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Modern Slavery Report
Toyota Canada Inc. Report on Efforts to Prevent & Reduce the Risk of Forced & Child Labour in Supply Chains
For the financial year ended March 31, 2025
I. Introduction
This is the second report to be filed by Toyota Canada Inc. (“TCI”) under Canada’s Fighting Against Forced Labour and Child Labour in Supply Chains Act (the “Act”).
This report reflects TCI’s ongoing commitment to implementing and endorsing responsible business practices to prevent and reduce the risk of forced labour or child labour in our supply chains. This report sets out TCI’s plans and actions taken to develop a robust forced and child labour compliance program, and places that initiative within the broader context of the actions taken by Toyota Motor Corporation and its production sites, both in Japan and North America, to prevent human rights abuses within our businesses and supply chains. This report also describes the steps that TCI has taken in the financial year ended March 31, 2025 to prevent and reduce the risk of forced labour and child labour in its activities and supply chain.
II. Operational Structure
(a) Structure & Activities
For over 60 years, TCI has been the exclusive distributor of ‘Toyota’ and ‘Lexus’ vehicles and genuine parts in Canada. TCI is a subsidiary of Toyota Motor Corporation (“TMC”), a publicly listed automotive company based in Toyota City, Japan. TMC owns 51% of TCI.
TCI purchases vehicles and genuine parts from TMC and certain of its North American subsidiaries. TCI then wholesales these vehicles and genuine parts to a network of 287 independently owned and operated franchised dealerships located across Canada.
In addition to distributing vehicles and genuine parts to our network of independent dealers, TCI is also responsible for marketing and promoting the ‘Toyota’ and ‘Lexus’ brands in Canada.
Toyota Motor Manufacturing Canada, Inc. (“TMMC”) is a vehicle assembly operation in Ontario. TMMC has three separate production lines: two in Cambridge, Ontario and one in Woodstock, Ontario. The 5.4 million square foot facility employs over 8,500 team members and has produced over 10 million vehicles. Vehicles assembled at TMMC are sold throughout North America. TMMC is a subsidiary of TMC and currently produces the Toyota RAV4 and RAV4 Hybrid, the Lexus NX and NX Hybrid, and the Lexus RX and RX Hybrid.
TCI (which focuses on sales and distribution) and TMMC (which focuses on vehicle assembly) are generally run as separate businesses. Accordingly, TMMC will be filing its own report under the Act.
(b) Supply Chains
TCI is the national sales, marketing, and distribution company for ‘Toyota’ and ‘Lexus’ in Canada, focused on distributing vehicles and genuine parts, managing the franchise retail network, supporting customers, and the promotion of the ‘Toyota’ and ‘Lexus’ brands. As such, the vast majority of TCI’s annual spending is focused on buying ‘Toyota’ and ‘Lexus’ vehicles and genuine parts from TMC and certain of its wholly owned North American subsidiaries. Accordingly, Part III of this report, below, addresses actions taken by TMC and its North American subsidiaries to prevent and reduce the risk that forced and child labour are used in our supply chains.
TCI also has a separate supply chain that we manage directly. This supply chain relates to activities typically taken by a local automotive distributor, and consists largely of marketing and advertising agencies, information technology services, transportation services, automotive accessories, and professional services. This TCI-specific supply chain accounts for a relatively small portion of TCI’s total annual spending. A summary of actions taken by TCI to prevent and reduce the risk that forced labour and child labour are used in this supply chain is set out below in Part III of this report.
III. Policies and Due Diligence Processes in Relation to Forced and Child Labour
The Toyota and Lexus vehicles and genuine parts that are distributed by TCI are the product of a corporate culture dedicated to protecting and improving the human rights of Toyota’s employees, customers, and other stakeholders. TCI acquires vehicles and most genuine parts from TMC and its North American subsidiaries.
(a) Measures Taken by TMC and its North American Subsidiaries
TMC and its North American subsidiaries have a number of measures in place to prevent and reduce the risk of forced & child labour in their supply chains. For the purposes of this portion of this Report, the term “Toyota” refers to TMC and its production facilities in Japan and North America. Such measures include the following:
(a) United Nations Guiding Principles on Business and Human Rights: Toyota refers to and respects the United Nations Guiding Principles on Business and Human Rights (UNGP), and promotes activities related to human rights based on these guidelines.
