FOOD

Themes Key Findings

2018 Food & Beverage

The 38 Food and Beverage companies were assessed across the benchmark's seven themes, which were developed to capture the key areas where companies need to take action to eradicate forced labor from their supply chains: commitment and governance; traceability and risk assessment; purchasing practices; recruitment; worker voice; monitoring; and remedy. There are a total of 23 indicators across the seven themes. Each theme is weighted equally and determines the company's overall benchmark score on a scale from 0 to 100.

30

Overall Score 2018 Food & Beverage
27 Theme Score

Summary of Results

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.

Auditing Process

The company audits its suppliers to measure compliance with applicable regulations and with its supply chain standards. The process includes non-scheduled visits, a review of relevant documents, interviews with workers, and visits to associated production facilities and related worker housing. The company also audits suppliers below the first tier.

The company has a supplier audit process that includes: (1) non-scheduled visits; (2) a review of relevant documents; (3) interviews with workers; (4) visits to associated production facilities and related worker housing; and (5) supplier audits below the first tier.

Low: 0
High: 90
38

Audit Disclosure

The company publicly discloses information on the results of its audits. This includes the percentage of suppliers audited annually, the percentage of unannounced audits, the number or percentage of workers interviewed, information on the qualification of the auditors used, and a summary of findings, including details regarding any violations revealed.

The company discloses: (1) the percentage of suppliers audited annually; (2) the percentage of unannounced audits; (3) the number or percentage of workers interviewed during audits; (4) information on the qualification of the auditors used; and (5) a summary of findings, including details regarding any violations revealed.

Low: 0
High: 60
15

Audit Disclosure: Notable Example

Unilever PLC

Unilever discloses comprehensive detail on its supplier audit findings. It reports that it found 272 non-conformances relating to forced labor. More than 70% were from Asia. Forty-four percent of the total non-conformances related to missing policies and procedures, 26% were issues relating to indicators of possible forced labor, and 39 cases concerned suppliers requiring deposits and fees from their workers. Nine percent of non-conformances related to retention of workers' identification documents.

Recommended Action

Audit Disclosure

Disclose the number or percentage of suppliers audited and workers interviewed as part of those audits, thus demonstrating that workers form an integral part of audits, increasing their effectiveness. Publish a summary of audit findings, including the number and type of violations per category.