24th October 2016
ASOS statement on policies and actions to protect vulnerable people in our supply chain
“Caring about what goes on in our supply chain, wherever in the world, is not just an option, it’s vital.
Turkey is particularly challenging for us right now, with the massive influx of refugees there. We welcome
any reporting that draws attention to the challenges our industry is wrestling with if it brings pressure on
the local Government, local employers, irresponsible brands … anyone who can improve the plight of
vulnerable workers.
The issues Panorama raises aren’t with our approved factories, who we audit. It’s with unapproved
outsourcing to factories we don’t know about. This will continue to be a problem until we know where
every garment is made and however difficult, that’s what ultimately we’ve got to achieve.
We could put our work out to another country, but we think that would be irresponsible. By staying in
Turkey and working within the system, we are committed to building good ethics into our supply chain
and in the meantime, we continue to play our part in supporting vulnerable people”.
Nick Beighton, CEO, ASOS plc
ASOS sources products from 28 countries, involving more than 500 factories and involving many thousands
of people. We take the whole subject of the human rights and welfare of the often vulnerable workers in
our supply chain incredibly seriously. It’s a never ending challenge that we and other responsible brands
wrestle with every day. It isn’t our approved factories that are the issue – we audit them regularly and have
worked with many of them for several years. It’s the unauthorised outs ourcing to unapproved factories that
we don’t even know that is the biggest issue. Until we know where every one of our garments is worked on,
the problem remains. Total transparency is what we and our industry must work towards urgently.
Accordingly, we put a significant and increasing resource into this area: we currently have a team of
executives whose sole job is to work with our supply chain. Many of the countries we source from have
labour laws that are weakly enforced at best and the scope for factories there to take advantage of
vulnerable people is a constant issue. Turkey is a special case with over 3 million Syrian refugees – and rising
daily – flooding into the country, needing to work to live. The scope for abuse in the Turkish garment industry
is obvious.
As part of the many policies they employ, our ethical trading team have developed a “tiering system” of
grading factories and rating them by our ethical benchmarks. They oversee audits of every factory we source
from, visiting them on the ground – often unannounced.
We find that a collaborative approach with the factories works over time. We have adopted a partnership
programme which means we are active within the system to bring about change. We’ve been in Turkey for
8 years and some of our suppliers today are the ones we first used when we started. These relationships
have allowed us to partner with these factories to build their processes to include our values and we are
proud of that.
It should go without saying that ASOS is totally opposed to underage workers in its supply chain anywhere
in the world. We have not found child labour in any of our approved Turkish factories. Most importantly, our
team oversees remediation programmes for vulnerable people who they discover in the workplace. In the
example BBC Panorama showed, that was a factory we didn’t know about – unapproved outsourcing.
Although we didn’t know this factory, we immediately got our team into it, removed the underage workers
and have brought them into our remediation programme which includes putting the young people back into
full time education and funding them until they are qualified to work. It also includes regular family welfare
visits. Inevitably, there are many more factories we won’t know, but nonetheless, our objective has got to
be to know where every ASOS garment is worked on.
ASOS is a member of a number of groups driving ethical change in the international garment industry supply
chain. We work with Governments, NGOs, local unions and other bodies, all striving to improve working
conditions for vulnerable people. Whilst we absolutely acknowledge that there is much more to do, we
believe that we are at the forefront of our industry in these areas and we remain totally committed to
creating a supply chain that reflects our values.
We believe that ethics in fashion - “Fashion with Integrity” is how we say it - is vital. This is not optional.
It is central to the future of our business. Our young customers care and they won’t deal with companies
that don’t. We agree. They shouldn’t.
Here is how ASOS is working to improve conditions within its supply chain.
POLICIES
Code of Conduct
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ASOS Code of Conduct covers all areas of the human rights base code
It is translated into 4 languages
It is shared with our suppliers and factories and they are under obligation to manage our code of conduct
through their supply chains or we will cease trading with them
Child Labour Policy
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ASOS Child Labour Policy strictly prohibits child labour in any form in our supply chain
It sets out remediation processes for action should we find child labour in our supply chain
It provides guidelines for the employment of young worke rs
It prohibits children entering production areas
It is translated in 4 languages
MEMBERSHIPS
ETI
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ASOS is a member of the Ethical Trading Initiative, having joined in 2009
The Ethical Trading Initiative is a tripartite membership organisation consisting of brands, NGOs and Trade
Unions with a particular focus on workers’ rights
ASOS reports regularly on its supply chain actions to the ETI
ETI Turkey Programme
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ASOS has joined ETI’s Turkey programme which has been set up to address labour rights issues in Turkey. In
line with the UN Guiding Principles on Business and Human Rights the programme will establish a platform to:
o allow businesses, employers, suppliers and trade unions to work together to build awareness of and
capacity to promote Business and Human Rights
o engage local stakeholders in workplace social dialogue to promote improved employment conditions,
protect workers’ rights and resolve conflicts
o to develop better policies and approaches to grievance redressal
TURKEY SUPPLY CHAIN STRUCTURE
Number of suppliers, factories, workers at September 2016
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Total number of suppliers: 23
Total number of factories: 66
Total number of workers: 7,793
Product types and processes
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Products require different processes in order to complete the full garment and these must be fully declared
by our suppliers and factories. We work hard to ensure we map the tier levels of our supply chain for each of
our product areas so that we can visit all factories in this chain.
