Leveraging ongoing initiatives:
we are implementing our roadmaps for C&A’s Workplace Dialogue Framework and Women’s Empowerment Principles.
Collaborating with suppliers:
we will continue working with suppliers who share C&A’s values on improvements that enhance the well-being of their workforce.
Rethinking existing approaches:
we have begun revamping the Supplier Ownership Program with a focus on simplicity, impact, and worker participation, while also driving further supplier involvement
Aligning with guidance:
we will review and refine C&A’s worker well-being program to align with OECD Due Diligence Guidance for responsible supply chains in the garment and footwear sector, including a clear scope for upstream supply chain to raw material source.
Continue reading for more about how we are improving worker wellbeing.
A holistic approach
For us, a key part of sustainability is offering clothing made in safe and fair working conditions. Supplier compliance with our requirements is the starting point, not the ultimate goal: we must collaborate with suppliers and their factories to create positive change benefitting workers across the industry. What we expect of suppliers is clearly laid out and communicated through our Code of Conduct and the Supporting Guidelines, which are also informed by the UN Guiding Principles on Business and Human Rights and OECD Guidelines for Multinational Enterprises.
Other guidelines and covenants we use to manage risk throughout our supply chain:
• Action, Collaboration, Transformation (ACT) initiative, of which C&A was a founding member
• Dutch Agreement on Sustainable Garments and Textile
• German Partnership for Sustainable Textiles
• OECD Due Diligence Guidance for Responsible Supply Chains in the garment and footwear sector
• Sustainable Apparel Coalition
We update our Code of Conduct as appropriate, and if there are breaches, we invite suppliers, C&A employees, and workers in supplier factories to let us know through our Fairness Channels, where concerns can be escalated anonymously.
C&A Code of Conduct
What we expect of suppliers is clearly laid out and communicated through our Supplier Code of Conduct and regularly assessed by our Sustainable Supply Chain (SSC) team, which comprises nearly 60 people worldwide. We update the standards expected within the Supplier Code of Conduct as appropriate. Since 2019, we decided that we are only going to carry out unannounced social and environmental audits throughout our supply chain. The scope of our social and environmental audits does not stop at the first tier. Since 2015 we have progressively incorporated in our audit portfolio all laundries, dying houses, and a very significant number of textile mills that support our first-tier suppliers to produce our garments. As part of our social and environmental methodology back in 2015 we incorporated the possibility to carry out offsite interviews during our audits. On some occasions, offsite interviews are a very useful tool to better understand the dynamics that might occur within a factory. Our upmost interest is to preserve worker information anonymous and in some cases, we prefer to meet them in public spaces outside of the factory premises. When there are breaches of our Supplier Code of Conduct, we invite suppliers, C&A employees, and workers in our supplier’ factories to let us know through our Fairness Channels, where breaches can be escalated to management anonymously. All our suppliers are required to sign our Code of Conduct as part of our contractual relationship and purchasing agreements.
Our Code of Conduct is available in around 20 different languages. Please connect with us if you wish a specific language.
Building capacity for long-term relationships
When it comes to evaluating suppliers on sustainability, our first guiding principle is transparency, supported by capacity building. Sustainability criteria make up 30% of our overall supplier scorecard rating and alongside operational performance and quality. Consistently well-performing suppliers are incentivised with increased business volumes. Each production unit is rated from A to E, with A being the highest rating, based on our Supplier Code of Conduct. Production units rated A and B are those with no serious violations. New suppliers and production units must be able to demonstrate they meet our sustainability criteria, and if needed, make improvements before they can start working with us.
In cases where suppliers and the factories do not comply with our Code of Conduct, we work with them to improve. Unless the non-compliances are serious and of a zero-tolerance nature, we maintain our business relationship to avoid unintended consequences to workers and aim for a responsible exit plan if necessary.
Our zero-tolerance criteria
To continually drive the right behaviour, we update our protocols every year to raise the bar on our standards over time. We maintain a list of issues we consider zero-tolerance criteria. Of these, the majority are related to the health, safety, wellbeing, compensation, and treatment of workers in the supply chain. Read our zero-tolerance issues
Lasting supply chain improvements
In 2020, we shifted our supplier monitoring programme away from C&A-specific auditing protocols to an industry-wide approach that is becoming widely adopted—the Social & Labor Convergence Program (SLCP) Converged Assessment Framework (CAF). We understand suppliers can experience audit fatigue when individual apparel companies use different monitoring tools and perform multiple factory audits over the year. Not only does this approach overwhelm suppliers, but the audits do not always lead to measurable improvement in working conditions.
SLCP: Apparel industry convergence
We believe—as do other brands in the fashion industry as well as many of our stakeholders—that we must achieve consistency and convergence among our peers and use standardised tools to increase the quality of our data, the efficiency of our actions, and therefore, the rate of change. Our use of the SLCP CAF to gather information about suppliers provides a useful baseline to help them improve, provides greater industry standardization, and boosts supplier accountability.
