Wesfarmers Health - Human rights and modern slavery
Wesfarmers Health recognises the importance of human rights and expects operations and supply chains associated with its businesses to operate in accordance with legal obligations and community expectations when it comes to prioritising ethical sourcing practices.
Wesfarmers Health is committed to:
- conducting ongoing human rights due diligence in its supply chain and business development activities
- identifying and mitigating human rights risks
- advocating for transparency and supporting national and international efforts to address human rights issues
- acting as quickly as possible to remedy identified human rights issues.
Ethical sourcing program
Wesfarmers Health is required to meet the minimum standards set out in the Wesfarmers Ethical Sourcing and Modern Slavery Policy. These minimum standards include the identification of ethical sourcing and modern slavery risks within its supply chains, working with suppliers to address harm caused and reporting ethical sourcing reportable breaches and their remediation.
Wesfarmers Health benchmarked against the ethical sourcing related policies and practices of other retail peers and Wesfarmers divisions, with the aim of designing its own Ethical Sourcing Program according to industry best practice and in line with the business’s risk appetite.
The Ethical Sourcing Program is governed by the Wesfarmers Health Ethical Sourcing and Modern Slavery Policy. The policy sets out minimum standards to ensure suppliers to Wesfarmers Health, provide products and services that meet legal obligations and community expectations. The Wesfarmers Health Board is responsible for overseeing its ethical sourcing and modern slavery commitments and reviewing the policy regularly to ensure it continues to evolve and reflect community expectations.
Wesfarmers Health has made the policy available on its website, intranet and supplier portals.
Traceability and supplier due diligence
During the year, in collaboration with the category and indirect procurement teams and suppliers, Wesfarmers Health mapped its tier 1 suppliers of own-brand goods for Resale (GFR) Own Brand, suppliers of goods not for resale (GNFR), service suppliers, and suppliers of GFR proprietary brand suppliers.
Wesfarmers Health takes a risk-based approach to assess and mitigate human rights risks in its operations and supply chains. In assessing risks in the goods supply chain, Wesfarmers Health considers manufacturing sites under GFR own-brand suppliers and goods not for resale suppliers that supply products with cotton, latex and polysilicon as material and high risk. Wesfarmers Health has since mapped these sites under two categories and utilises a combination of supplier due diligence forms, the Sedex risk assessment tool and third-party social audits to manage ethical sourcing risks.
In managing the risks in sourcing services Wesfarmers Health focuses on services such as cleaning, waste disposal, security and catalogue distribution, where vulnerable workers are at higher risk.
Social audits will be required or triggered by human rights related concerns as a result of the risk assessment and outcome of the due diligence of suppliers and sites. Wesfarmers Health’s monitoring system grades third-party social audits, recording non-conformances raised in the audits.
The category team is updated on the approval status of sites and suppliers. Wesfarmers Health then works with suppliers to ensure ethical sourcing requirements are understood and being met.
Wesfarmers Health’s approach to addressing non-conformances is aligned with the Sedex Members Ethical Trade Audit (SMETA), an industry-leading social auditing methodology. Suppliers and sites that are unwilling or unable to address SEDEX-defined critical1 and business critical non-conformances will be at risk of a suspension of further purchases until the issues are adequately addressed.
In addition, Wesfarmers Health requires its suppliers to remediate all non-conformances relating to excessive recruitment fees, bribery attempts, denying auditor access, and non-conformances that pose a threat to a worker’s life or health.
Suppliers and sites may potentially be exited, if they are unwilling or unable to work towards continuous improvement and commit to remediate the substantiated harm caused to their workforce.
Training, support and grievance mechanisms
Wesfarmers Health provided 648 hours of online modern slavery training to 2,593 team members and 39 hours of in-depth ethical sourcing training to frontline team members, including the category, indirect procurement, supplier engagement, logistics, legal, risk and sustainability teams, this financial year. The in-depth training addresses the identification of ethical sourcing and human rights issues in sourcing goods and services, as well as expectations of suppliers under the Wesfarmers Health Ethical Sourcing Program. Wesfarmers Health also designed and delivered an online webinar to 12 of its own-brand suppliers.
Wesfarmers Health has joined Group peers in the expansion of an additional in-country grievance mechanism, Your Voice. The mechanism is in the process of being implemented by a third-party service provider, and approximately 2,500 supplier workers will be able to raise grievances through Your Voice, from the first quarter of the 2024 financial year.
In the 2023 financial year, Wesfarmers Health commenced the process to update its Whistleblower Policy, which references the new Ethical Sourcing and Modern Slavery Policy. This amendment will take effect in the 2024 financial year.
In circumstances where human rights related issues are raised through the above channels, Wesfarmers Health will ask the supplier to investigate to ensure the Wesfarmers Health Ethical Sourcing and Modern Slavery Policy is being adhered to.
Wesfarmers Health will continue to work with its suppliers and other stakeholders to drive continuous improvement by identifying adverse impacts in its operations and supply chains and remediate harm wherever possible.
As the program matures, Wesfarmers Health aspires to expand the monitoring and social performance to more categories of suppliers and manufacturing sites deeper into the supply chain. Wesfarmers Health intends to review in more detail ethical sourcing data and improve its due diligence processes.
1 In a SMETA audit, issues observed by third-party auditors will be raised as minor, major, critical and business critical non-conformances.