Coles Ethical Sourcing Policy
October 2010
1. Introduction
Ethical sourcing is a commitment to the purchase of goods and services that are manufactured and
provided in a way that does not involve exploitation, or represent a danger to health, safety or the
environment. Coles Supermarkets (Coles) regard non-conformances relating to child labour and forced/
bonded labour unacceptable and in such circumstances will not proceed with suppliers until improvements
are made. As a leading Australian Retailer, Coles is committed to the communities in which we live and
operate and to ensuring we integrate responsible corporate behaviour into every aspect of our operations.
Corporate social responsibility is an important consideration for our stakeholders, including shareholders,
customers, and team members.
2. Scope and Purpose
3. Policy Requirements
This policy is for Coles team members and suppliers to Coles.
The purpose of this policy is to ensure:
Coles is committed to the safe and ethical manufacture and
supply of goods and services. Coles reserve the right not to
do business with suppliers that do not share and demonstrate
this commitment. Suppliers must ensure that the production
processes they use do not involve exploitation or represent
a danger to health, safety or the environment.
••
Coles are sourcing products in an ethical and
responsible manner;
••
there is clear guidance to our team members, most
importantly our buying, quality and development staff;
••
Coles is working with our suppliers to continually
improve social conditions;
••
There is an ethical sourcing strategy that will protect
the Coles brand.
3.1 Employment Practices
Coles expects its suppliers to comply with all local laws and
regulations regarding labour and employment. Coles has a
zero tolerance to child labour, illegal labour and forced/bonded
labour. Coles will only do business with suppliers who are
committed to the following requirements:
Version Number – PES-V5
Copyright
Commercial-in-Confidence, Copyright © 2010, Coles Supermarkets Australia Pty Ltd, ABN 11 004 089 936
Reproduction of any part of this document is not permitted without the prior written approval of Coles Supermarkets Australia Pty Ltd.
File Name – 209110_Coles_ES_Policy_QC
1 of 8
2 of 8
3.1.1 Child Labour (Coles have a zero tolerance)
3.1.8 Freedom of Association
Suppliers shall not use child labour. A ‘child’ is a person who
is younger than the local legal age for completing compulsory
education. Coles supports the development of legitimate
apprenticeship programs for the education and benefit of
young people under the age of 15 years, provided the child
is not being exploited or given jobs that are dangerous to
their health or safety.
Suppliers acknowledge that workers have the right to join
or form trade unions of their own choosing and to bargain
collectively. Suppliers are required to adopt an open attitude
toward the activities of trade unions and their organisation
activities. Where the right to freedom of association and
collective bargaining are restricted under the local laws,
suppliers will not hinder the development of alternative
means of independent and free association and bargaining.
3.1.2 Illegal Labour (Coles have a zero tolerance)
Suppliers shall not use illegal labour. Suppliers must be
able to verify the right of their employees’ legal eligibility
and entitlement to work in the country of employment.
3.1.3 Forced/Bonded Labour (Coles have a
zero tolerance)
Suppliers shall not use forced, bonded or involuntary labour.
Workers will not be required to lodge ‘deposits’ or their identity
papers with the supplier, they are free to leave once their shift
ends, or to leave their employment after giving their employer
reasonable notice.
3.1.4 Wages and Benefits
Wages and benefits paid for a standard working week must
meet as a minimum, any applicable local laws or industry
practices, whichever is the higher. All workers must be provided
with written and understandable information about their
employment conditions in respect to wages, before they enter
employment, and about the particulars of their wages for the
pay period concerned each time they are paid.
3.2 The Workplace
Coles expects its suppliers to comply with all local laws and
regulations regarding health and safety in the workplace.
In addition, Coles will only do business with suppliers who
adhere to the following requirements:
3.2.1 Health and Safety
Suppliers will provide workers with a safe and clean working
environment, taking into account the prevailing knowledge
of the industry and of any specific hazards and will provide
plant and systems of work that are safe and without risks
to health. This will include an adequate number of unlocked,
freely accessible and clearly marked exits for emergency
evacuations, and properly maintained fire fighting equipment.
