Supplier Code of Conduct

Report
1
“Consumers, investors, business partners,
regulators, and media organizations now expect
a company and its entire supply chain to be
ethical. The supplier-generated ethics scandal is
probably one of the biggest (and least foreseen)
business risks most leading companies face
today. The damage can be great, and protective
measures can and should be adopted
immediately.”
Michael R. Levin
Building an Ethical Supply Chain
November 24, 2008
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DII Supply Chain Initiative
Survey Results
0 Survey of signatories
0 Current supply chain requirements/tools
0 Preferred supplier programs
0 Value of current DII tools
0 Gauge interest in an industry code
0 Approximately 25% response rate
3
Survey Results
Q1: Does your organization
require suppliers to have a Code
of Conduct prior to conducting
business with them?
15%
Yes
45%
No
Sometimes
40%
Q3: Does your organization have a
set of ethical principles created
specifically for suppliers?
55%
45%
Yes
No
Q2: Are suppliers required to
adopt your organization’s Code of
Conduct when conducting
business with your organization?
25%
Yes
No
75%
Q4: Do you make available ethics
and/or compliance materials (training
videos, key principles, etc.) to your
suppliers?
35%
Yes
65%
No
4
Which of the following would your
organization find helpful when dealing with
supply chain integrity issues? Please rank
them 1-7, with 1 being the most helpful and
7 being the least.
1. A set of Key Principles that suppliers are
expected to follow
2. A Model Code of Conduct for suppliers
Q6: Several other industries, such
as the Electronics and
Pharmaceutical industries, have
created an industry-wide set of
business conduct principles for
suppliers. Would your organization
support a similar initiative in the
defense industry?
3. A guidebook for suppliers to assist in the
implementation of key ethical principles
Yes
4. A mandatory Code of Conduct for all
suppliers
5. A resource bank of ethical principles
45%
50%
No
6. A resource bank of model codes
7. A resource bank of training materials
5%
Maybe-I'd like to
hear
more
5
Why create a
Supplier Code of
Conduct?
0 Promote inter-organizational Ethics – each part of
the supply chain affects others
0 Set expectations for supplier behavior
0 Mitigate risk
0 Facilitate supplier collaboration and partnership
0 Reduce redundancy for suppliers
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EICC
Electronics Industry Citizenship Council
0 Focus areas: labor standards, health & safety,
environment standards, management system,
ethics
0 Total supply chain initiative, including member
parties
0 Global membership
0 Any electronics company may adopt code, full
members must invest in implementation
0 Includes common assessment tools
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DII Signatories
with Supplier Codes
Alcoa, Inc.
AT&T
CNA Corporation
IBM Corporation (EICC)
Siemens Government Services, Inc.
Day & Zimmermann, Inc.
Crane Co.
Sodexo Federal Services, Inc.
Timken Company
Wisconsin Physicians Service Insurance Corporation
General Electric
8
Benchmarking
0 Reviewed 36 codes
0 Industries included:
0 Aerospace & Defense
0 Electronics
0 Government
0 Healthcare
0 Manufacturing
0 Insurance
0 Telecommunications
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Content: Top
Benchmarked Sections
Consequences for violating Code
Human Rights
Supplier Responsibilities
Management Systems
Implementation Framework
Fair Competition
Financial Responsibility / Accurate Records
COI - Personal
Gifts
Confidential / Proprietary Info
Contacts / Resources
Anti-Corruption
Employment Practices
Env, Health, Safety
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12
13
13
13
14
14
17
18
20
22
24
27
28
0
5
10
15
Sample of 36 supplier codes
20
25
30
10
Key
Considerations
0 Appropriate content
0 Distribution
0 Introduction process
0 “Promoting” the Code
0 Marketing points
0 Potential pitfalls and how
to mitigate effect
0 Trial-group? Volunteers?
0 Applicable population
0 Format
0 Target length
0 Standalone document or
linked to references
12
Breakout Sessions
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Breakout
Topics
Business
Case
Content
0 Identify
0 Suggest which
marketing
points/potential
pitfalls
0 Correlate ideas
into major
themes
topics are
essential to a
supplier code
0 Identify &
explore
differences of
opinion on topic
inclusion
Format &
Distribution
0 Consider options
for code format
0 Explore life after
the creation of a
supplier code
0 Discuss
organizational
impact
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Thanks and
appreciation for our facilitators:
0 Roz Bliss, Northrop Grumman
0 Linda Burket, Raytheon
0 Mike Campbell, Raytheon
0 Ellen Daly, Lockheed Martin
0 Denise Drennan, Lockheed Martin
0 Lisa Gross, Lockheed Martin
0 Roxane Macgillivray, Lockheed Martin
0 Rielle Miller-Gabriel, Lockheed Martin
0 Cathy Payne, SAIC
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