Established in 1998 the Ethical Trading Initiative is an alliance of companies, trade unions and NGOs that work in partnership to improve the working lives of people across the globe who make or grow consumer goods.
Ethical trade means that retailers, brands and their suppliers take responsibility for improving the working conditions of the people who make the products they sell.
ETI’s objective is to work together with its members to tackle the many complex questions about what steps companies should take to trade ethically, and to make a positive difference to workers‘ lives. The initiative works to integrate ethical principles into company buying practices.
In order to improve working conditions in global supply chains ETI has established the ETI Base Code of labour practice and is active in developing effective approaches to implement this standard. Alongside the implementation of the Base Code ETI’s projects and working groups develop and try out new ideas to collectively establish good practice in ethical trade. ETI develops training and resources to capture this learning, providing practical tools to help companies to put their ethical trade policies into effect.
ETI’s membership comprises over 50 companies with leverage over more than 38,000 suppliers, collectively covering more than eight million workers across the globe.
ETI’s funding derives from a combination of members‘ fees, a grant from the Department for International Development ( DFID ), individual project funding and trading income.
| Sub-Category |
Private Sector
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| Standard for |
Consumer goods (food and non-food)
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| Focus |
Working conditions on farms and in factories
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| Structure |
ETI expects from its corporate members commitment, direct involvement and improvement over time. As a first step corporate members have to adopt the ETI Base Code in full. They also need to sign up to ETI’s Principles of Implementation, which set out the approaches to ethical trade that member companies should follow: companies are required to demonstrate a clear commitment to ethical trade, to integrate ethical trade into their core business practices, to drive year-on-year improvements to working conditions, to support suppliers to improve working conditions, and to report openly and accurately about their activities.
Addionally member companies are expected to play an active part in ETI activities alongside their trade union and NGO colleagues, including in members' meetings, projects and working groups.
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| Conformity Requirements |
The ETI Base Code of labour practice is based on the standards of the International Labour Organisation ( ILO ) and includes requirements on the following issues:
1. Employment is freely chosen
2. Freedom of association and the right to collective bargaining are respected
3. Working conditions are safe and hygienic
4. Child labour shall not be used
5. Living wages are paid
6. Working hours are not excessive
7. No discrimination is practiced
8. Regular employment is provided
9. No harsh or inhumane treatment is allowed
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| Auditing System |
To measure member companies‘ performance these must submit annual reports which set out the steps they are taking to tackle working conditions in their supply chains. Member companies have to inform the ETI who is driving the company's ethical trade strategy, how much money they have spent on ethical trade activities, what training they have given to staff and suppliers, what progress they have made in integrating ethical trade into their business practices, how they assess working conditions at their suppliers' worksites, and how they ensure that any improvements have been made.
The ETI Secretariat provides detailed feedback to each company, identifying where progress has been made and where further action is required. If member companies do not make sufficient progress, or fail to honour their membership obligations, their membership is terminated.
Each year random validation visits to a minimum of 20 percent of the reporting members are conducted to check that the company's management processes and systems for collecting data for its annual report are consistent and reliable.
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| Geographic Focus |
worldwide
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| Website |
http://www.ethicaltrade.org
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