Workers must be appropriately supervised and trained to
perform their jobs safely.
3.2.2 Accommodation
Where suppliers provide worker accommodation, it shall
be clean, safe and meet the basic needs of the workers.
3.1.5 Working Hours
3.2.3 Facilities
Working hours shall comply with applicable local laws.
Workers shall not work more hours in one week than allowable
under local laws. Overtime shall be voluntary and shall be
compensated as prescribed by local laws.
Suppliers will provide workers with access to clean toilet
facilities, clean and drinkable water and, if appropriate,
sanitary facilities for food storage and preparation.
3.1.6 Discrimination
All conditions of employment must be based on an individual’s
ability to do the job, not on the basis of personal characteristics,
such as gender, ethnic origin, religion, or personal beliefs.
Suppliers must ensure that they provide an environment where
their employees can work without distress or interference
caused by harassment, discrimination or any other inappropriate
workplace behaviour.
3.1.7 Discipline
Workers shall be treated with dignity and respect. In particular,
suppliers will not use (either directly or indirectly) any physical
abuse or discipline, the threat of physical abuse, sexual or other
harassment, verbal abuse or other forms of intimidation in any
of its premises.
3.2.4 Equipment
Suppliers will ensure that personal protective safety equipment
is available and workers are trained in its use. Safeguards on
machinery must meet or exceed local laws.
3 of 8
3.3 Management Controls
Coles expects its suppliers to comply with all local laws
and regulations regarding management controls. In addition,
Coles will only do business with suppliers who adhere to
the following requirements:
3.3.1 Sub-Contractors
Suppliers should ensure that all its sub-contractors, and
suppliers providing materials or labour in the manufacture
of goods ordered by us have an ethical souring program
that is similar or equivalent to our Ethical Sourcing Policy.
3.3.2 Environment
Coles requires suppliers, as a minimum, to meet all relevant
local and national environmental protection laws, and to strive
to comply with international environment protection standards.
3.3.3 Ethical Standards
Suppliers must demonstrate a high degree of professionalism
and have a close affinity with our business ethics. In particular,
honesty, fair dealing and the proper treatment of workers are
required at all times. Bribes, favours, benefits or other similar
unlawful or improper payments, in cash or kind, are strictly
prohibited, whether given to obtain business or otherwise.
3.3.4 Compliance with Local Laws
Coles requires all suppliers to comply fully with the legal
requirements of the countries in which they operate.
All requirements in this Ethical Sourcing Policy are in addition
to compliance with applicable local laws.
4. Expectations and Compliance
with this Ethical Sourcing Policy
4.1 Engagement
All suppliers are required to complete a Supplier SelfAssessment form and have it returned by email to the Coles
Ethical Sourcing Co-ordinator at ethicalsourcing@coles.com.au
within 30 days of it being communicated.
Additionally, ‘high-risk’ suppliers, within 12 months of being
communicated, are expected to either:
1. Provide Coles with evidence of a mutually recognised audit
(refer to Appendix B).
2. Undergo a social compliance audit for the facilities used
in the production of Coles products.
‘High Risk’ Suppliers are those located in developing countries
which excludes North America, Europe, Australia, New Zealand,
Japan, and any other OECD member country.
In addition, Coles may request a supplier operating in non
high-risk regions (i.e. Australia and other OECD member
countries) to undergo a third-party ethical audit if an ethical
issue has been identified. The supplier will be notified in
such circumstances.
4.2 Supplier Status and Audit Results
Coles will categorise various breaches as either: Zero Tolerance,
Critical, Major, Significant, or Minor. Categorisation will be
determined upon receipt and review of the suppliers self
assessment form, or in the case of ‘high-risk’ upon receipt of
their ethical sourcing audit report and certificate. According
to the results the supplier will be granted a status of either:
Green Status Supplier – Approved
Green Status for a ‘high risk’ supplier is when the supplier has
provided a completed SSA and has satisfied the requirements
of the audit, or has provided evidence of compliance from a
recognised audit body that has been approved by the Coles
Quality Team.
The Green Status is granted for 18-month period.
