2015 Global Responsibility Report
Strengthening and clarifying expectations

The safety and well-being of workers across our supply chain is a priority for us. We publish Standards for Suppliers to make clear our fundamental expectations for suppliers regarding the treatment and safety of workers and the suppliers’ impact on the environment. We’ve made several important updates to our standards, including:

  • Factory visibility: Strengthened our requirements for suppliers subject to audits to designate employees who are responsible for factory compliance with applicable laws and standards. The designated employees must have sufficient visibility into factory operations to ensure compliance at the facility level.
  • Factory disclosure: Clarified our requirements for suppliers subject to audits to proactively disclose facilities that produce products for sale at Walmart.

Listening to our suppliers:

In December 2013, we asked our suppliers to provide feedback on our fire safety standards. During this collaborative review, we received nearly 500 comments and suggestions from approximately 100 partners. We used that feedback, along with input from fire safety experts, internal partners and external auditors to develop the following resources published in April 2014:

  • Fire Safety Checklist: Allows suppliers and factories to conduct self-evaluations of their performance against our enhanced fire safety standards, in addition to our regular audits.
  • Enhanced fire safety training module: Provides step-by-step guidance on how to comply with the Fire Safety Checklist.
Establishing accountability

We’ve invested in detailed social audits to help verify that the requirements outlined in our Standards for Suppliers are met. These audits strive to ensure:

  • All labor is voluntary
  • Producers comply with all child labor laws and standards
  • Workers are properly paid for all labor hours
  • Hours aren’t excessive and are consistent with local laws or regulations
  • Factories meet health and safety standards

The majority of our social audits are unannounced and conducted at facilities by independent and internationally recognized firms. Facilities are re-audited every six to 24 months, depending on the findings of their previous audit. The results are assigned a color rating, based on type and severity of issues found. We use these ratings to help make decisions regarding suppliers and factories.

In 2014, we developed a risk-based approach to auditing that allocates more of our auditing resources to higher-risk facilities based on the geography where they're located. Over time, we will evolve our risk-based approach to include additional factors, such as industry- or supplier-specific risks, to help ensure the greatest impact.

Raising the bar at apparel factories in Bangladesh

As part of our commitment to transparency, Bureau Veritas, a third-party audit firm, conducted in-depth electrical and structural safety assessments for Bangladesh factories that produce ready-made garments directly for Walmart. The results show many factories have made substantial improvement over the past year, with electrical ratings climbing by more than 80 percent and building safety improvements by more than 60 percent. In addition, we’ve committed $1.6 million ($800,000 contributed through 2014) to improve safety training via the newly created Environmental Health & Safety Academy in Bangladesh. The purpose of EHS Academy is to provide a local, long-term platform for addressing challenges in the supply chain related to fire safety through technical training and engagement.

Worker helpline

We believe the worker voice plays a key role in driving safety and well-being across the supply chain. That’s why we require the factories that produce the finished goods we sell to display, with our Standards for Suppliers, a toll-free phone number, e-mail address and website where workers can anonymously report concerns in their local language. All reports are collected by a third party and directed to our Global Ethics office for investigation.

Building supply chain capacity

Through our Supply Chain Capacity Building program, we provide our suppliers with the following training opportunities aimed at influencing continuous and sustainable improvement:

  • Factory Audit Orientation is designed to provide new factories and suppliers with training in social and environmental compliance, enhanced fire safety, chemical and machine safety, dormitory and canteen standards, region-specific trends and more. In 2014 alone, 2,993 factories participated in our Factory Audit Orientation.
  • Violation Correction Training addresses common trends related to social and environmental compliance and ways to address those issues, with special focus on locally relevant topics. Through training in root-cause analysis, factories are able to develop corrective action plans to remedy potential violations. In 2014, we conducted 227 Violation Correction Training sessions attended by 3,163 factories.
  • Orange School Program provides one-on-one, hands-on training to select factories and suppliers. Using root-cause analysis methodology and procedures, we teach factory management to proactively identify noncompliance issues and develop a systematic approach to continuous improvement. In 2014, 51 factories completed the Orange School Program, and 46 additional factories are currently undergoing training.
  • Supplier Development Program consultants work with suppliers to conduct a thorough analysis of each area of business that impacts suppliers’ ability to work in accordance with our Standards for Suppliers. We help them develop customized plans to work toward meaningful improvement.
  • Supplier Round Table is a forum for our suppliers, factories and stakeholders from similar sourcing regions to discuss concerns and share best practices. The sessions are focused on responsible sourcing goals, as well as objectives and current challenges across their region. In 2014, we held 60 global Supplier Round Table sessions, with 566 participating factories and 414 participating suppliers.
Collaborating with stakeholders

While we leverage our size and scale to influence positive change in a variety of ways, driving long-term improvement across an industry as vast as the manufacturing industry requires collaboration. Through our ongoing collaboration with stakeholders, we’re helping to strengthen the global supply chain at a much faster rate than would be possible on our own.

Alliance for Bangladesh Worker Safety

Walmart is a founding member of the Alliance for Bangladesh Worker Safety, a group of brands and retailers seeking to drive safer working conditions for the men and women in the ready-made garment industry. According to the Alliance, over the past year, it has:

  • Trained more than 1 million factory employees on basic fire safety
  • Piloted a helpline where workers can anonymously report safety or other job-related concerns
  • Provided, together with factory owners, wages for approximately 1,000 displaced workers
  • Created a Board Labor Committee to focus exclusively on labor issues impacting workers’ lives

Coalition of Immokalee Workers and Fair Food Program

In 2014, Walmart was the first major retailer to join the Fair Foods program through a partnership with the Coalition of Immokalee Workers and Florida tomato suppliers. We’re working with the CIW to:

  • Expand the Fair Food program beyond Florida to the tomatoes we purchase from participating Florida-based growers with operations outside the state.
  • Provide long-term purchasing commitments to suppliers who best reflect the principles of the Fair Food program.
  • Explore how to expand the Fair Food program to other crops beyond tomatoes in our produce supply chain.
Better Work Program

Together, the International Labour Organization (ILO) and the International Finance Corporation (IFC) launched the Better Work Program with the objective of improving factory working conditions in the garment sector. Program components include monitoring factories, conducting training modules and engaging with key stakeholders, including workers, factories, communities and governments. We’ve worked with the ILO/IFC in the Better Work Program, which currently operates in Cambodia, Haiti, Indonesia, Jordan, Lesotho, Nicaragua and Vietnam, with plans to expand into Bangladesh.

Ethical Trading Initiative

Asda/George is a founding member of the Ethical Trading Initiative (ETI) and works within a multistakeholder environment on industry issues such as home workers, Sumangali workers, working-hours projects, fire safety, living wages and purchasing practices. ETI touches a wide spectrum of issues to help drive positive change through the supply base from which we source and to improve conditions for workers who make the clothes we sell.

Global Social Compliance Program

The Global Social Compliance Program (GSCP) is a business-driven program created to promote the continuous improvement of working and environment conditions in global supply chains. The GSCP was created by five leading companies, including Walmart. Approximately 40 member brands and retailers are working to harmonize existing efforts and deliver a common, consistent and global approach for the continuous improvement of working and environmental conditions in the global supply chain.

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