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Building supplier capability - how we engage with our suppliers

Engaging directly with suppliers is one of the most effective ways of improving performance in our supply chains. From monitoring non-compliance to carrying out assessments and employee surveys, we work to help suppliers strengthen their own compliance and processes.

This enables us to identify critical performance issues and take appropriate remedial action. It also helps us provide targeted support for suppliers to help them build capability to address issues within their own supply chains. We also provide support for communities within our supply chain, such as the LGBT+ community.

Improving performance and building capability

Engaging directly with suppliers through follow-up discussions and briefings using our monitoring processes is one of the most effective ways of improving performance in our supply chain. If there is evidence of non-compliance through Joint Audit Cooperation (JAC) audits, our own on-site assessments or worker surveys, we work with suppliers to develop corrective actions, to improve their policies and/or strengthen the processes they use to manage key risks.

This year, most of the recommendations made following Vodafone or JAC audits related to health and safety, excessive working hours and business ethics. Regarding health and safety, there was an increase in those related to fire evacuation signage, evacuation lighting and fire exits. There was also an increase in environmental recommendations, mainly regarding unsatisfactory management systems or emissions monitoring. We work directly and through the JAC governance process to ensure all recommendations are implemented.

Recommendations for improvement from combined JAC audits and Vodafone audits in 2019

Displaying number of cases
* JAC assessments are reported on a calendar-year basis

  • Emergency preparedness (e.g. missing building safety plans or missing equipment).

  • Lack of safety management policies and processes.

  • Inadequate safeguards to prevent exposure to hazardous substances.

  • Poor resource planning and forecasting, which leads to excessive working hours by supplier employees.

  • Lack of effective ethics policies.

  • Lack of ethics requirements towards their suppliers.

  • Lack of whistle-blowing mechanism.

  • Lack of environmental performance targets.

  • Missing environmental permits to conduct certain activities.

  • Poor control on disposal of hazardous substances.

  • Improper or unclear overtime payments.

  • Failure to comply with minimum wage requirements.

  • Failure to keep accurate records on social insurance payments.

  • Inadequate policies to ensure equality.

  • Instances of young workers 16–18, found to be doing dangerous or night work.

  • Inadequate records kept on verifying worker age.

  • Workers denied the opportunity to join representative bodies.

  • Worker representatives not elected freely.

  • Excessive use of agency or temporary labour.

  • Employees not receiving copies of their employment contract.

  • Wage deductions used as a disciplinary measure.

There were 30 out of 60 critical performance issues identified from JAC on-site audits that were resolved and signed off. The remaining 30 issues related to working hours and emergency preparedness require additional time and investment to monitor effectiveness of actions before they can be signed off as completed. Vodafone will terminate a contract if any supplier persistently fails to resolve compliance failures or if issues of gross misbehaviour occur.

Providing our suppliers with direct support and building capability

As part of the JAC initiative, Vodafone worked with three other operators this year to launch a Supplier Academy to build supplier capability.

Supporting LGBT+ communities in our supply chain

This year, we began to measure the progress our suppliers are making towards support for diverse groups such as LGBT+.

Download our Sustainable Business Report 2019