Introduction
This section will be completed by companies that are selling products of third-party / wholesale/national brands.
Out-of-scope: This section does not apply to retailers that have sales or production volume of third-party/wholesale/national brands that account for less than 1% of their sales or business volume.
Steps in the OECD due diligence process that are addressed in the Retailer – Environment section
Step 2. Identify & Assess Adverse Impacts in Operations, Supply Chains and Business Relationships.
Step 3. Cease, prevent or mitigate adverse impacts
Step 4. Track Implementation and Results
Step 5. Communicate how impacts are addressed
Environment
Product
1.1 Please describe or provide supporting documentation
Intent of the question
This question is intended to ensure that retailers have a robust understanding of the environmental impacts associated with the products they sell, so they can work with their brand partners to set strategies and targets to improve on these identified impacts. This question also supports your internal process to identify and prioritize the key environmental risks and impacts holistically across your product portfolio.
Technical Guidance
To answer ‘yes’ to this question, your company must have an analysis, assessment, or study (carried out in the last five years) that includes one or more of the following:
- Documentation of environmental risks and impacts based on the manufacturing through to use phase of key product categories.
- Description of the percentage of production or sales the above analysis, assessment or study covers.
- Documentation related to the materials used and the finished goods production processes — data collected through brand partners must be credible data or verified by an accredited third party.
- Analysis of specific opportunities within the stages of product design & development and consumer use phase to address environmental risks or impacts.
Helpful Resources
- Higg Product Tools – These tools enable companies to assess environmental impacts from materials to products, to help them develop more sustainable products consistently across the industry.
- European Clothing Action Plan – Mapping Clothing Impacts
Supply Chain: Product & Textiles
Intent of the question
This question intends to confirm that your company has engaged with your brand partners on your sustainability ambitions, and, as a result of this, your brand partners have established shared environmental goals and objectives.
Technical Guidance
The 2019 Sustainable Apparel Coalition and Globescan research report concluded that consumers want more transparency from brands and retailers. Brands and retailers who do not disclose information about social and environmental sustainability performance risk losing relevancy with consumers.
These consumers are eager to see more information about a brand’s overall sustainability efforts, and to know that they can trust the information shared with them by these brands. Consumers want to feel that brands truly represent them and their individual values. They also want to know more about manufacturing — and how, and by whom, individual products are created.
Retailers are in a unique position to collaborate with and unite all of their brand partners around a common goal to advance environmental sustainability.
Social & Labor
This section will be completed by companies that are selling products of third-party / wholesale/national brands.
Out-of-scope: This section does not apply to retailers that have sales or production volume of third-party/wholesale/national brands that account for less than 1% of their sales or business volume.
Steps in the OECD due diligence process that are addressed in the Retailer – Environment section
Step 1. Embed Responsible Business Conduct into policies & management systems
Step 2. Identify & Assess Adverse Impacts in Operations, Supply Chains and Business Relationships.
Step 3. Cease, prevent or mitigate adverse impacts
Step 4. Track Implementation and Results
Step 5. Communicate how impacts are addressed
Product
Intent of the question
This question evaluates whether the retailer has set minimum standards and/or policies for their brand partners, to protect the rights of workers and to ensure safe & healthy working conditions in the manufacturing supply chain.
Technical Guidance
An effective social/human rights program outlines the expectations that a company will uphold within their organization and its manufacturing supply chain to protect human rights and the right to safe and healthy working conditions. These expectations should be aligned with internationally recognized standards such as the International Labour Organization (ILO) conventions and the United Nations Guiding Principles on Business and Human Rights.
In order to answer ‘yes’ to this question, your company must be able to:
- Select (at minimum) one of the answer options related to your policies/standards.
- Specify the percentage of products that comply with your policies/standards.
- Describe or upload supporting documentation of your policies/standards.
Helpful resources
Examples of retailers with a social/human rights policy/standard
Supply Chain: Product & Textiles
Intent of the question
This question evaluates to what extent the retailer confirms that brand partners are in alignment with the company’s expectations on social/human rights.
Technical Guidance
Brand partners are crucial in helping retailers achieve success by ensuring business is conducted in an ethical and responsible manner along the value chain.
Developing a risk-based approach in the management and evaluation of brand partners’ efforts is essential to understand whether their efforts are creating any change to protect workers’ rights and to safeguard their livelihoods.
Helpful Resources
- Higg BRM Guidance: Understanding Human Rights Due Diligence. This overview defines how companies can embed human rights due diligence within their management system.
- Higg Brand & Retail Module (companies can use this module to evaluate the environmental and social/human rights performance of their brand partners)
- Higg Facility Social & Labor Module (companies can use this module to evaluate the social/human rights performance of their manufacturing partners)
- Percent of your supply chain included within the scope of your company’s scorecard.
- Demonstrating that goals related to responsible sourcing practices are incorporated into annual performance targets for individuals with sourcing/purchasing responsibilities, and are also incorporated into sourcing/purchasing staff individual goals.
Interview questions to ask:
- Which criteria and elements were included within the scorecard? What was excluded?
- What weighting, if any, is given to each criteria?
- Are any minimum thresholds applied to criteria?
- Who is responsible and accountable for various criteria in the scorecard?
- How is the scorecard used in business decisions?
- Are there examples of suppliers being selected or rewarded on the basis of the sustainability criteria?
- Providing educational resources which brand partners can access at their convenience.
- Facilitating interactive educational sessions which credible third-party company partners can attend.
- Offering an always-on forum for credible third-party company partners to contact your company and receive support in improving social/human rights performance.
- Lowering barriers to access for social/human rights-related multi-stakeholder working groups or initiatives.
- All of the above
- Other (If Other, please describe)
Intent of the question
This question intends to confirm that your company is taking responsibility within the value chain to support brand partners to improve.
Establishing a support program is an important step towards improving social/human rights performance and driving behavioral changes in your brand partners. This program should be designed and tailored to the brand’s needs (building their capacity) and should ensure transfer of knowledge across the supply chain by leveraging best practices and case studies.
Technical Guidance
If you have answered ‘yes’ at least one of the answer options (listed above) has been selected.