Our suppliers range from small farming cooperatives to multinational corporations. We consider factors such as capacity, quality and cost when selecting companies to buy from. In addition, we seek only to work with suppliers that can consistently meet our standards and specifications and are committed to standards of conduct compatible with our Five Principles.
Our global Responsible Sourcing strategy and Supplier Code of Conduct comprises consistent sourcing standards and guidelines for our suppliers.
1. Verification of Supply Chains
Supplier Code of Conduct
Our Supplier Code of Conduct captures the spirit of Mars’ business practices and sets globally-aligned standards and guidelines for our direct suppliers in each of the following areas:
Forced labor, including slavery and human trafficking
Abuse, harassment, disciplinary action
Fair and equal treatment/non-discrimination
Compensation and benefits
Freedom of association and collective bargaining
Health and Safety
Ethical business practices
All Mars business segments have adopted the Supplier Code of Conduct which includes workplace standards and guidelines aligned with International Labour Organization guidelines. We require our suppliers to comply with these standards and encourage suppliers to exceed them. Each supplier must sign our Supplier Code of Conduct to affirm its commitment to comply with it or demonstrate that its existing policies cover all aspects of the Supplier Code of Conduct
Selecting Our Suppliers
When selecting new suppliers, we incorporate responsible sourcing criteria at every stage of the process, from analyzing the location of the supplier and associated risks to inclusion of responsible sourcing metrics in commodity scorecards. These scorecards provide an upfront, strategic evaluation of the sourcing landscape for key commodities. They are increasingly used to build responsible sourcing factors into the decision-making process, before individual suppliers are even considered.
Suppliers must demonstrate compliance with specific expectations and labor codes in order to be ‘Responsible Sourcing Qualified’. These vary depending on the results of a third-party supplier risk assessment and can include: alignment with the Mars Supplier Code of Conduct, registration on the Sedex information management system, completion of site-specific self-assessment questionnaires, and completion of an initial responsible sourcing audit.
2. Audits of Suppliers
To help ensure compliance with our Supplier Code of Conduct, we evaluate the inherent risks associated with operating in different geographies and purchasing the commodities and services central to our business. We work with suppliers to assess and improve how they manage these risks and comply with our Supplier Code of Conduct.
In some areas of our business, compliance with all responsible sourcing expectations is mandatory for suppliers to do business with Mars. For example, suppliers of branded promotional items must complete all responsible sourcing expectations before any order is placed. Suppliers in these areas are informed directly of their requirements by the responsible buyer. If a supplier repeatedly fails to comply with our Supplier Code of Conduct and other verification standards and will not commit to compliance, we replace the supplier.
The three key components of our compliance audit program are:
Risk assessment - To help us determine whether a supplier completes a self-assessment or whether an independent audit is warranted, we use independent country, commodity and product risk data provided by Verisk Maplecroft (a global risk advisory business) to score, rank and assess the ethical, social and environmental risks associated with what we buy and where we buy it. Additional in-depth country and risk analysis also informs our commodity/category buying strategies.
Self-assessment - We use the Supplier Ethical Data Exchange (Sedex), a secure database where suppliers can record their ability to manage ethical, social and environmental risks. Suppliers are required to complete a self-assessment. The results of the self-assessment help determine whether an independent audit is needed.
Independent Auditing – A supplier is selected for an independent audit based on strategic significance to our business or the degree of human rights risk in the country where it is based. We appoint independent auditors who evaluate working conditions. These trained and accredited auditors use their experience and knowledge of national and local law and culture to gauge whether our Supplier Code of Conduct is effectively implemented and identify other legal or high-risk issues. We develop and track corrective action plans whenever an independent audit suggests that a supplier is not achieving our standards.
Our responsible sourcing program is engaged with AIM-PROGRESS, an industry forum of consumer goods manufacturers and suppliers that promote responsible sourcing practices and sustainable production systems. Mars participates on both the Leadership and Advisory Boards.
Please see Compliance with Our Standards for more information about our audit program.
3. Certification of Suppliers
Each supplier must sign the Mars Supplier Code of Conduct to confirm that it has systems in place to enable compliance with the legal requirements of the countries in which it does business and standards of its industry. Each supplier also must maintain transparent and current books and records to demonstrate compliance with applicable law and standards. For example, a supplier must affirm that it complies with the laws, rules and regulations related to minimum working age and work hours. Each supplier also must demonstrate that migrant workers are treated with dignity, respect and in accordance with the same standards as apply to other workers.
Suppliers with outstanding responsible sourcing performance and notable accomplishments are recognized through awards and acknowledged at regular supplier events hosted by Mars. We recognize internal teams with outstanding contributions to responsible sourcing programs. We choose to pursue business relationships with suppliers that demonstrate Mutuality by embracing their role in responsible sourcing.
Please see Compliance with Our Standards for more information our certification program.
4. Building Internal Accountability
Supplier codes and standards provide little assurance unless they are integrated into day-to-day supply chain management. Our purchasing teams are supported by a global Responsible Sourcing Center of Excellence with representatives in each key buying region: Africa, Asia Pacific, Europe and the Americas. Mars associates on the Center of Excellence team work alongside buyers and suppliers to ensure a consistent and centralized approach to responsible sourcing across Mars.
We train our buyers in responsible sourcing and build related criteria into their personal development plans. Each purchasing organization in every Mars business and every region has established annual targets regarding completion of responsible sourcing activities by suppliers. Purchasing teams are measured against established targets through regular reporting at all levels of the organization, including Mars’ senior leadership. The Responsible Sourcing Center of Excellence works with our internal Responsible Sourcing Steering Committee and other sourcing teams to identify and address emerging supply chain risks and opportunities in existing and new markets. This work helps us plan for future trends and respond quickly to political and environmental events.
Mars has also made available a confidential Ethics and Compliance Hotline. In countries where it is available, the Hotline can be used by workers to report violations of the Supplier Code of Conduct directly to Mars in a secure manner, 24 hours a day, 7 days a week, online or via telephone.
Mars University, our internal framework for all the learning and development opportunities provided to Mars Associates, includes responsible sourcing courses that Associates in relevant roles are required to take. These include robust training for Associates who implement our responsible sourcing program, as well as general training for all other Associates. Our “buyers’ toolkit” explains the role of the Responsible Sourcing Center of Excellence and the tools available to help buyers make the best possible sourcing decisions. These tools include Verisk Maplecroft Global Risks Portfolio, which is software for risk analysis by geographic region.
Please see Responsible Sourcing Training for Mars Associates for more information.