Summary of Results
Seventeen out of 20 companies have a process to create corrective action plans with first-tier suppliers found to be in violation of the company's standards. Most of the corrective action plans include potential actions taken in case of non-compliance, such as stop-work notices or supplementary training, a means to verify remediation and/or implementation of corrective actions, and potential consequences if corrective actions are not taken. A number of companies verify suppliers' corrections of non-compliance through follow-up audits. Gap specifies it monitors progress with corrective action plans through follow-up visits and on-site meetings with unions (where unions are present in a factory). Ralph Lauren send field monitors to verify the corrections.
A number of companies focus on preventing the issues from re-occurring. For example, as part of a corrective action plan, Under Armour requires suppliers to create a management system that includes the creation of policies, procedures, training, communication, accountability, and a review and update process. Further, Under Armour may direct and require manufacturers to engage firms to help support and document the remediation of identified issues and to enhance and build sustainable compliance systems. Companies including PVH and Lululemon specify their corrective action plans include a root-cause analysis, and H&M reports that, when compliance with standards is lacking, it sets up strategies and projects aiming to improve compliance for the specific issue both on individual factory level as well as from a holistic perspective. Some companies support their suppliers in correcting issues of non-compliance. For example, Nike collaborates with factory managers to take corrective actions and remediate problems.
Given both the progress of the sector in a number of areas and the fact that grave human rights violations persist, it is disappointing that only two companies disclose a process for responding to complaints and/or reported violations of standards, and only six companies provide examples of outcomes of these remedy processes. Primark provides an example of a situation where workers from Pakistan were suspected to be in forced labor in a supplier factory in UAE. The company states it investigated the issue, confirmed multiple breaches of its code of conduct, and immediately addressed the breaches, including repatriation of one worker, all at a cost to supplier. Adidas discloses that in 2013 and 2014 it worked with its suppliers in Taiwan to remedy poor working conditions for migrant labor by eliminating wage deductions made by employment agencies, returning passports and bank books, and relocating migrant workers to safer and higher quality dormitories.