Case study: How Hemtex promotes social sustainability among its suppliers

What are the material issues the company has identified?

In its 2018 Sustainability Report Hemtex identified a range of material issues, such as customer health and safety, emissions, non-discrimination, labour-management relations, occupational health and safety, effluents and waste. Among these, promoting social sustainability among its suppliers stands out as a key material issue for Hemtex.

Stakeholder engagement in accordance with the GRI Standards

The Global Reporting Initiative (GRI) defines the Principle of Stakeholder Inclusiveness when identifying material issues (or a company’s most important impacts) as follows:

“The organization should identify its stakeholders, and explain how it has responded to their reasonable expectations.”

Stakeholders must be consulted in the process s of identifying a company’s most important impacts and their reasonable expectations and interests must be taken into account. This is an important cornerstone for CSR / sustainability reporting done responsibly.

Key stakeholder groups Hemtex engages with:

How stakeholder engagement was made to identify material issues

To identify and prioritise material topics Hemtex carried out a materiality analysis with contributions from both internal employees and representatives of several stakeholders.

What actions were taken by Hemtex to promote social sustainability among its suppliers?

In its 2018 Sustainability Report Hemtex reports that it took the following actions for promoting social sustainability among its suppliers:

• Implementing a Code of Conduct
• Before commencing any collaboration with suppliers in high-risk countries, Hemtex carries out an audit to ensure that the factory meets the requirements of its Code of Conduct. The Group-wide Code of Conduct is based on the UN’s Guidelines on Human Rights, the Convention on the Rights of the Child and the ILO’s (International Labour Organization) core conventions. Hemtex ensures compliance by combining audits performed by its own staff or consultants with third-party audits. In the event of any breach of the Code of Conduct, an investigation is carried out and an action plan is put in place, together with the supplier. The first time a supplier is not approved, they are given a chance to correct the problem. If the supplier does not show any willingness to resolve serious irregularities or if a serious violation is repeated, Hemtex terminates the collaboration. The most common breaches of the Code of Conduct concern documentation and employment terms and conditions, as well as salaries and working hours.

• Promoting the right to collective bargaining and freedom of association
• Hemtex applies pressure on suppliers to make sure that the right to join a union and negotiate collectively is not violated, as trade unions are weak in many of the production countries and are even illegal in certain countries. Both factory managers and employees are informed of their rights, and compliance with requirements is followed up in social audits. All suppliers must allow workers to freely choose their own representatives, with whom the company can have a dialogue on workplace issues.

• Combatting forced and child labour
• Hemtex’s basic rule regarding child labour is that people under the age of 15 cannot work for any of its suppliers. If national legislation imposes more stringent requirements, these will apply. Hemtex also requires that suppliers pay careful attention to young workers (under the age of 18). For example, in relation to the right to limited working hours. If Hemtex discovers or suspects that a worker is under age, the supplier is contractually obliged to take measures to ensure the best outcome for that individual. Hemtex seeks the best possible solution together with the supplier, taking into consideration the child’s age, education and social situation. Forced or compulsory labour, is also prohibited. It is important that workers receive continuous wages for work performed, and that they are entitled to take holiday and to terminate their employment with wages for work performed. No incidents of child labour or forced labour were detected or reported during the year.

Which GRI Standards and corresponding Sustainable Development Goals (SDGs) have been addressed? 

The GRI Standards addressed in this case are:

1) Disclosure 407-1 Operations and suppliers in which the right to freedom of association and collective bargaining may be at risk

2) Disclosure 408-1 Operations and suppliers at significant risk for incidents of child labor

3) Disclosure 409-1 Operations and suppliers at significant risk for incidents of forced or compulsory labor

4) Disclosure 412-1 Operations that have been subject to human rights reviews or impact assessments

5) Disclosure 412-3 Significant investment agreements and contracts that include human rights clauses or that underwent human rights screening

6) Disclosure 414-1 New suppliers that were screened using social criteria

7) Disclosure 414-2 Negative social impacts in the supply chain and actions taken

Disclosure 407-1 Operations and suppliers in which the right to freedom of association and collective bargaining may be at risk corresponds to:

• Sustainable Development Goal (SDG) 8: Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all
• Business theme: Freedom of association and collective bargaining

Disclosure 408-1 Operations and suppliers at significant risk for incidents of child labor corresponds to:

• Sustainable Development Goal (SDG) 8: Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all
• Business theme: Abolition of child labor
• Sustainable Development Goal (SDG) 16: Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels
• Business theme: Abolition of child labor

Disclosure 409-1 Operations and suppliers at significant risk for incidents of forced or compulsory labor corresponds to:

• Sustainable Development Goal (SDG) 8: Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all
• Business theme: Elimination of forced or compulsory labor

Disclosure 412-1 Operations that have been subject to human rights reviews or impact assessments does not correspond to any SDG.

Disclosure 412-3 Significant investment agreements and contracts that include human rights clauses or that underwent human rights screening does not correspond to any SDG.

Disclosure 414-1 New suppliers that were screened using social criteria corresponds to:

• Sustainable Development Goal (SDG) 5: Achieve gender equality and empower all women and girls
• Business theme: Workplace violence and harassment
• Sustainable Development Goal (SDG) 8: Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all
• Business theme: Labor practices in the supply chain
• Sustainable Development Goal (SDG) 16: Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels
• Business theme: Workplace violence and harassment

Disclosure 414-2 Negative social impacts in the supply chain and actions taken corresponds to:

• Sustainable Development Goal (SDG) 5: Achieve gender equality and empower all women and girls
• Business theme: Workplace violence and harassment
• Sustainable Development Goal (SDG) 8: Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all
• Business theme: Labor practices in the supply chain
• Sustainable Development Goal (SDG) 16: Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels
• Business theme: Workplace violence and harassment

78% of the world’s 250 largest companies report in accordance with the GRI Standards

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References:

1) This case study is based on published information by Hemtex, located at the link below. For the sake of readability, we did not use brackets or ellipses. However, we made sure that the extra or missing words did not change the report’s meaning. If you would like to quote these written sources from the original, please revert to the original on the Global Reporting Initiative’s Sustainability Disclosure Database at the link:

http://database.globalreporting.org/

2) https://www.globalreporting.org/standards/gri-standards-download-center/

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