Supplier codes of conduct

August 5, 2015

Today’s supplier codes of conduct are better and more plentiful than those of a few years ago. Many companies are starting to recognise the importance of having a written code of conduct for their suppliers and other third parties, and the value that such a code can create for their company’s business. The code sets a consistent standard for vendor organisations, is a vital part of corporate social responsibility (CSR) and compliance and ethics programmes, and helps to advance integrity, responsible business practices and human rights.

Most companies have a uniform set of standards for the products and services they purchase, and similar standards should be in place for the ethical business principles that suppliers are expected to maintain. The consequences for a fault in the ethics of the supply chain can be just as catastrophic as a fault in the products being supplied, if not more catastrophic. The supplier code is also becoming a document that is of importance to the public (including consumers and investors). Many companies are beginning to significantly improve their existing supplier codes, or draft a supplier code for the first time. The driving forces behind the increased focus on supplier codes can be attributed to more global and sophisticated supply chains, increased public scrutiny on corporate responsibility, human rights and environmental compliance, new legislation enforcement developments, as well as the pioneering work of some leading organisations that set the trends and raise the bar. These factors are driving supplier codes into a new era of quality and best practices.

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