Shahi Exports, Pearl Global Industries, Arvind Mills, Texport Industries, Pratibha Syntex Ltd., Aquarelle India, Quality Knitwears and hundreds of such well-known apparel manufacturers of India along with big exports from Bangladesh like DBL Group, Beximco Fashions Ltd., Denim Expert, Shanta Denims are registered with the Social & Labor Convergence Program (SLCP), a Netherlands-based multi-stakeholder initiative active in over 30 countries. Many more Indian companies are in the pipeline to be associated with this initiative and the reason is simple – to reduce multiple audit fatigue.
SLCP’s mission is to improve working conditions in global supply chains by freeing up resources that are currently used on social auditing and redeploying them towards improvement activities.
And this is being achieved through the implementation of SLCP’s Converged Assessment Framework (CAF) – a common tool to collect and verify social and labour data. Though SLCP began 5 years ago, it launched its operations in June 2019 and already over 35 brands (Inditex, H&M, Gap, adidas, PUMA, C&A, etc.) and organisations are accepting SLCP-verified data in place of their own proprietary social audit tools.
It means that if a facility has a verified SLCP assessment, the 35 brands accept this in place of a third party or proprietary social audit. It is also pertinent to mention here that SLCP is neither a certification program nor a code of conduct or compliance program, and suppliers will therefore be obliged to meet each brand’s code of conduct/compliance requirements.
CAF’s aim is to replace current proprietary tools and in turn, eliminate audit fatigue by avoiding duplications and reducing the number of social and labour audits. It claims annual audit-related resource savings worth up to US $ 134 million by 2023, for redirection into improvement actions.
It addresses audit fatigue by reducing the number of social audits and facilitates measuring of employment practices, thus improving working conditions and employee relations. It also redeploys resources towards improvement actions and fosters trust and collaboration between supply chain partners. CAF provides a data set with no value judgement or scoring.
It is, however, compatible with existing audit systems and codes of conduct. The same data set can be used by a wide range of stakeholders and interpreted according to their interests and criteria. This eliminates the need for repetitive audits to be carried out in the same facility, and at the same time decreases costs for brands and manufacturers also.
SLCP’s robust verification methodology and verification oversight mechanism ensures each assessment is consistently verified to a high standard by an experienced SLCP-approved verifier.
As audit fatigue is a big concern for apparel manufacturers and for the compliance/audit teams of the factories, the association of factories is growing speedily with SLCP. 260 factories in India are registered with this program so far and there has been a significant increase of over 350 per cent in the number of facilities in India using SLCP in 2020 alone.
With 11 per cent of all the facilities registered in the SLCP Gateway, India is third in the list after China and Turkey. To support Indian companies with their SLCP implementation, SLCP also has a helpdesk team who can respond to questions in Hindi and Kannada languages.
“We officially launched SLCP in June 2019 and we have seen an increase of facilities in most countries in 2020 – this is evidence of SLCP beginning to scale: there is increased industry awareness and acceptance of SLCP and although COVID-19 has impacted our operations this year, we have achieved growth nonetheless. Due to the impact of COVID-19 on the industry, the need for collaboration, efficiency and reliable data has never been greater so we believe SLCP can be a useful tool moving forward,” shared Janet Mensink, ED, SLCP.
The main challenge for any manufacturer that is new to SLCP is to understand how the assessment process works as it is a new process. For this, SLCP has resources available including its e-learning support. Moving forward in March 2021, SLCP will also be launching an updated version of its tool (the CAF). The updated tool will be shorter and more user-friendly, and may therefore be more applicable for smaller facilities.
SLCP has been building collaboration with ILO-Better Work program over the last few years to further reduce the number of audits/assessments that facilities must complete and to produce actionable data that can be available for all industry stakeholders to act upon, including governments and workers’ and employers’ organisations.
“The textile and apparel industry is riddled with multiple annual audits, which have added limited value to all stakeholders and to the cause of social improvement in the supply chain. SLCP has helped reduce the audit burden and helped us redirect our resources towards supply chain improvements. So far during the past couple of years, we have already seen several of our clients accepting the SLCP-verified data in place of proprietary audits,” says Abhishek Bansal, Head of Sustainability, Arvind Limited.
Similar is the opinion of other manufacturing stalwarts. Rae Eun Sung, President of Youngone Corporation, says, “Being a manufacturer operating in multiple countries, serving renowned brands and retailers, we care deeply about the communities where we work and live. As a signatory of the SLCP, we are excited about the progress that has been made collectively, and remain committed to working proactively with our like-minded customers in achieving the mission of the SLCP.”
Contrary voices…
While there is a case for the advantage of associating with SLCP, there are many others who feel that there are concerns. Some of the exporters are of the view that its process/execution is difficult as it has around 1,000 questions and is overall complicated for factory’s HR/audit professionals.
Sharing this opinion Amrutesh Jaghuva, Executive Director, Quality Knit Wears Madurai says, “SLCP helps in a way that we need not go for third party audit for many buyers as there are a good number of brands associated with SLCP but at the same time I feel that SLCP puts additional responsibility on suppliers specially compared to the buyers.” Regarding the growing SLCP pace in India, he adds that looking at the critical timing of Covid, more and more companies wish for such a program. “I feel that because the brands trust SLCP, so more garment factories will associate with this program in future,” he said.
Audit firm WRAP has another story to tell, as it feels that the initial purpose of creating SLCP has shifted over the last year or so, and instead of bringing the audit firms under one roof, it has now moved to create a standalone entity – in the form of the verification oversight organisation, the verifier training program and the IT platform/Gateway (to be accessed via Accredited Hosts) – to take over the social compliance space with the offer of a universal solution.
“This effort counters the original mission and heads down the path other organisations attempted before – providing a one-size-fits-all approach. None of these efforts have been successful because that simply does not work for this complex industry. So now, instead of reducing audit fatigue, we have yet another entity administering another layer of oversight and bureaucracy. Moreover, the common audit tool that SLCP has produced is far too cumbersome to be practicable for all but the largest and most well-funded manufacturers,” argues Avedis Seferian, CEO, Worldwide Responsive Accredited Production (WRAP).
WRAP was one of the original signatories supporting SLCP and also supported the idea of a simpler approach to compliance audits that would allow users to share the results of audits in a standardised way while applying their own assessment criteria with a view to reduce red tape and costs. However, its concerns regarding tool, structure and the resulting additional costs are what made WRAP decide to no longer support SLCP.
Another apprehension in this regard is if SLCP will be a long-term solution as its economic model is based on membership fees and donations. Unless there is a path to becoming self-sustainable, such funding is unreliable and results in the strategic direction are being placed in the hands of a few large funders.
The goal of reducing audit fatigue is important. And there is only one solution in this regard that is the honest and collective efforts of the all stakeholders across the globe, that too without having intention of any personal favour. If this does not happen, the same repetition of efforts and wastage of resources will continue. Almost a decade ago, an Indian initiative on similar lines – Driving Industry Towards Sustainable Human Capital Advancement (DISHA) could not succeed despite having all resources and know how. But now the time has come for the industry to seriously act upon audit fatigue to survive in the new normal.
