Sedex Supplier Ethical Data Exchange. Driving a collaborative approach to supply chain management
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1 Sedex Supplier Ethical Data Exchange Driving a collaborative approach to supply chain management
2 What is Sedex? Sedex was established as a not for profit, membership organisation in 2004, it is dedicated to driving improvements in ethical and responsible business practises in global supply chains. Built across four main pillars, it is a secure web based management system: 1. Labor standards 2. Health and safety 3. Environment 4. Business integrity Sedex is the world s largest collaborative platform for the management and sharing of supply chain data.
3 Sedex Membership Model Sedex has 2 membership types that reflect the different types of businesses in global supply chains Visibility Purchase member Supply Member Information Who? Retailers, Consumer Brands, Government & NGOs What? View supply chain informafon on the system Who? Manufacturers, Agents, Importers, Farms, Growers, Factories, Service Centres, ProducFon Sites What? View and enter supply chain informafon Copyright Sedex 2014
4 Sedex Data Sharing SchemaFc Retailer 1 Retailer 2 Brand A Brand B Brand C Supplier 1 Supplier 2 Supplier 3 Supplier 4 Tier 2 Supplier Ø Brand Manufacturer B can share their data with 2 retailers Ø Brand Manufacturer B can see data from Suppliers 1, 2 and 3 Ø Supplier 3 can share data with Brand Manufacturer B and C Ø Brand Manufacturer C can access data for Tier 2 supplier Copyright Sedex 2014
5 Membership Types A Members AB Members B Members Visibility and traceability of supply chain informa:on Increase supplier engagement and collaborafon Support improvements in ethical performance Risk management and mi:ga:on Carry out risk assessments Run supply chain reports to analyse issues PrioriFse resources Reduce reputafonal risk Generate supplier value and demonstrate to stakeholders your commitment to responsible sourcing Share company informa:on with customers Upload audits, cerfficates & correcfve acfon plans Complete assessment for own sites
6 Supplier Sedex Membership B Suppliers become Sedex B Members: Ø complete a Self Assessment Ques:onnaire (SAQ) regarding their ethical standards Ø see your site risk ra:ngs on all Pillars in detail Ø upload and store audit reports, cer:ficates and correc:ve ac:on plans Ø request an ethical audit of your site Ø share your informa:on with mul:ple customers Cost: (incl VAT/TVA) Annual Subscrip:on $1200 $80.53 (US) Copyright Sedex 2014
7 Leading, pracfcal collaborafon Unique market position (code neutral/non profit/membership) Collaborating for influence helping to increase your influence down the supply chain by working together with other brands and retailers Trusted partner for leading global initiatives in responsible procurement More than just talk - innovative combination of cross sector working groups and agile technology The Business Case for supply chain collaboration Tiers in the supply chain Influence Risk Some examples of our partners Reut ers Strictly Confiden:al
8 Sedex Global Spread of Members Sedex team: Global presence: Global offices in London, Shanghai New York, Brussels & Santiago International team, multi-lingual support & resources 37,000+ supplier organisations across 150+ countries 700+ purchasing organisations including FTSE 100/Fortune 500 brands Worldwide training support and hotline/call centre facilities 70,000+ audits on Sedex Impacts 24 Million workers globally 8
9 AIM PROGRESS MISSION Providing a collaborative mechanism to more effectively assure and move beyond supply chain compliance Mutual Recognition of both SAQs and audits helps to reduce audit duplication, costs and fatigue ( an audit for one is an audit for all ) Best practice guidance helping members to build their own responsible sourcing programme & improve CSR standards
10 Industry specific ini:a:ves Providing a collaborative mechanism to more effectively assure and move beyond supply chain compliance Mutual Recognition of both SAQs and audits helps to reduce audit duplication, costs and fatigue ( an audit for one is an audit for all ) Best practice guidance helping members to build their own responsible sourcing programme & improve CSR standards
11 11
12 The benefits of mutual recognifon Increase supplier support and leverage Common Audit Methodology Across Platform Reporting Reduced cost for Supplier Interaction Buyers FAQ and templates Introductory webinars Suppliers guidance packs Suppliers workbook
13 The Sedex Process delivers your objec:ves Identify risks SAQ Management Risk Management Risk filter Iden:fica:on of poten:ally risky suppliers through internal risk filter Pre-Screening Tool Risk iden:fica:on based on inherent risk spend brand proximity product etc. Sedex & Maplecro. tool Engagement Sedex engages with suppliers based on their risk ra:ng Dynamic SAQ Interac:ve SAQ with risk specific focus sec:ons Data Management Hosts supplier documents iden:fying data gaps historical audits/ NCs etc. Data Analysis Track SAQ progress NC analysis trend 2c analysis Impact assessment SAQ v Audit etc. Risk Assessment Risk ra:ng risk forecas:ng risk scorecard risk mapping individual supplier risk report comparison report benchmarking Sedex & Maplecro. tool Risk Management Bespoke correc:ve ac:on planning & recommenda:ons to improve risk ra:ng Supplier guidance to rec:fy issues Audit Management Process management Booking, uploading & correc:ve ac:on submission NC analysis issue cri:cality NC closing repor:ng Capacity Building Dedicated training support Guidance and educa:onal resources Raise awareness Con:nuous improvement Support Dedicated Hotline Mul:- lingual team & support SAQ support Training resources Supplier Workbook* *Sedex & Verite tool It is your program use the tools as you need totally flexible solu:on
