SS ACC Learner Guide 16-01-2018

Social Systems
Auditor Conversion Course

Based on the SMETA Best Practice Guidance
IRCA Certificated Course:

17281 – PR 346
Learner Guide
SS ACC Learner Guide

16-01-2018
Welcome to your CQI and IRCA Certified Introduction to Risk Management Training Course.
SGS United Kingdom Limited has been independently assessed and approved by the CQI
and IRCA. This means they have the processes and systems in place to deliver certified
courses to the highest standard.
About the CQI and IRCA
The CQI is the only chartered professional body dedicated entirely to quality.
IRCA is its specialist division dedicated to management system auditors.
Find out more about the CQI and IRCA at www.quality.org.
We hope you enjoy your course.

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ADMINISTRATION
CONTENTS PAGE
Social Systems Auditor Conversion Course Based on the SMETA Best Practice Guidance . 1
Course Administration ........................................................................................................... 4
Session One ....................................................................................................................... 16
Background to Social Accountability ................................................................................... 16
Session Two ....................................................................................................................... 37
Introduction to SMETA Best Practice Guidance .................................................................. 37
Session Three ..................................................................................................................... 51
Interpretation of SMETA, Clauses 0 – 4 .............................................................................. 51
Session Four ....................................................................................................................... 67
Interpretation of SMETA, Clauses 5 – 9 .............................................................................. 67
Session Five ....................................................................................................................... 79
Interpretation of SMETA, Clauses 10 – 11 .......................................................................... 79
Session Six ......................................................................................................................... 87
Registration, Certification and Auditor Competence ............................................................ 87
Session Seven .................................................................................................................... 99
Audit Definition, Principles and Types ................................................................................. 99
Session Eight .................................................................................................................... 109
The Audit Process............................................................................................................. 109
Session Nine ..................................................................................................................... 123
Stage 1 Audit .................................................................................................................... 123
Session Ten ...................................................................................................................... 141
Stage 2 Audit: Conducting the On-Site Audit..................................................................... 141
Session Eleven ................................................................................................................. 157
Stage 2 Audit: Report and Conclusions; Addressing Corrective Actions............................ 157
Appendices ....................................................................................................................... 175
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Course Administration
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FOREWORD
This Course is certificated by the International Register of Certificated Auditors (IRCA;
Course Certification Number, 17281.
Learners who successfully complete this programme may be eligible to apply for
certification by the IRCA as a Social System (SS) Auditor within five years of course
completion.
Other requirements for certification are outlined in this Manual and detailed on the CQI /
IRCA website www.quality.org
The Course is owned by and certificated as SGS United Kingdom Ltd. The SGS policy
and objectives with respect to the course are given below.
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POLICY STATEMENT AND OBJECTIVES

It is the policy of SGS United Kingdom Ltd to provide Auditor/Lead Auditor Training
Courses which meet the requirements set by the International Register of Certificated
Auditors (IRCA).
The objective of each Course is to equip Learners with the knowledge and skills required
to perform audits on social systems and to contribute to the continual improvement of the
system.
IRCA COURSE CRITERIA – OBJECTIVES
Upon completion of this Course, Learners will be able to:
 Explain the purpose, content and interrelationship of the SMETA Best Practice
Guidance, SMETA Measurement Criteria etc. local industry practice and the relevant
legislative framework.
 Describe the responsibilities of an auditor and describe the role of audit in the
maintenance and improvement of social systems in accordance with ISO 19011 and
ISO 17021, as appropriate.
 Conduct and report an audit of social system of an organisation by interpreting the

requirements of the SMETA Best Practice Guidance, SMETA Measurement Criteria
etc. in accordance with ISO 19011 and ISO 17021, as appropriate.
Learners will need to demonstrate acceptable performance in all of these areas in order
to complete the course successfully.
This course is based on SMETA Best Practice Guidance, Measurement Criteria etc.
Version 6.0 April 2017 (Replaces V. 5.0 Dec 2014).
PRIOR KNOWLEDGE
Before starting this course, Learners are expected to have the following prior knowledge:
 Knowledge of SA 8000.
 Knowledge of the ETI Code of Conduct
 Knowledge of SMETA Best Practice and Measurement Criteria etc.
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COURSE BRIEF
1. LEARNER INTRODUCTIONS
At the start of the course, Learners will be asked to introduce themselves. This
introduction should include information on the individual’s job function, organisation,
the organisation’s product or service, the organisation’s certification details, the
individual’s knowledge and understanding of the Social Systems Standards and their
expectations upon completing the course.
2. PARTICIPATIVE LEARNING
This course is presented using techniques that have been designed to make training
an enjoyable as well as a beneficial experience. The approach is based on scientific
evidence as to how the brain works and people learn. A better understanding of the
Standard, and the knowledge and skills of an auditor is guaranteed.
3. SUCCESS CRITERIA
Learners will be graded on the basis of:
 A continuous assessment of their performance against the Course learning

