In May 2019 Sedex introduced significant changes to the organisation of SMETA audits. The Sedex Stakeholder Forum (SSF) implemented these changes in June 2019. From 1st June 2019, all SMETA full scope audits must now be conducted with the new methodology of version 6.1, with the 6.0 audits being phased out.
Sedex is a recognised global organisation, whose services include a broad scope of industries. This includes retailers, manufacturers, institutions, and construction businesses. You can find out more about Sedex here.
Updates Effective June 2019
In this article we will look at the changes to;
- The SMETA audit and the report
- The best practice guide
- The measurement criteria
- The noncompliance guidance
We will also review the general improvements and the feedback from Sedex customers considered during the changes.
The improvements and introductions to new topics have been no small effort. A great amount of work has gone into making the reporting clearer, easier to digest and implemented good suggestions from customers.
Let’s look at those changes and general improvements…
1. Changes to the SMETA Audit
An example of the Sedex SMETA report can be found here. The download also includes guidance to complete the audit.Template SMETA Report
Audit Type – Terminology
SMETA audits are conducted as either 2 Pillar or 4 Pillar audits, depending which criteria the business scope fits into. There is specific terminology that is used for both types due to the intensity of analysis. These changes help clarify if environmental questions are part of 2 or 4 pillar audits.
- 2 Pillar audit change: The ‘Health & Safety ‘section has now been renamed ‘Health & Safety plus Environmental 2 pillar’.
- 4 Pillar change: ‘Environment’ is now renamed to ‘Environment 4 pillar’
SMETA declaration – Auditor credentials
The lead auditor, team auditor and interview auditors, can now provide details of their credentials on the audit report. This is in the form of the ‘Association of Professional Social Compliance Auditors’ (APSCA) number and status.
Site Details – Site location
GPS location and ‘Latitude/Longitude’ options have now been added to the report site details page.
Changes to Sections – ‘0A: Universal Rights covering UNGP’
This section looks at whether the site grievance mechanism meets the UNGP expectations. This was previously covered in section 9: No harsh or inhumane treatment is allowed. This is an introduction but not a replacement for a full Human rights assessment.
The audit will check for:
- Checks for awareness / commitment
- Starting to take responsibility
- Access to a grievance
- Relevant section of SAQ completed
The auditor will also look for good examples to measure the effectiveness of practices;
- Broader awareness of their Human Rights impacts
- Giving access to remedy
- Engagement of wider community
- Grievance methods include salient issues, and that a developed level of response is in place
- Demonstrate and implement data privacy procedures for workers’ information
*UNGP is the acronym for ‘United Nations Guiding Principles of Business and Human Rights’. You can find out more here.
Additional elements – Responsible Recruitment (Regular Employment)
Recruitment practices are now more transparent – including migrant, agency and other recruitment practices. Additional factors are being reviewed during the audit in responsible recruitment:
- Businesses have full understanding of the entire recruitment process including all labour recruiters and intermediaries in terms of required legal and/or ethical requirements.
- There are effective management systems in place to identify and monitor the hiring and management of all migrant workers, contract, agency, temporary or casual labour.
- Employment agencies must only supply workers registered with them.
- All workers pay no recruitment fee at any stage of the recruitment process.
- Worker contracts accurately reflect the agreed payment and terms in the recruitment process and are understood and signed by workers.
Additional elements – Land rights & land grabs management systems
This addition isrelated to legal land tenure and free, informed, prior consent. Additional factors are being reviewed during the audit;
- Checks on all applicable / required land rights, licences and permission.
- Check on management systems in place to conduct legal due diligence relating to land title
Additional elements – Land rights & Conservation (4 Pillar)
Additional factors are being reviewed during a 4 pillar audit, section 10.B.4 Environment;
- Checks site management systems and capacity to cover land use
- Change to recognize and apply relating to nature conservation and deforestation
- Site measures and avoid damage to land which has any biological, ecological, social or cultural values which are considered outstandingly significant or critically important, at the national, regional or global level.
Additional elements – Workplace Impact assessment indicators
A set of common industry indicators to measure improvements in the workplace has been added. Where the annual worker turnover is considered, the auditor will also review;
- Absenteeism / lost day work cases
- # work related accidents
- % workers on high hours
Definition – ‘Migrant worker’
The definition of migrant worker has been reviewed and amended for version 6.1.
- New definition: “The term “migrant worker” refers to a person who is engaged or has been engaged in a remunerated activity in a country of which they are not a national or permanent resident or has purposely migrated on a temporary basis to another in-country region to seek and engage in a remunerated activity”.
- Previous definition: “The term “migrant worker” refers to a person who is engaged or has been engaged in a remunerated activity in a country of which they are not a national and where they do not intend to remain permanently or has purposely migrated on a temporary basis to another in-country region to seek and engage in a remunerated activity.”
New Question – Worker nationality
A new audit question is now included: “B: Please list the nationalities of all workers, with the three most common nationalities listed first.”
2. Changes to the Best Practice Guide
You can download the latest Best Practice Guide here. Best Practice Guide 6.1
Audit Frequency
Sedex have clarified their guidance to buyers how often they recommend supplier sites conduct their social/ethical audits. They encourage audit cycles in relation to the site risk rating. The audit frequency recommended is;
- High risk – annual audit
- Medium risk – 2-yearly audit
- Low risk – at customer’s discretion
Audit duration, sample size and timetable
Interviewing and sampling can take varying time for an auditor to completed dependant on the size of the site and quantity of employees. Guidance to calculate the sample sizes and time taken for over 2000 workers has been released.
Data Protection
Processes have been changed to be in line with the newest GDPR requirements.
Audit Report – Observations
The requirement to reference a Code or Law in in relation to Observations has been removed.
3. Changes to the Measurement Criteria
You can download the Measurement Criteria PDF here. Measurement Criteria
Health & Safety Section 3.9
The criteria has been updated to clarify, exit routes in multi-story or multi-business premises that go through other businesses’ premises should be included in the audit checks.
Other Issues Section 10A.6
Auditors will now check nationalities of workers within UN sanctioned countries for ‘entitlement to work’. Evidence gathered by the auditor will be recorded and reference these nations.
Sedex worker wellbeing assessment
The SMETA methodology now includes a wellbeing assessment of workers. This covers worker satisfaction and job conditions.
4. Changes to the Noncompliance Guidance
You can download an example of a Corrective Action Plan Report (CAPR) here. CAPR
0B: Management Systems
The ‘Incomplete Sedex SAQ’ is now not included in nonconformities.
Final thought – Preparation
Sedex issue a lot of guides available to refer to prior to the audit being conducted. It’s worth taking a thorough look at these guides prior to applying for an audit. They will help you understand exactly what type of audit you need and how to prepare for one.
Preparation is key! It’s much better to spend 2 days with an auditor well prepared, rather than go into it blindly and potentially be faced with a list of nonconformities so long that you have to employ an additional person to manage them for the next 6 months.
If you are looking for further advice or guidance in this area, please feel free to reach out to us.
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