(b) Human Rights Policy: Toyota’s Human Rights Policy applies to all executives and employees at Toyota and its subsidiaries. Toyota also expects its business partners, including its suppliers, to understand and support this policy, and to work with Toyota to ensure that their business operations respect this policy. The Human Rights Policy makes clear that Toyota does not tolerate forced or child labour.
(c) Supplier Sustainability Guidelines: Toyota has implemented Supplier Sustainability Guidelines that set out Toyota’s sustainability expectations of its suppliers in the areas of business ethics, legal compliance, labour and human rights, and environmental sustainability. The Supplier Sustainability Guidelines are cascaded to first tier suppliers, and Toyota expects such suppliers to embed the Supplier Sustainability Guidelines in their own operations and to disseminate them to their own supply chain. The Supplier Sustainability Guidelines make clear that Toyota does not tolerate forced or child labour.
(d) Toyota Code of Conduct: Toyota’s Code of Conduct makes clear that Toyota is committed to complying with international human rights obligations and applicable laws and regulations and prohibitions against forced and child labour. The Code of Conduct also includes a Global Speak Up Line where employees can raise questions or concerns.
(e) Human Rights Due Diligence:Toyota continuously identifies and assesses risks related to human rights impacts on stakeholders, while ensuring mitigation and preventative measures are implemented. Toyota also conducts continuous risk monitoring operations, which include business partner collaboration, affected stakeholder consultations, and Human Rights risk research. Toyota develops risk mitigation plans through an agreement with the affected stakeholders while also being guided by specialist external bodies.
(f) Initiatives for Migrant Labour / Forced Labour: As part of its due diligence activities, TMC has been working with non-governmental organizations to ensure fair working conditions for migrant workers within its affiliates and suppliers, both inside and outside Japan. TMC has developed guidelines to help eliminate possible exploitation by unscrupulous employment agencies charging high recruitment fees, and to ensure freedom of movement, fair treatment, and proper employment contracts for migrant workers. A task force was assembled to conduct surveys on matters such as numbers of migrant workers, countries of migration, and possible issues in the recruitment and/or repatriation process.
(g) JP-MIRAI: TMC is a founding member in the establishment of the “Japan Platform for Migrant Workers toward a Responsible and Inclusive Society (JP-MIRAI)” which has now grown to be a multi-stakeholder framework for resolving issues faced by migrant workers in Japan. In May 2023, JP-MIRAI officially started operating a grievance mechanism for migrant workers after a one-year pilot program. TMC supports and cooperates with this mechanism that aims to resolve issues in an appropriate and timely manner.
(h) Prevention of Child Labour: Toyota has undertaken an initiative to enhance due diligence activity in the high-risk sector of child labour in our business operations and supply chain.
For more information on these and other TMC initiatives, the full text of Toyota’s Human Rights Policy, Toyota’s Supplier Sustainability Guidelines, Toyota’s Code of Conduct and Toyota’s Sustainability Data Book can be found here:
https://global.toyota/en/sustainability/
In addition, a report on Toyota’s Action Taken for Forced Labour of Migrant Workers (Statement on Modern Slavery Acts) can be found here:
https://global.toyota/pages/global_toyota/sustainability/human-rights/statement_on_the_modern_slavery_acts_en.pdf
(b) Measures Taken by TCI Independently
During the fiscal year ended March 31, 2024, TCI: (1) created a list of all current suppliers to TCI; (2) updated the template vendor agreement for accessories suppliers; (3) updated its Vendor Code of Conduct; (4) scheduled associate training regarding forced labour and child labour for TCI associates in certain departments; and (5) initiated planning for further actions to prevent and reduce the risk that forced labour or child labour is used in TCI’s supply chain.
