Presentation on theme: "Taking care of our people Being good neighbours"— Presentation transcript:
1 Primark’s Ethical Trade Programme Katharine Kirk, Ethical Trade Director January 2010
2 Taking care of our people Being good neighbours Our Core ValuesTaking care of our peopleBeing good neighboursFostering ethical business relationshipsAs an international brand with a global supply chain we have a responsibility to act “ethically”. We embrace this responsibility as an opportunity to be a force for good.
3 The FactsWe support the livelihood of 2 million people across the developing worldInvestment of £700 million per year in the developing worldProducts purchased from more than 20 countriesWe share 95% of our factories with other brands196 stores across 7 markets: ROI, UK, and internationally in Spain, the Netherlands, Portugal, Germany and Belgium
4 The Business Case for Responsible Sourcing ‘Buying Smarter’ gives us the competitive edgeEthically compliant factories produce better quality products, on timeChoosing ethically compliant suppliers delivers other benefits to the businessDetailed supply chain mapping helps us get to know our supply base and make better overall sourcing decisionsKnowing your suppliers, supplier selection and looking at the production schedule are all good buying practices commercially and ethically4
5 The Business Case for Responsible Sourcing Reputational RiskGreater focus in the customer’s mindSales are good now, but how many customers are not walking through the door?Younger generation now educated formally on the issuesStrong media interestInvestors are assessing new types of riskOur staff care - it impacts recruitment5
6 Issues in the supply chain Problems are common and sharedMore transparency and activity uncovers more issues!
7 Our priorities Integrating ethical priorities into core business Increasing visibility in the supply chainPartnering with suppliers and factories to support sustainable improvement in working conditionsSupporting workers to understand their rights and responsibilitiesFurther development of our environmental policy
8 Integrate ethical priorities into core business practices 2009Train all Primark buyers on ethical tradeIncrease transparency and communications between the buying and ethical teamsExamine the impact of our purchasing practices on suppliersImplement new supplier/factory approval processLesson: Buyers are very receptive and are hungry for more information about their suppliers2010Ongoing ethical training for Primark staffInitiate project work on purchasing practicesActive participation in the Ethical Trading Initiative (ETI) Purchasing Practices Group (breakout group)
9 Increase visibility in the supply chain 2009Implement online supplier management databaseWork with local partners to do bottom-up supply chain mappingConduct 1000 auditsActive participation in the ETI Home Working GroupLesson: Appropriate technical support is critical2010Continue to monitor and remediate factoriesContinue to map supply chains and start to focus on ‘second tier’Partner with other brands on auditing and remediation where possible and ‘beyond auditing’ projects
10 Lesson: It is worth taking time to find the right people for your team Partner with suppliers and factories to support sustainable improvement in working conditions2009Expand regional ethical trade team to focus on supplier support rather than auditingConduct supplier training in China, India, and the UKDevelop supplier handbook on code implementationDevelop supplier online feedback surveyLesson: It is worth taking time to find the right people for your team2010MAJOR focus on support, training and remediation for suppliers from in-country teamsLaunch online compliance training modules for suppliersLaunch Suppliers’ Extranet
11 Supporting workers to understand their rights and responsibilities 2009Initiate productivity/wage projects in Bangladesh and ChinaInvestigate delivery of support services to workers Lesson: There is not always the in-country capacity to provide support services, you may need to help develop it2010Establish additional NGO partnerships to support workers in main sourcing countriesConduct external verification of audit resultsDevelop secure worker communication channels – e.g. worker hotlineWork with other ETI member on cross brand FOA initiatives
12 Further development of our environmental policy 2009Initiate project in China with three factories Lesson: We need to think about sustainable suppliers, not just socially compliant suppliers2010Initiate projects in India and the UKAim to improve efficiency and mitigate future risks associated with environmental and social pressures through creating a model for sustainable growth
13 Lessons learned in 2009Ethical priorities need to be embedded in and wholly supported by the business at every level in order to achieve progress and desired goalsAuditing activities achieve less sustainable change, than focused support, training and capacity building with suppliers and factoriesCompany expectations and processes need to be communicated clearly both externally and internallyCross brand initiatives help speed up learningAny supplier training is best carried out locally and with speakers using the local language
14 Improvement requires a collaborative approach The challenges are shared challengesWe owe a responsibility to workers to find sustainable ways to protect their rights.That means working together with others and seeking to find solutions expert, local knowledge that are appropriate for workers and business partners