Three ideas: make your supply chain more ethical
We help you avoid guilt, customer criticism and potential problems.
Your customers will always hold you responsible if your
suppliers behave badly. Follow Smarta's three ideas to make sure
your supply chain is as scrupulous about its ethics as your
1. Create guidelines for your suppliers
While the jargon-tastic term 'ethical supply chain management
policy' makes us shudder, the idea behind term is very sound:
create a list of guidelines for those involved in your supply chain
to ensure at every point, suppliers are observing best
If parts of your supply chain are abroad, consult with local
trade unions and NGOs to identify areas of concern. Take into
account issues such as forced labour, whether the supplier allows
trade union activity, workplace health and safety, workers' ages,
wages, working hours, known cases of discrimination, and any
history of inhuman treatment. Outline how you expect your suppliers
to behave and what sort of conditions you expect to see in
factories. See the Ethical Trading Initiative's (ETI) base code for
For the best results, communicate your policy as much as
possible: identify employees such as buyers or managers who will
need training - but ensure the policy is available to all your
staff so they know exactly how you manage your supply chain.
If you want to go the extra mile, take inspiration from Divine
Chocolate and incentivise your suppliers into becoming more
socially conscious. The business' suppliers all have a stake in the
company - which means they have a vested interest in maintaining
its ethical image.
2. Look out for suppliers'
Your suppliers may say their practices are squeaky clean, but if
they can't prove it, how can you trust them? Instead, find out if
they have any certification: bodies such as the Fairtrade Foundation,
Association, the Forest
Stewardship Council, the
Marine Stewardship Council and the Product Authentication
Inspectorate (PAI) all have the power to determine whether a
company's products can be deemed ethical or not.
Take a look at the Ethical Trading Initiative
(ETI), Business Social
Compliance Initiative (BSCI), Business in the
Community (BITC) and Business for Social Responsibility
(BSR) websites as well - all four feature lists of members with
socially responsible credentials.
Making your supply chain ethical isn't all fair wages and
eliminating child labour - how the chain deals with its waste is
equally important. Ask your suppliers to cut down on unnecessary
packaging - particularly if it's plastic - or look at more
sustainable alternatives. The government's Waste and Resources
Action Programme (WRAP) has made a voluntary agreement, called
the Courtauld Commitment, with a range of British
retailers, to cut down on waste. Its website lists targets and
timescales supply chains should be aiming for.
Find out from your suppliers how they handle the rest of their
waste, as well. Electrical items should be disposed of in
accordance with the Waste Electrical and Electronic Equipment
(WEEE) directive, which says all electronic equipment should be
disposed of at no cost by the manufacturer. Look into your
industry's best practice, and make your suppliers are following it,
ensuring they do everything they can to cut down on the amount of
waste they produce. Remember: if your suppliers aren't following
best practice, it will reflect badly on your own business.
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