During the fiscal year ended March 31, 2025, TCI has taken the following additional actions to further prevent and reduce the risk that forced labour or child labour is used in its activities or supply chains:
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Updated TCI’s Code of Conduct and Ethics Policy: TCI’s Code of Conduct and Ethics Policy applies to all TCI associates. TCI updated the policy to address risks related to forced and child labour. The updates to TCI’s Code of Conduct and Ethics Policy provide that:
a. associates must be knowledgeable of, and comply with, all applicable laws and regulations, including forced and child labour, in the jurisdictions where they carry out their duties to TCI and all jurisdictions where TCI conducts its business;
b. associates are expected to adhere to TCI’s commitment to promoting respect for human rights, set forth in the United National Universal Declaration;
c. TCI strictly prohibits forced and child labour within its organization and expects the same commitment from its third-party partners; and
d. TCI seeks to only do business with third parties who uphold the same values and standards as its own.
The updated policy includes a definition of “forced labour” and “child labour” and includes a link to the OECD’s Guidelines for suggestions on how to identify forced and child labour. All associates are required to review and acknowledge the Code of Conduct and Ethics Policy on an annual basis.
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Updated TCI’s Speak Up Line Policy: TCI updated its Speak Up Line Policy to add that all TCI associates have a responsibility to report concerns regarding forced labour or child labour practices either within TCI’s business or within third-party business partners. All associates are required to review and acknowledge the Speak up Line Policy on an annual basis.
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Updated TCI’s RFP Supplier Questionnaire: TCI added forced and child labour risk assessment questions to its supplier questionnaire, distributed during RFPs, to help the Procurement Department assess vendor health. The updated supplier questionnaire is currently in use by TCI’s Procurement Department.
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Updated TCI’s RFQ survey for Accessory Vendors: TCI has added forced and child labour risk assessment questions to its RFQ survey distributed to potential accessory vendors. The updated RFQ survey is currently in use by TCI’s Accessories Department.
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Continued Planning for Further Actions: TCI is committed to proactively planning additional actions for the coming fiscal years to further mitigate the risk of forced and child labour in its activities and supply chain. TCI has created a forward-looking compliance plan in the fiscal year ended March 31, 2024, that it continuously assesses and updates.
(c) Risk Assessment
Based on the results of TCI’s risk assessment, TCI can reasonably be considered at low risk for forced labour & child labour. This is largely because the majority of the activities carried out by TCI are in the nature of professional and administrative services. However, there are some aspects of TCI’s business that carry some risk of forced labour or child labour, primarily among third-party suppliers of manufactured goods such as automotive accessories, automotive service parts, and promotional marketing goods procured directly by TCI (as opposed to our global affiliates), and service providers that provide physical services to TCI such as catering services and janitorial services. These risks will be addressed in TCI’s ongoing and forward-looking forced and child labour compliance plan.
TCI acquires vehicles and most parts from TMC and certain of TMC’s North American subsidiaries. Toyota recognizes that automotive supply chains have a risk of forced labour and child labour. A description of efforts undertaken by TMC and its production facilities in Japan and North America to prevent and reduce the risk that forced labour or child labour is used it their respective supply chains is set out above in Part III of this report.
(d) Risk Management and Mitigation
TCI’s forward-looking compliance plan is designed to allow us to identify those activities and supply chain elements that carry a risk of forced or child labour, and to specify the appropriate steps to assess and manage those risks. To date TCI has not identified any instances of forced or child labour in our supply chains, and so we have not undertaken any measures to remediate any forced or child labour, nor have we undertaken any measures to remediate the loss of income to the most vulnerable families that results from any measure taken to eliminate the use of forced or child labour in our supply chains. As we continue to develop and implement our forward-looking compliance plan, we will have greater visibility into these issues and any remediation measures they may necessitate.
(e) Training Provided to TCI’s Associates on Forced and Child Labour
TCI held training regarding forced labour and child labour for its associates in Procurement, Accessories and Service Marketing Departments in April 2024. TCI determined that these departments are most likely to be impacted by risk of child and child labour. A refresher training for the same departments, for all associates, was held in April 2025.
TCI also works to promote awareness through having all TCI associates review and acknowledge the Code of Conduct and Ethics Policy and Speak Up Line Policy on an annual basis.
