Protect Your Brand Through Our CSR Compliance Program

What Motivates Brands to Have a Compliance Program?

 

Brands may have multiple motivations for developing compliance programs. Altruistic motives, to enhance the overall conditions of humankind and produce products that contribute to a circular economy, are one motivation. There are also growing trends among consumers to support brands that are committed to ethical business practices. Compliance programs can provide supply chain transparency which allows consumers to observe the ethical business practices that brands are actively seeking to promote. Providing consumers with visibility into compliance initiatives helps generate goodwill among consumers. Lastly, legal requirements for supply chain due diligence are increasing and provide an additional incentive for brands to develop compliance programs.  

 

Social Compliance Programs

 

Brands that are interested in promoting the welfare of workers may develop compliance standards for the following areas:

• Organizational governance
• Human rights
• Labour practices
• Environment
• Fair operating practices
• Consumer issues
• Community involvement and Development

Brands that effectively manage their social compliance programs can help their internal teams feel good about their overall production and supply chain process, can assure their customers that they only work with suppliers that use ethical business practices, and can achieve peace of mind knowing that they are providing a safe and fair working environment for factory workers.

 

How do Evolving International Legal Requirements for Packaging Supply Chains Impact Brands?

 

There is increased international scrutiny for business practices within extended supply chains. In North America, for example, there is the California Transparency In Supply Chains Act 2012 and in the UK there is the UK Modern Slavery Act 2015.

 

North American Compliance Regulation - An Example

 

The California Transparency In Supply Chains Act 2012 recognizes that slavery and human trafficking are illegal on a state, federal, and international basis. In an effort to avoid implicit endorsement of slavery and human trafficking practices, this Act requires retailers to be transparent with consumers regarding ongoing efforts that are used to ensure that the products retailers sell are manufactured without the use of either slave labour or workers who have been victims of human trafficking. The Act provides very specific criteria to identify which business entities conducting business in California are subject to these laws. The following businesses must comply with the requirements of the Act:

• Retail Sellers or Manufacturers
• Doing Business in the State of California
• With Annual Worldwide Gross Receipts in Excess of $100,000,000

European Compliance Regulation - An Example

 

As explained by the Harvard Law School Forum on Corporate Governance, the UK Modern Slavery Act 2015 requires businesses that operate in the United Kingdom and have worldwide revenues of at least  £36 million to publish an annual transparency statement. The transparency statement needs to describe the steps the business has taken during the most recent financial year to make sure that their business and supply chains do not use modern slavery or human trafficking.  

 

The British government has established a Modern Slavery Statement Registry to provide a centralized location for businesses to register their anti-slavery statements. This registry also empowers individual consumers, investors, and other interested parties to research the efforts that a company has taken to combat modern slavery.   

 

 

Billerud is very committed to supporting anti-slavery initiatives. In addition to being a signatory member of the UN Global Compact and adhering to the Compact's ten principles, Billerud has implemented multi-faceted programming to help combat modern slavery. These initiatives are summarized in our Modern Slavery Statement. 

 

Escalating Penalties for Noncompliance

Concurrent with this increased focus on international supply chains, legal and regulatory penalties for noncompliance are escalating. Legal and regulatory bodies frequently group issues together under the term “ESG” collectively covering issues related to environmental, social, and governance.  According to the international law firm Dechert, LLC, there is an increasing likelihood that corporations will bear more legal responsibility in relation to their supply chains in the near future. Here’s what Dechert, LLC believes will occur: 

“Although some corporates have previously adopted voluntary international reporting and due diligence standards, it seems increasingly likely that corporates will bear more legal responsibility in relation to their supply chains in the near future, including the prospect of penalties and debarment for EU companies and non-EU companies doing business in the EU that fail to conduct under proposed EU legislation that would introduce mandatory ESG due diligence for supply chains.”  

A growing focus on ESG issues also impacts non-EU companies. The ESG initiatives compel corporations   to be better corporate citizens by proactively addressing and mitigating human rights issues. Legislative actions and increased stakeholder pressure contribute to the escalating pressure on brands to deploy stringent compliance programs.

Social Media Platforms Accelerate Consumer Vigilance for Social Compliance

Brands are also acutely aware that each consumer is, in effect, their own distribution platform. If a consumer discovers a human rights or sustainability violation associated with a brand’s packaging supply chain, with the click of a button they can share their findings with their entire social network. With the ease of sharing content, these compliance transgressions can quickly go viral on social media causing great harm the goodwill associated with a brand.

A Compliance Program Based on International Standards that is Tailored to the Packaging Industry

Decades of experience serving global brands has provided Billerud’s compliance team with insights regarding which countries are most likely to have business practices that include noncompliance activities. We strategically assess the likelihood of a violation occurring in a particular country. We then tailor our compliance efforts to efficiently match our auditing efforts to that likelihood.

Our compliance team is skilled at managing packaging supply chain compliance risks across multiple industries including consumer goods, sporting goods, electronics, and apparel industries.   

Leveraging Best Industry Resources to Keep Current on Evolving Compliance Issues

Our team knows which industry organizations are most effective at monitoring human rights violations. For example, The International Trade Union Confederation (ITUC)  is an international organization focused on protecting the rights and interests of workers. This resource is frequently consulted by our compliance team to monitor evolving trends in international compliance. Based on updates found within the ITUC, our compliance auditors understand that the likelihood of a human rights labour violation is far less likely to occur in countries that are a member of the EU versus certain countries in SEA. Knowing which countries are at higher risk of compliance violations allows the auditing team to adjust the scope of audits as needed.

Billerud’s Packaging Supply Chain Compliance Team can Meet Your Needs in Required Timeframes

Our cumulative compliance knowledge allows our team to use their time judiciously. The most extensive efforts can be focused on the most likely targets of compliance violations. By effectively managing our time, our auditors have the resources available to serve every brand in the time frame required.

Brands frequently audit their Tier 1 suppliers for compliance. Packaging suppliers, however, are frequently categorized as Tier 2 or Tier 3 suppliers. Our compliance program can provide brands with compliance transparency for their Tier 2 or Tier 3 packaging suppliers.

Billerud’s Compliance Programs Are Scalable and can be Implemented Quickly

Billerud can help brands that rely on SEA product factories for sourcing make sure that their packaging suppliers are compliant. Whether your brand has an ongoing compliance program or is just launching a compliance initiative, Billerud can meet you at wherever you are in the evolution of your compliance journey.

For brands that need to rapidly implement a compliance program for their packaging supply chains, Billerud can effectively offer a “turnkey" compliance service. By leveraging our existing packaging supplier network, internal resources, and auditing programs, we can help you quickly identify packaging suppliers that are violating compliance procedures and help you identify mitigation programs to rapidly bring your brand’s packaging.  

Conclusion:

Starting a packaging supply chain compliance program from scratch can be intimidating. Understanding how to integrate your brands’ compliance needs with the needs that are particular to your industry is challenging. Learning how to navigate a complex web of legal requirements, that frequently vary from country to country, adds to the complexity of the task.

With Billerud’s compliance program, you can share your needs and concerns with our experienced team of supply chain compliance professionals. We can then work with you to provide customized supply chain and packaging solutions that will ensure that your packaging supply chain is compliant to local laws and meets the particular needs of your brand.