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A Toolkit for Responsible Businesses
Boy working in match-making industry

Scheduling Audits

If you are part of an industry or multi-industry group, the group’s systems and processes may drive when and how you schedule audits.  If you are pursuing a social compliance system on your own, you will have several decisions to make in scheduling your audits.

First, if auditing is part of a pre-screening or pre-registration process (i.e., if you require potential suppliers to obtain a passing score on an audit before you will place your first order), you will schedule audits with these facilities as soon as you believe they are ready, based on their experience with audits and/or the training they have received.  Once the supplier has passed the audit and been registered to supply to your company, audits should be repeated on a periodic basis, depending on the findings of the audit.

Example In Action

Pre-Registration Processes

Many companies require a new supplier to earn a passing score on a social audit before the company will place any orders with that supplier.  Typically, the company provides training to prepare the supplier for the audit, or may expect a vendor/agent to provide training to suppliers.  Once a supplier passes an audit, some companies will then register each supplier in the social compliance information system; other companies’ information systems are web-based and allow suppliers to register themselves.

For example, Target Corporation requires all of its vendors to train the factories from which they source in Target’s requirements for product quality and ensuring “efficient, safe and ethical factory environments.”  Vendors can then register factories in Target’s sourcing system. By registering a factory, the vendor is accountable for the factory’s compliance with Target’s Standards of Vendor Engagement and local laws.  Registration also authorizes unannounced audits by Target team members or third-party auditors.  Vendors must maintain accurate and up-to-date information about each factory.

For more information, see Target’s Standards of Vendor Engagement webpage.

Companies with vast supply chains and/or dispersed suppliers typically conduct audits on a sampling basis.  This is common with audits of agricultural producers, for example.  Your sample should be random and statistically representative.

Audits should be scheduled at times when code violations are most likely to occur.  For example, in agriculture, child labor may be most likely to occur at harvest time.  In manufacturing, labor issues are most likely to occur when facilities are at maximum production levels.  Your risk assessment should provide information to feed in to these determinations.

Auditing of your supply chain should also be scheduled regularly.  However, your audit team should also be ready to react quickly if a grievance is received regarding a particular worksite.

Some companies allow suppliers to conduct their own self-audits, in which suppliers evaluate their own performance using the audit tools, and report it to the company.  Typically, companies may allow this for suppliers who have established a pattern of excellent performance on audits, and/or for suppliers located in countries where the government has shown a pattern of effective labor law enforcement.  It is still advisable to reserve the right to conduct additional audits on such suppliers.  Self-auditing has the advantage of raising the capacity of suppliers, but results of self-auditing should still be verified by an independent party.

Example In Action

The Sports Goods Foundation of India (SGFI)

Thirty-two of India’s leading manufacturers and exporters of soccer balls, volleyballs and rugby equipment—representing 95 percent of India’s sporting goods exports—joined together in 1998 to form the Sports Goods Foundation of India (SGFI).  SGFI is a non-profit organization that aims to prevent and progressively eliminate child labor in sports equipment production, raise awareness of child labor and provide education to children in producer communities.

The members of SGFI have teamed with many partners, including the World Federation of Sporting Goods Industries (WFSGI), FIFA, SGS India, UNICEF, and Save the Children Foundation UK.  FIFA provided start-up funds for an auditing program of workplaces where sports balls are produced; SGS India performs the audits.  Any situation of child labor identified in an audit is immediately reported, and SGFI works with the child and his or her family to provide educational opportunities, health care and other services according to the child’s needs.  UNICEF and Save the Children UK contributed to the design of these programs in order to ensure they adhere to sound child protection and safeguarding principles.

SGFI has registered and mapped all locations where their members are producing sports balls, including homes, to ensure that SGS India auditing covers all workplaces.  Over 3,300 workplaces are registered in SGFI’s database and are regularly monitored.

For more information, see the SGFI website.