(f) Assessing the Effectiveness of our Actions
TCI has developed a working group with members from Procurement, Finance and Accounting, Corporate Strategy and Legal to review, assess and update TCI’s forward-looking compliance plan. TCI will also conduct an annual executive review assessing the effectiveness of its policies and due diligence processes in relation to forced and child labour. This review will involve an examination of the existing policies and procedures and their alignment with international human rights standards, all applicable laws and regulations on forced and child labour and industry best practices. The findings will be used to update and strengthen TCI’s initiatives to reduce the risk of forced and child labour.
IX. Collaboration with our Affiliates
TCI will continue to collaborate with other Toyota companies, both in Canada (TMMC), in North America, and worldwide, to identify best practices to prevent and reduce the risk of forced and child labour in our supply chains.
X. Approval
This report has been approved by the board of directors of TCI.
In accordance with the requirements of Canada’s Fighting Against Forced Labour and Child Labour in Supply Chains Act, and in particular section 11(4)(a) thereof, I attest that I have reviewed the information contained in the report for the entity listed above. Based on my knowledge, and having exercised reasonable diligence, I attest that the information in the report is true, accurate and complete in all material respects for the purposes of the Act, for the reporting year listed above.
Signed: Cyril Dimitris
Title: President & CEO
Date: May 12, 2025
I have the authority to bind Toyota Canada Inc.
2025 Report
Toyota Canada Inc. Report on Efforts to Prevent & Reduce the Risk of Forced & Child Labour in Supply Chains
For the financial year ended March 31, 2024
I. Introduction
This is the first report to be filed by Toyota Canada Inc. (“TCI”) under Canada’s Fighting Against Forced Labour and Child Labour in Supply Chains Act (the “Act”). The Act came into force in Canada on January 1, 2024. Its goal is to implement Canada’s international commitment to contribute to the fight against forced labour and child labour through the imposition of reporting obligations on entities producing goods in Canada or elsewhere or importing goods produced outside Canada. The Act is part of a broader global effort to prevent and combat forced and child labour, an effort that TCI is committed to supporting.
This report reflects TCI’s commitment to implementing and endorsing responsible business practices to prevent and reduce the risk of forced labour or child labour in our supply chains. This report sets out TCI’s plans to develop a robust forced and child labour compliance program, and places that initiative within the broader context of the actions taken by Toyota Motor Corporation and its production sites, both in Japan and North America, to prevent human rights abuses within our businesses and supply chains.
II. Operational Structure
(a) Structure & Activities
For nearly 60 years, TCI has been the exclusive distributor of ‘Toyota’ and ‘Lexus’ vehicles and genuine parts in Canada. TCI is a subsidiary of Toyota Motor Corporation (“TMC”), a publicly listed automotive company based in Toyota City, Japan. TMC owns 51% of TCI.
TCI purchases vehicles and genuine parts from TMC and certain of its wholly owned North American subsidiaries. TCI then wholesales these vehicles and genuine parts to a network of 287 independently owned and operated franchised dealerships located across Canada.
In addition to distributing vehicles and genuine parts to our network of independent dealers, TCI is also responsible for marketing and promoting the ‘Toyota’ and ‘Lexus’ brands in Canada.
Toyota Motor Manufacturing Canada, Inc. (“TMMC”) is a vehicle assembly operation in Ontario. TMMC has three separate production lines: two in Cambridge, Ontario and one in Woodstock, Ontario. The 5.4 million square foot facility employs over 8,500 team members and has produced over 10 million vehicles. Vehicles assembled at TMMC are sold throughout North America. TMMC is a wholly owned subsidiary of TMC and currently produces the Toyota RAV4 and RAV4 Hybrid, the Lexus NX and NX Hybrid, and the Lexus RX and RX Hybrid.
TCI (which focuses on sales and distribution) and TMMC (which focuses on vehicle assembly) are generally run as separate businesses. Accordingly, TMMC will be filing its own report under the Act.
(b) Supply Chains
TCI is the national sales, marketing, and distribution company for ‘Toyota’ and ‘Lexus’ in Canada, focused on distributing vehicles and genuine parts, managing the franchise retail network, supporting customers, and the promotion of the ‘Toyota’ and ‘Lexus’ brands. As such, the vast majority of TCI’s annual spending is focused on buying ‘Toyota’ and ‘Lexus’ vehicles and genuine parts from TMC and certain of its wholly owned North American subsidiaries. For example, in the fiscal year ended March 31, 2023, 85% of TCI’s total spending was in respect of purchases of vehicles and parts from TMC and its North American subsidiaries. As of the date of this report a comparable percentage for the fiscal year ended March 31, 2024 is not yet available, but for the 10 months ended January 31, 2024, the corresponding percentage is 84%. Accordingly, Part III of this report, below, addresses actions taken by TMC and its North American subsidiaries to prevent and reduce the risk that forced and child labour are used in our supply chains.