Tier levels
Supply chains are complex in nature, so we assign a tier level to our factories.
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Tier 1: Is the main producer who would typically be the factory which cuts, stitches, finishes and ships the
garment to ASOS.
Tier 2: Stitching, cutting, finishing
Tier 3: Printing, embroidery, garment dying, laundry for washed processes
The full list of processes which may be outsourced must be declared to ASOS :
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Cutting; stitching; pressing; labelling; finishing; quality checking; packing; or any other finishing processes no
matter how small or infrequent;
Dying, printing, washing and laundering of cut pieces or finished items;
Manufacture of labels; buttons; tags (where ASOS branding is used);
Embellishment; embroidery;
Piece assembly (jewellery, accessories, footwear);
Brand and care labels; packaging; shoe boxes (where ASOS branding is used);
Re-processors and warehousing
Undeclared subcontracting
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Any production processes which are listed above and have not been declared to ASOS would be undeclared
subcontracting and are strictly prohibited by ASOS
On discovering undeclared subcontracting:
o We immediately visit the site to ensure no major infringement of our policies and that workers are
protected: put in place remediation where needed
o Contact the supplier and factory responsible with next steps and a first warning
o Contact buying teams and senior retail staff to advise of the i ssue and place a hold on orders where
necessary
o Review the supplier and/or factory relationship, ultimately if we cannot assure ourselves our
standards are being met, terminate the relationship
Communication
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ASOS holds regular conferences with suppliers and factories. Our last conference in Turkey was in March 2016
with suppliers and factories
We held a conference in the UK during October 2016 for our top suppliers
We are in regular contact with our suppliers and factories both in the UK and in Turkey
Our local team visits all factories on a regular basis. These visits are both formal audits as well as short checks
to follow up on corrective action plans. All visits are unannounced
HEAD OFFICE TEAM
Role and Responsibilities
o Development of strategy and implementation of long terms goals in relation to human rights
o Engagement with and reporting to internal and external stakeholders on programme work
o Development of project work specific to labour markets and to mitigate risks of harm to workers
against our code of conduct
o Regular contact with retail teams, suppliers, factories and local teams
o Development of process and policy in line with changing labour markets and local and international
legislation
o Audit processes and data management
o Stakeholder engagement and participation in external initiatives
o Supply chain mapping
o Control of onboarding suppliers and factories and exit processes
o Remediation of serious issues
LOCAL TEAM
Role and responsibilities
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Unannounced factory audits
Follow up at factory level to manage through corrective actions based on audit visits
Regular checks and communication with factories on individual action plans as well as ASOS code and policy
Close contact with ASOS head office team regarding strategy for improvements in the Turkish supply base
Development of audit methodology and improvement to processes
Regular updates on ASOS database regarding corrective actions and factory information
Critical issue and remediation plans
Connecting with local stakeholders and NGOs
Subcontracting checks and supply chain mapping
AUDIT PROCESSES & FINDINGS
Methodology and structure
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ASOS audits all factories in our approved supply chain
ASOS audit methodology is based on experience and best practices and can only be carried out by our
own local teams
All audits are unannounced, meaning factories have less chance to evade our audit processes
The structure of a typical audit is:
o Factory tour – to make observations about the production floor, building and workers
o Review of key documentation – wage and working hours’ records, personnel files, licences
and certificates
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o Interviews of managers, supervisors and most importantly workers – some worker interviews
are individual, some in groups and always confidential, away from factory management
The auditor will triangulate this information and the factories are left with a corrective action plan
that identifies any gaps in the factory’s ability to meet the ASOS ethical standards
In 2016 we strengthened our audit methodology to include an assessment of specific risks of modern
slavery
Frequency and reporting
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ASOS visit all factories and subcontractors in our approved supply chain at least once a year
For many Turkey factories we visit more frequently
ASOS auditors will leave a corrective action plan with the factory, that identifies and gaps in the factories ability
to meet the ASOS ethical standards
ASOS auditors will submit a full report to the ASOS head office ethical trade team, providing further detail on
the factory, the worker interviews and management attitude. These are confidential to ASOS in order to
protect the anonymity of individuals and allow for more subjectivity
Based on the audit report, factories are rated by ASOS: Red Critical, Red, Amber, Green
ASOS has an ethical trade database which enable us to identify and analyse trends and common issue s our
factories face in meeting our ethical standards
This information is used by ASOS to develop our strategic priorities, programme work and supplier conferences
Improvement actions
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ASOS build long term relationships with our suppliers and factories to enable us to address issues found during
ASOS audits
Our aim is always to work with suppliers and factories that have difficulty in meeting our standards, while they
make the necessary improvements
We do this by providing ongoing support to factories to implement improvement plans designed to improve
working conditions
However, where a factory consistently fails to improve despite our best efforts to support remediation, we
will terminate the relationship
Audit evasion
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ASOS is aware of audit evasion across the garment industry. For example, factories can keep multiple sets of
books and falsify their records to hide issues they have in meeting retailers’ code of conducts
