Responsible Sourcing with AIM-PROGRESS

Without industry-wide collaboration, consumer goods companies will continue to create individual programs that increase complexity and hinder broad-based improvements throughout the supply chain. Thus, industry leaders, like Diageo, Unilever, Kraft Foods, Procter & Gamble and PepsiCo, have voluntarily decided to take action through AIM (www.aim.be), the European Brands Association, whose mission is to create an environment of fair and vigorous competition among brands.

Forming AIM-PROGRESS

A number of manufacturers within AIM have set up a task force, called AIM-PROGRESS, to develop guidelines for responsible sourcing. In conjunction with the GMA, the task force has set four main objectives:

• To work jointly on evaluating responsible sourcing programs;
• To increase efficiency by recommending common assessment standards and methodologies for responsible sourcing;
• To seek convergence with similar efforts and platforms around the world;
• To always recognize that it is the choice of each manufacturer to determine whether or not, and how, to implement any responsible sourcing policies.

"We are all trying to use the same methodologies and tools to limit supplier fatigue and overall cost to the industry while working to improve the labor, health and safety, environmental and business integrity standards," says AIM member Russ Wood, Director of Responsible and Sustainable Sourcing for PepsiCo Global Procurement.

Using SEDEX

To provide an independent way of collecting, managing, analyzing and reporting on supplier data, while at the same time minimizing supplier audit fatigue, a number of AIM members joined the Supplier Ethical Data Exchange (SEDEX) (www.sedex.org.uk). A Web-based system launched in 2004, SEDEX allows suppliers to maintain data on responsible practices in their production sites and make this data available to trading partners.

"Each company is responsible to manage its own SEDEX engagement," explains Wood.

Just 12 months into the program, a number of benefits have come to fruition. For example, nearly 3,000 suppliers are leveraging SEDEX with another 5,000+ targeted for onboarding in 2009; protocols for audit benchmarking and sharing have been agreed upon; specific approaches to intermediaries/agents and agricultural sectors are being developed; and advantages to members and their suppliers are beginning to emerge such as proactive supplier linking and increased shared supplier leverage.

"This is one of the few initiatives that brings together highly-competitive companies and leverages best practices to address corporate social responsibility issues in our supply chains," closes Wood.

Participation in this program is open to non-members of either AIM or GMA.