objectives.
 Their marks obtained in the written examination.
To successfully complete the Course, Learners must obtain at least:
 A pass grade in the continuous assessment.
 70% or more of the total marks available in the examination.
4. CONTINUOUS ASSESSMENT
Throughout the duration of the Course, the performance of Learners will be evaluated
during the course sessions, role-plays and exercises. Learners must demonstrate
acceptable performance in the learning objectives to successfully complete the
Course.
In the event that a Learner is either not understanding the subject or not participating
adequately, he or she shall be made aware of the shortfall in performance and, if
appropriate, be provided with additional coaching outside the formal Course hours.
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4. CONTINUOUS ASSESSMENT, continued
Timekeeping during the Course is taken into account during the continuous
assessment of Learners. Poor timekeeping may result in failure to meet course
requirements. No exception will be given to extending break times for external
business activities.
In addition, Learners are required to be in attendance for the full duration of the
Course. Failure to do so will be reflected in the Learner’s continuous assessment and
final grade. Learners may be graded ‘Excellent’, ‘Good’, ‘Satisfactory’ or ‘Fail’
according to the tutor’s perception of their overall readiness and ability to carry out
third-party audits.
Learners who fail the continuous assessment, and who intend to apply for
certification as a Social Systems Auditor, will be required by the IRCA to retake the
entire Course.
5. LEARNING OBJECTIVES
Learning objectives describe in outline what Learners will know and be able to do by
the end of the course. On completion, successful Learners will have the knowledge
and skills to:
5.1 Knowledge
 Explain the purpose, content and interrelationship of the SMETA Best

Practice Guidance, local industry practice and the relevant legislative
framework.
 Describe the responsibilities of an auditor and describe the role of audit in

the maintenance and improvement of social systems in accordance with
ISO 19011 and ISO 17021, as appropriate.
5.2 Skills
Conduct and report an audit of social system of an organisation by interpreting

the requirements of the SMETA Best Practice Guidance and Measurement
Criteria etc. in accordance with ISO 19011 and ISO 17021, as appropriate.
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6. EXAMINATION
The examination comprises a one and a half hour paper. Learners are allowed
access to, ETI standard, SMETA Best Practice, SA 8000 or national equivalent
during the examination.
Electronic devices such as laptops and mobile phones are not permitted in the
examination room.
The exam is in three sections:
 Section 1 contains questions that require a brief written answer.
 Section 2 contains questions that require brief written answers.
 Section 3 contains a number of situations for which a Corrective Action Request

may be required.
To pass the examination, Learners must achieve 70% of the total marks available; in
addition, a minimum of 40% must be achieved in each Section.
Learners who fail the examination shall be allowed one re-sit with a different
examination paper to that which they sat originally. The re-sit must take place within
12 months of sitting the original examination. Re-sits are only permitted provided that
the Learner has passed the continuous assessment. Learners who fail the re-sit must
re-take the entire Course if they wish to gain a certificate of successful completion for
the Course.
7. COURSE CERTIFICATION
Learners who pass both the examination and continuous assessment will be issued
with a “Certificate of Achievement”. The “Certificate of Achievement” is valid for a
period of five years from the date of the last day of the Course for the purpose of
certifying as an auditor with the CQI / IRCA.
Learners who do not pass the continuous assessment and have been in attendance
for the full duration of the course will be issued with a “Certificate of Attendance”.
Learners who fail the written examination and pass the continuous assessment will
receive a “Certificate of Attendance” and will be allowed to re-sit the examination
within 12 months of the end date of the original course.
Learners will receive their certificates within eight weeks of course completion.
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8. REMINDER
The use of mobile phones, iPads, iPhones, tablets, pagers etc. during the Course are
not permitted.
9. CONTINUOUS IMPROVEMENT
Learners are given a Course Evaluation Form at the start of the course for
completion and submission at the end of the course. This provides SGS CBE with
important customer feedback for the continuous improvement of the course.
10. APPEALS AND COMPLAINTS
Learners may appeal or make a complaint about any aspect of the Course or the
continuous assessment. Appeals and complaints should be addressed, in writing, to
the Global Training Manager, SGS United Kingdom Limited.
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COURSE TIMETABLE
DAY 1
08.45 Course Registration
09.00 Course introduction

Objectives, workshops, team-work, continuous assessment,
examination structure, administration; Learner introductions
Session 1 Background to Social Accountability

 Drivers for social and ethical accountability
 Human rights
 Consumer expectations
 Corporate responsibility
 Stakeholders
 Supplier/ subcontractor control
 Interaction with community, society and
environment
 Conventions, specifications and codes
Workshop 1 Working with SMETA
Workshop 1 Feedback
Session 2 Introduction to SMETA Best Practice Guidance

 Sedex vision
 History
 Governance
 Membership
 SMETA Best Practice Guidance
 Contents
 Usage
 Review
 Structure
Session 3 Interpretation of SMETA: Clauses 0 – 3

 Management system and code implementation
 Background to forced labour
 Summary of SMETA requirements on forced labour
 Background to freedom of association
 Summary of SMETA requirements for freedom of
association
 Summary of SMETA requirements for safe and
hygienic working conditions
 Prioritising hazards in the workplace
 Background to child labour and young workers
 Summary of SMETA requirements for child labour and
young workers
13.00-14.00 Lunch
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DAY 1, CONTINUED

 Summary of SMETA requirements for a living wage
 Summary of SMETA requirements for working
hours
 background to discrimination
 Summary of SMETA requirements for
discrimination
 Summary of SMETA requirements for regular
employment
 Background to inhumane treatment
 Summary of SMETA requirements for discipline

