Basic Procurement Policy

Seeking to Realize Inherent Potential of Energy

Procurement Activities

Introduction

• Profile
• Basic Procurement Policy
• What We Ask of Our Suppliers
• Major Procurement Items

Procedures

• Selling Products to Chugoku Electric
• Standard Procurement Procedures

New Suppliers Sought

Import Action Program

• Summary
• List of Overseas Products Available for Purchase
• Main Items Purchased from Overseas

Notice

• Main Procurement Plan of Materials and Equipment in Fiscal 2009
• Publication of Procurement Information

Basic Procurement Policy

Chugoku Electric aims to become a "company trusted and selected by society", through its acceptance of its duties as a public utility bearing the lifeline of a region. We believe even in procuring activities it is important for us to fulfill social responsibilities demanded of a corporation in addition to securing quality and reducing costs. Based on this understanding, procurement at our company will proceed according to the following basic policies.

	1.	Adherence to legal regulations and social standards of conduct
		In material procuring activities, domestic and overseas laws, regulations and morals will be observed, and will act with noble intensions.

	2.	Securing of safety and health
		Safety and health will be secured by performing any and all necessary measures regarding safety and health during the procuring activity.

	3.	Active efforts in environmental problems
		Environmental products and work methods will be actively purchased and utilized towards creating a society that is able to continue developing.

	4.	Management and protection of information
		Information gained through the procuring activities will be properly controlled, to maintain secrecy.

	5.	Provision of fair participation opportunities
		To perform high-quality, economic procurement, doors are open for desired domestic and foreign suppliers, and a fair participation opportunity will be provided.

	6.	Selection of suppliers
		For the selection of suppliers, the reliability of management, cost, quality, safety of the product, accuracy of the supply and work schedule, consideration for safety and health, technical ability, after-sales service, stable supply ability, response during a problem, corporate stance (work in compliance/consideration for the environment/protection of human rights, and other CSR viewpoints) are reviewed as a whole, and is selected fairly.

	7.	Establishment of mutual trust with the supplier
		Mutual trust will be built with the supplier through fair purchasing transactions, and we will work to establish a trade relationship that will allow both parties to prosper in the long term.

	8.	Contribution to the local societies
		Through the procuring activities, we will work to become good partners with our suppliers, working together for the progress and development of the local societies.