Client Resources, Supply Chain Trends

New Standards Call for Socially Responsible Supply Chains. What Does This Mean?

The supply chain industry is facing an ethical challenge head on. Recent years have brought ups and downs for the supply chain industry and how it is perceived globally as a result of events such as the collapse of the Rana Plaza garment factory in Bangladesh last year. To address these concerns, more American supply chain companies are working toward making global supply chains more socially responsible and accountable.

As a result of globalization, almost every item bought by consumers in developed countries like the United States is produced at least partially by low-wage workers in developing countries. And in recent years, leaders in the United States and other developed countries have realized that many of them work in conditions that we would find unacceptable.

The maze of subcontractors and sub-subcontractors in global supply chains makes it complicated for buyers to keep track of every supplier and manufacturer used to deliver products, but changes are afoot.

What is being done?

More than 100 investor groups have called for “zero-tolerance policies on global supply-chain abuses.”

To improve working conditions in global supply chains, multinational buyers, national governments, local factory owners, labor, consumers and international organizations are coming together to solve the problem. Better Work, a joint venture of the International Labor Organization and the International Finance Corporation, is the model for this type of program.

Better Work provides factory-level assessments of garment industry conditions in eight nations, including Cambodia, Indonesia, Nicaragua, Haiti, and now, Bangladesh. Their representatives visit factories unannounced to assess a wide range of practices, from workplace safety to child labor, forced overtime and collective-bargaining rights compared with national and international standards.

How much power do companies have?

Although Better Work doesn’t have the power to demand specific changes, their reports provide accurate and credible information to multinational buyers. Major global retailers know they run the risk of harming their brand and alienating their consumers if they purchase from factories that don’t pass Better Work inspections.

Supply chain professionals will have to be aware of this growing commitment to responsible and sustainable supply chains if they want to compete in the global economy. This will become a factor in hiring, as more companies will seek managers with this type of awareness and experience. If you are searching for jobs in the supply chain industry, make sure you add any skills relevant to social responsibility to your resume and LinkedIn profile. If you are a hiring manager and looking to fill positions at your supply chain company, be sure to look for candidates with this type of record.

If this issue is important to you, you can count on ZDA Supply Chain Recruiting to find you supply chain professionals with socially responsible experience. Our longtime involvement in and knowledge of the supply chain community will help us locate the people who will help change the world.

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