Ethical Business Practices: Sedex Launches SMETA V6.0

Published on April 6, 2017, It came into effect on June 1, 2017, after which, all new SMETA audits will be undertaken against SMETA V6.0 and SMETA V5.0 will only be used for following up on findings.

Businesses looking to manage reputational risk need to consider the working conditions, health and safety, environmental impact and ethical business practices of their suppliers. One way to do this is by partnering with suppliers who can provide a transparent, independent assessment of their business procedures.

SMETA

The Supplier Ethical Data Exchange, (Sedex) is a global not-for-profit membership organization that allows companies to share information about their ethical performance with their trading partners. To help Sedex promote ethical business practices they developed the Sedex Stakeholder Forum (SSF), the Sedex Members Ethical Trade Audit (SMETA).

SMETA is an audit which reviews a company against a compilation of the best practices in ethical business management. It follows a standardized report format, incorporating Best Practice Guidance and Measurement Criteria. It is not a code of conduct or a certification process, rather is uses the ETI (Ethical Trading Initiative) Base Code and local laws to measure performance.

SMETA is one of the most commonly used ethical audit methodologies in the world. It can be used by both Sedex members and non-members, as it is in the public domain, and it is accepted across a wide range of industries.

SMETA aims to assist responsible sourcing and transparency in supply chains and provides a platform for continuous improvement across four pillars:

• Labour Standards
• Health & Safety in the workplace
• Environment
• Ethical business practices

The audit can be carried out internally but, in most cases, brands and retailers will require a third-party assessment by a company like SGS.

Where relevant, the independent audit will be uploaded to the Sedex database, by the auditing company, giving greater transparency.

Main Differences in SMETA V6.0

• Human Rights (Clause 0.A) - a new section based on the United Nations Guiding Principles on Business and Human Rights. Focuses on the level to which a business and/or site understands and manages their impact on human rights, not just for workers but also in local communities, etc. As a new section, it is aimed at raising awareness and so missing elements will be recorded as observations
• Responsible recruitment (under Regular Employment) - includes measurement criteria designed to help identify indicators of modern slavery and forced labor - a key problem in long supply chains, especially in industries with seasonal, temporary, agency and migrant workers. Businesses must have a full understanding of the entire recruitment process, making recruitment practices more transparent - including the conditions under which migrant, agency and other workers have been recruited and the contractual conditions applied
• Business Ethics - originally added in SMETA V4.0 as an awareness raising section, this has now been raised to a state where missing elements will be noted as non-compliances
• Management Standards - increased focus on the need for management systems to ensure the ongoing compliance of good working practices, as well as those related to legal land tenure and free, informed, prior consent
• Alignment to Customer Codes - new version allows additional requirements from client codes to be included to promote further flexibility and sharing of reports

Why Audit Against SMETA V6.0?

• Reduce audit fatigue and costs by using one common format
• Enhance your supply chain and ethical trading programs
• Protect your brand by highlighting responsible sourcing and transparent supply chain practices
• Be a reliable business partner by ensuring robust data is collected and held, allowing you to respond to questions from stakeholders and other interested parties with authority
• Enhance your relationship with your customers
• Manage workforce issues, improving the worker retention rates and safeguarding your most important assets
• Share audit results with existing customers via the Sedex platform - helping to increase transparency

SGS Solutions: SMETA Audits

SGS has been providing sustainability solutions and services for companies and organizations across the globe for many decades and we have been involved with SMETA audits since their creation in 2005.

SGS is an active member of the SSF, helping to drive forward the convergence of audit methodology and reporting, and, as a member of the working group that defined and issued SMETA V6.0, SGS is fully aware of all the new requirements and the intent behind them.

SGS's global network of highly-trained local auditors help bring a pragmatic, added-value approach to auditing, helping companies highlight their sustainable, responsible business practices.

To learn more visit SGS's Sustainable Audits.

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For further information, please contact:

Effie Marinos
Global Technical Governance Manager, Supply Chain Assessment & Solutions
SGS United Kingdom Ltd.
t: +44 203 008 7860

About SGS

SGS is the world's leading inspection, verification, testing and certification company. SGS is recognized as the global benchmark for quality and integrity. With more than 90,000 employees, SGS operates a network of over 2,000 offices and laboratories around the world.