- Company Approach
- Supply Chain
- Social Commitment
- Press Releases and Statements
Over the years, Benetton Group has implemented a series of procedures and initiatives designed to ensure that all individuals and entities involved in our supply chain are treated fairly and correctly. Respect for human rights is not only an ethical imperative, but also a pressing demand from consumers as well as a necessary prerequisite for doing business.
In confirming its commitment to respecting human rights, Benetton Group updated and published a statement in 2020 based on Section 54 of the Modern Slavery Act of 2015 concerning the measures adopted to prevent and mitigate the risk of all forms of slavery along the supply chain and to actively promote respect for human rights.
We select our suppliers not only based on product quality, competitive prices and transparency, but also on their compliance with social, ethical and environmental principles. A list of our active suppliers located all over the world is available on our web site for consultation.
Code of Conduct
Any individual or company that establishes a business relationship with us undertakes to comply with the Benetton Group’s Code of Conduct, founded on compliance with human rights and protection of the environment.
The Group’s Code of Conduct implements the most relevant international regulations with particular reference to the UN Business and Human Rights of June 2011 and the Communication from the European Commission on the Renewed Strategy on Corporate Social Responsibility of October 2011. Benetton Group’s Code of Conduct is annexed to the commercial contract, and, as such, our suppliers have to sign it.
For the benefit of active business partners worldwide, the Code of Conduct is available on our website in several languages. We ask to our suppliers to expose its version in local language in a space of their production building accessible to workers.
Guidelines for Benetton Group Code of Conduct for Manufacturers
In order to support suppliers in the operational implementation of Code of Conduct’s requirements, Benetton has produced the document Guidelines for Benetton Group Code of Conduct for Manufacturers, which details the organization’s expectations for fair, healthy, safe workplace conditions and environmentally sound factory operations. The aim of the document is make the CoC standards understandable and practical, provide additional guidance for our suppliers, and help us work together to find effective solutions to workplace problems.
As a member of SAC, in 2021 Benetton Group adopted the Higg Facility Social and Labor Module (FSLM) tool for measuring the social performance of its suppliers, completing the transition phase from its CSR audit program that began in 2020.
The module is dedicated to verifying and promoting fair and safe working conditions along the supply chain and evaluating the effectiveness of management systems in the social field, in line with the provisions of the Code of Conduct and the most important industry standards. Indeed, Benetton intends not only to guarantee and demonstrate respect for the human rights of its direct and indirect workers, but also to actively collaborate with other brands, suppliers, employee representatives and associations in order to define a common standard for assessing social impacts and monitoring progress in ensuring safe and respectful working conditions.
The transition from the proprietary tool to the FSLM module is motivated by the opportunity to reduce the effort associated with the audit activity, to concentrate resources on improvement actions and to ensure the comparability of data. In this sense, the contents of the FSLM module take up the framework of the Social & Labor Convergence program (SLCP), a multi-stakeholder initiative that aims to develop a systemic solution to the proliferation of social verifications, creating a common assessment tool (Converged Assessment Framework CAF).
The FSLM module evaluates the following areas:
- Recruitment procedures
- Working hours
- Wages and benefits
- Treatment of workers
- Freedom of association and representation of workers
- Health & Safety
- Termination of the employment relationship
- Management system
The FSLM module is required jointly by the Sustainability function and the Operations function to all producers of finished garments (tier 1) with particular attention to those located in areas where respect for human and workers' rights is considered most at risk.
As a first step, suppliers must complete a self-assessment, which must subsequently be subjected to on-site verification by an internationally recognized audit firm qualified as a Verifier Body. The verification aims to check the accuracy of the information transmitted and to record the correct answers in the event of missing or incorrect data. Since the tool is focused not only on the identification of non-compliances, but also on the monitoring of the management system of social issues and working conditions, the verifications are carried out in an announced or semi-announced manner; the reference protocol is defined by SLCP which specifies the required procedures, the number of man/day and the sampling criteria of individual and group interviews.
Since 2021 Benetton Group has been working only with suppliers who adopt the Higg FSLM module, with the exceptions related to the ILS audit, where required by the license agreement and to our Indian suppliers reporting to our Indian local division, which about the transition to the new tool was not completed and therefore previous CSR audit program was still adopted.
Our goals for a sustainable supply chain:
• Compliance with legal requirements: commitment to reduce 100% of legal non-conformities;
• Continuous improvement approach: request for resolution of the critical issues raised by the verifier within the subsequent completion of the FSLM form;
• Identification of critical issues and capacity building actions: for the most recurring non-conformities (e.g. excess of overtime, insufficient payment of social insurance) Benetton is working with suppliers in the medium term to ensure their resolution.
