25th November 2019
One of my latest projects as Product Manager for the EV Cargo Technology Compliance modules has been to deliver a new feature focussed on supplier collaboration into our existing Ethical Trade module. The new functionality allows suppliers to directly access and submit ethical audit information for their own factories, therefore increasing their ownership and accountability over the corrective actions they are responsible for, whilst facilitating a two way conversation about improvement.
This work has highlighted that alongside the urgent action retailers must take to tackle their negative impact on the environment, maintaining and developing an ethical approach to the social impact of their business practices must hold equal importance in any Environmental, Social Governance (ESG) programme.
Identifying and addressing poor labour conditions and human rights violations within supply chains not only has a strong moral case but is recognised to increase profitability. A workforce which is free from exploitation and discrimination and is treated fairly and lawfully is undoubtedly more stable and productive. Adopting a code of labour practice that a retailer expects and supports its suppliers to work towards helps to avoid labour unrest, reduces training and recruitment costs and provides a trusted supplier base from which to source products.
Although there is growing recognition that simply auditing factories is not the total answer to addressing labour exploitation and abuse, it is still central to monitoring and vetting factories within the supplier base. The ETI Base Code is viewed as a global reference standard and is widely used as the foundation of ethical audits. The Base Code is founded on the conventions of the International Labour Organisation and includes:
- Employment is freely chosen
- Freedom of association and the right to collective bargaining are respected
- Working conditions are safe and hygienic
- Child labour shall not be used
- Living wages are paid
- Working hours are not excessive
- No discrimination is practised
- Regular employment is provided
- No harsh or inhumane treatment is allowed
Collating the results of these ethical audits and the associated corrective actions in one central database enables retailers to ensure that all factories have a current ethical audit and that corrective actions are managed and resolved.
However, it also presents a huge opportunity to apply intelligent analytics to the data. Geographically mapping factory locations and highlighting high risk regions, charting trends in corrective actions by country and merchandise hierarchy and providing access to global worker information, including the types of workers in the supply chain and their gender breakdown, is extremely beneficial.
Armed with this information, retailers can make informed decisions about where to focus social initiatives to ensure the biggest difference is realised. Analytics is central to the EV Cargo Technology roadmap and its application within Ethical Trade promises to make a big impact.