*The California Transparency in Supply Chains Act of 2010 (SB 657) becomes effective on January 1, 2012. This California state law is aimed at making large retailers and manufacturers transparent about their efforts to eradicate slavery and human trafficking in their supply chain.
Xerox Corporation and our affiliates and distributors do business in more than 160 countries. Our employees work with customers and suppliers from around the world. Being a global enterprise brings heightened responsibility to act in a manner that is consistent with our human rights ideals.
Xerox is guided by the United Nations Universal Declaration of Human Rights which prohibits slavery, servitude and the slave trade. Xerox’s commitment to freely chosen employment is embedded in our Code of Business Conduct, in our position on labor relations and in our employment practices.
Additionally, Xerox is a member of the Electronic Industry Citizenship Coalition (EICC), a group established to improve social, economic, and environmental outcomes in the electronics industry. Xerox adopted the EICC’s Code of Conduct on corporate social responsibility as its code of conduct for suppliers (“Supplier Code of Conduct”). The Supplier Code of Conduct includes labor standards based on recognized principles on international labor and human rights. Freely chosen labor is a primary standard in the Supplier Code of Conduct, prohibiting forced, bonded or indentured labor. Further, the EICC has a Freely Chosen Employment task force designed to help identify opportunities to share best practices among members, expand the EICC and make recommendations on available tools and training. Xerox actively participates in EICC meetings and events.
The following are highlights of our efforts in this area:
Supplier Code of Conduct Compliance Program: Xerox has implemented a compliance program with its direct/technology suppliers to monitor their compliance with the Supplier Code of Conduct.
As part of this program, Xerox requires such suppliers to comply with the Supplier Code of Conduct (which includes the provisions on freely chosen labor). The terms and conditions in Xerox purchase agreement and purchase order forms incorporate this requirement as well as the requirement for suppliers to comply with all applicable laws and regulations. Xerox reinforces the Supplier Code of Conduct in an annual communication to its suppliers.
Xerox conducts initial risk assessments of its suppliers based on objective criteria. For key suppliers and certain suppliers identified in Xerox’s initial risk assessment as high-risk, Xerox requires the completion of supplier questionnaires. While the key suppliers represent a small portion of Xerox’s total direct supplier base, they represent a significant portion of Xerox’s spend with direct suppliers. In addition to allowing Xerox to validate its initial risk assessment, the supplier questionnaire step also serves to raise suppliers’ awareness about the importance of social responsibility topics, clarify Xerox’s expectations, target areas for review and serves as written documentation of suppliers’ assessment of their performance.
To monitor suppliers’ compliance with the Supplier Code of Conduct, Xerox’s compliance program calls for announced compliance reviews/audits of its key suppliers if a key supplier’s score on their supplier questionnaire falls below a passing level. In addition, Xerox conducts announced compliance reviews/audits of those suppliers identified in Xerox’s initial risk assessment as high-risk regardless of their score on the supplier questionnaire. All compliance reviews/audits are on-site visits by either trained Xerox or qualified third party personnel and follow a consistent review/audit process.
By the end of 2010, Xerox conducted over 150 first time and follow up Supplier Code of Conduct compliance reviews/audits. Areas of nonconformance are evaluated as priority, major, minor or observation and are addressed through a corrective action process. We monitor our compliance program regularly through internal management reviews.
Supplier Management: In addition to compliance-related visits, on-site visits of suppliers are routinely conducted as part of Xerox’s ongoing supplier management by Xerox procurement professionals and quality assurance engineers.
Training Xerox Personnel: Xerox now requires its procurement professionals who are responsible for managing suppliers to complete training on awareness and mitigation of the human trafficking problem. Training of these procurement professionals and other key personnel with an active role in supplier relations will begin in 2012.
Code of Business Conduct and Training: Xerox’s Code of Business Conduct aligns our actions and decisions with our core values and compliance requirements. Our position advocating for human rights and opposing human trafficking is codified in our Code of Business Conduct. Our employees can read our Code of Business Conduct in any one of 13 languages. We require annual refresher training and ethics acknowledgement for all employees. Xerox has a strictly enforced ‘no retaliation policy’ to promote comfort in using the Ethics Helpline. All violations of the Code of Business Conduct are treated seriously, fairly and consistently.
This focus on international labor and human rights standards is part of Xerox’s long-standing, world-wide commitment to behave responsibly as a good corporate citizen. For more information about Xerox’s social responsibility, please visit Xerox’s Global Citizenship site.