Social Fingerprint®:

Measure & Improve

Social PerformancePresented at the ISSP Conference

September 22, 2011by Craig Moss, Director –

Corporate Programs & Training

© Social Accountability International 2011

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Social Accountability International

Multi-stakeholder organization - established May 1997

Developed leading social compliance standard and certification system - SA8000®

Multi-industry and global

Leader in social compliance training for brands, suppliers and auditors

Contracted by many governments and multi-national agencies to conduct CSR awareness and supplier training

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SAI Corporate Programs Work with brands and retailers to use management

systems to drive continual improvement of social performance in their supply chains - applicable to various codes and standards

Published “Implementing a Socially Responsible Supply Chain”

Developed Handbook for World Bank/IFC on client use of management systems to meet PS2

Members include Carrefour, Disney, HP, Gap, Timberland, Anvil Knitwear, Rosy Blue, General Mills, Chiquita, Gucci, TNT, Otto Group, Billabong, etc.

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Session Overview

(Really Brief) Introduction to Social Performance

Challenge: Prescription versus Judgment

Setting the Stage: Social Performance in the Global Supply Chain

Measure & Improve: Using a Process-based Approach

(Really Quick) Tour of Social Fingerprint®

Discussion

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aka Labor Standards Performance, Social Compliance, Labor Compliance

Introduction to Social Performance

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SA8000®: Labor Standard

Child Labor Child labor shall not be used

Forced Labor People have the right to change jobs and shall not be forced to work

Health & Safety People must not be endangered at work

Freedom of Association

People have the right to organize and be heard at work thru collective bargaining

Discrimination Hiring, promotions and wages must be equal and fair

Discipline People must not be abused at work and free from all corporal punishment

Working Hours Overtime is limited, voluntary and paid at a premium

Compensation People must earn enough to live on during a regular work week

Management System A management system is the key to sustainable compliance

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Elements of Social Performance

Improving social performance requires improvement by managers and workers in all three areas

Skills

Attitudes

Knowledge

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Social Performance in the Global Supply

Chain

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Consumer Electronics Supply Chain

CONSUMER ELECTRONICS BRAND

SUPPLIER: ASSEMBLY, QC & PACKAGINGSub-Contractor:

Batteries

Sub-Supplier: Wires

Sub-Supplier: Connectors

Sub-Supplier: Switches

Sub-Supplier: Cells

Sub-Contractor: Memory

Sub-Contractor: Displays

Sub-Supplier: Security

Sub-Supplier: Dormitory

Sub-Supplier: Cleaning

Sub-Supplier: Cafeteria

X X X X

X X X XProduc

eMeat Paper Tools Bakery

PO

Sub-Contractor: Plastic Cases

Socially Responsible Supply Chain Trends Increasing use of “Strategic Suppliers”

Working with suppliers to build internal capacity

More training, less auditing

All industries struggling with how to manage sub-contractors

Integrating social compliance into sourcing operations and performance measurements

Shift from “the stick” to “the carrot”

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Prescription versus

Judgment

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Discrimination or Not?

Women at the shoe factory in India are not allowed to perform certain production jobs after the age of 25 since younger workers are considered to be more efficient at this particular task.

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Prescription

Choice 1 Choice 2

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uuThe Third Option

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More Choices – More Decisions

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Prescription vs. Calibration

Judgment and the Theory of Motivated Reasoning

Our Beliefs versus New Facts Confirmation Bias Disconfirmation Bias

Changing Attitude is REALLY HARD

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Measure & Improve

Using a Process-based Approach

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You Can’t Improve What You Don’t Measure

Losing weight

Running a marathon

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Social Fingerprint® Program Approach

“Measure & Improve”

Focuses on processes and management systems – not only code violations

Builds on SA8000 management systems

Analyzes system development and implementation

Supports continual improvement along any standard, industry code or corporate code

Shapes the path and creates small steps to improvement

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Social Fingerprint® Programs

Company

Looks inside a company at how

they manage social

performance

Typically for suppliers

Supply Chain

Management

Looks at how a company

manages social performance in its supply chain

Typically for brands/retailers

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Social Fingerprint® Program: Uses

Self-Assessment Internal tool to measure and improve Risk assessment tool

“Remote” Independent Evaluation Phone interview and document review Benchmarking

Field Verification

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Social Fingerprint® Process Categories

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Company Program (Supplier)

Supply Chain Management Program (Brand/Retailer)

Management Systems Scope & Risk

Internal Social Performance Team

Aggregate Score of Suppliers

Worker Involvement & Communication

Annual Improvement of Suppliers

Complaint Management & Resolution

Internal Integration of Compliance and Sourcing

Level & Type of Non-Conformance

Supplier Communication & Purchasing Practices

Progress on Corrective Actions Complaint Management & Resolution

External Stakeholder Engagement

Training & Capacity Building

Management of Suppliers & Contractors

Social Fingerprint® Levels

1 = Little or no awareness, systems or interest

2 = Limited systems with sporadic implementation

3 = Systems in development with partial implementation

4 = Fully developed systems with improving implementation

5 = Mature systems, fully implemented inside and outside company

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Mapping Social Fingerprint® to SA8000 or a Rigorous Code

Implementation Tips Verify that policies and procedures in

Management Systems meet SA8000 or Code Think both ways

Use the 9 Social Fingerprint categories to tackle any individual labor code element

Use the 9 Social Fingerprint categories as a detailed plan for a management systems audit

Social Fingerprint improvement tips can help with corrective actions and remediation

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Human resource policies and procedures meeting the selected code or standard

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Trained multi-department team that leads the effort and includes worker representation

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Effective two-way communication channels and joint participation

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The system for handling and addressing grievances

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Severity and frequency of problems in meeting labor standards – systemic or isolated

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Effective system for addressing problems and making changes to prevent them from recurring

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Cooperation with outside auditors and involvement with external stakeholders to enhance efforts to improve labor standards

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System for training on the attitude, skills and knowledge needed to improve labor standards - in your company and supply chain

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System for informing suppliers of labor standard and methods for influencing them to meet the code or standard and improve

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Social Fingerprint®

in Action

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Comparison: 50 Suppliers in China

MSIS

PT WIC

CMSLT

NCPC

AEV

SE TCB

MSC

Socia

l Fin

gerp

rint

0

0.5

1

1.5

2

2.5

3

3.5

4

4.5

5

Self-AssessmentSAI Evaluation

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Case Study: Benefits & Results

60 vendors in one country - random survey of 23: 91% agreed or strongly agreed - online system

easy to use 100% implemented improvement tips

immediately (57% 3-5 tips; 24% implemented 6+ tips)

Improvement highlights–reporting “significantly better” Management Systems – 48% Internal Social Performance Teams – 44% Worker Involvement & Communication – 35% Progress on Corrective Actions – 44%

82% agreed or strongly agreed that Social Fingerprint was more helpful than other social performance programs

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Social Fingerprint®

Getting Started:

Quick Tour

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Questions & Answers

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