Forced Labor Not Acceptable – Best Buy Corporate News and InformationBest Buy Corporate News and Information

Company News

February 6, 2020

Hamlin MetzgerStaff Writer

Share

Best Buy is committed to the International Labour Organization (ILO) Core Conventions and will not stand for any practices that run counter to the Core Conventions, including forced labor.

We source our private label products from seven countries and approximately 185 factories that employ over 165,000 workers, of which fewer than 200 are foreign migrant workers (i.e., workers who travel temporarily from their home country for employment). As an active member of the Responsible Labor Initiative, we understand that forced labor conditions are a risk in some of these regions, especially for foreign migrant and other vulnerable workers. Therefore, we conduct both country-level risk assessments and an annual factory-level risk assessment that takes into account both business and social risks to help us identify where additional due diligence may be needed. Forced labor risk is specifically included in these assessments using data from:

We make our expectations on forced labor clear for our suppliers in avariety of ways, including:

  • Provisions prohibiting forced labor are standard in our vendor contracts
  • 100 percent of our private label vendors receive training on our Supplier Code of Conduct
  • These trainings occur during the vendor onboarding process, annually as part of an overall training program and when aspects of forced labor are identified.

We also require and assess that ourprivate label suppliers cascade our Supplier Code of Conduct to the next tierof the supply chain.

We provide specific training to private label suppliers on the topic offoreign migrant workers in Taiwan and student workers in China, which are two vulnerablegroups of individuals at risk of forced labor. We partnered with a HongKong-based NGO and created a toolkit for the factories we contract with inChina to help identify and prevent forced labor conditions among studentworkers. In addition to our private label suppliers, we train our internal privatelabel teams including product managers, sourcing and the leadership team.

READ  5 Things To Know About Using Those Holiday Gift Cards

Beyond training, we ensure our private label suppliers are complyingwith our expectations through a rigorous monitoring program. In fact, we conduct due diligence oneach factory in multiple ways including:

  • Apre-contract audit for 100 percent of potential private label factories
  • Increaseddue diligence for medium and high-risk vendors as determined by our riskassessments

This results in audits of approximately 75 percent of private label factories annually. These audits, which include assessments of the factory and dormitories, reviewing of numerous documents and policies and interviews with factory management and workers, are conducted by firms and auditors who have been trained and approved by the Responsible Business Alliance, where we are a member. Auditors look for any conditions that indicate a potential for forced labor (for example: withheld passports, restricted movement, recruitment fees and withheld pay), and interview workers, either directly or via worker surveys, to better understand their working conditions. In the most recent fiscal year, we engaged nearly 3,500 workers, including offsite, if necessary, to avoid risk of retaliation.

If we do find conditionsof forced labor, we immediately take action to hold our supplier accountableincluding, but not limited to

  • Requiring the specific action(s) to cease immediately
  • The supplier must complete a Corrective Action Plan (CAP) that is approved by Best Buy
  • Workers are paid their due wages, including the reimbursement of all recruitment fees, which is verified through spot checks and ultimately 3rd party audits.
  • The supplier must establish a policy preventing all conditions of forced labor and conduct a training on the policy for all relevant employees
  • We leverage partners with expertise on foreign migrant workers and forced labor, like Verité, to conduct a required training so factory management and staff fully understand our requirements
  • Moving forward, the supplier is designated as high-risk and is subject to additional due diligence.
READ  Best Buy Partners with Vivint Smart Home to Launch Leading-Edge Smart Home Service

If the supplier refuses to comply and does not complete aBest Buy approved Corrective Action Plan (CAP), we will terminate therelationship with the factory.

Beyond directsuppliers, we also respond to allegations of forced labor in raw materialsourcing and engage smelters who may be sourcing from mines where forced labormay be present. In these cases, we help lead industry efforts to engage thesmelters in question to determine what actions they are taking to verify and ,if necessary, address conditions of forced labor at the mine. By partneringwith industry peers, we build leverage that is then applied to the smelters so thatthey increase their engagement and improve their oversight of source mines.

Our focus oneliminating conditions of forced labor is just one example of how Best Buyseeks to ensure the responsible sourcing of our private label products. We arededicated to driving continuous improvement of our sourcing practices and ourvendor’s working and environmental conditions and we firmly believe one of thebest means to further our responsible sourcing efforts is through engagementand collaboration with stakeholders, including suppliers, peer companies,investors, academics and civil society organizations.