Transparency is key to ensuring credibility among stakeholders and keeping your own company committed to responsibility.
Through monitoring and evaluation your company develops an ability to measure, monitor and interpret its impacts and to progress toward the defined goals. The monitoring and evaluation process sets out and describes the appropriate tools, knowledge and qualifications necessary to conduct audits and to make suitable action plans in the event that a supplier does not meet the requirements of a responsible supply chain.
All businesses involved must at all times be open and accessible for announced, semi announced and unannounced audits for monitoring and evaluation of compliance with their Code of Conduct
Monitoring is necessary not only to create a durable production and business relationship but also to ensure the transparency and credibility consumers expect. Different settings, different companies and different types of suppliers foster different monitoring and evaluation setups. Smaller companies need a simple setup, while large companies require a more complex approach. All companies have a starting point from which efforts can become more advanced over time. No matter the size of the company, though, without support from the top management, responsible supplier management will never be an embedded part of the business and other goals (like savings, prices, delivery schedules etc.) will always take precedence during critical periods.
Clearly define internal roles and responsibilities. Top management is accountable for ensuring that appropriate resources are available for working with responsible supply chain management. The practical responsibility should lie among employees that have responsibility for production issues in the supply chain, e.g. the production manager, quality manager or purchasing manager. If the practical responsibility is placed in the purchasing department, special attention should be paid to the inherent risk that responsible supply chain management requirements do not conflict with the aim of securing cheap or quick deliveries. Your purchasers can potentially face tricky situations; hence clear guidelines and management support are necessary.
Integrate responsible supply chain management in the daily work. If you have procedures for systematically evaluating suppliers on quality, prices, delivery etc., incorporating procedures for responsible supply chain management in the existing system is advantageous. It allows the integration of responsible supply chain management into daily work procedures and avoids the necessity of having two different systems against which to evaluate suppliers. The better the responsibility is integrated across the organisation, the more strongly it is anchored. Define the appropriate level for monitoring and evaluation At all levels a successful responsible supply chain setup consists of several building blocks. Considering the complexity of your company and its risk appetite you can act on different levels starting with very little or no engagement and ending in forming partnerships with selected suppliers.
Basic level: Use the NICE Code of Conduct as an amendment to the current contract or CSR clauses currently included in supplier contracts, possibly supplemented with purchasers/quality staff/others being trained to look for environmental, social and ethical conditions when visiting suppliers for other purposes.
High level: Work more systematically with responsible supply chain management. For the most important suppliers, based on a risk assessment, self-assessment requirements are included, as well as internal audits with follow-up action plans.
Advanced: Include third-party audits of suppliers and possibly partnerships with selected suppliers.