14 Member Sedex Tools Supply Chain Mapping SAQ ConFnual Improvement Supplier Engagement` SEDEX RemediaFon/ CorrecFve AcFon Assessment of Risk Audit Management Audi t Risk
15 Sedex Supply Chain Management Process 1 Supply chain mapping Initial risk screening to identify which suppliers to prioritise (e.g. high risk / high spend) Create supplier target list 2 Supplier engagement Suppliers contacted to join Sedex platform, upload sites and grant access rights to buyers Suppliers complete a selfassessment questionnaire (SAQ) covering questions related to labour standards, health & safety, the environment and business ethics 3 Risk assessments Full supply chain risk assessment based on country; product area; site profile and SAQ Determine appropriate actions based on risk level, e.g. schedule immediate audits for high-risk suppliers, action-plans for medium-risk suppliers, biannual audits for low-risk suppliers, etc. 6 Monitoring & reporting Use dashboards and comprehensive reporting functionality to: Access real time info on you supply chain performance Use dashboards to quickly identify critical issues that require action Monitor and report on progress 5 Driving improvements Based on audit findings, suppliers upload corrective actions and evidence to the system Auditors verify completed actions to confirm issue(s) have been addressed Copyright Sedex Auditing External audits conducted at supplier s sites Audit findings discussed with supplier Supplier empowered to make corrective actions and manage issues Findings summarised and uploaded onto system by auditor
16 Supply Chain Mapping/Inherent Risk Profiling With the challenges facing retailers today in dealing with the global supply base, Sedex offers a truly holistic picture of supply chain risk and location. As a first step an overall inherent risk profile of suppliers is run. This gauges risk based upon things the company can not change. Such as location, product/sector etc. The results allow member companies to focus their efforts on suppliers or sectors of high risk brand exposure immediately Co Name Address Country Sector Product Op:onal Risk Ra:ng ABC Co 123 High Street France Manufacturing Food Processing Spend Low Sedex Beta The Mine DRC Mining Gold Unique Supply High The Farm Chocolate Rd Ivory Coast Agriculture Cocoa Spend High XYZ Co The Bazaar Tanzania Intermediary Labor Unique Med
17 Self Assessment Questionnaire Profile Labour Health and Safety Environment Business Ethics Audit History Management Systems H&S Management Management Systems Management Systems Seasonal Variance Employment is Freely Chosen H&S Training Waste AnF CorrupFon Worker Types Freedom of AssociaFon Emergency and Fire Safety Raw materials CerFficaFon and Best PracFce Living AccommodaFon Machinery & Site Vehicles Water Applicable Laws Children and Young Workers Hazardous Materials PolluFon Size of Site Wages Worker Health Emissions, including GHG Supplier Management Working Hours Housekeeping & Hygiene Energy & Climate Non- DiscriminaFon Renewable Energy Regular Employment Biodiversity Discipline and Grievance Suppliers Smallholders Homeworkers Copyright Sedex 2014
18 ITEM: Sub-National Labour Rights and Protection Index, China Sedex Our partnership with Maplecroft October 2011 Contact:
19 The Risk Assessment A fundamental aspect of a proactive and focused approach to supply chain transparency is the construction and interpretation of supplier risk profiles. The Sedex Risk Assessment Module combines three different areas of risk scoring to provide the most accurate and robust view of global risk. It combines Inherent Risk, Company Management Risk (SAQ Answers) & historic audit. Sedex partners with Maplecroft is the world s leading global risk analytics, research and strategic forecasting company. A retailers heat map of risk A member company can, based upon it s own appetite for risk develop structured behaviors based upon a suppliers risk profile, including the timing and necessity of audit.
20 Monitoring and ReporFng Mexico 62 days
21 Mexico 62 days
22 Mexico - 839
23 Mexico 5.04
24 Cujng edge thinking: monitoring and learning Any social, environmental or human rights audit can be uploaded and managed on the Sedex system SMETA is voluntary audit standard open to all (members and non members) New audit quality project launched On- going development of SMETA Unique market posifon to drive change (through a working group of auditors, brands, retailers and suppliers) New online learning management for suppliers and buyers tool launching soon InnovaFve, unique technology being developed to connect online learning with sustainably big data
25 Sedex and Ethical Auditing Sedex is not an auditing body Any ethical audit can be uploaded onto Sedex BV, SGS, Levelworks, Intertek etc With an average audit cost of $3,000, Sedex was founded to reduce the duplication of ethical audits, the average supplier shares their data with 3.3 customers through the system Sedex has working group dedicated to reviewing the practice of ethical auditing -Associated Auditing Group (AAG) AAG launched Sedex Membership Ethical Trade Audit (SMETA), a common format and guidance for ethical auditing Open for use by members and non members designed to benefit all retailers, brands and suppliers by reducing duplication.
26 Added Benefits of Sedex Multi-lingual helpdesk and support materials Participate in working groups to help shape future Sedex developments Sedex Members Ethical Trade Audit (SMETA) ü Common best practice guidance on ethical trade audits ü Common audit report format ü Common corrective action plan format Attend Member events China and UK Members Forums Regular member communications quarterly newsletter Links with other collaborative projects - AIM Progress
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