Q: What does HP expect from its suppliers?
KD: HP suppliers must meet specific requirements regarding ethical, environmental, occupational, health and safety and labour standards, as well and human rights. And we require that all suppliers comply with local, regional, national and international laws. Suppliers must complete detailed, factory-level assessments on their practices.
We have six fully trained auditors in EMEA. Last year we carried out 12 audits in Hungary, the Czech Republic and Poland, at the premises of direct material suppliers, contract manufacturers and repair service providers. We plan to audit 12 more this year.
Q: How do you carry out an audit?
KD: It normally involves a minimum of two auditors. One auditor will be responsible for checking the labour and ethics, the other for health and safety and environmental elements.
Recently we’ve seen issues arise regarding labour management systems and using labour agencies in our Eastern Europe facilities.
In one case in the Czech Republic, a major PC manufacturer was not ensuring that their suppliers conformed with the Code of Conduct and local laws and, in particular, they lacked policies to make sure their agency workers were treated equally. Based on extensive interviews we carried out with workers and labour agencies it was clear that pay and conditions varied greatly depending on which agency was hiring you.
So we helped the local management team put a corrective action plan in place. In all cases, we require a schedule for completion on specific improvements, ranging from one week to one year.
What did the action plan include?
KD: In this case we specified that the number of labour agencies be reduced from six to two and that new contracts included the requirements of the Code of Conduct. All suppliers have now signed a declaration that workers now know the rules and rights that exist to protect them. Weekly meetings with the labour agency reps have been set up and workers have also been included in subsequent surveys to get their feedback.
Is the technology industry in general taking action?
BNG: Very much so. In 2004 we worked with Dell, IBM and our EMS providers to develop a common Electronic Industry Code of Conduct to promote industry standards for socially responsible business practices across the global supply chain. It was clear that there were advantages to addressing supply chain issues on an industry-wide basis, to develop common assessment, auditing methods and a central database for the technology sector.
HP also plays a key role in the Europe-based Global e-Sustainability Initiative and the Global Monitoring Standards Project – to develop a global certification process for supply chain auditors.
If a company does not have a Code of Conduct, can they adopt the Electronic Industry Code of Conduct?
BNG: Yes. The Electronic Industry Code of Conduct may be voluntarily adopted by a business in the electronics sector and subsequently applied by that business to its own suppliers.
Fundamental to adopting the code is the understanding that a business, in all of its activities, must operate in full compliance with the laws, rules and regulations of the countries in which it operates. The code encourages participants to go beyond legal compliance, drawing upon internationally recognised standards, in order to advance social and environmental responsibility.
Click here for more information on HP’s supply chain responsibility
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