Green Status for a ‘low risk’ supplier is when the supplier has
provided a satisfactory self assessment that has been approved
by the Coles Quality Team.
The green status will be granted for a 2 year period.
4 of 8
Amber Status Supplier – Conditionally Approved
4.3 Corrective Action
Amber Status for a ‘High Risk’ supplier is when there are no
zero tolerances identified and the supplier has provided a self
assessment or audit report. However, the supplier has critical,
major, significant or minor breaches and corrective actions are
required. To be an amber status the supplier must provide an
action plan and with a time frame for close out that is agreed
by the Coles Quality Team.
Coles recognise some suppliers will not be fully compliant with
the standards, but is committed to improve working conditions
to gain compliance over time. Non-compliance with this Policy
will require corrective action and this will be dependent upon
the nature of the breach.
This action must be communicated to Coles within 30 days
and a follow up audit is required within 12 months.
For any queries regarding this policy contact your Coles Product
Technologist and/or the Coles Ethical Sourcing Coordinator at
ethicalsourcing@coles.com.au.
Amber Status for a ‘low risk’ supplier is when there are no
zero tolerances identified and the supplier has provided a self
assessment. However, the supplier has critical, major, significant
or minor breaches and corrective actions are required. To be
an amber status the supplier must provide an action plan and
with a time frame for close out that is
agreed by the Coles Quality Team.
This action must be communicated to Coles within 30 days
and a follow up SSA is required within 12 months.
Red Status Supplier – Not Approved
Red Status for a ‘High Risk’ supplier is when zero tolerances
have been identified in a third party audit report or in the self
assessment or any other evidence that is available to the Coles
Quality team. The supplier must provide a corrective action
plan within 14 days that is agreed to by the Coles Quality team.
The Coles Quality team will also raise an incident report and call
together a category team that will include a buyer, developer,
Quality Manager, Product technologist and a recognised expert
in the field to discussion corrective actions or other steps
necessary which could include suspension of trade.
A re-audit will be required within 3 months.
Red Status for a ‘low risk’ supplier is when zero tolerances
have been identified in the self assessment or any other
evidence that is available to the Coles Quality team. The supplier
must provide a corrective action plan within 14 days that is
agreed to by the Coles Quality team. The Coles Quality team will
also raise an incident report and call together a category team
that will include a buyer, developer, Quality Manager, Product
technologist and a recognised expert in the field to discussion
corrective actions or other steps necessary which could include
suspension of trade.
A re-audit will be required within 3 months.
Note: Other evidence may for example include media reports,
complaints or random ethical audits
Contacts and Queries
Further Information
(available on Connect and the supplier website)
1.
For Suppliers – Ethical Sourcing Supplier Fact Sheet,
and the Ethical Sourcing Supplier Self Assessment Form
2. For Merchandise Team Members – Ethical Sourcing
Merchandise Fact Sheet
3. For Further detail and Background – Coles Supermarkets
Ethical Sourcing Code Procedural Guidelines
4. For general ethical sourcing information:
••
www.ethicaltrade.org
Appendix A
Ethical Sourcing
The 4 Step Process
Step 1. Communication
Q
B
Buyers/developers and product technologist’s to communicate the ethical
sourcing policy, supplier fact sheet and supplier self assessment form in
discussions with new and existing suppliers when required.
CGA
Step 2. Engagement
Q
S
CGA
R
Step 3. Outcome
Q
B
S
All suppliers are required to complete a Supplier Self-Assessment form
and have it returned by email to the Coles Ethical Sourcing Co-ordinator at
ethicalsourcing@coles.com.au within 30 days of it being communicated.
‘High-risk’ suppliers are also required to undertaken a social compliance audit
to Coles requirements. It is the supplier’s responsibility to organise the audit.
Alternatively, the supplier can provide evidence of compliance from a mutually
recognised audit, by sending a copy of the current audit report and certificate
to the Coles ethical sourcing coordinator at ethicalsourcing@coles.com.au
The outcome of self assessment and audits are graded on three levels:
CGA
R
Step 4. Report
••
Green status approved supplier – the supplier located in a ‘high risk’ area has
satisfied the requirements of the self assessment, audit, or has provided evidence
of compliance from a recognised audit body. The approval is for an 18 month
period for an 18 month period. Suppliers operating outside of ‘high-risk’ areas
will be approved for a 2 year period on receipt of a satisfactory self assessment.
