Oriflame takes a strong stance on social and ethical issues and we are proactively embedding this position across our value chain.
Oriflame operates in several high-risk areas in terms of breaches of human rights. In order to understand the risk as fully as possible, we have developed a Corporate Human Rights Due Diligence process. Sustainability and human right risks are incorporated into our corporate business risk assessment process.
During 2015 we conducted an in-depth study assessing the major human rights impacts throughout our business. The assessment included an overall analysis of our value chain and the major impacts our operations have on people. In order to identify our most salient impacts, we conducted interviews with some of our key internal stakeholders, including business unit heads and representatives from all our regions. The evaluation was completed with desktop research on the major human rights issues in our markets and business sectors. As a result, we have identified our most salient risks and we are now working to ensure these are adequately addressed. For some areas we are developing action plans to mitigate risk and potential human rights impact, while seeking the opportunity to increase our positive contribution to society.
We are integrating human rights issues into existing risk assessments when entering new markets and have committed to conducting country specific assessments for high-risk markets. This is important because it also allows us to concentrate our efforts on those areas where we have the highest level of influence.
Some of our products are sourced from markets that are classified as high risk in terms of e.g. child labour and forced labour, mainly in Asia. As part of our supplier evaluation process, we put additional resources into verifying compliance by conducting sustainability audits in these markets, in addition to using the Supplier self-assessment tool. We have dedicated staff for this purpose in both India and China. See the section on suppliers for more detailed information.
As a business, we adhere to the Universal Declaration of Human Rights and the United Nations Global Compact. We have integrated the ten principles of the Global Compact into the Oriflame Code of Conduct, the Supplier Code of Conduct and other policies. These principles speak directly of human rights, labour standards, the environment and anti-corruption, and help guide us in making good decisions across our business. Trainings regarding the Code of Conduct and Oriflame policies are an integral part of the Oriflame training system, the Oriflame Academy.
We are currently working on strengthening Oriflame’s Human rights statement, basing it on the UN Guiding Principles on Business and Human rights. To make sure these principles become an everyday part of how we do business, we have made a commitment to educate our employees on our business responsibility to respect human rights. We are starting this in 2016 with an education program aimed at our global management team.
Oriflame also participates in the Swedish Network for Business and Human Rights, a business network that focuses on exchanging best practices. This allows us to build our knowledge and competence, as well as stay up to date on developments in this area.
Although this is an important step, we do not think simply including these principles in our codes and policies is enough. To make sure they become an everyday part of how we do business, we have made a commitment to educate our employees on our business responsibility to respect human rights. We are starting this in 2015 with an education program aimed at our global management team.
We also participate in the Swedish Network for Business and Human Rights, a business network that focuses on exchanging best practices. This allows us to build our knowledge and competence, as well as stay up to date on developments in this area.
Helping our suppliers improve
Our Oriflame Global Supplier Evaluation program is an important way for us to improve human rights across our value chain. Every global supplier is part of this program, and joins it by committing to follow our Supplier Code of Conduct. The program allows us to objectively assess our suppliers on a range of criteria, including ethicalness.
We have a five-step process that means we can accurately identify any high-risk suppliers and prioritise their audit and evaluation. We conduct regular site visits at all of our subcontractors and packaging suppliers, and undertake sustainability audits at high-risk suppliers, especially in Asia.
We support suppliers willing to make improvements, and will stop working with any that score below the requisite grade and are unwilling to commit to make a positive change.
We have also launched our Supplier Self-Assessment Tool to all our major suppliers. The tool allows suppliers to thoroughly evaluate and take action on their environmental, social, ethical performance, as well as their own supply chain policies. SSuppliers representing 60% of our total direct and indirect procurement spend and more than 95% of our Finished Goods suppliers, currently use the self-assessment tool.