TCI also has a separate supply chain that we manage directly. This supply chain relates to activities typically taken by a local automotive distributor, and consists largely of marketing and advertising agencies, information technology services, transportation services, automotive accessories, and professional services. This TCI-specific supply chain accounts for a relatively small portion of TCI’s total annual spending. A summary of actions taken by TCI to prevent and reduce the risk that forced labour and child labour are used in this supply chain is set out below in Part III of this report.
III. Policies and Due Diligence Processes in Relation to Forced and Child Labour
The Toyota and Lexus vehicles and genuine parts that are distributed by TCI are the product of a corporate culture dedicated to protecting and improving the human rights of Toyota’s employees, customers, other stakeholders. TCI acquires vehicles and most genuine parts from TMC and its wholly-owned North American subsidiaries.
TMC and its North American subsidiaries have a number of measures in place to prevent and lessen the risk of forced & child labour in their supply chains. For the purposes of this portion of this Report, the term “Toyota” refers to TMC and its production facilities in Japan and North America. Such measures include the following:
(a) United Nations Guiding Principles on Business and Human Rights: Toyota refers to and respects the United Nations Guiding Principles on Business and Human Rights (UNGP), and promotes activities related to human rights based on these guidelines.
(b) Human Rights Policy: Toyota’s Human Rights Policy applies to all executives and employees at Toyota and its subsidiaries. Toyota also expects its business partners, including its suppliers, to understand and support this policy, and to work with Toyota to ensure that their business operations respect this policy. A copy of the Human Rights Policy can be found here: https://global.toyota/en/sustainability/
(c) Supplier Sustainability Guidelines: Toyota has implemented Supplier Sustainability Guidelines that set out Toyota’s sustainability expectations of its suppliers in the areas of business ethics, legal compliance, labour and human rights, and environmental sustainability. The Supplier Sustainability Guidelines are cascaded to first tier suppliers, and Toyota expects such suppliers to embed the Supplier Sustainability Guidelines in their own operations and to disseminate them to their own supply chain.
(d) Human Rights Due Diligence: Toyota continuously identifies and assesses risks related to human rights impacts on stakeholders, while ensuring mitigation and preventative measures are implemented. Toyota conducts continuous risk monitoring operations, which include business partner collaboration, affected stakeholder consultations, and Human Rights risk research. Toyota develops risk mitigation plans through an agreement with the affected stakeholders while also being guided by specialist external bodies.
(e) Initiatives for Migrant Labour / Forced Labour : As part of its due diligence activities, TMC has been working with non-governmental organizations to ensure fair working conditions for migrant workers within its affiliates and suppliers, both inside and outside Japan. TMC has developed guidelines to help eliminate possible exploitation by unscrupulous employment agencies charging high recruitment fees, and to ensure freedom of movement, fair treatment, and proper employment contracts for migrant workers. A task force was assembled to conduct surveys on matters such as numbers of migrant workers, countries of migration, and possible issues in the recruitment and/or repatriation process.
(f) JP-MIRAI: TMC is a founding member in the establishment of the “Japan Platform for Migrant Workers toward a Responsible and Inclusive Society (JP-MIRAI)” which has now grown to be a multi-stakeholder framework for resolving issues faced by migrant workers in Japan. In May 2023, JP-MIRAI officially started operating a grievance mechanism for migrant workers after a one-year pilot program. TMC supports and cooperates with this mechanism that aims to resolve issues in an appropriate and timely manner.
(g) Prevention of Child Labour: Toyota has undertaken an initiative to enhance due diligence activity in the high-risk sector of child labour in our business operations and supply chain.
