Responsible Supply Chain Loading...
At Sears Holdings, our supply chain is broad and complex, making it an important focus of our corporate responsibility efforts. It spans across the producers of raw materials, manufacturers of goods, transportation and logistics service providers, and processing and storage systems. Each of these steps along the supply chain plays an integral role in bringing to market the products we sell in our stores and online.
Over 4,000 factories in over 60 countries are involved in the production of products sold by Sears and Kmart. We have well-established due diligence checkpoints to ensure we are sourcing from safe factories that adhere to local country laws.
We are committed to doing business with a high standard of ethics, regard for human rights and in compliance with all applicable laws. We are also committed to working with vendors, factories and other partners who share these same values. We communicate these expectations in our Global Compliance Program Requirements, which define the basic obligations we require our suppliers to abide by in their operations. Pillars of our Global Compliance Program include a strong emphasis on ways we can support remediation, continuous improvement and greater transparency and collaboration with the many valued members of our supply chain.
Our Global Compliance Program Requirements cover 13 areas of ethical business practices:
- Compliance with the Law
- Health and Safety
- Fire Safety Risk
- Child Labor
- Forced Labor, Slave Labor and Human Trafficking
- Harassment or Abuse
- Working Hours
- Wages and Benefits
- Freedom of Association
- Environmental Compliance
- Notice and Record Keeping
- Factory Security
We provide our Global Compliance Program Requirements document in 26 different languages and require that it be visibly posted in the factories where all of our products are made. This communication also provides a way for factory workers to confidentially report any suspected violations of the law or company policy. To better engage with our vendor and factory community, Sears Holdings sends periodic newsletters throughout the year to provide education on our factory requirements, Sears Holdings compliance programs, and general industry trends and updates.
For more information on all of our policies related to Human Rights, click here.
In addition to providing education and training, our Global Compliance team has implemented a factory auditing program to ensure compliance with our Program Requirements and continuous improvement in factory working conditions. Audits are conducted in all high-risk factories by an internal Sears Holdings auditor or a pre-approved third-party auditor. Audits take place on a semi-unannounced basis, providing our vendors and factories a 15-day window in which the audit will take place. In certain cases, audits may also be conducted without a designated timeframe. In 2017, Global Compliance conducted over 2,200 audits in over 1,900 of our highest-risk factories involved in the production of merchandise for Sears and Kmart.
Our audits include a review of factory records and documents, inspection of the factory itself, private and confidential interviews with selected employees, as well as opening and closing meetings with factory management. It is common to uncover some shortcomings through the audit process, and each audit is assigned a rating and follow-up review schedule. Following the audit process, factories are required to provide a corrective action plan for each violation found during the audit process. Egregious violations such as child labor, forced labor, harassment, bribery or discrimination are not tolerated and will usually result in termination of the factory for future production. Additionally, a factory that receives a “Needs Improvement” rating, and does not improve its results within three consecutive audits will be terminated and not allowed to produce future orders.
Sears Holdings is a participant of Better Work, an international organization dedicated to improving the lives of workers employed by the global garment industry. In key countries where it operates, the organization assesses the social compliance of garment industry factories based on core international labor standards and national labor laws. Better Work also provides training to factory workers and management, as well as research briefs and white papers on garment industry working conditions. Participating in the program allows us to use the Better Work factory assessments, and reduces duplicative auditing while allowing factories and participating companies to better focus on solutions and capacity building.
We are proud to be one of the founding members of the Alliance for Bangladesh Worker Safety, a, legally binding commitment to improve the working conditions of garment workers in Bangladesh. The Alliance was created in response to a series of tragic factory events in the garment industry. It represents a collaborative effort between North American retailers, nongovernmental organizations, factory workers, the government of Bangladesh, labor unions and private organizations to improve the safety of Bangladesh’s garment factories. Since its inception, the Alliance has successfully worked to develop a strict set of common standards for the fire, structural and electrical safety of factories. The Alliance has conducted safety assessments in all the ready-made garment factories producing for Alliance members (650+), and has provided important safety training for all factory workers and managers in these factories.
The Alliance will be coming to a close at the end of 2018. We will be reviewing all options and deciding how to best support factories in reaching and maintaining a high level of safety in our Bangladesh factories in 2019 and beyond.
Sears Holdings strictly prohibits the use of cotton sourced from Uzbekistan and Turkmenistan in its supply chain due to concerns over the use of child labor and forced labor to harvest cotton. We require that all of our suppliers and partners follow our policy prohibiting the use of cotton from these countries in any phase of production for merchandise sold by Sears Holdings. We also prohibit our suppliers from doing business with companies that are invested in the cotton sector in Uzbekistan or Turkmenistan, or using Uzbek or Turkmen cotton in other aspects of their business.