BlogpostA supplier code of conduct is more than a compliance document. It’s the foundation of how your company builds trust, manages risk, and ensures ethical practices across every tier of your supply chain. With ESG scrutiny intensifying, human rights due diligence laws expanding across jurisdictions, and 2030 climate targets approaching fast, the expectations placed on suppliers have never been higher.
This code sets out clear social, environmental, and ethical expectations for all suppliers and subcontractors conducting business with our organization. It applies to manufacturers, service providers, logistics partners, and any other entity involved in the services provided to us.
The Supplier Code of Conduct is contractually binding and forms part of all new and renewed supplier agreements effective for agreements signed on or after 1 January 2025. The purpose is straightforward: reduce operational, legal, and reputational risk while building resilient, transparent, and sustainable supply chains that deliver positive impact for everyone involved.
What Is a Supplier Code of Conduct?
A supplier code of conduct is a documented set of requirements and standards that guides suppliers’ behaviour across ethics, labour practices, environment, and business operations. It functions as a shared agreement between your company and every supplier in your ecosystem, establishing the rules of engagement for responsible sourcing.
This code applies to all tiers of suppliers—manufacturers, service providers, logistics providers, agents, and relevant subcontractors—in all countries where they operate. Whether a supplier produces components in Southeast Asia or provides professional services in Europe, the same core values and expectations apply.
The code covers critical areas including:
- Working conditions and workplace safety
- Human rights protections throughout the supply chain
- Anti corruption measures and business integrity
- Data protection and information security
- Environmental responsibility and sustainability goals
- Fair treatment, non discrimination, and equal opportunity
Suppliers commit to these standards as a condition of doing business. They must also cascade these requirements to their own critical subcontractors, ensuring that ethical practices extend beyond direct supplier relationships into deeper supply chain tiers.
Core Principles and Scope
This supplier code is grounded in internationally recognized standards that represent the global consensus on responsible business conduct. These include the UN Guiding Principles on Business and Human Rights, ILO Core Conventions, OECD Guidelines for Multinational Enterprises, and the Paris Agreement on climate change.
We expect suppliers to operate according to these core principles:
- Legality: Comply with all applicable laws and regulations in every jurisdiction of operation
- Respect for human rights: Protect the dignity, safety, and freedom of all workers
- Environmental stewardship: Minimize environmental impact and work toward sustainability goals
- Business integrity: Conduct all operations with honesty, transparency, and ethics
- Transparency: Provide accurate disclosure of practices, performance, and any issues
- Continuous improvement: Commit to ongoing enhancement of standards and practices
The geographic scope is global. This includes high-risk sourcing regions in Asia, Africa, and Latin America where supply chain risks may be elevated. Suppliers must follow whichever standard is stricter: local law, contractual terms, or this code.
These requirements cover both direct operations and, where feasible, upstream activities such as raw materials sourcing and outsourced services.
How to Develop and Implement a Supplier Code of Conduct
Creating and operationalizing a robust supplier code of conduct requires a systematic process that moves from risk assessment through to full integration with supplier relationships. This section provides practical guidance for procurement and sustainability teams responsible for this work.
Follow this step-by-step process to develop an effective code:
- Map and assess supply chain risk: Identify country, sector, and product risks across your own supply chain. High-risk categories often include manufacturing in regions with weak labour protections, industries with known environmental impact, and sectors vulnerable to corruption.
- Review existing policies and legal requirements: Examine current internal policies and align with applicable legislation such as the EU Corporate Sustainability Due Diligence Directive, UK Modern Slavery Act, German Supply Chain Due Diligence Act, and similar regulations in your operating jurisdictions.
- Benchmark against industry initiatives and peers: Study how leading organizations in your industry structure their codes. Reference frameworks like the Ethical Trading Initiative Base Code, Fair Labor Association standards, and sector-specific codes provide valuable templates.
- Draft clear, accessible language: Write in plain, direct English that suppliers across different regions and education levels can understand. Avoid legal jargon where possible while maintaining enforceability.
- Consult with strategic suppliers and internal stakeholders: Engage key suppliers early to identify potential implementation challenges. Include input from legal, procurement, sustainability, and operations teams.
- Approve and roll out through contracts and onboarding: Integrate the code into standard contract terms. Build it into supplier onboarding processes and ensure acknowledgment is documented.
Where your suppliers already follow multiple customer codes, work to align requirements where possible. Conflicting standards create confusion and reduce compliance. The goal is cooperation that makes it easier for suppliers to achieve expectations, not bureaucratic burden.
Labour Standards, Working Conditions and Human Rights
Protecting people in the supply chain is a non-negotiable expectation. Our requirements align with ILO core labour standards and the UN Universal Declaration of Human Rights. We expect every supplier to treat workers with dignity and respect.
