Goals and progress
Supply chain | Helping factories move forward
In terms of our factory relationships, we prefer to think long term. We’ll work with them to ensure they meet our expectations around quality, cost and compliance. This means that, over time, we need to assess each factory’s ability to adhere to the requirements outlined in our Code of Vendor Conduct (COVC).
Based on site visits and comprehensive monitoring, each factory receives a color rating – from red (lowest) to green (highest). Green, or “excellent,” indicates that we’ve found either no or few minor code violations. Red, or “action required”, means that we’ve found many violations, ranging from minor to serious. An “action required” factory is in danger of losing our business if management does not show improvements as they relate to our code. (We introduced this color code in 2009, which replaces our previous numerical (1-5) rating system). For more information on this change, click here.
Rating factories is a challenging process. There are many nuances. It’s work that requires us to make decisions about the weight of various issues. For example, we define "key" violations as having a greater negative impact on a factory's rating than "non-key" violations.
We regularly review our list of key issues to ensure that it’s consistent with the conditions our Social Responsibility Specialists (SRSs) are seeing in factories. We also consult our stakeholders for their insight and guidance.