ASOS’s dedicated local team have an in-depth knowledge of the local situation, including local culture and
level of application of local laws which enables them to better detect and assess factories working conditions
Our teams have knowledge of the production process and can identify any issues in the factories capability to
produce ASOS garments and so have a better understand of the risk of outsourcing and subcontracting
ASOS teams build long term relationships with factories to encourage full transparency of issues and offer
support for any factories that cannot fully meet our ethical standards
ASOS audits focus on worker interviews and our auditors will report back to head office in detail and
transparently on any proven or suspected issues at a factory
The ASOS approach to ethical trade, is that we do not penalise factories for audit findings. We will always aim
to continue to work with any factory that has issues in meeting our ethical standards, so long as they are
transparent and demonstrate a willingness to improve. Only where they are non-transparent and not willing
to improve, will ASOS disengage with a factory
CHILD LABOUR
Policy and remediation processes (child labour is defined as under 15 years or under 16 years depending on country)
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On finding child labour our team carry out the following steps:
o Immediately remove the child from production area
o Remain with the child at the factory until a family member or guardian has been reached
o Discuss options for child returning to the family home ensuring safety of child is placed first and
foremost. If parent or guardian is unavailable travel to child’s home is accompanied by 2 team
members
o Put in place a remediation plan for child to return to education. This is voluntary, ASOS cannot force a
child to return to education
o If child choses to return to education ASOS pays a living support to the child’s family for the duration
of qualification selected by the child and family
o Conduct regular welfare checks with the child and child’s family throughout the remediation
Actions in relation to our findings specific to Panorama’s programme
Workers at Yilteks Tekstil
o One 14 year old Syrian under the working age – a remediation plan is in place and we are supporting this
child to return to school and receive a living support of local living wage (not national minimum wage). The
timeframe for this remediation is approximately 5 years, until graduation. Now attending school
o Two Syrian workers who are just over the legal working age but have worked as child workers historically
at this site – a remediation plan is in place and we will support these people to return to school and receive
a living support of local living wage. The timeframe for this remediation is approximately 3 years until
graduation.
o One of these has not opted to return to school and is still working in Yilteks, this is his choice. We are
experiencing difficulty in getting the other one enrolled in school, she is too old for primary education but
as she left Syria at 11 she has not had enough schooling to join senior school. If we can’t get her enrolled
in public education the NGO we are working with will enrol her into private education. She is not working
at Yilteks.
o One Turkish worker, just over the legal age, working for the summer holidays and is enrolled in school – a
remediation plan will be in place to ensure that this person leaves the factory and receives full recompense
for the time she has been in work (she was working below minimum wage). She has now returned to school.
Workers at Yasemin Ilik
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Interviewed 5 Syrian workers present at this site to confirm they are paid above minimum wage and are
not discriminated against
Accompanied them and factory management to start the registration process – the local bureau turned
them away
We will not press the factory to dismiss these workers
UNREGISTERED/CASUAL LABOUR
Policy and process
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All workers in the factories are covered by the ASOS ethical programme, whether they are permanent,
temporary, casual or agency staff
ASOS carry out regular checks for unregistered or casual workers through unannounced audits
Where off-the roll or casual workers are found ASOS will assess whether they are afforded the same rights as
registered workers
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ASOS make it clear that our factories cannot use unregistered or casual workers to avoid the provision of
employment rights, pay, benefits or social insurance
Where casual workers or unregistered workers are commonly used we will support the factory to improve
their manpower management, so that they are providing more regular work to registered workers
REFUGEE LABOUR
ASOS position
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Ensure that Syrian workers (or other refugees) are given fair treatment to include:
o Payment of at least legal minimum wage
o The same work place benefits as given to local Turkish workers
o Ensure that they are not sacked from their jobs as a result of brand intervention
o Begin process for application for work permit (very complex the practical administrative mechanism
for this is often blocked by civil servants)
o Create log of all workers and contact details
o Interview using a Syrian translator to understand their working conditions or other issues which they
may need support on
BUYING PRACTICES
Review and improvement actions
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Reviewing and developing our buying practices is part of our ethical trade strategy and roadmap
In 2014 we carried out an anonymous supplier wide survey encouraging suppliers to feedback to us on our
performance in relation to buying practices. This also included interviews conducted by a third party with
buyers, merchandisers, designers and suppliers. The resulting report was reviewed by the most senior retail
executive and actions were agreed and implemented
We have used an industry best practice document, “IEH Suppliers Speak Up” to further inform our actions in
this area
We have since developed a supplier scorecard, the supplier ‘score’ is heavily affected by supplier’s
performance on ethical trade
ASOS collaborated with ETI and ILO on a global survey of suppliers in relation to buying practices
ASOS is a signatory to Action Collaboration Transformation (ACT) and as such is required to work develop it’s
buying practices (referred to as purchasing practices) to ensure none of our practices affect a supplier’s ability
to pay decent wages
We have guidelines for our buyers to create a structure around buying decisions
We work hard to ensure we have long term partnerships with our suppliers
ENDS