Effective implementation of a supplier code of conduct.
October 2, 2024 - The goal of a supplier code of conduct is to bring about transparency and improving performance, because companies today know their reputations are potentially at risk.
Implementing a supplier code of conduct is about having the right knowledge and with the right alignment with the business, and with leadership commitment - only then, companies will be in a position to meet stakeholders’ key sustainability demands and regulatory requirements.
Transparency and visibility, getting closer to suppliers, responsible and ethical purchasing, and mitigate deception, are key components for an effective implementation.
Seven helpful tips to remember when writing the supplier code of conduct:
• Keep the language direct, clear, and easy to understand.
• Tailor your supplier code of conduct to your sector.
• What topics should be addressed beyond the general framework as a result of the business field? The code of conduct should at minimum address the four elements of the UN Global Compact; Human Rights, Labour Environment, Anti-Corruption and should consider applying the OECD Guidance for multi-national organisations.
• Keep your supplier code realistic and honest — do not add requirements that are impractical or cannot be measured.
• Understand cultural challenges of the suppliers and the feasibility of expectations being asked.
• A code is not the entire solution to ensure CSR and transparency in the supply chains. Aim to go beyond legal compliance requirements with your suppliers.
• Consider how you will respond to violations. Consider how you will participate in solutions to code violations instead of terminating business relationships as a first response.
EPG is one of the leading procurement outsourcing providers in China and have been serving companies with our expertise for over ten years. We focus exclusively on procurement, supply chain and supplier sustainability, and how they can create better results for our clients. Our services, capabilities, knowledge and methodology ensure you get sustainable savings, increased control over procurement costs, improved transparency, and accelerated time to value.
A supplier code of conduct is important, but it’s only effective if its requirements can be met with actions to bring about transparency.
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