 Summary of SMETA requirements for entitlement
to work, migrant and agency labour
 Summary of SMETA requirements for environment
 Summary of SMETA requirements for community
benefits
Module Social Legislation
Workshop 2 Audit Evidence / Audit Trail
Workshop 2 Feedback
Session 9 Audit Stage 1

 Initial contact with the auditee
 Pre-audit visit
 Document review
 The audit plan
 Work documents
IRCA Examination Guidelines
18.00 End of Day 1
Note: Sessions 6, 7 and 8 are located within the Manual to use for referral purposes
only.
There will be a break of 15 minutes mid-morning and mid-afternoon.
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DAY 2
09.00 Recapitulation
Workshop 3 Audit Planning
Workshop 3 Feedback
Workshop 4 Audit Plan Day 2
Workshop 4 Feedback
Session 10 Conducting the On-Site Audit
 Social system audit performance
 The opening meeting
 Overcoming bias
 Social system audit tools and techniques
 Focus groups
 Questionnaires
 Interviews and interviewing skills
 Observation
 Documents and records
 Factors affecting sampling
 Reliability and availability of evidence
13.00-14.00 Lunch
Workshop 5 Audit Preparation
Workshop 5 Feedback
Workshop 6 Focus Group Role Play
Workshop 6 Feedback
Session 11 Stage 2 Audit: Report and Conclusions
 Audit review meeting

 Audit findings
 Finding statements
 Corrective Action Plan Report (CAPR)
 Potential issues (opportunities for improvement)
 Presenting the findings
 Reporting on the audit
 Audit completion
 Corrective action
 Management review
 Follow-up and close out
Workshop 7 Evaluating Evidence
Workshop 7 Feedback
18.00 End of Day 2
There will be a break of 15 minutes mid-morning and mid-afternoon

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DAY 3
09.00 Recapitulation
Workshop 8 Gathering Evidence through Management Review
Workshop 8 Feedback
Workshop 9 Reviewing and Reporting on an Audit
Workshop 8 Feedback
Examination Specimen Examination Paper

Review
 Key elements of Course Learning Objectives
12.30-13.30 Lunch
13.30 IRCA Review
14.00 Course Review and Summary
14.45 WRITTEN EXAMINATION
16.45 End of Course
There will be a break of 15 minutes mid-morning
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SESSION ONE
Session One
Background to Social
Accountability
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SESSION ONE
BACKGROUND TO SOCIAL ACCOUNTABILITY

OBJECTIVES
When you have completed this topic, you will be able to:
 Describe the range of drivers and pressures faced by companies in relation to social
and ethical issues that need to be managed, and the business and social benefits of a
social management system.
 Understand social issues in the context of relationships with stakeholders, including

suppliers and the interaction of business with local communities, society in general and
the environment.
 Understand the conventions, standards, specifications and codes of conduct and the
legal context under which companies are operating.
KEY POINTS
 Drivers for social and ethical accountability.
 Human rights.
 Consumer expectations.
 Corporate responsibility.
 Stakeholders.
 Supplier/ subcontractor control.
 Interaction with community, society and environment.
 Conventions, specifications and codes.
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BACKGROUND TO SOCIAL ACCOUNTABILITY

1. DRIVERS FOR SOCIAL AND ETHICAL ACCOUNTABILITY
The field of social accountability has grown exponentially in the last decade. More
companies than ever before are engaged in serious efforts to define and integrate
social accountability into all aspects of their business, with their experiences being
bolstered by a growing body of evidence that social accountability has a positive
impact on business economic performance.
New voluntary social accountability standards and performance measurement tools

continue to proliferate. Stakeholders - including shareholders, analysts, regulators,
activists, labour unions, employees, community organisations, and the news media -
are asking companies to be accountable not only for their own performance but for
the performance of their entire supply chain, and for an ever-changing set of social
issues. All of this is taking place against the backdrop an ever more complex global
economy with continuing economic, social and environmental inequities.
1.1 Concepts
International mechanisms for defining the law in this area have been around for
a long time. The International Labour Organisation (ILO) was established in
1919 and has been producing Conventions and Recommendations on labour
standards regularly since that time. These have found their way into national
legislation controlling the way that businesses behave ever since.
The concept of Human Rights is not new; the United Nations Universal
Declaration on Human Rights was published in 1948 and has shaped law and
policy around the world since that time.
Globalisation of business has been a major driver behind the move to become
more socially accountable. Businesses are operating on a global basis and
company purchasing power is being viewed as a unique resource that
contributes economic development investment capital, as well as facilitating
basic trade of products and services.
1.2 Business and marketing
Along with globalisation, businesses have generally been moving from “Multi-
national” corporations to “Trans-national” corporations, the difference being that
previously businesses owned and operated facilities around the world, whereas
now many more organisations rely on suppliers and subcontractors from
around the world where there is less transparency and control over day-to-day
activities.
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1.2 Business and marketing, continued
Brands are now incredibly valuable and recognisable globally so businesses

operating in this arena are becoming more and more sensitive of issues that
could have a negative impact on their brand and company image.
1.3 Information
Corporate accounting scandals have focused attention more than ever on

companies’ commitment to ethical and socially responsible behaviour. The
public and various stakeholders have come to expect more of business.
Increasingly, they are looking to the private sector to help with myriad complex
and pressing social and economic issues.
There is a growing ability and sophistication of activist groups to target

corporations they perceive as not being socially responsible, through actions
such as public demonstrations, public exposes, boycotts, shareholder
resolutions, and even "denial of service" attacks on company websites.
There are ever increasing numbers of Non Governmental Organisations

