Question

What are the challenges of monitoring overseas suppliers (especially tier 3, tier 4, etc.) that are guilty of not following labor and human rights guidelines?

Answer 1

• Labor practices in the supplier countries

Unethical practices are accosted in labor sourcing in many supplier countries. Poor working standards are the norm. This makes it difficult for the company to make the suppliers take voluntary action. It is hard to manage already guilty suppliers who may return back to old practices. Converting awareness into action and responsibilities is a difficult task. The legal framework is also weak in many of these countries, thus not providing a support for the company’s regulatory practices

• Complexity

Sometimes a company can have numerous suppliers for necessity, risk management, and flexibility.

• Cost of monitoring and monitoring system

Monitoring may be in the form of visits, detailed audits and so forth. This can extend far beyond immediate suppliers. This takes a lot of effort, consistency, and money

• Communicating the company code of ethics and values

Communication can be a big barrier to managing the suppliers overseas. Variations in practices and culture affect the communication

• Training and guiding

Training suppliers helps in educating the regarding the necessity of ethical practices and installing values in the supply chain. Training is a tedious process and requires time and persistence

• Lack of technology and infrastructure

Several supplier countries like Namibia lack the regulatory framework as wells technology infrastructure required for monitoring

• Lack of strong international regulatory mechanism

Third party mechanisms to control supplier practices are still weak. The only way to regulate them, for malpractices, remains with the company