Primark Ethical Trading

Primark’s Ethical Trading Initiative report

In 2011 we were pleased that the ETI recognised our efforts in improving our programme by categorising Primark as Leader in four out of six categories, a significant step up from our previous overall rating of Achiever.

This is a significant achievement and demonstrates the hard work and commitment made by Primark in ensuring that workers making our products are paid fairly, treated well, and work in decent conditions. However, we recognise that we still have further to go and still much more that we can do either individually at Primark or in collaboration with other retailers, NGOs and stakeholders.

The ETI recognises four progressive stages of a company’s commitment to, and performance of ethical trading. These are Foundation, Improver, Achiever, and Leader. The ETI classifies a Leader as “tackling the root causes of labour rights problems beyond individual workplaces with collaborative initiatives aimed at the sectoral level and / or in raw materials or components supply. The company can demonstrate positive impacts for workers in its supply chain and reports transparently on progress. The company is advocating for greater respect for workers' rights throughout its sphere of influence.” Ethical Trading Initiative Management Benchmarks 2010

The ETI Annual Report looked at Primark’s performance against a wide range of benchmarks that included our commitment to the ETI; our systems of monitoring, reporting and independent verification; awareness raising and training on ethical trading issues; improvements and corrective actions at an individual factory level; our management procedures, pricing and incentives.

The report is reviewed by the ETI Secretariat, and by a non-governmental organisation. Organisations which have reviewed our report have included Save the Children, and Anti-Slavery International. This combined feedback helps us to improve and grow our programme each year.

How the ETI rated us

The tables below highlight how we performed in each category and sub-category for 2009 and 2008. Note that the management benchmarks used in 2009 and in previous years were changed in 2010.

1. Commitment

2. Monitoring, independent verification and reporting

3. Awareness raising and training

4. Corrective actions

5. Management procedures, pricing and incentives

Our report for 2009 was reviewed by Save the Children, a NGO member of the ETI. We were pleased to receive the following feedback from Save the Children, who highlighted our positive progress.

I am writing on behalf of Save the Children UK in its capacity as members of the Ethical Trade Initiative (ETI, to give feedback on Primark’s Annual Report to ETI (2009).

This was my first opportunity to review Primark’s ETI report, though I had the opportunity to meet with Primark alongside other members of the ETI NGO Caucus in July 2008. My overall impression after reading the report (which was very complete and a pleasure to read) was to be highly impressed at the significant progress that Primark has made in its ethical trade programme since our 2008 meeting. Primark is to be congratulated on its renewed commitment to ETI in recent years, a particularly impressive achievement especially given its years of tenure in the ETI. Overall, I agreed with Primark’s self assessment of itself as an Achiever in all management indicators, except Principle 5 (Management, Procedures, Pricing and Incentives) where I agreed that it was an Improver.

The challenge for Primark in coming years will be to consolidate progress, and to ensure that it doesn’t lose momentum.

Areas of good practice, of which were many, recognised in the report are as follows:

- Commitment to ethical trade:

• Expansion of Ethical Trading team (increased resources and size of team), with plans for further increases to a total of 15 staff by the end of 2010
• Ethical Trade Director is a member of the Primark Executive Committee and reports directly to Chief Executive
• Extensive engagement in ETI working groups and pilot projects
• Extending implementation beyond first tier

- Monitoring, independent verification and reporting:

• Supplier rationalisation and a focus on building long-term relationships with suppliers
• All factories risk assessed
• Massive increase in the number of audits over 2008
• Numerous aspects to verification process, including own staff, commercial auditors and NGO auditors. Plans to expand involvement of other “on the ground” bodies to verify inspections
• Incorporate worker interviews in inspection process, both on and offsite

- Awareness raising and training:

• Staff intranet acts as central portal of information on ethical trade
• Conducting worker training project in Bangladesh; established Worker Education Groups in India

- Empowering suppliers:

• Focus of ethical trade programme on supplier ownership and capacity building
• Held a number of supplier training workshops, with plans for more
• Code of Conduct translated in to a wide variety of languages

- Integration of ethical trade into purchasing practices:

• Ethical trade included as part of employee induction, including one-to-one meeting with Ethical Trade Director
• Training on ethical trade for buyers
• Regular engagement between ethical trade and buying teams – for e.g., providing buyers with information packs about ethical trading issues prior to buying trip
• Plans to focus on intractable provisions of the Base Code, including plans to address Living Wage issues in 2010
• Focusing attention in risk assessments on homeworking and subcontracting

- Ensuring that informal workers are covered by its code implementation:

• Developed a policy and implementation plan on homeworking, based on ETI guidelines
• Active participants in the Homeworkers Group (UK and Delhi)
• Participated in Homeworkers Trip to India
• Planned pilot project in Tiripur

- Engaging with workers and trade unions in code implementation:

• Individual worker interviewers incorporated into inspection, both on site and off site
• Worker training programme for over 1000 workers (NUK project in Bangladesh), plus rights-based training (SAVE project India)
• Worker Education Groups established in India
• Discussion with union in India re: verifying the findings of the main audits
• Worked with NGO auditors in China, Bangladesh and India
• Worked with trade unions in Bangladesh and India on remediation
• Informal relationships with local NGOs

- Taking measures to focus implementation on tricky/intractable BC provision:

• Leading project on vulnerable young female workers as part of Brand Ethics Working Group (with H&M and Gap)
• Initiated project SAVE in India on worker education, including gender equality and freedom of association
• Member of project in India on freedom of association training and worker education
• Living wage projects in China (project sponsor) and Bangladesh (project partner)

While we fully recognise Primark’s significant progress in recent years, we would like to offer some constructive suggestions for how Primark can continue to progress its ethical trading programme:

• Build on the success of programmes started in 2009, ensuring that the ethical trade programme is well-anchored in the organisation and not dependant on the efforts of on person
• Push further on the difficult issues in the Base Code, including homeworking and living wage
• Translate efforts and initiatives into impact on workers, to be able to demonstrate next year clear instances of how workers’ conditions are improving across Primark’s supply chain
• Further implementation of guidelines on termination of supplier relationships
• Further integration of ethical trade into commercial terms and more formal systems for recognitions of suppliers with high labour standards
• Further develop targets in terms of labour conditions in your supply chain, as other companies are now doing, either at department level of through KPIs on ethical trade for staff, including buyers
• Ensure that information systems (including audit databases) are able to give evidence of conditions across company supply chains, identifying issues to inform implementation and to demonstrate impact

These measures should help Primark translate efforts and initiatives into impact on workers and demonstrate evidence that working conditions are improving across Primark’s supply chains.

In summary, we are delighted to see Primark’s impressive progress on ethical trade and look forward to hearing how many initiatives and projects progress. We would be happy to meet with you to discuss your 2009 report or other ethical trading issues further if that would be helpful.