Prohibition of Forced Labour and Child Labour
Suppliers must eliminate all forms of forced, bonded, or trafficked labour from their operations. This means:
- All employment must be freely chosen employment—workers cannot be coerced into labour relationships
- No worker shall be required to surrender identity documents or pay recruitment fees
- Child labour is prohibited, with a minimum working age of 15 years (or higher where local law requires)
- Young workers aged 15-18 receive special protections including limitations on hazardous work and night shifts
Wages and Benefits
Fair compensation is fundamental to ethical employment:
- Pay at least the legal or collectively agreed minimum wage, whichever is higher
- Deliver payment on time in a manner convenient to workers
- Make no unlawful deductions from wages
- Work toward living wage standards where feasible, particularly in regions where minimum wages fall short
Working Hours
Working hours must comply with local law and align with ILO standards:
- Regular working hours should not exceed 48 hours per week as a standard
- Overtime must be voluntary, compensated at premium rates, and limited
- Workers must receive at least one day off in every seven-day period
- Adequate rest breaks during shifts are required
Workplace Safety and Health
Safe working conditions protect employees from harm:
- Maintain clean, hygienic facilities that meet or exceed regulatory requirements
- Provide adequate training on safety procedures for all workers
- Supply appropriate protective equipment at no cost to workers
- Establish emergency preparedness measures including fire exits, evacuation drills, and first aid capabilities
- Report and investigate all workplace accidents and near-misses
Alignment with ISO 45001 standards or equivalent frameworks provides objective benchmarks for occupational health and safety management.
Fair Treatment and Non-Discrimination
Every worker deserves respect:
- No discrimination based on gender, age, race, religion, disability, sexual orientation, nationality, union membership, or any other protected characteristic
- Zero tolerance for harassment, abuse, verbal intimidation, or disciplinary violence
- Grievance mechanisms that allow workers to raise concerns without fear of retaliation
Freedom of Association
Workers have the right to organize:
- Respect freedom of association and the right to collective bargaining
- Allow workers to join or form trade unions without interference
- Where local law restricts union activity, provide alternative means of worker representation and dialogue
Diversity, Inclusion and Equal Opportunity
Diversity and inclusion are core values that extend throughout our supply chain. Inclusive workplaces drive innovation, improve decision-making, and create environments where all employees can contribute their best work.
We expect suppliers to foster inclusive workplaces where employees can succeed regardless of gender, ethnicity, religion, disability, age, sexual orientation, or other protected status. This is not simply about avoiding discrimination—it’s about actively creating conditions for equal opportunity.
Supplier expectations include:
- Equal opportunity in recruitment, promotion, training, and compensation
- Hiring processes that actively prevent bias, including diverse interview panels and standardized evaluation criteria
- Pay equity assessments to identify and address unexplained compensation gaps
- Reasonable accommodations for workers with disabilities
- Flexible working arrangements where operationally feasible
Where legally permitted, we encourage suppliers to set and track measurable diversity goals. Examples include targets for gender balance in management roles by 2030 or representation metrics for underrepresented groups in technical positions.
Training managers and HR staff on anti-discrimination and inclusion practices is essential. Bias often operates unconsciously, and structured training helps decision-makers recognize and counteract it.
Business Ethics, Integrity and Anti-Corruption
We maintain zero tolerance for corruption, bribery, extortion, and fraud in all business dealings. This position reflects our core values and aligns with international instruments including the OECD Anti-Bribery Convention, the US Foreign Corrupt Practices Act, and the UK Bribery Act.
Anti-Bribery Requirements
Suppliers must:
- Never offer, pay, solicit, or accept bribes in any form
- Prohibit facilitation payments, regardless of local custom
- Reject any payments intended to improperly influence decisions by public officials or private partners
Gifts and Entertainment
Business courtesies must remain appropriate:
- Gifts and hospitality must be modest, infrequent, and fully transparent
- Anything intended to gain improper advantage is forbidden
- All entertainment must be in line with documented company policies
Conflicts of Interest
Transparency prevents improper influence:
- Disclose any personal, family, or financial relationships with our employees that could influence business decisions
- Avoid situations where personal interests conflict with professional duties
- Report potential conflicts promptly for appropriate management
Accurate Records
Integrity requires honest documentation:
- Maintain accurate books and records of all transactions
- Never falsify invoices, certifications, quality reports, or audit data
- Preserve documents according to legal retention requirements
Fair Competition
Healthy markets benefit everyone:
- Comply with all competition and antitrust laws
- Never engage in price-fixing, bid-rigging, market allocation, or improper information-sharing
- Compete on merit through quality, service, and value
Confidentiality, Privacy, and Information Security
Protecting confidential information, trade secrets, and personal data exchanged between partners is vital to maintaining trust in supplier relationships.
