Corporate Social Responsibility Module to Protect Against Brand Risk

Santa Clara, Calif.May 28, 2014Resilinc Corp., a provider of supply chain resiliency solutions, announced the immediate availability of the SupplyIntel CSR Module to help companies interested in taking a proactive stand to protect against threats to their brand arising from inadequate management systems, controls and governance processes involving labor, ethics, and environmental compliance and sustainability.

Most companies have internal corporate policies regarding the use of child or slave labor, bonded labor, sweat shops and working conditions, minimum pay and employee health, and environment friendly sustainable practices. However, recent examples show that companies need to address these issues not only within their own factories and businesses, but also outside their four walls by including their direct and sub-tier suppliers.

Increasingly, companies are being held accountable for the conduct of their suppliers and vendors. Apple and its contract manufacturer Flextronics provide a recent example. When poor working conditions at Flextronics’ factories became public knowledge, Apple received negative publicity that affected its brand. Prior to that, employee suicides at another contract manufacturer, Foxconn in China, also had a negative impact on Apple’s brand.

Another notable example of brand damage resulted from the tragic fire, which killed 117 people, making it the deadliest factory fire in Bangladesh history, at a garment factory owned by Tazreen Fashions. The Tazreen Fashions factory was found to be a sub-contractor to a supplier to Walmart. Walmart had previously terminated relationships with this factory due to repeated violations and marked it high risk. However, a Walmart supplier had sub-contracted work to Tazreen Fashions, unbeknownst to Walmart. Though Walmart did not sanction the use of this sub-contractor, the company was nonetheless held morally responsible for having this sub-contractor in its supply chain.

It should be noted that, in this Walmart example, it was a sub-contractor to a Tier 1 supplier that was in violation of Walmart’s code of conduct—a clear demonstration of why supply chain mapping is now a critical first step in understanding and mitigating brand risk.

In order to proactively protect their brand against these types of threats, companies need to first gain a better understanding of their global supply chain through supply chain mapping, which involves identifying the manufacturing locations worldwide that are used by their component suppliers, and then for each site, gain a deeper understanding of their suppliers’ practices regarding labor and workers’ rights, as well as environmental and sustainable practices.

“Companies are finding their brands are vulnerable as the market holds brand owners accountable for the business practices of their suppliers. As is seen in California with the passing of the SB-657 legislation, this is on its way to becoming a compliance issue,” said Bindiya Vakil, CEO of Resilinc. “Brand owners need a better way to identify which factories and sub-tier suppliers are used in their extended supply chain in order to make sure these suppliers accept and comply with the company’s code of conduct. The Resilinc corporate social responsibility (CSR) Module leverages the multi-tier mapping capabilities of Resilinc’s technology platform and enables brand owners to proactively manage the risk to their brands.”

Resilinc CSR Module for Brand Risk Protection

The Resilinc CSR Module is based on the Electronics Industry Citizenship Coalition (EICC) standard, and covers the management systems, business practices and controls instituted by the suppliers that govern labor practices, employee health and safety, and environmental compliance and sustainability. It is offered in combination with the supply chain mapping capabilities of the Resilinc platform. Resilinc SupplyIntel enables companies to identify factories worldwide that are used in manufacturing their parts and raw materials, as well as the ownership of the factories, whether owned or sub-contracted.  

The Resilinc CSR module enables brand owners to survey suppliers at the supplier and site levels. Resilinc provides all the supplier onboarding, training and data collection services needed to make the CSR survey process a low-resource undertaking for customers. Additionally, Resilinc’s publish-once, share multiple times methodology enables suppliers to automatically share their business practices with many customers, thereby minimizing the effort required to provide the requisite information.

The Resilinc CSR solution also automatically generates scorecards at a site level, and provides a quick heat map of the weakest areas in which insufficient management systems and controls are prevalent. This allows the brand owners to quickly identify sites that may need to be audited and suppliers who may need to be educated.

SupplyIntel Meets Today’s Risk Management Challenges

Resilinc SupplyIntel is specifically designed to address multi-tier visibility issues experienced in major global industries, including high-tech and electronics, automotive, medical devices and the life sciences. Resilinc SupplyIntel provides these and other industries with the foundational supply chain mapping capability that is core to addressing the challenges associated with risk management, conflict minerals compliance, business continuity and social responsibility.

With the business-critical addition of CSR capabilities, Resilinc SupplyIntel now delivers a complete and scalable solution for the entire spectrum of risk management challenges. SupplyIntel’s comprehensive capabilities include multi-tier mapping, event monitoring, and risk quantification and mitigation tools, together with a range of survey modules for business continuity mapping, conflict minerals, corporate social responsibility and supply chain security—all on a single integrated platform.

Resilinc’s model delivers benefits of the network effect as customers can quickly connect with many suppliers, and adopt multiple capabilities at a low total cost of ownership with a low resource impact and a fast time to value. Resilinc’s clients also realize a growing return on investment over time as more and more supplier data can be seamlessly and securely shared with multiple clients.

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