Critical and high-risk non-conformities
With respect to some particularly critical issues, Benetton Group adopts a zero tolerance attitude. Non-conformities related to this category determine an immediate intervention by Benetton and the request to the supplier to promptly implement the corrective action deemed most suitable.
Furthermore, as part of the elements checked, some high-risk non-conformities were identified relating to sensitive aspects that require more attention for the Group in the resolution process.
Evaluation of the FSLM module
The Sustainability function evaluates the FSLM module, with the aim of guiding and supporting the supplier in resolving the identified non-conformities, expressing three levels of rating: pass, pass with recommendation and fail. In each case, the supplier's risk level is analyzed and appropriate mitigation actions are established.
Interruption of the commercial relationship with the supplier
In the event of a “fail” result in the FSLM assessment, Benetton undertakes to work with the supplier through actions of help and support in the remediation process through a monitoring activity, which provides for the sending of updated corrective plans and evidence of the resolution of the non-compliances on a regular basis. Also in this perspective, the Guidelines for the Benetton Group Code of Conduct made available to manufacturers contain advice and best practices.
The relationship with the supplier is terminated when:
• the supplier refuses to complete the verified FSLM form within the required deadlines;
• the supplier fails to correct previously identified high risk non-conformities;
• a zero tolerance non-compliance is detected.
In determining the exit strategy, the peculiarities of the relationship with each supplier are considered. In all situations, Benetton Group ensures that workers are not negatively impacted by the interruption of the commercial relationship, respecting at least the requirements.
Specifically, Benetton adopts the following steps:
• Internal alignment relating to analysis of the impact on production capacity, incidence of orders on the total volumes of the supplier, situations of dependence or economic exposure of the supplier, duration of the commercial relationship;
• Transparent communication to the supplier and agreement on the exit time frame;
• Monitoring of impacts on workers.
Our performance in 2021
In 2021, 146 suppliers were evaluated through the FSLM module. Since we believe that transparency is the key to improving working conditions along the supply chain, we have invited our suppliers to disclose their performance and their social impacts by sharing the FSLM module with strategic partners. 37 suppliers were instead evaluated according to the ILS protocol, as required by the license agreement and 3 suppliers through multi-stakeholder audit initiatives such as SMETA or BSCI. Furthermore, 49 Indian suppliers, reporting directly to our local division, were assessed basing on the company's proprietary checklist.
According to the performance results and the benchmark offered by Higg.co, we update the risk assessment of the various countries each year, to identify the areas considered most at risk, on which to focus our supervision and monitoring activities.
In 2021, almost exclusively announced or semi-announced audits were carried out in accordance with the SLCP protocol.
View the summary of non-compliant suppliers by each assessment area.
Non-discrimination and freedom of association
Benetton Group believes that every company must commit to rejecting any form of discrimination, ensuring fair and respectful treatment of its people in all circumstances. In particular, in 2021, through the Whistleblower mechanism a single report from employees was detected in relation to episodes of discrimination, which was then resolved positively. In addition, 93% of our suppliers meet the Code of Conduct requirements. The non-conformities identified refer to the failure to reach the minimum quota of disabled workers hired with respect to the provisions of local regulations, with the exception of two cases: one related to a bad practice adopted during the recruitment phase, which included questions about the health status of the candidates and the second related to the salary received by two female workers.
About 7% of the suppliers assessed have unions representation. The percentage reaches 78% if we consider the Workers’ Committees or workers' representatives freely elected by the employees. Furthermore, 40% adhere to a Collective Bargaining Agreement. According to the legal and the Group’s requirements, 87% of suppliers are compliant. In seven cases there is no valid form of worker representation, whereas the most recurrent non-compliances concern procedural aspects. All suppliers found to be non-compliant on this matter have promptly implemented a corrective action plan.
Monitoring of the risk of forced labor
Benetton Group is actively working with its suppliers to mitigate the risk of forced labor, in order to protect especially the most vulnerable categories of workers. For this reason, the risk factors relating to episodes of excess of ordinary and overtime work, restrictions on freedom of movement, withholding of personal documents, request for payments during the recruitment process or forms of indebtedness are reported in the verifications and strictly monitored. In particular, Benetton believes that the principle of Employer Pay - whereby no worker has to pay to access a job and hiring costs are borne by the employer - is fundamental in tackling all forms of exploitation. During 2021 we detected a case of forced overtime (the supplier was asked for an immediate remedy, verified through an on-site follow-up in an unannounced manner) and four cases of suppliers requesting the payment of medical expenses at workers’ charge in the pre-employment phase (it is estimated that about 50 workers were involved). In all cases, Benetton Group requested reimbursement of expenses in the corrective plan.