Suppliers must sign and comply with non-disclosure agreements where requested. All company information must be treated as strictly confidential and used only for the purposes specified in our business relationship.
Data Protection Compliance
Suppliers must comply with applicable privacy and data protection laws, including:
- GDPR in the European Union
- UK GDPR
- CCPA/CPRA in California
- Other applicable national and regional data protection regulations
This compliance includes maintaining lawful basis for processing personal data, practicing data minimization, implementing appropriate security measures, and respecting retention limits.
Information Security Measures
Suppliers must implement appropriate technical and organizational measures to safeguard data:
- Encryption of sensitive data in transit and at rest
- Access controls limiting data access to authorized personnel only
- Secure disposal of data when no longer needed
- Incident response procedures for potential breaches
- Prompt reporting of any data breach to our organization within contractually specified timeframes
Where proportionate to the supplier’s role and risk level, information security requirements should align with recognized standards such as ISO 27001 or equivalent frameworks.
Environmental Responsibility and Climate Action
Suppliers’ operations contribute significantly to our overall environmental footprint. Meeting our sustainability goals requires active partnership with suppliers who share our commitment to environmental stewardship.
Regulatory Compliance
Suppliers must comply with all applicable environmental laws and permits, including those related to:
- Air emissions and greenhouse gas reporting
- Solid waste management and disposal
- Water use and wastewater discharge
- Hazardous substances handling and storage
Measuring and Reducing Environmental Impact
We expect suppliers to integrate environmental management into their operations:
- Measure and track key environmental metrics including energy consumption, water use, and waste generation
- Implement energy efficiency improvements across facilities and processes
- Transition toward renewable energy sources where feasible
- Conserve water resources and reduce consumption in water-stressed regions
- Minimize waste through reduction, reuse, and recycling
- Phase out unnecessary single-use plastics from operations and packaging
Climate Targets
High-impact suppliers should set science-based greenhouse gas reduction targets aligned with limiting global warming to 1.5°C. We encourage:
- Establishing carbon emissions reduction targets with milestone years (e.g., 50% reduction by 2030 versus a 2018 baseline)
- Reporting Scope 1, 2, and material Scope 3 emissions annually
- Developing decarbonization roadmaps for energy-intensive operations
Chemical and Substance Management
Responsible chemical management protects people and ecosystems:
- Safely store and dispose of hazardous materials according to regulations
- Avoid substances of very high concern where safer alternatives exist
- Comply with regulations such as REACH and RoHS where applicable
Biodiversity Protection
Suppliers must protect local ecosystems and biodiversity:
- Avoid activities causing deforestation or habitat destruction
- Protect endangered species and sensitive ecosystems
- Conduct environmental assessments before expanding operations into new areas
Local Communities, Social Impact and Responsible Sourcing
Our aim is to ensure that sourcing decisions support—and do not harm—local communities. Supply chains should create fair economic opportunities in the regions where they operate.
Community Economic Development
Suppliers should:
- Prioritize local sourcing where quality, cost, and reliability permit
- Support small and medium-sized enterprises in their supply networks
- Create stable, fairly compensated employment in operating regions
- Contribute positively to local economic development
Land Rights and Indigenous Peoples
Respect for community rights is essential:
- Avoid involuntary resettlement or land grabbing
- Do not acquire land or natural resources without free, prior, and informed consent of affected communities
- Respect Indigenous Peoples’ rights in accordance with international standards including the UN Declaration on the Rights of Indigenous Peoples
Community Health and Safety
Being a good neighbour matters:
- Manage noise, pollution, and traffic impacts on surrounding communities
- Engage transparently with local stakeholders about operations and concerns
- Participate in community dialogue and address grievances promptly
Upstream Responsible Sourcing
Responsible sourcing extends beyond direct operations:
- Conduct due diligence on high-risk raw materials including conflict minerals, palm oil, timber, and cotton
- Maintain traceability systems that identify material origins
- Verify that upstream suppliers meet human rights and environmental standards
- Participate in industry initiatives for responsible material sourcing where available
Compliance with Laws and International Standards
Suppliers must comply with all applicable international, national, and local laws and regulations in the countries where they operate. This is the baseline expectation for any business relationship.
Where this supplier code sets a higher standard than local law, suppliers are expected to follow the stricter requirement to the extent legally permitted. Our standards represent the minimum acceptable performance, not aspirational goals.
We use key international frameworks as benchmarks when evaluating supplier practices:
| Framework | Focus Area |
|---|---|
| ILO Core Conventions | Labour rights and working conditions |
| UN Global Compact Principles | Human rights, labour, environment, anti-corruption |
| OECD Due Diligence Guidance | Responsible supply chain management |
| Paris Agreement | Climate action and emissions reduction |
Specific legislation relevant to our operations includes:
- EU Corporate Sustainability Due Diligence Directive
- German Supply Chain Due Diligence Act
- French Duty of Vigilance Law
- UK Modern Slavery Act
- US Uyghur Forced Labor Prevention Act
- EU Deforestation Regulation
Suppliers operating in regulated sectors must maintain all required licenses, permits, and certifications.
