Since 1997, our 'Code of Conduct' has been part of every contract with our suppliers. It stipulates the minimum social standards that all business partners and their subcontractors must comply with in production. It also includes items such as anti-corruption measures and good management practice.
Countries with a relatively high risk of poor working conditions in the production of clothing, house and home textiles, shoes and toys are China (including Hong Kong), India, Bangladesh, Turkey, Vietnam, Pakistan, Indonesia, Thailand, Mauritius, Bulgaria and the United Arab Emirates.
Compliance with the 'Code of Conduct' in these markets is regularly monitored by independent firms (accredited by the Social Accountability International, SAI). There are three possible audit results:
Suppliers who score a 'good' can continue to business with Otto Group companies for another three years before undergoing another audit.
If the audit determines that the supplier's practices are 'in need of improvement' or 'critical', i.e. if suppliers fail to meet the minimum standards stipulated by the Otto Group's social program, they have six months to remedy the identified shortcomings, after which time they are re-audited.
Suppliers with especially positive audit results are encouraged to pursue to best-practice standard and gain SA8000 certification.
While we require our foreign business partners to comply with social standards, we also realize that existing circumstances, which in some cases are culturally determined, cannot be changed overnight. Therefore, it also helps suppliers to achieve compliance by investing in training and coaching them. For this purpose, the Otto Group drew up a 'Market Development Programme' in 2003 and bears all costs for implementing the entire social program - in the years 2004 to 2006 alone these amounted to nearly 9 million euros.