Alliances for building Ethical Supply Chains

Building ethical supply chains is not an overnight job. It requires forming strategic alliances between companies, NGO’s, voluntary organizations and various trade unions stretching back into the countries where the raw material is grown by the farmers. Different industries have a different set of initiatives to build their supply chains.

For example, Starbucks, Cadbury’s and Unilever are more concerned about coffee, tea and cocoa growers in places like Africa and Indonesia. Apparel and garment manufacturers like Nike and Gap extend their supply chains in to India, Bangladesh, Pakistan etc. Technology companies like Apple, HP, and Dell look at China for their supply chain partners.

Companies look to build ethical supply chains to not only improve the worker conditions under various obligatory laws, guidelines and principles but they also look at it as a way to promote and improve their brand image, build lasting relationships with their suppliers thereby enhancing their reputation. So, how do these companies ensure that such supply chains are developed and what type of alliances can be built to ensure their promotion? Some of those alliances are listed below:

  • Ethical Trading Initiative (ETI): This is a ground-breaking alliance of companies, trade unions and voluntary organizations working in partnership to improve the working lives of poor and vulnerable people across the globe that make or grow consumer goods.
  • Apparel Industry Partnership (AIP): This was initiated in August 1996, after President Clinton brought leaders of the apparel and footwear industry, labor unions, consumer groups and nongovernmental human rights organizations together.
  • Fair Labor Association (FLA): As an add-on to AIP, Fair Labor Association was formed as a not-for-profit association, to develop an independent external monitoring system and appropriate consumer education mechanisms.
  • Milieu Project Sierteelt: MPS certifies for quality certificates that relate to the social conditions at a company in the floriculture and horticulture area.
  • Fair Factories Clearing House (FFC): A non-profit organization that uses software technology to enable cost-effective, well-informed ethical business transactions and improved workplaces around the world.
  • Electronic Industry Code of Conduct (EICC): It provides tools to assess operational risks and determine conformance to the Code for members to use in their own facilities and with their suppliers.
  • Fair Trade International (FTI): A group of 25 organizations working to secure a better deal for producers. From its headquarters in Germany, FTI sets international Fair trade standards and support fair trade producers.

Today companies all over the world are going beyond compliance in the area of ethics management to not only control risks arising in the supply chain but also are recognizing the importance of building ethical supply chain systems focusing on best practices.

(Image credit: http://www.fairlabor.org/)

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