IKEA does not prescribe HOW the supplier should comply only WHAT the requirements are. Cost of the compliance is borne entirely by the supplier.
BENEFITS
Potential benefits of compliance:
- Access to consumer who buys large volume
- Sustaining the suppliers workforce
- Ability to comply with the requirements of other buyers
- Increased competitiveness and efficiency
- Savings (energy/waste)
- Inventory management improvement
AUDITS
- before the first delivery
- 12 months after the contract enters into force
- at least every 24 months
- unannounced audits may be performed
IKEA employs 80 full time auditors and it has a monitoring group that checks the quality and consistency of its auditors. They also use third party auditors to check themselves.
REQUIREMENTS
6 basic requirements (they are a must before first delivery is made to IKEA):
- Prevention of child labor
- Severe environmental pollution
- Workers have accident insurance
- Forced and bonded labor
- Severe safety hazards
- Keeping records on working hours and wages
12 additional requirements (supplier has 12 months for implementation):
- Environment
- Chemicals
- Fire prevention
- Hazardous and non-hazardous waste
- Worker health and safety
- Housing facilities
- Wages
- Benefits and working hours
- Discrimination
- Freedom of association
- Harassment
- Abuse and disciplinary actions