For more information on these and other TMC initiatives, the full text of Toyota’s Human Rights Policy, Toyota’s Supplier Sustainability Guidelines, and Toyota’s Sustainability Data Book can be found here: https://global.toyota/en/sustainability/
In addition, a report on Toyota’s Action Taken for Forced Labour of Migrant Workers (Statement on Modern Slavery Acts) can be found here: https://global.toyota/pages/global_toyota/sustainability/human-rights/statement_on_the_modern_slavery_acts_en.pdf
During the fiscal year ended March 31, 2024, TCI has taken the following actions to prevent and reduce he risk that forced labour or child labour is used in our supply chains:
1. List of Current Suppliers: TCI’s Procurement Department has created a list of all current suppliers to TCI. We have identified approximately 860 suppliers.
2. Updated Vendor Agreement for Accessories Suppliers: The template Vendor Agreement for use with suppliers of automotive accessories has been updated with contractual language that requires vendors to take steps to prevent and reduce the risk that forced labour or child labour is used in their supply chains.
3. Updated Vendor Code of Conduct: TCI’s Procurement Department requires TCI’s vendors to comply with a Vendor Code of Conduct. TCI has updated the Vendor Code of Conduct to require vendors to take steps to prevent and reduce the risk that forced labour and child labour is used in their supply chains.
4. Associate Training: TCI has scheduled training regarding forced labour and child labour for TCI associates in our procurement, accessories, and service marketing departments, which we have assessed as the departments most likely to be impacted by risk of forced and child labour. The training is scheduled to take place by April 30, 2024.
5. Initiate Planning for Further Actions: TCI has initiated development of a strategy to further prevent and reduce the risk that forced labour or child labour is used in our supply chains. In the coming fiscal years we will focus on further refining and implementing our strategy.
IV. Risk Assessment
TCI can reasonably be considered at low risk for forced labour & child labour. This is largely because the majority of the activities carried out by TCI are in the nature of professional and administrative services. However, there are some aspects of TCI’s business that carry some risk of forced labour or child labour, primarily among third-party suppliers of manufactured goods such as automotive accessories, automotive service parts, and promotional marketing goods procured directly by TCI (as opposed to our global affiliates), and service providers that provide physical services to TCI such as catering services and janitorial services. These risks will be addressed in TCI’s forced and child labour compliance plan as described above in Part III of this report.
TCI acquires vehicles and most parts from TMC and certain of its wholly owned North American subsidiaries. Toyota recognizes that automotive supply chains have a risk of forced labour and child labour. A description of efforts undertaken by TMC and its production facilities in Japan and North America to prevent and reduce the risk that forced labour or child labour is used it their respective supply chains is set out above in Part III of this report.
V. Risk Management and Mitigation
TCI’s compliance plan is being designed to allow us to identify those activities and supply chain elements that carry a risk of forced or child labour, and to specify the appropriate steps to assess and manage those risks. To date TCI has not identified any instances of forced or child labour in our supply chains, and so we have not undertaken any measures to remediate any forced or child labour, nor have we undertaken any measures to remediate the loss of income to the most vulnerable families that results from any measure taken to eliminate the use of forced or child labour in our supply chains. As we continue to develop and implement our compliance plan, we will have greater visibility into these issues and any remediation measures they may necessitate.
VI. Assessing the Effectiveness of our Actions
TCI is committed to ensuring that actions that we take to prevent and reduce the risk of forced and child labour in our supply chains are effective. In the coming fiscal year, we will closely monitor the development and implementation of our compliance strategy.
VII. Collaboration with our Affiliates
TCI will continue to collaborate with other Toyota companies, both in Canada (TMMC), in North America, and worldwide, to identify best practices to prevent and reduce the risk of forced and child labour in our supply chains.
VIII. Approval
This report has been approved by the board of directors of TCI.
In accordance with the requirements of Canada’s Fighting Against Forced Labour and Child Labour in Supply Chains Act, and in particular section 11 thereof, I attest that I have reviewed the information contained in the report for the entity or entities listed above. Based on my knowledge, and having exercised reasonable diligence, I attest that the information in the report is true, accurate and complete in all material respects for the purposes of the Act, for the reporting year listed above.
Signed: Larry Hutchinson
Title: President & CEO
Date: April 19, 2024
I have the authority to bind Toyota Canada Inc.