California Transparency in Supply Chains Act
On January 1st, a new law took effect in California. The California Transparency in Supply Chains Act of 2010 requires any retailer or manufacturer doing business in California and with greater than $100 Million in annual revenue to train employees and publish their approach to eliminating forced labor and human trafficking in their supply chains. The effective date of this legislation comes at a time of increased interest in the social implications of how products are made and distributed. And the interest extends well beyond the industry; I have begun to see people raise this topic on social networking sites like Facebook and Twitter.
The increased focus on socially responsible supply chains is clearly a good thing. Any improvements made in this area – whether as a result of legislation, corporate action, or consumer attention – are unarguably positive. That said, I believe that many of the people outside the supply chain industry who have recently begun to take an interest in social responsibility in the supply chain would be pleased to learn what companies are doing in this area.
In order to comply with the new California law, companies have published their approach to preventing forced labor in their supply chains on their websites. (Here are examples from HP, IBM.) But for most companies (certainly including HP and IBM), a commitment to a socially responsible supply chain is nothing new. For many companies (including ModusLink and many of our clients), joining the Electronic Industry Citizenship Coalition (EICC) was one way to ensure an industry-standard approach to social responsibility. A large number of companies have adopted and published codes of conduct and comprehensive Corporate Social Responsibility (CSR) Reports (view ModusLink’s CSR report) that go well beyond the standards of the EICC. In other words, many of the world’s leading companies are leading by example.