(NGOs) interested in a variety of issues relating to business activities. These
range from the well known international NGOs, such as Amnesty International
and Human Rights Watch, to the lesser known local NGOs who may be
interested in only specific issues or companies.
The rapid growth of information technology has also served to sharpen the
focus on the link between business and corporate social responsibility. Just as
email, mobile phones and the internet speed the pace of change and facilitate
the growth of business, they also speed the flow of information about a
company's CSR record.
A company's reputation for labour practices in Indonesia can, for example,

immediately be made known to individuals in Indiana.
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1.4 Growing investor pressure and market-based incentives
The last few years have seen the launch of several high-profile socially and/or
environmentally screened market instruments (e.g., indexes like the Dow Jones
Sustainability Indexes, FTSE4Good, and the KLD / Russell/Mellon products, as
well as screened investment offerings from Morgan Stanley, Citigroup, Credit
Lyonnais and Vanguard). This activity is a testament to the fact that
mainstream investors increasingly view CSR as a strategic business issue.
Many socially responsible investors (SRI) are using the shareholder resolution
process to pressure companies to change policies and increase disclosure on a
wide range of CSR issues, including environmental responsibility, workplace
policies, community involvement, human rights practices, ethical decision-
making and corporate governance. Activist groups are also buying shares in
targeted companies to give them access to annual meetings and the
shareholder resolution process.
1.5 Supply chain risk
Over the past several years, the social accountability agenda has been
characterised in large part by the expansion of boundaries of corporate
accountability. Stakeholders increasingly hold companies accountable for the
practices of their business partners throughout the entire supply chain with
special focus on supplier environmental, labour, and human rights practices.
With the combination of trans-national operations of companies with valuable

brand names and the ever increasing amount of information available to
stakeholders through the internet, media and NGOs, the international supply
chain can present a huge risk to maintaining a company’s image and
reputation.
The more remote and unclear the supply chain, the more risky for organisations
operating in this way. Unauthorised subcontracting has exposed many well
known brand names. Additionally some prisons in the Far East, using prison
labour, are known to be trading under a limited company name.
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1.6 Consumer expectation
Consumers are becoming more knowledgeable about social issues and are
starting to make more discriminating decisions about their purchasing
practices, based on more than just price and quality.
1.7 Reputation management
Given all of the above, the majority of businesses have to ensure that they
manage and protect their reputation. With increasing information available it is
becoming much more risky for reputations of organisations to simply outsource
activities to the developing world where labour is cheaper and controls have
tended to be less stringent, and have no controls in place.
2. HUMAN RIGHTS
Although the United Nations Universal Declaration on Human Rights has been in
existence for almost 60 years, there still does not appear to be universal
implementation of the concepts embedded in the Declaration.
In his 2001 publication “Human Rights: Universality in Practice”, Peter Baehr wrote:
“There is a big difference between universalism in standard-setting and universalism

in implementation. With regard to the latter there can be little doubt: there is none.
….. That is hardly surprising. If there existed universal implementation of human
rights, it would hardly be necessary to codify them in international treaties and to
design complex supervisory mechanisms.”
Even recent press reports have shown, for example, the prolific use in some regions
of child and forced labour. Such practices do not meet internationally agreed
standards of practice and fundamentally breach the human rights of the individuals
affected, yet in some industries and some locations it continues.
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3. CONSUMER EXPECTATIONS
Consumers are becoming increasingly aware of practices occurring in supply chains,

predominantly through media coverage of issues or reports published by NGOs. For
example, there was extensive coverage of the discovery of children in Pakistan and
India stitching world-cup footballs in 1996. Practices within suppliers to major brands
such as Nike and Gap have also been widely publicised.
This has led to a general feeling of distrust of business and industry practices, even
though there is an expectation that businesses will uphold similar values to the
individual. Especially with companies putting increasingly detailed information about
their social and environmental performance into the public arena.
Consumer attitudes and practices change very slowly, but still there are trends
towards ever increasingly discriminating purchasing decisions, often based on a
variety of factors. For example, a consumer may boycott products from a particular
company due to media coverage about a single issue. Alternatively consumers may
make positive purchasing decisions, such as purchase of “Fair Trade” or “Organic”
labelled products. Quite often, a bad news story can change a consumer’s perception
of a company for a very long time. It is therefore in every company’s interests to
ensure that they are not highlighted in a negative fashion to the public.
4. CORPORATE RESPONSIBILITY
Businesses are responsible for their activities, and must ensure that they take
responsibility both for those impacts that they directly control, for example in their
own operations, as well as those that they may only be able to influence, such as
those in their supply chain. A big factor in this is the relative power that the company
and supplier have. If the company is a major customer for a particular supplier, they
are more likely to be able to influence their behaviour. However, if the company is not
a major customer it may be much more difficult to influence supplier behaviour.
The aim for every company is to create a win-win situation for all stakeholders,
including investors, customers, employees, subcontractors, communities etc. By
recognising their impacts and managing them appropriately this is potentially
achievable.
Many businesses are currently using a reactive approach rather than a proactive
approach, whereby they tackle issues when they become problematic. However, this
is a dangerous approach that leaves organisations open to criticism and potential
loss of reputation.
The leaders in business recognise the strategic importance of the interrelationship

