Sedex Supplier Ethical Data Exchange. Driving a collaborative approach to supply chain management

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Sedex

Supplier Ethical Data Exchange

Driving a collaborative approach to supply

chain management

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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

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Sedex  Membership  Model  

Sedex  has  2  membership  types  that  reflect  the  different  types  of  businesses  in  

global  supply  chains  

Who?  

Retailers,  Consumer  

Brands,  Government  &  NGOs  

What?  

View  supply  chain  

informaFon  on  the  system  

Purchase member

Who?  

Manufacturers,  Agents,  

Importers,  Farms,  Growers,  

Factories,  Service  Centres,  

ProducFon  Sites    

What?  

View  and  enter  supply  

chain  informaFon  

Visibility

Supply Member

Copyright Sedex 2014

Information

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Sedex  Data  Sharing  SchemaFc  

Copyright Sedex 2014

Retailer  1  

Brand  A  

Retailer  2  

Brand  B  

Supplier  1  

Supplier  2  

Supplier  3  

Brand  C  

Supplier  4  

Supplier  

Tier  2  

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

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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  

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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)

 

 

 

 

 

 

Copyright Sedex 2014

Supplier Sedex Membership B

Annual  

Subscrip:on  

£48.38  

$1200  

$80.53  (US)  

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Reut ers

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

Some examples of our

partners

0   1   2   3   4   5   6   1   2   3   4   5   Influence   Risk  

Tiers in the supply chain

Strictly  

Confiden:al  

 

The Business Case for supply chain collaboration

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Sedex  –  Global  Spread  of  Members

 

 

 

 

 

 

 

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Sedex team:

§

Global – offices in London,

Shanghai New York, Brussels &

Santiago

§

International team, multi-lingual

support & resources

§

Worldwide training support and

hotline/call centre facilities

Global presence:

§

37,000+ supplier organisations

across 150+ countries

§

700+ purchasing organisations

including FTSE 100/Fortune

500 brands

§

70,000+ audits on Sedex

§

Impacts 24 Million workers

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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

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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

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Increase supplier support and leverage

Common Audit Methodology

Across Platform Reporting

Reduced cost for Supplier Interaction

The  benefits  of  mutual  recogniFon…  

Buyers  FAQ  

and  templates  

Introductory  

webinars  

Suppliers  

guidance  packs  

Suppliers  

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The  Sedex  Process  –    

delivers  your  objec:ves  

Risk filter

Dynamic SAQ

2c

Identify risks

SAQ Management

Risk Management

Iden:fica:on  of   poten:ally  risky   suppliers  through   internal  risk  filter  

Hosts  supplier   documents  |    

iden:fying  data  gaps   |  historical  audits/ NCs  etc.  

Pre-Screening Tool

Sedex  &  Maplecro.   tool  

Risk  iden:fica:on   based  on  inherent   risk  |  spend  |  brand   proximity  |  product   etc.  

Engagement

Sedex  engages  with   suppliers    based  on   their  risk  ra:ng  

Interac:ve  SAQ  with   risk  specific    focus   sec:ons  

Data Management

Data Analysis

Track  SAQ  progress  |   NC  analysis|  trend   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  

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Sedex  Tools

 

Supply  Chain   Mapping   Supplier   Engagement`   Assessment   of  Risk     Audit   Management   RemediaFon/ CorrecFve   AcFon   ConFnual   Improvement  

SEDEX

 

 

 

SAQ Audi t

   

   

   

Member Risk

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1

Supply chain mapping  

 

•  Initial risk screening to

identify which suppliers to prioritise (e.g. high risk /

high spend)  

•  Create supplier ‘target list’

 

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, bi-annual 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

 

4

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    

2

Supplier engagement

   

•  Suppliers contacted to join

Sedex platform, upload sites and grant access rights to

buyers  

•  Suppliers complete a

self-assessment questionnaire (SAQ) covering questions related to labour standards, health & safety, the

environment and business ethics

Sedex Supply Chain Management Process

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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  

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

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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  

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Our partnership with Maplecroft

October 2011

Sedex

Contact: kevin.franklin@maplecroft.com www.maplecroft.com ITEM: Sub-National Labour Rights and Protection Index, China

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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 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.

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Monitoring  and  ReporFng  

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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  

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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.

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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

Figure

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References

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