The first place to visit when carrying out supplier audits is the toilet, a conference was told.
Charlie Browne, environmental and sustainable development manager at IKEA UK, said this was the best way to judge working conditions at a supplier.
Speaking during a panel discussion on ethics at the CIPS Annual Conference in London, Browne said 7,000 supplier audits were carried out last year as part of the IWAY programme.
“The first place, when you are doing an audit, is visit the toilets, because they give you the best idea of a company,” he said.
Browne also said it was important that some audits were unannounced. “Suppliers should not be able to roll out the red carpet if they know the auditors are coming; it should be a way of doing business,” he said.
Andrew Newnham, group procurement director at ITV, said ethical purchasing was more about mindset than processes. “ITV don’t have a big ethical team. We see it as a way of doing business,” he said. “On a real and detailed level we can influence how our companies are seen and do business.
“It’s not all about price; it’s about value, it’s about culture, it’s about how they [suppliers] treat people. If suppliers don’t take that on consistently we will stop doing business with them.”
Frances Goodwin, head of ethical trading – group procurement at Tesco, said the firm sourced from 30 to 40 countries and dealt with “10 to 20,000 suppliers across the world”.
She said audits were carried out by third party organisations. “It’s incredibly important how you react to a non-compliance,” she said. “We have certainly learned the most important thing is to say you have found it and what you are doing about it.”
Newnham said ITV was signed up to the Living Wage while Browne said IKEA paid “above the minimum wage”. Goodwin said Tesco was not signed up to the Living Wage but paid the minimum wage, though this could be complicated with suppliers in other countries.
“It’s quite difficult for us to benchmark the minimum wage in terms of other countries,” she said. “It can be a tough challenge to work out what they should be paying.”