Supplier ownership of responsible sourcing helps you forge stronger and more collaborative relationships with your customers, recommend better factories, understand complex compliance issues, and be a better informed partner in reducing supply chain risk. It also drives your revenue as you differentiate yourself from your competitors.
Policies & Procedures
The Supplier has established effective policies, procedures and controls. These include:
Code of Conduct
- This defines the expectations for factory compliance.
- See our Build Your Own Code of Conduct feature
Factory responsible sourcing manual
This details specific procedures a factory must follow when working with a Supplier. Topics covered by the manual may include:
- Audit Procedures
- Corrective Action and Remediation
- List of Zero Tolerance violations
- Termination Policy
- Contact Information
- Document checklist
- Pre-Sourcing questionnaire
Internal guidelines that provide internal procedures for managing your program
- Topics covered by the guidelines may include:
- Factory Pre-Approval Process
- Audit Scheduling and Review
- Corrective Action Plan Review and Verification
- Tracking and Reporting
- Managing Customer Requirements
As the Supplier, you have taken steps to ensure that program is overseen by employees at the appropriate level and with the appropriate training.
- There is executive support for Responsible Sourcing and the program is given adequate resources to operate effectively.
- The Supplier has internal staff dedicated to Responsible Sourcing.
- The Supplier has local staff in all manufacturing regions to support management of factory relationships and compliance.
Training and communication
The Supplier is responsible for communication and training on requirements to employees and suppliers, in addition to the principles of proactive ownership, progressive business practices and better performance. The Supplier clearly communicates the customer’s and supplier’s expectations to factories through a combination of:
- Policies and Procedures, such as the Code of Conduct and Factory Responsible Sourcing Manual
- Email and other channels for internal communications
- In person meetings
The Supplier has provided appropriate training of staff to understand and comply with Responsible Sourcing requirements.
The Supplier provides regular factory training, including both general program expectations and specific compliance requirements. Examples may include:
- Group seminars
- In-factory training and consulting
Auditing and monitoring
Supplier staff will follow the Supplier’s own policies and procedures and the Supplier will regularly audit and monitor supplier compliance to requirements.
- The Supplier employs dedicated, internal audit staff and / or engages third party auditors to conduct regular audits of manufacturing facilities as part of its pre-sourcing review process.
- The Supplier works closely with customers to support their audit process and follow up.
Staying on track
Suppliers dedicate their organizational culture and practices to proactively managing Responsible Sourcing and remaining compliant.
- The Supplier communicates those issues that are “Zero Tolerance” and has an action plan to address them when they arise
- The factory implements consistent incentives for factory compliance
- The Supplier maintains factory scorecards that give equal weight to responsible sourcing in addition to conventional metrics such as price, delivery, quality and safety.
- The Supplier practices transparency and ensures senior management is aware of critical issues as they arise.
To exercise continuous improvement, the Supplier monitors program effectiveness, responds appropriately to incidents, and takes steps to learn from and prevent future incidents.
- The Supplier reviews and updates its policies and procedures at least annually to ensure they reflect actual business practices.
- The Supplier reviews factory profiles at least annually.
- The Supplier measures program success based on specific metrics, which may include:- Number of factories- Audit scores- New factory approval rate- Number of audits and re-audit conducted- Percentage of factories audited- Audit spend- Transparency rate- Factory remediation and capacity building activities- Factory improvement and progress- Customer feedback, including supplier scorecards
- The Supplier provides its customers with regular reporting on factory performance