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SUPPLY CHAIN EXPECTATIONS
We work with thousands of suppliers, consultants, and business partners around the world and this work has a direct impact on the communities we serve and live in.
Ideally, Mondelēz International and our Suppliers and Partners will have comparably high standards of conduct. Of course, we cannot — and do not presume to — control how they run their businesses. But, as described below, we take five pragmatic steps to align what they do for us – and how they do it – with our own standards of fair and honest dealings.
In addition, to summarize our position and commitment to ethics, respect, and fairness, we established a Supplier & Partner Code of Conduct, underlining our desired ethical human and business practices. We encourage all our Suppliers & Partners to familiarize themselves with the Code, ask us about it and strive to align with it.
1. SELECTION AND RISK ANALYSIS
We begin with the selection process. As we evaluate suppliers, we want to be familiar with their own codes of conduct and reputations, as well as their ability to deliver quality, service, and total value to Mondelēz International.
Before engaging in new business relationships – and during the course of business, we conduct appropriate and risk-based due diligence, which includes screening potential suppliers against restricted party lists from authorities worldwide and may include human rights related information. These systems support the identification of potential risks, help guide our approach for impact mitigation and monitoring, and inform our procurement practices.
Our Supplier & Partner Code of Conduct is available on our Mondelēz International website for all our current and future business partners to consult.
2. CONTRACTING: TERMS AND CONDITIONS
Once we determine a good fit with a supplier or business partner, we develop a contract that not only provides the core commercial terms but specifically incorporates mandatory terms and conditions in areas such as corporate social responsibility, ethics, integrity, and safety.
In addition to complying with all laws and regulations, suppliers must comply with Mondelēz International’s expectations in term of:
- Forced Labor
- Child Labor
- Diversity and Inclusion
- Harassment and Abuse
- Safety and Health
- Third-Party Representation
- Working Hours and Compensation
- Disciplinary Procedures
- Business Integrity
- Environment and Sustainability
- Anti-bribery
As part of our supplier agreements and embedded in our Purchase Orders, our suppliers understand and acknowledge that they will adhere to our Supplier Code of Conduct.
3. ASSESSING CORPORATE RESPONSIBILITY THROUGH "PROGRESS"
We are not alone in our approach as most major companies have supplier corporate responsibility requirements. Yet most companies are both suppliers and customers, leading to a proliferation of codes of conduct and assessment requests. We supported the creation of a superior approach for society called PROgram for RESponsible Sourcing (PROGRESS). This industry initiative allows a supplier to provide common information to its customers, so each customer can independently reach business decisions in accordance with its own corporate responsibility standards.
We are currently rolling out PROGRESS to our suppliers and business partners. This is an ambitious global effort that will take several years to complete. When dealing with such an important issue as corporate responsibility, we have taken a long-term approach that we are confident puts us on the right path.
4. WORKING TOGETHER: SUPPLY CHAIN TRANSPARENCY AND LABOR PRACTICES
As awareness and advocacy efforts around human trafficking and slavery grow among governments, NGOs, and investors, so do expectations for businesses to demonstrate how they address this issue within their supply chains.
The Mondelēz International Human Rights Policy guides our approach. In line with the California Transparency in Supply Chains Act (SB 657) and the UK Modern Slavery Act 2015, our annual Human Rights Due Diligence & Modern Slavery Report provides more detail on our efforts to help make a difference in our operations and those of our suppliers.
Our purchasing contracts require suppliers to comply with all laws and support Mondelēz International’s policies on child and forced labor. We have various tools to address non-compliance, which may include, but are not limited to, a corrective action plan. If the supplier does not resolve the issues of concern in a timely and satisfactory manner, Mondelēz International reserves the right to take more drastic action, such as termination of the business arrangement.
Suppliers working with Mondelēz International are also expected to abide by our:
5. VERIFICATION AND IMPROVEMENT: COMPLIANCE AUDITS
For our own operations and tier 1 suppliers, on an ongoing basis we seek to identify potential human rights issues, and monitor compliance with our policies and our corporate responsibility expectations through independent audits. We use the SMETA audit protocol to evaluate our internal manufacturing sites and direct suppliers against a common set of corporate social responsibility standards developed for the consumer goods industry.
In addition, we strive to address potential negative social and environmental impacts in our value chain, including our cocoa and palm oil supply chains, through our sustainability initiatives and multi-stakeholder collaboration with suppliers, industry peers, civil society, and government. More information on our sustainability framework and strategy in the Snacking Made Right section.