures to make them more comprehensible in fiscal year 2010. However, it was not possible to assess these documents as they are not publicly available. The company therefore scores 1.

Based on public information, there is evidence that the company has a compliance training programme.

Based on public information, there is evidence that compliance training is provided to all employees where the company operates. TI notes that in 2012, the company trained over 95% of employees.

Based on public information, there is no readily available evidence that the company provides targeted anti-corruption training to members of the Board.

Based on public information, there is no readily available evidence that the company provides tailored training for employees in sensitive positions. TI notes that training is provided according to an individual’s rank, but it is unclear if this is tailored according to the risks of a role.

Based on public information, there is no readily available evidence that the company has a clear and formal process by which employees declare conflicts of interest.

Based on public information, there is evidence that the company can apply disciplinary procedures to individuals who have breached the Codes of Conduct. However, there is no evidence that the company has an explicit commitment to apply disciplinary procedures to employees, Directors and Board members who have violated the Codes of Conduct. The company therfore scores 1.

Based on public information, there is evidence that the company has multiple, well-publicised channels that are easily accessible and secure, to guarantee confidentiality or anonymity where requested by the employee to report concerns or instances of suspected corrupt activity. The external whistleblowing hotline can be used over email, phone or fax. Confidentiality and anonymity are guaranteed.

Based on public information, there is evidence that the company has whistleblowing channels available to all employees in all geographies. Both internal and external whistleblowing hotlines can be used by all employees in all geographies.

Based on public information, there is some evidence indicating that the company has formal and comprehensive mechanisms to assure itself that whistleblowing by employees is not deterred, and that whistleblowers are treated supportively. Biannually the company reviews whether the rights of whistleblowers have been violated. However, there is no evidence of other mechanisms. In particular, there is no evidence that an annual compliance survey enquires about employees’ satisfaction with the whistleblowing process. The company therefore scores 1.

Based on public information, there is some evidence that the company has well-publicised resources available to all employees where help and advice can be sought on corruption-related issues. Evidence suggests that queries can be addressed via the internal hotline. However, it is unclear if this hotline is specifically for reporting corruption incidents. The company therefore scores 1.

Based on public information, there is evidence that the company has a commitment to non-retaliation for bona fide reporting of corruption. However, there is no evidence that disciplinary measures are applied to employees who breach this policy. The company therefore scores 1.