INCLUDE TRANSPARENCY TO YOUR SUPPLIER CODE OF CONDUCT
Transparency and traceability of the supply chain is a new requirement that is very quickly becoming mandatory for many buyers, across the Globe. This requirement is new, and suppliers may hesitate to comply when they are made aware of the requirement late in the purchasing process. We therefore recommend communicating your expectations and obtaining Supplier’s consent as early as possible in the process. Besides, “transparency” is a general principle that is at the core of the supplier-buyer trust relationship.
We therefore recommend adding to your Supplier Code of Conduct a specific section on “Transparency”. In this section, you, as a Buyer, request your supplier to engage in information sharing and accept your assessment process in a transparent manner; suppliers agree to be audited on topics that matter to you. You may even consider listing in this document the topics that do matter to you (mapping of supply chain, audits on social responsibility…).
Here is an example of Code of Conduct language:
Transparency
As a COMPANY Supplier, you must work with COMPANY and COMPANY representatives in a transparent manner. COMPANY may conduct audits and assessments, and you shall participate and support COMPANY activities proactively, by providing access to unbiased and unaltered information. In particular, you are expected to:
[List here the audits you are intended to carry during your assessments]
Presenting these general principles on which the relationship is built early in the process significantly improves adoption. “
Here are additional DO’s and DON’T’s:
- Audit shall be conducted by your appointed representatives (choice of the representative solely belongs to the Buyer);
- Information shall be provided without bias, unaltered, and shall remain confidential;
- Audits shall be repeated with the objective that supplier engages into improvement practices;
- Audits results may not result in a disqualification, but opposition to being audited may;
- Audit scope may evolve over time at your discretion.
Remember as well to include in your purchase contract or MSA that the Supplier must abide by your Supplier Code of Conduct to avoid breach of the MSA/Contract.