Social Responsibility in Supply Chain Management Nikki Bliven Lauren Jones Tara Tjaden Josh Pine Nicole Kenney

Social Responsibility: “A framework of measurable corporate policies, procedures, and resulting behavior that are designed to benefit the workplace and, by extension, to benefit the individual, the organization, and the community in terms of community, diversity, environment, ethics, financial responsibility, human right, and safety.” -ISM “A framework of measurable corporate policies, procedures, and resulting behavior that are designed to benefit the workplace and, by extension, to benefit the individual, the organization, and the community in terms of community, diversity, environment, ethics, financial responsibility, human right, and safety.” -ISM

Why SR is becoming an Issue New Government Regulation New Government Regulation “Take Back” Laws “Take Back” Laws Lead in Computers Lead in Computers Hazardous Waste Hazardous Waste Increased Community Awareness Increased Community Awareness Sweatshops Sweatshops Child Labor Child Labor

Why SR is important in SCM Increased Retention of Employees Increased Retention of Employees Increased Productivity and Quality Increased Productivity and Quality Enhanced Reputation and Image Enhanced Reputation and Image Reduces Operating Costs Reduces Operating Costs Creates Long Term Value Creates Long Term Value Anticipates Challenges Anticipates Challenges Reduces Risks Reduces Risks

7 Principles of Social Responsibility Institute for Supply Management (ISM) Institute for Supply Management (ISM) Not-for-Profit association founded in 1915 Not-for-Profit association founded in 1915 Includes more than 40,000 supply management professionals Includes more than 40,000 supply management professionals Promotes standards of excellence, research, promotional activities, and education Promotes standards of excellence, research, promotional activities, and education Created the 7 principles in 2002 Created the 7 principles in 2002

Community Provide support and add value to communities and communities of your supply chain Provide support and add value to communities and communities of your supply chain Encourage members of supply chain to add value in their communities Encourage members of supply chain to add value in their communities Ex. Wal-Mart and Sam’s Club Ex. Wal-Mart and Sam’s Club

Diversity Promote purchasing from and the development of socially diverse suppliers Promote purchasing from and the development of socially diverse suppliers Encourage diversity with in your organization Encourage diversity with in your organization Promote diverse employment practices throughout the supply chain Promote diverse employment practices throughout the supply chain Ex. Apple’s Supply Diversity Program Ex. Apple’s Supply Diversity Program

Environment Encourage your own organization and others to be proactive in examining opportunities to be environmentally responsible within their supply chains Encourage your own organization and others to be proactive in examining opportunities to be environmentally responsible within their supply chains Encourage Environmental responsibility of your suppliers Encourage Environmental responsibility of your suppliers Encourage environmental development within company Encourage environmental development within company Ex. Herman Miller Ex. Herman Miller

Ethics Abide by your organizations code of conduct Abide by your organizations code of conduct Awareness of ISM principles Awareness of ISM principles Awareness of Ethical SCM conduct Awareness of Ethical SCM conduct Ex. Nike Ex. Nike

Financial Responsibility Become knowledgeable or, and follow, applicable financial standards and requirements Become knowledgeable or, and follow, applicable financial standards and requirements Promote and practice responsible financial behaviors at all levels of supply chain Promote and practice responsible financial behaviors at all levels of supply chain Apply sound financial practices and ensure transparency in financial dealings Apply sound financial practices and ensure transparency in financial dealings Ex. Enron Ex. Enron

Human Rights Dignified and respectable treatment of others Dignified and respectable treatment of others Support and respect the protection of international human rights within the organization’s sphere of influence Support and respect the protection of international human rights within the organization’s sphere of influence Encourage your organization and its supply chain to avoid complicity in human or employment rights abuses Encourage your organization and its supply chain to avoid complicity in human or employment rights abuses Ex. HP Ex. HP

Safety Promote safe environment for employees and supply chain Promote safe environment for employees and supply chain Provide a definition of “safe” for your organization Provide a definition of “safe” for your organization Support continuous development and diffusion of different safety practices within your organization and your suppliers Support continuous development and diffusion of different safety practices within your organization and your suppliers Ex. HP Ex. HP

Benefits of SR Customers Customers They are given preferred status to those suppliers that have solid policies and procedures in places around social responsibility They are given preferred status to those suppliers that have solid policies and procedures in places around social responsibility Investors Investors Investors are finding that companies with socially responsible core values, policies and procedures Investors are finding that companies with socially responsible core values, policies and procedures

Steps to Implement a successful SR Plan Look Internally Look Internally Define Your Code of Conduct Define Your Code of Conduct Map the Process Map the Process Make Sure Each Relationship Fits With Your Strategy Make Sure Each Relationship Fits With Your Strategy Have a Monitoring Mechanisms/Technology In Place Have a Monitoring Mechanisms/Technology In Place Train Your Buyers and Be Consistent in How They Are Compensated. Train Your Buyers and Be Consistent in How They Are Compensated. Communicate Your Code to Your Suppliers Communicate Your Code to Your Suppliers

Conclusion Companies that are socially responsible are ones that comply with laws and regulations while increasing their reputation. Companies that are socially responsible are ones that comply with laws and regulations while increasing their reputation. This reputation is achieved by enhancing the well-being of all stakeholders, increasing profitability and customer satisfaction. This reputation is achieved by enhancing the well-being of all stakeholders, increasing profitability and customer satisfaction.

Sources Apple.com Apple.com Boyd, D.; Spekman, R.; Wehane, P. “Corporate Social Resoponsibility and Global Supply Chain Management: A Normative Perspective.” (June 2004) Apr 25, Boyd, D.; Spekman, R.; Wehane, P. “Corporate Social Resoponsibility and Global Supply Chain Management: A Normative Perspective.” (June 2004) Apr 25, HermanMiller.com HermanMiller.com HP.com HP.com ISM Committee. “SocialResponsibility and the Supply Management Profession: A Baseline Study.” Apr. 25, Apr 25, ISM Committee. “SocialResponsibility and the Supply Management Profession: A Baseline Study.” Apr. 25, Apr 25, Nieves, Anthony. “Why Social Responsibility Matters.” Sept Apr 23, Nieves, Anthony. “Why Social Responsibility Matters.” Sept Apr 23, Roberts, Julie S. “Inside Supply Management.” May Apr 25, Roberts, Julie S. “Inside Supply Management.” May Apr 25, WalMartfacts.com WalMartfacts.com