between their products, activities and services and their stakeholders, and aim to
manage their resources and risks accordingly.
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5. STAKEHOLDERS
Stakeholders are any groups or individuals who are affected by, or who can affect an
organisation. They include a range of groups and individuals, either directly and
indirectly affected by, or affecting the organisation.
Shareholders
Supply-chain
NGOs Government
Homeworkers
MLOs
Manufacturer
Buyer
Company Consumers
Management
Sub-supplier
Workers Local
Trade unions Government
Dependent families
A useful activity for an organisation to undertake is the identification of its

stakeholders and the analysis of this information to determine the most crucial to the
business.
This is one method of helping to manage the risks associated with business activities
and ensuring that the organisation is behaving in a socially responsible manner, and
being accountable for its activities and practices.
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6. SUPPLIER / SUBCONTRACTOR CONTROL
One of the areas of a business that can pose the highest degree of risk to brand
image and reputation is the supply chain. However, businesses have to recognise
their responsibility for practices that may be occurring in the supply chain.
It is quite often issues such as last minute changes to orders, or sudden increased
demand for a particular product, that can lead to suppliers increasing working hours
or overtime to ensure they meet the order. Big business is notorious for late payment
of invoices, which has a profound effect on the smaller supplier’s cash flow including,
for example, their ability to pay wages regularly and on time.
Probably the area that has the biggest impact is the ever-increasing demands for
lower prices. This can have a number of impacts, such as an inability to increase
wages in line with inflation to the relocation of manufacturing facilities where
overhead costs and regulatory oversight are much lower.
A lack of clear communication channels and oversight can be detrimental to both

customer and supplier and can enhance the problems discussed above. Corporate
responsibility extends beyond the bounds of the company down the supply chain as
far as they can still exert influence.
In order to minimise the problems, it is vital that an organisation implements practices

such as fair contracts, detailing prices, payment details, notice of changes to orders
and other requirements, such as adherence to Codes of Conduct.
Similarly they should have established and transparent processes for communication,
including complaint resolution, so that they can ensure that their practices are not
having a negative impact in the supply chain.
They are, after all, most interested in improving working conditions in the supply
chain to minimise risk to their own brand, so it is in their interests to enable this
process to happen by working constructively with their suppliers.
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7. INTERACTION WITH COMMUNITY, SOCIETY AND ENVIRONMENT
Corporate Responsibility has a much wider definition than just the social aspects
associated with working conditions, and includes managing impacts and interactions
with wider stakeholders.
Companies are facing increased demands for transparency and growing

expectations that they measure, report, and continuously improve their social,
environmental and economic performance.
Companies are expected to provide access to information on impacts of their

operations, to engage stakeholders in meaningful dialogue about issues of concern
that are relevant to either party and to be responsive to particular concerns not
covered in standard reporting and communication practice.
Leadership companies are also investigating various types of audit and verification as
a further means of increasing the credibility of their transparency and reporting
efforts. Increasingly, demands for greater transparency also encompass public policy;
stakeholders want to know that the way companies use their ability to influence public
policy is consistent with stated social and environmental goals.
As part of this move toward greater disclosure, many companies are putting
increasingly detailed information about their social and environmental performance -
even when it may be negative - onto their publicly accessible websites, or in annually
published reports.
7.1 Community
The community includes a range of individuals and groups who may be

affected by or who may affect the organisation, including relatives of workers as
well as workers themselves; the local neighbourhood; local businesses;
schools, etc.
The impact on communities can include economic issues, such as provision of

labour, local taxes, funding for schools; and safety issues, such as the effect of
activities on the health and wellbeing of individuals.
7.2 Society
Businesses are responsible for their impacts on society in general, which may
include their customers and consumers, and the general public.
The impact on society can include increasing wealth and knowledge, as well as
increased dependence on products and materialism.
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7.3 Environment
Every business has some impact on the environment in which it operates. It

uses natural resources as raw materials and as energy; it uses the air, water
and land as disposal routes for various wastes that are produced through its
activities, products and services; and has impacts on biodiversity in the
environment in which it operates.
7.4 Case studies
The following case studies are fairly well known and illustrate some of the
above mentioned impacts:
7.4.1 Union Carbide, Bhopal
In 1984 the Union Carbide factory manufacturing pesticides in Bhopal,

central India, released a huge cloud of toxic gas that rapidly spread
across the surrounding area.
This area contained rapidly constructed villages housing workers and

their families who had moved to the area specifically to work at the
factory, as well as the occupant’s town of Bhopal itself.
The gas immediately killed thousands of people, and is continuing to

cause serious health problems to thousands more to this day. In addition,
the storage and disposal practices at the now abandoned factory
contaminated the surrounding water and land, which are vital resources
for people living in the area.
Further details and information can be obtained from the following

