Auditing for ethical working practices: the challenges facing organisations

July 13, 2020

With the worrying allegations about the treatment of workers in clothing factories in Leicester and Xinjiang in China, I was wondering how retailers and brand owners could ever find ways to combat the curse of unethical sourcing.

The reality is that poor working practices have been going on for decades, not just in the clothing industry but others as well. If a factory really wants to hide this they pretty much can, with often "clever" means being used to disguise bad working conditions, unethical employment practices and more.

And yet some of the organisations can point to a record of regularly auditing suppliers, so what might be going wrong?

Some might be relying on self-certifying factories and other vendors. The buying organisation relies on the findings of the factory's inspectors whose findings are shared in an audit with multiple clients: in principle there's nothing wrong with that but it's not necessarily an objective analysis of the factory and its working practices. It's also a generic audit which may not include organisation-specific questions - and makes following up on corrective actions more difficult because the vendor may have many action plans to manage.

There's also the question of how far down a supply chain the auditing is conducted; if it stops at Tier 2, how would an organisation know what was going on below that level? Often it's a question of cost and complexity: managing, say, 50 vendors at Tiers 1 and 2 using email, spreadsheets and telephone calls may just about be manageable but increasing that to include another 500 Tier 3 vendors may just about break that particular system and render it unworkable.

We created ClearChain to address these challenges, to make bespoke audits and action plans that could be managed to completion. And done at a cost that compares well with the alternative cost of a damaged reputation.

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