Responsible Sourcing and Human Rights

 Our Responsible Sourcing and Human Rights Approach

As a responsible retailer we are committed to:-

·       the principles of responsible sourcing

·       respecting human rights

·       promoting the dignity and well-being of everyone contributing to our business.

We collaborate across industries and organisations around the world to help combat risks including, but not limited to:-

·       forced and child labour

·       unsafe working condition

·       restricted freedom of association; and

·       violence, harassment, and discrimination.

Our commitment extends to all individuals impacted by Asda and our subsidiaries’ business activities and relationships, including colleagues, customers, suppliers, workers within our supply chains, and the communities in which we operate. Asda's Human Rights Policy outlines the steps we take to respect internationally recognised human rights and formalises our expectations across our global supply chains.

Improving labour standards is a responsibility that should be shared with all our suppliers. We expect suppliers to operate responsibly, abiding to applicable local labour and employment laws and adhering to our Standards for Suppliers. These standards are the cornerstone of our programme and lay out how we expect our suppliers to respect foundational worker rights across the globe. Our Standards for Suppliers are aligned to the ETI Base Code; an internationally recognised code of labour practice. Our Supply Chain Monitoring Requirements and Guidance policy details how we monitor supply chain compliance with our standards and how we will support suppliers to demonstrate continuous improvement through the provision of guidance and resources.

We currently use third party social, safety, and environmental compliance audits to help us evaluate our suppliers’ compliance to our standards and to manage risk in the supply chain. These audits seek to monitor whether, among other things, workers are properly paid for the work they do, labour is voluntary, working hours are not excessive and are consistent with local laws, and facilities meet health and safety laws and regulations. Whilst social audits still have a place within our programme, we recognise their limitations and the need to move beyond audit to identify root cause. We will continue to work with suppliers to help upskill and improve standards within their facilities through the provision of guidance and access to tools and resources. For example, we have partnered with suppliers from our George, Food and GNFR supply chains, to pilot a worker voice application to improve understanding and gather additional data on the worker experience, including temporary labour. We will compare the outputs from this exercise against audit data to identify any potential gaps and areas of risk not previously considered.

Where an issue is identified in the supply chain, we are committed to working with suppliers and third parties to understand the root cause and provide relevant guidance and resources to support thorough investigation and remediation for impacted workers. We ask suppliers to close any non-compliances raised in a social audit within the timelines recommended by the auditor. If this is not possible, we will discuss the circumstances on a case-by-case basis and where there is both commitment and a clear action plan to resolve the outstanding issues, we may agree an extension. We encourage our suppliers to apply the same principles when working with their supply chain. Further examples of our approach to incident management can be found in our annual Modern Slavery Statements, available on the Asda Corporate website.

Transparency of the supply chain is key to our approach. We map and collect data on our supply chains through Sedex, an online responsible sourcing management platform which helps us to identify our salient labour risks. We monitor and investigate issues in the supply chain, we enable colleagues within the business to understand their role in human rights and its impacts, and engage in initiatives to find root cause solutions that can transform entire supply chains. Partnering with our suppliers and their global facilities, we work to mitigate risks, drive remediation, and improve standards for workers via our risk-based approach. We are active members of external collaborations such as the Ethical Trading Initiative (of which we are a founding member), Stronger Together, and the Food Network for Ethical Trade which continue to support their members to drive continuous improvement. Through these partnerships we engage with other retailers, NGOs, Trade Unions, and suppliers to address risks, share best practice, investigate issues where appropriate, and establish initiatives to achieve collective goals.

Transparency of the supply chain is essential to identify and manage our salient risks. Below we have published a list of our Tier 1 Food, Non-Edible Grocery, Produce and General Merchandise sites, supplying Asda branded or exclusive products.

In 2023 we partnered with Open Supply Hub to provide more datapoints publicly. With more interactive and user friendly information we hope to drive accountability and awareness of where Asda operates globally.

Through these partnerships we engage with other retailers, NGOs, Trade Unions, and suppliers to address risks, share best practice, investigate issues where appropriate, and establish initiatives to achieve collective goals. 

Salient Human Rights Risks and Themes

­To identify the salient labour and human rights risks in our supply chains we have used a combination of country-specific risk information from publicly available sources, self-declared supplier information, social audit trends and incidents that have occurred. Using this data, we have formulated the salient risks which are pertinent to the operation of our business and require attention from Asda, our suppliers, and colleagues, to address root cause. We have prioritised our focus based on commodity, geography, impact, and complexity, and are committed to understanding these areas better, to address the risks for the benefit of the people who make the products we sell.

In addition, to achieve greater impact for workers and to have improved understanding of the key risks across our global supply chains we have embedded the Open Supply Hub, a collaborative supply chain mapping platform. With over 2,500 accessible data points currently available, users have a comprehensive view of our in-scope supply chain network, including information on suppliers, manufacturing sites, site demographics, workers’ contracts, whether a trade union is present, alongside key compliance information such as when the site was last audited.

­We are working closely with data science colleagues to explore how open-source information and technology can provide us with real-time information and enhance our understanding of the experience of workers in our supply chains.

We will continue to explore the salient human rights risks identified and utilise our emerging data science led approach, to better understand and address root cause, whilst constantly reviewing our scope and human rights impact across all tiers of our supply chains. Action plans have been developed for these risks with early phases of risk mapping and stakeholder engagement being undertaken to better understand the role Asda can play in delivering change.

To further strengthen our approach, we have:

• Introduced a compulsory Tier 1 facility disclosure and site-claiming requirement on the Open Supply Hub platform, aimed at driving greater transparency, accountability and local ownership of issues and resolutions. By associating each facility with its site manager or owner, we enable clear visibility to our supply chain and where remediation has the best chance of being effective and representative of rights holder requirements. This new step has been fully integrated into our enhanced Transparency Requirements and Monitoring Policy, which not only rewards supplier best practice, but also identifies and addresses risk with greater precision and measurable/ meaningful impact.

• Issued enhanced guidance and clear expectations for suppliers operating in high-risk categories, including the sourcing of tomatoes, paprika, solar, seafood, and cotton. It covers the development of commodity-specific guidance documents that set out due diligence requirements such as transparency of ownership structures, identification of sanctioned individuals, assessment of potential indirect links to State Imposed Labour (SIFL), and mapping the supply chain from cultivation through to processing. We also expect suppliers to implement robust compliance systems with effective monitoring and accountability mechanisms.

• Initiated engagement with our concession partners to better understand their human rights practices and supported capacity building. This includes strengthening risk identification processes and supporting effective remediation to ensure more resilient and rights-respecting operations.