websites:
http://www.bhopal.net
http://www.bhopal.com
7.4.2 Shell, Nigeria
Shell have been exploring for and extracting oil from the Niger Delta
region of Nigeria for many years. There has always been friction between
the company and the local Ogoni people, native to the region.
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7.4.2 Shell, Nigeria, continued
This mainly arises from the perceived lack of financial input from the
company back into the community, predominantly due to the actions of
the government. This has led to many problems, including hostage-
taking, attacks on Shell employees and sabotage of pipelines.
The local people also have issues with excessive local environmental
impacts, such as from gas flaring activities. There has resulted a lot of
local and international protest from a range of groups, culminating in
petrol station blockades in 1995 after the execution of Ken Saro Wiwa, an
outspoken writer and activist in Nigeria, by the then incumbent
government, who were felt generally to be supported by the company.
Also in 1995 the proposed disposal of the Brent Spar oil installation in the
North Sea created public outcry, stimulated by occupation of the
installation by environmental activists, due to the potential for
contamination of the ocean with toxic residues and the setting of a
precedent for such action.
The publicity generated forced a change in UK government policy and the

eventual dismantling of the installation on land.

websites:
http://www.corporatewatch.org.uk/publications/shell.html
http://www.foei.org/publications/corporates/shellshine.html
http://www.shell.com
7.4.3 Exxon Mobil, USA
In 1989 the Exxon Valdez, an oil transporter, ran aground off the coast of
Alaska in North America. The ensuing spill had a long-term devastating
impact on that pristine area of Alaskan coast and the wildlife in the area.
As well as local environmental impacts from extraction, processing and

transport of their product, oil companies, such as Exxon Mobil are
contributing to global impacts, predominantly that of climate change,
through the production of fossil fuels which, during the combustion
process produce carbon dioxide, a greenhouse gas.
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7.4.3 Exxon Mobil, USA, continued
Climate change is affecting society globally through changing weather

patterns, increased flooding, droughts and more devastating storms.

websites:
http://www.evostc.state.ak.us/facts/
http://www.exxonmobil.com
8. CONVENTIONS, SPECIFICATIONS AND CODES
Legal requirements in this field have been in existence for many years, through
international conventions and national law, yet it is only recently that standards and
codes of conduct started to proliferate.
The following section provides some background to international conventions,

specifications and codes that are in existence, but it must be stressed that local and
national laws are also crucial in this area, as they often provide the detail relating to
each requirement in any given specification or code, and they can vary from country
to country and even in different regions of the same country.
8.1 Universal Declaration of Human Rights
The United Nations adopted the Universal Declaration of Human Rights in

1948, which described the basic human rights to be adopted globally. These
relate to civil and political rights, economic, social and cultural rights, many of
which are fundamental to the standards, codes and national law that
companies are aiming to comply with. Some examples of the rights
incorporated into the Declaration are provided below. The full text can be
obtained from the United Nations website (www.un.org).
Examples of Human Rights:
 All humans are equal
 All have the right to life, liberty and security of person
 No slavery or servitude
 No torture, cruel, inhuman or degrading treatment or punishment
 Freedom of association
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8.1 Universal Declaration of Human Rights, continued
 Equal pay for equal work
 Just and favourable remuneration
 Right to rest and leisure, limitation on working hours and holidays with
pay
8.2 International Labour Organisation (ILO)
The International Labour Organisation is the UN specialised agency which

seeks the promotion of social justice and internationally recognised human and
labour rights. It was founded in 1919 and is the only surviving major creation of
the Treaty of Versailles which brought the League of Nations into being and it
became the first specialised agency of the UN in 1946.
The ILO formulates international labour standards in the form of Conventions

and Recommendations setting minimum standards of basic labour rights:
freedom of association, the right to organise, collective bargaining, abolition of
forced labour, equality of opportunity and treatment, and other standards
regulating conditions across the entire spectrum of work related issues. It
provides technical assistance primarily in the fields of:
 vocational training and vocational rehabilitation;
 employment policy;
 labour administration;
 labour law and industrial relations;
 working conditions;
 management development;
 co-operatives;
 social security;
 labour statistics and occupational safety and health.
It promotes the development of independent employers' and workers'

organisations and provides training and advisory services to those
organisations. Within the UN system, the ILO has a unique tripartite structure
with workers and employers participating as equal partners with governments
in the work of its governing organs.
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8.2 International Labour Organisation (ILO), continued
Some examples of ILO Conventions are provided below, further details and full
text of conventions and recommendations can be obtained via the ILO website
(www.ilo.org).
Examples of ILO Conventions:
 Forced Labour (29, 105)
 Child Labour (138, 182)
 Freedom of Association (87, 98)
 Discrimination (111, 100, 35, 154)
 Wages (100, 131, 95, 63)
 Working Hours (1, 30, 63, 47)
 Health & Safety (155, 162)
 Home workers (177)
8.3 Government and international programmes
The European Commission has placed Corporate Social Responsibility (CSR)

at the core of Europe's competition strategy, and has issued a Green Paper on
CSR and a subsequent communication outlining the Commission's definition of
CSR and steps that companies, governments, and civil society can undertake
to refine their commitments to CSR. This has led to the creation of a European
Multi-Stakeholder Forum on CSR that will recommend to the Commission how
to more fully embed CSR in policy and practice.
National governments have also been active; requirements for social and
environmental reporting have been established in France and the UK, and
Denmark has made efforts to promote cross-sectoral collaboration. European
companies have also increased their commitment to CSR, and have
participated prominently in the World Summit on Sustainable Development and
the UN Global Compact, as well as individual company initiatives. Other
initiatives are underway at least at a policy development level in South Africa,
Brazil, and Argentina.
The requirements for human rights and working conditions laid down in the UN
Universal Declaration of Human Rights and the ILO Conventions and
Recommendations are implemented at a national level by individual countries
that have ratified the conventions.
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8.3 Government and international programmes, continued
The relevant legislation will predominantly be found in employment and health