Monitoring, Audits, and Continuous Improvement
Monitoring is collaborative. Our approach aims at both assurance and improvement—we want to identify problems early and work together to solve them, not simply police compliance after the fact.
Monitoring Tools and Assessments
We use multiple monitoring mechanisms to verify supplier performance:
- Self-assessment questionnaires: Annual surveys covering labour, environment, ethics, and management systems
- Documentation reviews: Examination of policies, certifications, training records, and permits
- Third-party audits: Independent social and environmental audits conducted by qualified assessors
- On-site visits: Direct observation of facilities, processes, and working conditions
- Worker interviews: Confidential discussions with employees to understand actual conditions
Audit Rights
The company reserves the right to conduct announced and, where justified, unannounced audits. These may be performed directly by our personnel or through independent experts.
Suppliers must:
- Grant reasonable access to facilities, records, and relevant personnel
- Cooperate fully with auditors and investigators
- Support corrective action plans if issues are identified
- Track and report progress on remediation efforts
Tracking Progress
We expect suppliers to take ownership of their own improvement:
- Establish KPIs for key compliance areas
- Set targets for improvement in identified risk areas
- Report performance annually or as otherwise agreed
- Demonstrate measurable progress over time
Metrics we track include audit pass rates, corrective action closure times, ESG incident rates, and supplier certification validity periods.
Reporting Concerns, Non-Compliance, and Consequences
Transparency and early reporting of problems are essential to managing supply chain risk effectively. Hidden issues cannot be addressed—and often grow worse when concealed.
Reporting Channels
Suppliers, their workers, and other stakeholders should have access to confidential reporting channels for raising concerns about violations of this code. We provide:
- A confidential, preferably anonymous, hotline
- A web-based reporting portal available in multiple languages
- Direct communication channels with our procurement and compliance teams
Whistleblower Protection
Suppliers must:
- Protect anyone who reports concerns in good faith from retaliation
- Investigate all reports promptly and fairly
- Maintain confidentiality throughout the investigation process
- Take appropriate action based on findings
Consequences of Non-Compliance
Non-compliance triggers a structured response:
| Severity Level | Response |
|---|---|
| Minor issues | Dialogue and agreed corrective action plans with defined timelines |
| Repeated or serious issues | Formal warning, enhanced monitoring, temporary suspension of new orders |
| Severe violations | Immediate contract termination |
Material breaches that may trigger immediate termination include:
- Use of forced labour or human trafficking
- Child labour violations
- Serious environmental damage or illegal pollution
- Bribery, corruption, or fraud
- Falsification of audit data or certifications
- Refusal to cooperate with investigations
Notification Requirements
Suppliers must promptly notify us if they discover any actual or potential breach in their operations or their own supply chain. Cooperation in remediation is expected. Concealment of violations is itself a serious breach of this code.
Implementation, Training, and Supplier Engagement
A supplier code of conduct is effective only when it’s understood, integrated into daily processes, and supported by ongoing dialogue. Implementation is not a one-time event—it’s a continuous line of communication and cooperation.
Communicating the Code
We will communicate this code during:
- Initial supplier onboarding and qualification
- Contract renewals and renegotiations
- Periodic supplier engagement sessions
The code will be available in key languages used across our supply chain to ensure accessibility for all suppliers regardless of location.
Supplier Responsibilities
Suppliers are expected to:
- Brief their employees on the requirements of this code
- Inform key subcontractors of applicable standards
- Integrate these requirements into their own policies and management systems
- Provide relevant training to workers in areas such as health and safety, anti-corruption, and human rights
Company Support
We recognize that implementation requires resources and capability building. We will:
- Provide guidance documents and practical tools
- Offer training sessions, webinars, and workshops
- Share best practices from across our supplier network
- Provide targeted support for suppliers in high-risk or developing markets
Long-Term Partnerships
Our goal is building long-term partnerships based on shared values. We prioritize:
- Supporting suppliers’ continuous improvement rather than immediately switching at the first sign of difficulty
- Recognizing and rewarding suppliers who demonstrate leadership in sustainability and ethics
- Collaborative problem-solving when challenges arise
- Transparent communication about expectations and performance
The supplier code of conduct represents our commitment to responsible sourcing and ethical business conduct. We expect our partners to share these values and work with us to achieve supply chains that protect people, respect the nature around us, and operate with integrity.
Together, we can build supply networks that deliver not only commercial value but lasting positive impact for workers, communities, and the environment. That’s the standard we’re committed to—and we invite every supplier to join us in making it a reality.