Managing supply chains - Retail Council of Canada

Managing supply chains

April 23, 2014
Managing supply chains

For RCC’s landing page on Responsible sourcing, please click here.

RCC’s members have highly complex supply chains and source from countries all over the world. To start with, retailers typically have a code of conduct that sets out the core principles that suppliers and factories must adhere to as it relates to human rights, working conditions, and in some cases, environmental considerations.

RCC developed the Responsible Trading Guidelines in 2003, intended as a baseline in responsible sourcing for all sizes of Canadian retailers, and to provide guidelines for members that would like to create or update their own codes. It was updated in 2013 with an expanded scope, with references to best practice conventions and codes from NGOs and multilateral organizations.

Below are some codes and conventions that are widely referred to in the industry:

Ethical Trading Initiative Base Code
International Labor Organization Conventions
Fair Labor Association Labor Standards
Global Social Compliance Programme Reference Code

Below are several examples of some member codes of conduct.

Audits, monitoring and verification

To ensure that the code of conduct is followed, members will typically use internal resources or hire a third party to audit against the code of conduct to ensure that procedures are being followed. In recognition that audits can be time consuming and costly for factories, there have been a number of tools developed over the past few years that have allowed companies to share audit information.

Fair Factories Clearinghouse – RCC is a founding member of FFC
Business Social Compliance Initiative (BSCI) – RCC is a member of BSCI

Consultation and remediation

Companies increasingly recognize that it is no longer enough to stop sourcing from a factory because it does not meet a company’s standards, except in cases where a facility does not show a commitment to improvement. Companies recognize that overseas sourcing contributes to the socioeconomic development of a country, and nowadays, companies are working with their suppliers and factories to improve their performance. A company will typically complete an audit, and the findings are communicated back to the factory along with any remediation actions. Most importantly, is getting at the root cause of the issue to ensure long term changes.

Capacity building

Capacity building is a way to address issues in supply chains and to improve the skill sets of those in factories. In many cases, it has been shown to improve the output of the factory as well. There are many tools that companies have used, including webinars, in-person workshops, conferences, on-the-job training, etc. These will typically occur in-country along with an NGO, government, or other partners.


Recognizing that companies cannot work alone in achieving long term solutions in the garment industry, they will often work with other partners such as peers in the retail industry, industry and trade associations, NGOs, suppliers and other value chain partners, as well as workers.

Some examples of collaborative efforts include:
BSR HerProject
Global Social Compliance Programme (Consumer Goods Forum)
ILO Better Work
Sustainable Apparel Coalition
Alliance for Bangladesh Worker Safety
Bangladesh Accord on Fire and Building Safety

For links to other resources in responsible sourcing, please go to Resources.