Our ambition is to support SLCP in the transition to become the go-to assessment tool for the apparel and footwear industry. We support SLCP by actively participating in the Technical Advisory Committee for the Common Assessment Tool and by being co-chair for the Technical Advisory Committee on Verification Oversight, overseing the Quality Assurance process for SLCP assessments.
Converged Assessment Framework (CAF)
Signatories vote on all strategic decisions and contribute directly to the development of the program through a series of Technical Advisory Committees.
The CAF is a three-step assessment process. First, suppliers report their own data by completing a self-assessment using the Data Collection Tool. Next, an SLCP verifier checks the self-assessment for accuracy. This yields data about the supplier which is factually correct but does not formally score or rank performance. Lastly, the SLCP-verified self-assessment is made available to various stakeholders.
Moving away from auditing and toward the SLCP CAF brings several benefits. It creates conditions for suppliers to take more responsibility for performance and allows us to collaborate with other brands for supplier training. Importantly, it also affords our team more time for capability building with suppliers. Where our team members previously spent their time in factories conducting audits, they now use that time to work with suppliers to raise awareness of key requirements, answer questions, provide training, and build an even stronger relationship. Use of the SLCP CAF also enhances consistency across the fashion industry and will ultimately improve factory social performance.
Honouring worker voices
Throughout the apparel industry we need to hear more from the workers themselves, not just from management. We joined Better Work in 2020 to help us do just that. This International Labour Organisation (ILO) and International Finance Corporation (IFC) initiative engages with governments and brands in nine countries to improve working conditions for factory employees. One of Better Work’s guiding principles is to offer workers greater ownership over their workplace by honouring worker voices. The organisation also provides advisory services to factories as well as unions with the aim of giving workers a greater say in their lives, collaborates with governments to improve labour laws, and works with brands to help ensure progress is sustained. C&A’s involvement with both SLCP and Better Work contributes to greater convergence in the apparel industry, which is good for workers, suppliers, and fashion brands alike.
Promoting transparency
C&A has a good overview of its supply chain, with 100% transparency of cut and sew, wet processing, printing, and embroidery units, which applies to units from all direct suppliers as well as importers. We also have oversight of a considerable proportion of fabric and spinning mills and can estimate the country of origin for 85% of our raw materials. Our certified organic cotton can be traced to the farm group.
Addressing OECD sector risks
Safe and fair working conditions should be the norm for all apparel workers, which is why we use our influence to build capacity across our supply chain, normalising good practices and creating convergence with other brands. The OECD Due Diligence Guidance for Responsible Supply Chains in the Garment and Footwear Sector identifies 12 sector risks for the garment and footwear industry. The Guidance establishes a common understanding of due diligence to help companies meet the responsible business expectations laid out in the OECD Guidelines for Multinational Enterprises and emphasizes the voice of workers in the supply chain.
C&A believes the due diligence process is valuable. Although sustainability is already ingrained in what we do, completing the OECD due diligence provides a perspective shift. It helps us learn where our current practices are strong and effective, where we need improvement, and where we have gaps. The learnings from C&A’s OECD assessment process are embedded into our 2028 sustainability strategy through ambitious new goals designed to address gaps and create the roadmaps to make positive change in our supply chain. And because we reassess and revise our sustainability strategic priorities annually, we have ongoing opportunities to make updates in line with our learnings from the OECD due diligence process.
Approach
In 2021, C&A went through its first OECD due diligence risk assessment process. It took us nine months of in-depth and dedicated analysis, strongly guided by the Dutch and the German Partnership for Sustainable Textiles (PST) and finally closing by sharing the entire assessment with four of our key external stakeholders (OECD, Better Work, IndustriALL and SGF, Fair Wear Foundation) for consultation and discussion. Their feedback was that the outcome is a focused, ambitious and to the point assessment – with some methodological gaps to be closed during the next assessment circle.
For example: Including product risks in our scoping methodology, put more focus on outlining connections to our purchasing practices, validating our work through worker & supplier voice and adding external stakeholder engagement at all steps of the Due Diligence process. Especially in the discussion with the representatives from IndustriALL and SGSF, it became clear that there is a need to focus particularly on stakeholders with expertise in women human rights as most factory workforces are women.
Our risk assessment includes the 12 sector risks, such as forced labour, freedom of association, and health and safety. First, we assess the risks to understand the country risks as well as those possible in the actual C&A supply chain, along with their potential severity and a gap analysis of our actions compared to OECD expectations. Next, we determine the likelihood of risks occurring and prioritised future actions in a SMART way. We will implement actions as needed to address the risks and monitor their effectiveness, refining actions where appropriate.
We have worked with PST’s TexPerT tool to outline the details. Please refer to this link and choose “Roadmap”.
Our next formal OECD due diligence risk assessment will be conducted in the course of 2023. 2022 has been a year with a clear priority on getting the 2028 sustainability strategy for worker wellbeing into action as well as revising our Human Rights Management System as a preparation for the German Supply Chain Due Diligence Act (LkSG). The upcoming OECD due diligence risk assessment will take the learnings of both 2022 topics as well as the above outlined methodological gaps into consideration.