••
Amber status conditionally approved supplier – the supplier has satisfied the
self assessment/audit in that there are no zero tolerances. However, a corrective
action(s) has arisen from the self assessment/audit, and the supplier and product
technologist must agree on an action plan and time frame for close out. This
action must be communicated to the ethical sourcing coordinator within 30 days.
A follow up audit will be scheduled for completion within the following 12 months.
••
Red status not approved supplier – The supplier has not satisfied the zero
tolerances of the self assessment/audit. The supplier must provide a corrective
action plan within 14 days that is agreed to by the Coles Quality team. The Coles
Quality team will also raise an incident report and call together a category team
that will include a buyer, developer, Quality Manager, Product technologist and
a recognised expert in the field to discussion corrective actions or other steps
necessary which could include suspension of trade. A re-audit will be required
within 3 months.
Supplier status data is recorded and reported.
An annual status report is compiled for the Wesfarmers Sustainability Report,
which is publicly available.
Q
Q
Quality
B
Buyers and Developers
S
Supplier
CGA
CGA/CGI*
R
5 of 8
Recognised Audit Body
* Coles Group Asia/Coles Group India
Appendix B
6 of 8
JAS-ANZ Accredited Certification Bodies and Recognised Auditors
JAS-ANZ Accredited Certification Bodies
> SGS
> Bureau Veritas (Australia) Pty Ltd
> Intertek Testing Services HK Ltd (ITS)
Third Party Auditors must be certified to ISO 9001 (QMS or EMS) by an independent accreditation body that are a signatory to IAF
or be approved to conducted the recognised audit formats.
SGS Audit Contacts
Australia
Indonesia
South Africa*
For International enquiries:
Ray Hartland
Ph: 61 (03) 9790 3421
Email: ray.hartland@sgs.com
Dian Mardiana
Ph: (62) 21 781 8111 ext 228
Email: mardiana@sgs.com
Jaco Conradie
Ph: 27 (0) 82 604 5577
Email: jaco.conradie@sgs.com
Israel
Sri Lanka
Jeff Zucker
Ph: 972 3516 1074
Email: jeff.zucker@sgs.com
Roshan Jayakody
Ph: (94) 0 11 2323 878
Email: roshan.jayakody@sgs.com
Argentina
Kenya and Tanzania
Taiwan
Maria De Plano
Ph: 54 11 4124 2131
Email: maria.deplano@sgs.com
Ronald Watsiera
Ph: 254 202 733 690
Email: Ronald.watsiera@sgs.com
Haimon Chu
Ph: (886) 2 229 93279 ext 5112
Email: haimon.chu@sgs.com
Bangladesh
Korea
Thailand
Sirajul Islam
Ph: (880) (0) 2 967 6500
Email: sirajul.islam@sgs.com
Michelle Yoo
Email: michelle.yoo@sgs.com
Potjana Keechanoda
Ph: (662) 678 1813 ext 1767
Email: potjana.keechanoda@sgs.com
For Australian enquiries:
Kiran Bhagat
Ph: 61 (03) 9790 3400
Email: kiran.bhagat@sgs.com
China
Jessica Wu
Ph: (86) 0 755 2532 8888 ext 8380
Email: Jessica.wu@sgs.com
Hong Kong
Billy Lai
Ph: (852) 2765 3618
Email: billy.lai@sgs.com
India
Navneet Panwar
Ph: (91) 124 23 99990 - 98 ext 151
Email: navneet.panwar@sgs.com
Malaysia
Jaimie Lee
Ph: (60) 3 5121 2320
Email: jaimie.lee@sgs.com
Peru
Berta Helfgott
Ph: 511 517 1931
Email: berta.helfgott@sgs.com
Philippines
Rowena Musni
Ph: (632) 817 5656 ext 608
Email: Rowena.musni@sgs.com
* Includes Botswana, Namibia, Mozambique, Lesotho, Swaziland, and Zimbabwe.
