Audit processes, accompanied by occasional spot visits may (not overly optimistic) work where the supply chain is both short and simple. But in today’s economy, the supply chain is rarely short, or simple. This makes the reliance upon independent audit regimes quite literally dangerous. Inaccurate reports can leave you at risk of exposure which can lead to not only reputational damage, but significant financial damage also. An independent audit regime only works, as many large brands have discovered at a cost, if the audit/compliance process is free from corruption and conflicts of interest.
It’s been brought up numerous times over the past few years whether audits can be entirely reliable. Corrupt auditors are not uncommon - bribes in exchange for a glowing audit report even when the working conditions are clearly dire and in some cases, dangerous and/or illegal continues to happen despite the unmissable campaigns for supply chain human rights and ethics as well as the well-known consequences of such practices.
We are not suggesting that all existing audit and compliance measures are wrong, nor are we suggesting that more regulation can be instantly enforced, especially since we are only just reviewing the first year’s Modern Slavery Act compliance. The proposition is really quite simple: Give the people a voice, listen to what they say, and; act on it. Had this been in place then perhaps tragedies such as Rana Plaza or scandals such as refugee children making clothes for big UK retailers might have been prevented or at least resolved before they became crises.
Here at Responsible Trade Worldwide we developed a tool which allows for a comprehensive insight into workforces throughout an entire supply chain via a worker assessment, and metrics linked to their HR practices. Through direct dialogue with workers, an organisation can achieve unprecedented insight into the real practices and processes within their supply chain, uncovering risks along with opportunities, allowing for the best in both ethical and operational standards. The result is that the retailer gets assurances that the very best standards are being met by their supply chain, ultimately mitigating its reputational risk.
Between the shocking stories in the press, new regulations and promising case studies, it is a process that, over time, will see organisations better able to fulfill their need to do profitable business (both retailers and suppliers) without compromising on good and ethical standards of practice – a future we all want to invest in.
Learn more about our supply chain tool and the benefits it can have on your business.