Most companies in the benchmark disclose an audit process they have in place for suppliers, which includes a review of labor standards. However, the disclosures reveal a disparity between reporting on the audit process and reporting on audit outcomes (e.g., the percentage of audits or a summary of audit findings).
The majority of companies (34 out of 38) disclose a supplier audit program, which includes an assessment of forced labor criteria. Fifteen out of 38 companies state that they conduct, or may conduct, unannounced audits on suppliers. However, no company discloses the percentage of unannounced audits they had undertaken on suppliers. Eight companies disclose auditing some second-tier suppliers.
Audits typically include interviews with workers, which 21 out of 38 companies disclose conducting. Coca-Cola gives detail on how worker interviews are conducted as part of its supplier audits, stating that interviews are carried out with randomly selected employees and contract workers from different production lines, and include people of different genders, ethnic and religious backgrounds, employees who look very young, and union representatives. However, no company reported the number or percentage of workers interviewed as part of audits.
More than half of the companies (22 out of 38) disclose that they conduct site visits as part of their audits, but only seven make clear that such visits include a review of worker housing.
Although the majority of companies disclose an audit process, less than a quarter (eight out of 38) disclose a summary of their audit findings or details on violations found. Only three companies provide the number or percentage of suppliers audited on an annual basis. Ahold Delhaize, for example, reports that it has audited 59% of its suppliers’ own-brand production facilities in high-risk countries. Thirteen out of 38 companies disclose information on the expertise of their auditors in relation to forced labor. Without disclosing this information, companies cannot make clear that audits conducted on suppliers are effective and conducted by auditors who understand forced labor issues.