& safety law. Local legislation will often be more detailed and prescriptive than
the Convention it is derived from, and an understanding of the local laws will be
a fundamental part of preparing for audits in any particular country. For
example, a national law may describe the numbers of toilets per 100
employees required in a factory.
Legislation will be discussed in more detail during the timetabled session during
the Course.
8.4 ISO Standards
Responsible behaviour is always measured against the standards of the

relevant community. For international business, this means recognition of the
internationally agreed standards reached through the appropriate international
organisations such as the International Organisation for Standardisation (ISO).
Such standards are critical for the protection of workers, and their observance
is one measure of human welfare.
International standards are also important to the overall political, social and
economic environment in which international companies operate. They
contribute significantly to the constitution of a stable and productive framework
for business. Although most international standards concern the obligations of
governments and companies they are not signatories of them, the meaning and
intent of these standards can serve as equally relevant benchmarks for
companies and can be reflected in their codes od practice.
Responsibility for setting international labour standards is given by the

international community to the International Labour Organisation which was
established for this purpose.
There are currently no ISO standards relating to social accountability.

However, there is ISO 26000, a guidance document and is not intended for
certification purposes. Further details can be obtained from the ISO website
(www.iso.org).
8.5 Supply chain standards and codes of conduct
There has been a proliferation of supply chain standards and codes of conduct
over the past few years. Some of them are described below, however it should
be noted that they are generally based on the same principles and incorporate
the ILO Conventions as a baseline.
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It should also be noted that there are numerous company-specific codes of

conduct, mainly produced and used by major retailers for assessing their
supply chain. These are similarly based on the ILO Conventions, but some
include additional requirements, for example on environmental performance, as
well as the standard requirements relating to employment working conditions.
8.5.1 SMETA Best Practice Guidance
This common best practice guidance was developed by the Sedex

Associate Auditor Group (AAG) (now SEDEX Stakeholder Forum)(SFF)
in response to the challenge from Sedex members to provide a report
format for ethical trade audits that could more easily be shared and to
give greater transparency into the auditor qualifications and practices that
underpin reports.
8.5.2 Ethical Trading Initiative (ETI)
The ETI was established by the UK government’s Department for

International Development and has a published “Base Code” of
requirements.
ETI members commit to regular monitoring of their supply chain against

the Base Code, and sharing of findings. Further details can be obtained
from the ETI website (www.ethicaltrade.org).
However, many members of the ETI are concerned about the audit
fatigue being caused by multiple audits and have been looking at ways of
sharing information so as to reduce the need for such repeat visits.
One of the methods being used to share audit results is Sedex, the
“Social and Ethical Data Exchange”.
This is a membership organisation where factories can input information

about their social performance, including audit reports which they can
then share with any customers they wish. This then allows the users to
focus on closing out non-compliances and working on improvements to
working conditions rather than just re-auditing.
8.5.3 SA 8000
The SA 8000 standard was initially published in 1997, and has undergone
several revisions. The current standard is the 2014 revision. Published by
Social Accountability International (SAI), it is globally recognised as a
certification standard. Further details can be obtained from the SAI
website (www.sa-intl.org).
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8.5.4 Fair Labor Association (FLA)
The Fair Labor Association (FLA) is a non-profit organisation combining

the efforts of industry, non-governmental organisations (NGOs), colleges
and universities to promote adherence to international labour standards
and improve working conditions worldwide.
The FLA was established as an independent monitoring system that

holds its participating companies accountable for the conditions under
which their products are produced.
To advance fair, decent and humane working conditions, the FLA

enforces an industry-wide Workplace Code of Conduct, which is based
on the core labor standards of the International Labour Organization
(ILO). Further details can be obtained from the FLA website
(www.fairlabor.org).
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8.5.5 Worldwide Responsible Apparel Production (WRAP)
The American Apparel and Footwear Association (AAFA) is the largest

and most representative sewn products trade association in the United
States with over 700 member companies. More than three years ago, the
industry began a process to demonstrate its commitment to responsible
business practices and to ensure that apparel is produced under lawful,
humane and ethical conditions.
Manufacturing associations and member manufacturing companies are

actively participating in the WRAP Certification Program. The WRAP
Certification Program is the only independent and globally supported
factory certification programme requiring manufacturers to comply with
the 12 universally accepted WRAP Production Principles assuring safe
and healthy workplace conditions, and respect for workers' rights.
Further details can be obtained from the WRAP website

(www.wrapapparel.org).
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WORKSHOP 1: WORKING WITH SOCIAL ETHICAL ISSUES

Purpose
 To enable Learners the opportunity to become familiar with the SMETA code and to
apply the knowledge to case study examples.
Task
 You will be divided into teams and provided with a handout containing seven case
studies.
 Each team is to:
- Read all seven case studies.
- Examine the situation described and decide:
- What are the clauses to consider?
- What evidence would you want to see to confirm that the situation is operating
satisfactorily?
- Who would you wish to talk to?
 Explain the reason for your decision?
Output
 Be prepared to feedback your findings for discussion by the whole class.
Time Allowed
 Workshop: 40 minutes.
 Feedback: 30 minutes.
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Session Two
Introduction to SMETA Best