Turkey
Pinar Alpaslan
Ph: 90 212 368 4314
Email: pinar.alpaslan@sgs.com
Vietnam
Tran Thanh Phong
Ph: (84) 8 395 1920 ext 135
Email: phong.tran@sgs.com
Appendix B
7 of 8
ITS Audit Contacts
Argentina
Egypt
Philippines
Pablo Dramis
Tel no: + 54 11 52179487
Email: pablo.dramis@intertek.com
Mohamed Ibrahim
Tel no: + 20 2 44796611
Email: mohamed.ibrahim@intertek.com
Marie Mabazza
Tel no: +632 8195841
Email: marie.mabazza@intertek.com
Australia
Mauritius and Madagascar
Singapore and Sri Lanka
(for international enquiries)
Faith Mathew
Tel no: +61 3 96469299
Email: faith.mathew@intertek.com
Oumme Ramjaun
Tel no: + 230 6978251
Email: oumme.ramjaun@intertek.com
Yeo Sin Joon
Tel no: +65 63 888666
Email: sinjoon.yeo@intertek.com
Morocco
Taiwan
Asmaa Erraji
Tel no: +212 22 298181
Email: asmaa.erraji@intertek.com
Paul Yu
Tel no: +886 2 66022300
Email: paul.yu@intertek.com
India
Thailand
Sothy Khuth
Tel no: +855 23 220421
Email: sothy.khuth@intertek.com
Bangalore, Mumbai, New Delhi, Tirupur
H.R. Venkataramaiah
Tel no: +91 80 4021 3781 or 3700
Email: venkat.h@intertek.com
Varapa Srisomboon
Tel no: +66 2 9390661
Email: varapa.srisomboon
North Eastern China -
Indonesia
Hangzhou, Ningbo, Qingdao,
Shanghai, Tianjin
Gilbert Li
Tel no: +86 21 61815798
Email: gilbert.li@intertek.com
Sano Resdiano
Tel no: +62 21 3918453
Email: sano.resdiano@intertek.com
South China -
John J Park
Tel no: +82 2 21091255
Email: john.park@intertek.com
Bangladesh
Sumona Sharmin
Tel no: +880 2 815 6226-28
Email: sumona.sharmin@intertek.com
Cambodia
Dongguan, Guangzhou, HongKong,
Macau, Shenzhen, Xiamen
Wilson Leung
Tel no: +86 755 26020406
Email: wilson.leung@intertek.com
Colombia
(contact for other South American
countries other than Argentina
and Brazil)
Viviana Rodriguez
Tel no: + 571 6108458
Email: viviana.rodriguez@intertek.com
Korea
Malaysia
Eileen Tan Ee Leen
Tel no: +60 3 3325 8199 or 8299
Email: eileen.tan@intertek.com
Pakistan
Azam Hadi
Tel no: +92 21 2590154-58
Email: azam.hadi@intertek.com
Vietnam
Nguyen Thi Thao
Tel no: +84 8 2971099
Email: thao.nguyen@intertek.com
Turkey
Nurten Gunaydin
Tel no: +90 212 4710 065 or 106
Email: nurten.gunaydin@intertek.com
Recognised Audit Formats
••
ICTI – International Council of Toy Industries
••
Nike
••
Federated
••
Sears Holding Corp
••
SGS
••
Wal-Mart
••
ILO – International Labour Organisation
••
H&M Sweden
••
SA8000
••
Kmart Australia / New Zealand
••
ETI – Ethical Trading Initiative (Base Code)
••
Target Australia
••
SEDEX
••
Other Wesfarmers Businesses
••
United Nations Global Compact
••
Macy's Inc.
••
WRAP – Worldwide Responsible Apparel Production
••
Tesco
••
FLA – Fair Labour Association
••
Sainsburys
••
ICS – Initiative Clause Sociale
••
Marks & Spencer
••
AVE Sector Model
••
Waitrose
••
Business Social Compliance Initiative
••
ASDA
••
Disney
Coles will consider and assess other Audit Formats and will update this list accordingly.
8 of 8