What is ethical manufacturing and how can you ensure you are working with an ethical supplier?
A guest blog this week written by Heather Williams @ Sourcing Playground - an ex buyer who is passionate about helping brands meet the right factories for them seamlessly, read more about Heather at the end of the article!
Over the last ten years there have been a few major disasters within the manufacturing sector which has highlighted a larger problem within the industry. One of which was known as the Rana Plaza disaster where 1,130 people died from a collapsed building in Dhaka, Bangladesh. The building contained clothing factories, a bank, shops, and apartments.
As a result of the devastating event in Bangladesh it had raised concerns and begged the question how established brands and retailers who were using the factories within the collapsed buildings, were not aware of the conditions of their workers?
The increased awareness has led to changes within the industry and many steps & initiatives are being put in place (continued efforts) to increase the health and safety, labour rights for workers whilst also reducing risks associated with manufacturing companies.
What is Ethical Manufacturing?
First of all, to understand what ethical manufacturing is, we need to define it.
Whilst there is no set definition, we feel that ethical manufacturing is ensuring that everything in your supply chain matches or exceeds international labour rights. This includes fair living wages and safety for workers.
Amongst other things, it ensures that:
- the price you pay allows workers to be paid a decent living wage
- acceptable working hours
- your supplier’s safety standards guarantee the workers’ safety
- your supplier doesn’t use child labour or enforced labour
- suppliers’ commitment to improving working conditions
Essentially, workers should be safe and earn a decent living wage.
Image Source: Unsplash
What Ethical Initiatives & Certification Standards Should I Look For?
To verify whether a supplier is ‘ethical’ they need to have been audited to a specific industry standard or be a member of an ethical initiative.
There are many certification standards and ethical initiatives within the industry, some focus on product categories, location, or have a specific type of review / auditing process.
Image Source: Fair Trade
As a whole these organisations improve labour conditions and standards within a manufacturing company by (some may vary):
a) Setting a benchmark of what ethical manufacturing should look like
Certification standards by definition is a list of criteria that a manufacturer has to pass or comply with. The certification standards then perform some form of audit (onsite audit or self-assessment questionnaire) to check to see if the manufacturer is compliant with the list of criteria set:
· Onsite audit – An auditor will visit the manufacturer onsite to check different aspects of the company:
i.e. making sure the company has up to date health and safety procedures in place, checking building regulations, or checking employee working records to make sure they are within the legal limits of working weekly hours.
· Self-Assessment questionnaire – alternatively some standards send a manufacturer a questionnaire to fill out for them to check
This ensures, all companies are checked to the same criteria. Whether that may be, ensuring that employees within a company are not working more than the legal working hours limit or whether they are paid a fair living wage.
b) Provide a framework to help a manufacturer improve their company standards within the workplace
Certification standards then have a follow-on procedure after the initial audit process to help show the manufacturer how they can improve their company standards. Often referred to as a ‘Corrective Action Plan’.
Some standards have a pass / fail system, some have a scoring / grading system. The Corrective Action Plan is then used to the increase the company’s score or to show them what they need to improve to pass the audit.
c) Ensuring accountability and follow on improvements to help the manufacturing companies improve over a specific time period
Certification standards usually have a follow-on (2nd) audit after a set time period to check to make sure that the company is improving the areas that were raised on the initial audit. Certification standards that have more than one audit and continually check their companies are usually the best to look for.
Audits are usually just a snap shot in time and therefore things can change after the initial audit has been done. The process of having continued follow on audits ensures that the manufacturing company is sticking to the standards and continually trying to improve.
Once a supplier has been audited or reviewed usually a report is generated with the findings. The report highlights what the auditors have checked during the audit and also any key findings
I.e any ‘non compliances’ i.e. if the supplier has fallen below the set criteria of the standard.
If non-compliances are found, then the ‘Corrective Action Plan’ would be used to highlight the ways the supplier would need to improve.
How to Make Sure You Are Working with an Ethical Supplier?
1. Research certification standards that could be relevant to your target product or sector. Standards differ in the way they check companies and also the criteria that they look for, so it’s worth researching what standard could be relevant for you.
2. When sending sourcing requests to new manufacturers, make sure you specify what certification you require.
3. AND ask the manufacturer what certification they already have. Often the same criteria can be found on different standards and it’s a case of checking each one to see what criteria the supplier has passes or has been audited against. You may find that the supplier doesn’t have the certification you need but it has been audited and the findings are still suitable for you.
4. Request proof of the manufacturer’s certification or documentation. The supplier usually is given a certificate as proof they have pass or comply with the criteria of the standard. Some standards are a pass fail or they may have some type of grading system: Gold, (Best) Silver (Better), Bronze (Good).
5. Check to make sure the manufacturer holds a valid certification. You can do this by contacting the standard and asking them to check whether the company has a passed certificate. Some standards allow you to check certified factories via their websites.
You can also use Sourcing Playground to post a project and receive quotes from suppliers around the world. Sourcing Playground cross references and checks suppliers’ certification and company credentials and verifies to ensure they hold valid certification so that you know you are working with verified manufacturers.
Image Source: Fair Trade
Certification Standards & Ethical Initiatives
Below are just some of the most well known in the industry:
· BANGLADESH ACCORD – Fire & Building Safety in Bangladesh
· WRAP - Worldwide Responsible Accredited Production
· SA8000 -Social Accountability International
· WFTO - World Fair Trade Organisation
· SMETA - Sedex Members Ethical Trade Audit
· Fair Trade
· BCI - Better Cotton Initiative
· BSCI - Amfori
· BW - Better Work
· Cradle to Cradle
· EDGE - Economic Dividends for Gender Equality
· FSC - Forest Stewardship Council
Heather Williams Founder & CEO | Sourcing Playground
Ex buyer turned tech-founder looking to improve the ways in which buyers and suppliers work online.
Sourcing Playground: The online B2B platform connecting industry sourcing teams with compliant, ethical & sustainable product manufacturers. Transforming the industry with trust, transparency and structure. Reducing travel costs for sourcing teams, to find verified suppliers.
Website - https://sourcingplayground.com/
Email – firstname.lastname@example.org