What are some supplier requirements to keep in mind when conducting a corporate social audit? If you’re unfamiliar with the SA8000 certification, or what it means to be one of the first in your industry to apply this rigorous standard, please read on. You might be surprised by what you find!
What is a Corporate Social Audit?
In an age of increasing scrutiny, businesses need to be sure that they are taking good care of their partners. The easiest way to make sure you aren’t inadvertently supporting illegal, unethical or socially irresponsible activity is by implementing a corporate social audit. In order to do so, it helps to understand what a corporate social audit actually is. Simply put, it’s a way for your business to assess how well its own practices line up with social and environmental standards. If you’re interested in becoming involved in more responsible supply chains, read on for more details about how to conduct a corporate social audit as well as some surprising requirements from one of the most recognized certification standards out there: SA8000.
What is SA8000?
The social aspects of a supply chain management system are often an afterthought if they are considered at all. But if you’re creating a global supply chain or sourcing materials from abroad, it’s important to go beyond where materials come from and how much they cost. The globalized nature of manufacturing means that what may be unsavory working conditions or low pay for some workers in your country may be standard practice for suppliers elsewhere. So consider adding supplier requirements to any SA8000 audits you undertake—it could help improve working conditions for thousands of laborers without adding significant cost or disruption to your company’s supply chain.
How Is It Different From Other Audits?
The supply chain management industry-standard, social supplier audit and certification body Social Accountability International (SAI) requires suppliers to sign a corporate social responsibility (CSR) agreement before they are accepted as certified by SA8000. The terms of these agreements can vary depending on each buyer, but most require suppliers to pay their employee’s fair wages and follow employment laws. These standards address non-payment of wages and other workplace issues that can lead to labor violations. They also typically include clauses that guarantee safe working conditions and freedom of association for employees.
Basic Requirements of a Corporate Social Audit
The SA8000 standard is a base requirement for companies to conduct corporate factory audits. It outlines exactly what information a company needs in order to assess and measure worker well-being and humane labor standards. In addition, it includes safety training information, occupational health, and safety reports, an inspection of all electrical equipment, on-site first aid facilities, written maintenance procedures for equipment & forklifts. Also include job security guidelines with written contracts (no subcontracting), disciplinary procedures if infractions are found at individual sites or suppliers, and formalized grievance procedures within 7 days of the incident. Include other clauses such as allowing employees personal time/compensation for missing it during personal emergencies, etc.
Which companies require compliance with SA8000?
Adidas, Armani, Disney, and Puma; among others. The SA8000 certificate is required if a company wants to work with these corporate giants. If they are going to allow a company to make their products, then that company has to follow all of their policies and expectations. They have certain regulations in place which must be followed for each product that is created for them. The companies expect their suppliers to be able to meet all of these requirements on time and with high-quality products that don’t have any flaws or errors in them at all.
Who needs to comply?
If you’re involved in business-to-business transactions, chances are you have a supplier with whom you interact. In other words, a company that provides products or services to your company. From time to time, suppliers may be required to comply with additional standards or certifications—especially if they serve a large industry where social responsibility is important. The question of compliance can get complicated quickly; furthermore, it can be tough for managers who don’t handle it on a regular basis. Instead of letting things fall through the cracks and acting like you’re clueless when your CEO asks about supplier compliance requirements, consider getting ahead of future problems by following these steps.
How to Ensure Compliance Before Awarding Contracts
At a basic level, social compliance refers to a company’s ability to guarantee it is meeting legal standards regarding equal opportunity, anti-discrimination laws, fair wages and hours of work, and much more. These standards can be both domestic and global. An ethical supply chain, however, goes beyond simple compliance into practices that ensure certain types of purchases are being made ethically—that workers are paid a living wage for example or that there is little environmental damage caused by our manufacturing process. Supply chain social compliance (also known as corporate social audit) occurs when companies want to ensure these principles are enforced in their supply chains regardless of where they originate from.
In order to run a successful and socially conscious business, you have to ensure that all of your suppliers adhere to corporate standards. That’s where a supplier audit comes in handy; it helps you confirm whether or not your providers are meeting social responsibility standards like those outlined by SA8000.