California Supply Chain Transparency Act – Sustainability | Mars, Incorporated

CALIFORNIA TRANSPARENCY IN SUPPLY CHAINS ACT

At Mars, we believe everyone touched by our business should be treated with fairness, dignity and respect. We are a global, principles-driven company seeking to promote and advance respect for human rights across our value chain - from farms to our suppliers’ factories to our own workplaces.

For more than 100 years, we’ve sought to bring our FIVE PRINCIPLES of Quality, Responsibility, Mutuality, Efficiency and Freedom to life every day, in pursuit of creating shared growth and opportunity. Our goal is to work with partners who share our principles-based approach to business, and we expect our first-tier suppliers to respect human rights in their workplaces.

Our global human rights approach includes first-tier suppliers through our Responsible Sourcing program and the Supplier Code of Conduct.

1. VERIFICATION OF SUPPLY CHAINS

We use third-party supplier risk assessment to help identify and verify risk, including indicators of forced labor, and inform the types of actions we take with both current and new suppliers. These actions may range from alignment with the Mars Supplier Code of Conduct, registration with a third-party supplier information management system, completion of a site-specific self-assessment or completion of an initial responsible sourcing audit. Based on publicly available information and advice from experts, we’ve identified extended supply chains in which human rights risks are high and where we are actively engaging – for example, cocoa, palm oil and fish.

Our Supplier Code of Conduct outlines our global human rights expectations of all first-tier suppliers, including workplace standards and guidelines aligned with the International Labour Organization’s Fundamental Principles and Rights at Work. It prohibits the use of prison, slave, bonded, forced and indentured labor and human trafficking. The following areas are included in the Code:

  • Child labor
  • Forced labor, including slavery and human trafficking
  • Migrant labor
  • Abuse, harassment, disciplinary action
  • Fair and equal treatment/non-discrimination
  • Compensation and benefits
  • Working hours
  • Freedom of association and collective bargaining
  • Health and Safety
  • Environment
  • Ethical business practices

The Code encourages suppliers to implement relevant systems to manage risk in their own operations, such as confidential grievance mechanisms. Suppliers have an important role in promoting responsible sourcing policies and principles in their own supply chains, and as part of our commitment to building supplier capability, we periodically engage suppliers in training and awareness raising to drive continuous improvements.

2. AUDITS OF SUPPLIERS

We evaluate human rights risks associated with operating in specific geographies or purchasing specific commodities and services. We work with suppliers accordingly to assess and improve how they manage these risks and their implementation of our Code. If a supplier repeatedly fails to meet our Code and other verification standards and does not credibly commit to meeting them in a given time period, we may terminate our relationship.

Additional tools, often implemented with independent human rights experts, may include further desk research, self-assessment questionnaires, audits and rapid human rights risk assessments. For example:

  • Risk assessment - We use independent country, commodity, and product risk data provided by Verisk Maplecroft to score and assess the social and environmental risks associated with what we buy and where we buy it. Forced labor and related risks are included in this data, which is based on publically available information from sources such as the U.S. Department of Labor and civil society reports as well as proprietary analysis provided by Verisk Maplecroft’s team of human rights risk analytics experts. Risk assessment helps us determine, based on our requirements, the actions expected of specific suppliers, which could include self-assessments or independent audits.

  • Independent Auditing – Select suppliers are further required to have an independent third party conduct semi-announced workplace assessments based on a range of factors, such as whether they are operating in a high human rights risk geography. The scope of the audit includes factors related to forced labor. Audited suppliers are required to implement corrective actions and are reassessed to measure compliance.

Building on our approach to due diligence and auditing, Mars serves on the Leadership Team of AIM-PROGRESS, the manufacturing and supplier forum promoting responsible sourcing practices and supplier capability building. Through AIM-PROGRESS, we work with peer companies to support awareness raising and select trainings related to forced labor.

3. CERTIFICATION OF SUPPLIERS

We expect our first tier suppliers to align with our Code of Conduct, including its provisions on forced labor, by affirming their commitment to uphold our Code or demonstrating an equivalent policy of their own. Suppliers are expected to maintain transparent records to demonstrate compliance with applicable law and regulations.

4. BUILDING INTERNAL ACCOUNTABILITY

Supplier codes and standards are most effective when they are integrated into day-to-day supply chain management. Our purchasing teams are supported by a global Responsible Sourcing team within the Human Rights team, with representatives covering key buying regions. The central Human Rights team works alongside buyers and suppliers to promote consistency in responsible sourcing across Mars.

Purchasing teams and buyers are expected to take a course in in responsible sourcing and have related criteria embedded in their personal development plans. This training is based in the core elements of our Code of Conduct, including forced labor. Purchasing organizations across the business have established annual targets regarding completion of responsible sourcing activities by suppliers and are measured against established targets through regular reporting.

Our dedicated global human rights team works with colleagues across our business as our policies are applied. Our Human Rights Working Group meets monthly and brings together day-to-day practitioners from relevant business segments and functions to discuss and advance human rights priorities. Our Human Rights Steering Committee, comprised of senior executives in Corporate Affairs, Legal, Human Resources, Operations and Commercial, meets quarterly to review our global human rights progress, issues and performance. Our Board of Directors and our global management team review an annual report on our human rights progress and challenges.

5. TRAINING

Mars University, our internal framework for learning and development opportunities provided to Mars Associates, includes responsible sourcing courses that are required for specific Associates. All of our Commercial Associates are expected to take our Responsible Sourcing training course –content includes our human rights standards and expectations of our suppliers, including with regard to forced labor. General training is available for all other Associates, reviewing both the core issues of our Code and processes applied in Responsible Sourcing.


We expect our suppliers to uphold the Mars Supplier Code of Conduct.