Eliminating forced labour
We do not tolerate any kind of forced, bonded, or prison labour, or any kind of unauthorized subcontracting in our supply chain. In addition to our existing Supplier Code of Conduct, the C&A Forced Labour Policy reiterates the importance of eliminating forced labour. C&A requires each supplier to sign and return the statement to us. To this end, the media reports and allegations about China’s Xinjiang province are as concerning to us as to governments and civil society organisations around the world. We continue to work with our supply base to ensure best practice in these areas. We are working together with a number of major brands to better understand the situation in the Xinjiang Region and to define the actions to ensure an effective due diligence process, in particular with regards to Chinese cotton production.”
Whilst severe cases of actual forced labor are extremely rare, C&A detected very few contractual/procedural incidents such as unreasonable restrictions or fees, particularly related to migrant labor. Please refer to the Supporting Guidelines to the Code of Conduct.
Promoting freedom of association
Freedom of association and collective bargaining is fundamental to improving labour conditions by amplifying worker voices and encouraging dialogue with management. Freedom of association is tested as part of our auditing process and is a key aspect of our Fairness Channel compliance hotline. We believe workers in any given country should be able to negotiate their wages under the same conditions, regardless of the factory or the brands for which they produce. C&A actively promotes the right of workers to bargain and negotiate collectively through their democratically elected labour unions.
As a founding member of ACT, we have adopted the ACT Purchasing Practices in five areas: fair terms of payment, full coverage of wage increases in prices, better forecasting and planning, training, and responsible exit. The ACT accountability and monitoring framework measures implementation of these commitments annually. Communication with suppliers and workers as well as a confidential channel to raise concerns and complaints will ensure continuous external feedback. Our commitment to work towards living wages in our supply chain is also spelled out in the Memorandum of Understanding C&A signed with IndustriALL. We have also committed to the Myanmar Guideline on Freedom of Association, under which supplier violations of this guideline would be treated as a zero-tolerance non-compliance.
Protecting health and safety
Our Supplier Code of Conduct includes robust requirements for building construction, fire protection, and emergency preparedness. We have learned a lot from our work with the Bangladesh Accord on Fire and Building Safety, and maintained leading brand status in remediation of fire and building safety issues in Bangladesh. We support our suppliers by working closely with them to understand the implications of new requirements and to implement changes, such as through training and capacity assessment. In addition, we regularly update our fire and building safety requirements, inspect all factories, and require them to have legal documentation in place for each building, including dormitories, canteens and warehouses. C&A suppliers also must maintain adequate insurance that covers workers for any injuries, accidents, or death.
Many other health and safety requirements are checked in each audit or SLCP assessment, such as electrical, machinery and boiler safety, availability of appropriate personal protective equipment, and worker training. Because health and safety non-compliances remain the most frequent violations identified during audits and assessments, we work very closely with suppliers to make sure they—and their workers—understand our requirements and comply consistently.
Supporting victims of underage labour
The required minimum age of workers in our supply chain follows the recommendations in the ETI Base Code and is in line with ILO Labour Standards. All workers must be at least 16 years to be present or work in a supplier’s production area. If young workers (aged 16 to 18) are hired, suppliers must comply with all relevant legal requirements, including work hour restrictions, hazardous work restrictions, and health checks.
If underage labour is identified in our supply chain, the child is removed from the factory immediately. To discourage them from seeking a job elsewhere, monthly payments equal to the minimum wage, funded by the supplier, are disbursed until they reach the legal minimum working age. At this point, the individual should be given the opportunity to be re-employed.
We also require that the supplier provides families with compensation for health screening, transportation funds, and accommodation for a child’s relatives to return them home. If the child is willing to attend lessons, the supplier must pay their school fees until the child meets the legal minimum working age.
We partner with local NGOs like the Child Rights in Business (CRIB) Working Group in China and Southeast Asia, Sheva in Bangladesh, Çagdas Yasami Destekleme Dernegi (the Association for the Support of Contemporary Living) in Turkey, and others, to ensure that underage workers are supported and that we follow through the process of remediation. In other production countries, we seek NGOs that can better support the needs of children and follow the remediation process. In the meantime, our local teams take the responsibility to ensure that the remediation process is fulfilled.
Eliminating undisclosed production
Undisclosed production is when garments are being made in a place that has not been approved for production. It constitutes a serious violation because we cannot verify that the factory is in alignment with our Supplier Code of Conduct and our environmental and social requirements. We require that each new production unit is audited and meets the requirements of our Supplier Code of Conduct before orders are placed.
Clear expectations and consequences
If undisclosed production is identified, the Sourcing, Sustainable Supply Chain and Quality teams assess the undisclosed production unit(s). We operate under a three-strike policy to mitigate the risk of undisclosed production units. If undisclosed production is detected and the factory meets the other requirements of our Supplier Code of Conduct and quality standards, the supplier will receive a warning on the first instance, suspension for 12 months or termination after the third instance. If a zero-tolerance item is found on inspection, a supplier can be suspended for 12 months or terminated, depending on the results of the investigation. To foster accountability and understanding of our requirements around undisclosed subcontracting, we informed our entire supply base and have regular interactions on the subject.