Tesco Corporate Responsibility Review 2005

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Supply chain

Managing our supply chain ethically

As a founder member of the Ethical Trading Initiative (ETI), Tesco uses the ETI Base Code as its standard for all primary suppliers across our businesses.

    ETI Base Code

  • employment is freely chosen;
  • freedom of association and the right to collective bargaining are respected;
  • working conditions are safe and hygienic;
  • child labour shall not be used;
  • living wages are paid;
  • working hours are not excessive;
  • no discrimination is practised;
  • regular employment is provided;
  • no harsh or inhumane treatment is allowed.

In 2004 we started a three-year initiative to extend our ethical trading policy and programme beyond the UK to cover primary suppliers to all our businesses. We were also influential in developing Sedex (Supplier Ethical Data Exchange), a web-based system that encourages businesses to share data on labour standards at production sites. This means that retailers can now get important information without duplicating assessments. It allows inspection resources to be better targeted and removes unnecessary costs for suppliers across the world. For further information visit: www.sedex.org.uk

Supplier Code of Practice

We are one of only four signatories to the UK Government’s statutory Supplier Code of Practice. Since the introduction of the Code, we have run a tailored training programme for all Tesco buyers to promote understanding and compliance. In March 2005 The Office of Fair Trading (OFT) audit found no breaches of the Supplier Code at Tesco. The audit showed that suppliers do take up issues with us regularly, and to support this process we will be appointing a Code Compliance Officer to hear formal complaints, confidentially if requested.

Buyer training

All Tesco commercial staff involved with buying for the UK are expected to understand and reflect ethical considerations in their purchasing practices – their job description makes this clear. All buying staff must attend a ‘Buying With Your Eyes Open’ course which teaches them how to recognise potential problems and employ purchasing practices that minimise ethical risks. Over the past year, we have restructured the training into two half-day courses – one specifically for food buyers and one for non-food buyers. Our 89 UK technical managers must complete a two-day social accountability audit training course, run in conjunction with Bureau Veritas Quality International (BVQI).

Supplier training

We organise ‘Supplying With Your Eyes Open’ courses and ethical trading workshops for our suppliers. These courses explain our ethical trading policy and programme, raise awareness of ethical issues and build supplier confidence in managing ethical issues in their own countries and industry. This year ten full-day courses have been held in the UK, Hong Kong, Shanghai, Bangalore, Dhaka, Cape Town, Sao Paolo, Lyon and Malaga. Based on the positive feedback we received from participants we will continue to run supplier training as a tool for ensuring the delivery of our ethical trading programme. To date, 100% of high-risk suppliers have attended this training, enabling us to achieve our target for the year.

In the UK this year there has been increasing public concern over the poor employment practices of gangmasters – principally in picking and packing fresh produce. We are committed to making the Gangmaster (Licensing) Act a success, and are participating actively in the ETI Temporary Labour Working Group. This year, we wrote to all our produce suppliers to explain the work done by the Working Group, and are holding workshops for our suppliers to raise awareness of the legislation and the Code of Practice for Labour Providers.