WESFARMERS SUSTAINABILITY REPORT 2017

Sourcing our products and services ethically

Target continues to focus on an ethical and transparent supply chain. During the year there were four key initiatives aimed at enhancing Target’s ethical sourcing program.

  • Target and Kmart commenced work on establishing a combined Department Stores (Kmart/Target) Ethical Sourcing Program. The combined program will ensure consistency in ethical sourcing policies and procedures between Kmart and Target, and achieve efficiencies in program implementation, monitoring and reporting. This will be accompanied by an overarching Department Stores ethical sourcing program Standard Operating Procedure
  • Target commenced preparations to join the International Labour Organisation (ILO) and International Finance Company (IFC) Better Work program, which aims to improve working conditions in the garment industry and make the sector more competitive.
  • Target continued its participation in the Action, Collaboration, Transformation (ACT) living wage collaboration. In the past year, ACT was established as a foundation in the Netherlands, an Executive Director was hired and secretariat established in Berlin, and ACT was formally recognised at the G20 Labour Ministers meeting in Hamburg.
  • Target along with other brands signed an Agreement with IndustriALL Global Union and UNI Global Union to extend the Bangladesh Accord on Building and Fire Safety to 2021.

During the year, Target conducted 176 ethical sourcing audits of its suppliers' factories and accepted 614 audit reports through its mutual recognition program. Although the majority of factories were approved or conditionally approved, its audit program and ongoing monitoring efforts identified 13 critical breaches of Target’s Code in the past year. Nine of these breaches related to bribery of a Target inspector or third-party auditor, and one case related to a third-party auditor asking for a bribe from the factory. Target also identified one case of forced labour, one case of child labour, and one case of unauthorised subcontracting. Nine factories will be deregistered after last shipment (meaning no further orders can be placed), remediation was implemented in three factories and one is under investigation.