An Overview of Social Compliance

&
Introduction to WRAP
Clay Hickson
Vice President, Strategy & Business Development
Monica Escobar-Hertzoff
Sr. Mgr., Compliance & Training, the Americas

June 30, 2017

Honduras
 Origins & Evolution of Social Compliance

• In the mid-to-late 1990s, US / EU brands and

retailers were embarrassed by reports of
worker abuse.
• Many brands and retailers wrote Corporate
Codes of Conduct and began auditing factories.
• Evolving from comply-or-die models to
conversations about sustainability.
 What is Sustainability?
• Many Definitions
– Most of them context driven
• Need to Look at the Big Picture
– Our definition of choice:
Sustainability is being able to do whatever it is we are doing
now, without endangering the ability of future generations to
do the same.
 Why do Social Compliance &
Sustainability Matter?
• Doing the Right Thing

• If that’s not enough - it comes down to

protecting your company

– Social Compliance = Risk Management

– Sustainability = Business Continuity

 What Is WRAP?
• World’s largest independent certification program

• Focused on the apparel, footwear, and sewn products sectors

• Inspects and certifies factories all over the world

• Objective, non-profit team of global experts dedicated to

promoting safe, lawful, humane, and ethical manufacturing
around the world through certification and education
 WRAP’s 12 Principles
1. Compliance with Laws 7. Prohibition of
and Workplace Regulations Discrimination

2. Prohibition of
8. Health and Safety
Forced Labor

3. Prohibition of
9. Freedom of Association &
Child Labor
Collective Bargaining

4. Prohibition of Harassment
10. Environment
or Abuse

5. Compensation and
$ Benefits 11. Customs Compliance

6. Hours of Work 12. Security

 Who Do We Serve?
• Workers
– Safer, healthier, more ethical working conditions

• Production Facilities
– Verified compliance leading to increased
competitiveness
• The Sourcing World
– Makes ethical sourcing a global reality
Leading Independent Certification Program
WRAP Top 10+ for 2016
Rank Country Registrations
1 China 832 Received over 2,600
2 Vietnam 384 applications in 2016
3 Bangladesh 245
4 India 226
As of early 2017, over
5 Pakistan 151
6 Cambodia 113
2,300 facilities employing
7 Sri Lanka 99
more than 2 million
8 Indonesia 75
workers in over 40
9 Mexico 55 countries are currently
10 Egypt 46 certified
12 Honduras 29
 We Are Worldwide

Headquarters
Arlington, Virginia, USA
Bangladesh Hong
Kong
India

Latin America SE Asia

(Thailand, Indonesia,
& Vietnam)

• Weekly newsletter with over 8,300 global readers

• Website gets over 6,000 unique visitors per month
and is available in 4 languages
 Recognized Expertise
Media Presence
WRAP is regularly sought to
provide analysis and
expertise about social
compliance issues WRAP contributes to many
leading trade publications and news outlets

Our VP serves on the Steering Committee of

Our CEO is Chair of the Executive Board of the Social & Labor Convergence Project
APSCA and serves on the Board of Advisors
for the Alliance for Bangladesh Worker
Safety
 History
• Task force established by AAMA in 1996 to study the issue of
“sweatshops” in offshore manufacturing and recommend an
industry-wide response
• Committee sought input from brands, suppliers, NGOs,
academics and governments
• WRAP incorporated in 2000 with 12-point code
• Based on universally recognized min. standards
• Compliance to national laws, respect for local culture
 Organizational Overview
• Non-profit organization (not a charity)
• NOT a membership club
• By charter, Board is majority non-industry
• HQ in Arlington, VA, USA
• 2 Regional offices
– Hong Kong, SAR, and Dhaka, Bangladesh
– Representation in India, Thailand, Vietnam and Latin America
• 24 full-time staff
– 10 experienced auditors / 8 accredited trainers
• Audits conducted by 3rd-party firms, as well as
WRAP staff (latter mainly for quality control)
 WRAP Practices
• Management systems approach to social
compliance and sustainability
– Engaging with facilities to build relationships
• Education is essential
– WRAP Training offerings
 WRAP Training Offerings

• General awareness training

• Five-day lead auditor
• Two-day internal auditor
• Modular training courses
– Fire safety training
– C-TPAT training
 Benefits of WRAP Certification
• WRAP’s Credibility and Dependability
– Clear requirements; systemic approach
– Cost effective expertise
– Availability of expert resources (training)
• Safer Working Conditions
• Improved Worker Morale and Communications
• Avoiding Audit Fatigue
• Remember the Business Case for Compliance
 Summary
• Sustainability and social compliance
certification are increasingly important
aspects of supply chain management.
• A properly implemented, and credibly
certified (WRAP!) social compliance system
meets buyer requirements as well as
increases worker efficiency & morale, and
productivity & profitability.
 WRAP Is
• The “standard most often cited” for social
compliance certification in the textile sector.
– “Making Private Standards Work For You”
UNIDO Study.
• A respected leader in the training arena.
• A highly recognized, responsive and
effective partner for supply chain social
compliance management.
 For More Information
www.wrapcompliance.org
USA Headquarters +1-703-243-0970 info@wrapcompliance.org

Latin America +1-703-243-8795 mescobarhertzoff@wrapcompliance.org

Hong Kong +852-2730-2381 bchung@wrapcompliance.org

Bangladesh +880-2-982-2339 knahar@wrapcompliance.org

India +91-98212-12814 ktramakrishnan@wrapcompliance.org

Southeast Asia – Thailand +66-8-3033-1004 bseliger@wrapcompliance.org

Southeast Asia – Vietnam +84-9-0398-0015 knguyen@wrapcompliance.org