Supply Chain Imperative, The: How to Ensure Ethical Behavior in Your Global Suppliers

There are several approaches to adopting standards a company can take, depending on the results of the business case for action, and an analysis of the areas where a company is vulnerable, or alternatively, wishes to be very progressive. After all, if the company has particularly good environmental practices that are coordinated and enforced with its various suppliers, it may be of a great benefit, both in terms of publicity and also in finding additional productivity improvements, to gain certification in ISO 14001. Alternatively, some companies prefer to begin with the adoption of a high level aspirational code, and then apply industry specific codes, related directly to their immediate needs, before moving toward the broader impact codes such as SA 8000. There are any number of approaches that companies are taking.

• ICA Ahold, the Scandinavian grocery retail group , has a multistep supplier program in place, with the ultimate goal of gaining SA 8000 certification at its foreign supplier sites. The company begins by training its buyers in manufacturingrelated ethical and human rights issues and providing buyers with the skills and confidence necessary to raise these key issues with their suppliers. The company surveys its international suppliers concerning their policies and working conditions, and then helps them with improvement programs. We use our influence, where possible, and work with suppliers to systematically improve the social, environmental and ethical quality of their products and services, particularly those sold under Ahold brand names . ^{[19 ]}

• Chiquita, a member of the Ethical Trading Initiative, has certified 100 percent of its company-owned farms in Latin America (though not its contractor farms) under the Rainforest Alliance s Better Banana Project, and has a joint agreement on labor rights with several trade unions, including the International Union of Foodworkers (IUF) and COLSIBA, the union representing banana harvesters in Latin America. They are now working toward site certification in SA 8000. ^[20]

• H&M s suppliers contractually guarantee not to use certain hazardous or environmentally dangerous chemicals in production, including chemicals that are restricted by national laws (if any nation in which they sell restricts a chemical, H&M uses that same restriction in all other countries ), and those that the company has voluntarily chosen to include (particularly substances that might cause skin irritation or allersregularly performed on the finished clothes to ensure that there are no banned chemicals in the materials. Approximately 30,000 chemical-related tests were performed in 2002, either by H&M or by a third-party laboratory. ^{[21 ]}

^{[19 ]} Sustainable Supply Chain, Ahold Web site at www.ahold.com/aholdinsociety/food/supplychain.asp.

^[20] Chiquita Joins Ethical Trading Initiative, PR Newswire, May 3, 2002.

^{[21 ]} H&M s Social Responsibility Report, pp. 28 “ 30 at www.hm.com/corporate/pdf/social/csr_report_social.pdf .