Practice Guidance
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INTRODUCTION TO SMETA BEST PRACTICE GUIDANCE

OBJECTIVES
 Appreciate the vision, governance, membership of Sedex.
 Understand the purpose, basis and principles of the SMETA Best Practice Guidance.
KEY POINTS
 Sedex vision.
 History.
 Governance.
 Membership.
 SMETA Best Practice Guidance.
 SMETA Measurement Criteria.
 Contents.
 Usage.
 Review.
 Structure.
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INTRODUCTION TO SMETA BEST PRACTICE GUIDANCE

1. THE SUPPLIER ETHICAL DATA EXCHANGE
Sedex, the Supplier Ethical Data Exchange, is a not-for-profit organisation, open for
membership to any company anywhere in the world that is committed to continuous
improvement of the ethical performance of their supply chains. Organisations join
Sedex in order to:
 use the Sedex web-based system;
 participate in Sedex governance;
 participate in working groups;
 network and engage with other Sedex members;
 utilise Sedex value-added services
2. THE SEDEX VISION
Sedex will be recognised throughout global supply chains as the first choice for the
collection, management, analysis and reporting of ethical data.
It is a tool to:
 Encourage and enable convergence.
 Improve the quality of ethical data.
 Reduce duplication of ethical information.
 Promote the improvement of labour standards.
3. HISTORY OF SEDEX
Sedex was started in 2001 by a group of UK retailers and their first tier suppliers.
These organisations recognised a need to collaborate and drive convergence in
social audit standards and ethical self-assessment questionnaires. The founding of
Sedex was seen to ease the burden on suppliers who were being audited multiple
times and drive improvements in labour standards at production sites globally.
 2001 Impact convened a group of UK retailers and first tier suppliers, who
conceived the Sedex idea and were instrumental in co-ordinating and
developing Sedex from concept to launch.
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3. HISTORY OF SEDEX, CONTINUED
 2004 Sedex is founded as a not-for-profit organisation.
 2005 Associate Auditor Group (AAG) is formed (now named Sedex

Stakeholder Forum SSF)
 2006 Sedex Advisory Board founded.
 2007 Sedex achieves 10,000 members.
 2015 Sedex achieves 38,000 members with 97,705 audit uploaded
4. GOVERNANCE
At Sedex, the mission is to make it simpler to do business that’s good for everyone.
Corporate governance is how Sedex is directed and controlled to help fulfil that
mission.
Sedex Information Exchange (Sedex) is a not-for-profit membership association. It is

incorporated in the UK as a Company Limited by Guarantee. As a membership
association Sedex operates for the mutual benefit of all its members.
Sedex is headquartered in London, UK, with a regional office is Shanghai, China.
4.1 Management
The board of directors is responsible for the governance of Sedex. The board
is responsible for setting Sedex’s strategic aims, providing the leadership to put
them into effect, supervising the management of the business and reporting to
Sedex’s members on the Board’s stewardship.
In line with the Sedex Articles of Association the Sedex Board of Directors
comprises up to fourteen Directors, Nine are selected Member Directors, four
are independent Non-Executive Directors and one in an Executive Director (the
CEO).
On a day-to-day basis, Sedex is run by a management team which oversees

implementation of Board decisions.
4.2 The Advisory Board
This comprises individuals from business, the investment community, non-

governmental organisations and trade unions. The purpose of the Advisory
Board is to advise and challenge the Sedex Board on strategy, direction and
best practice; such as:
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 issues of strategic direction, appropriate labour standards and methods

used to improve labour standards;
 to help inform best practice in relation to pertinent ethical issues with

which Sedex is involved; for example, auditor methodology and
production of data for annual reports
4.3 Membership
Sedex is a membership based organisation with three membership levels that

reflect the different types of businesses in global supply chains:
A: Top of supply chain: retailers, consumer brands.
AB: Middle of supply chain: agents, first tier suppliers, manufacturers,

importers.
B: Bottom of the supply chain: farms, growers, factories, service centres,

production sites.
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4.3 Membership, continued
Sedex A and AB Members include:
 B&Q Plc
 Britvic Soft Drinks LTD
 Burberry
 Cadbury Schweppes PLC
 Co-operative Retail
 Levi Strauss & Co.
 Marks and Spencer
 Nestle
 PepsiCo
 RHM
 Sainsburys Supermarkets Ltd
 SCA Hygiene Products
 Tesco
 The Body Shop
 Whitbread Group PLC
In addition there are over 280,000 SMETA’s that have been conducted to date
with 93,000 of those on the Sedex Advance System.
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3.4 Sedex Stakeholder Forum (SFF)
SMETA is developed and maintained by the Sedex Stakeholder \Forum (the

SFF). The companies on this working group include:
 SGS
 Amcor
 Bureau Veritas
 DNV
 Givaudan
 Kellogg
 M&S
 Pepsico
 SAB Miller/ABInbev
 Walmart
4. SMETA - SEDEX MEMBERS ETHICAL TRADE AUDIT
SMETA stands for Sedex Members Ethical Trade Audit, and it incorporates four
elements:
 Best Practice Guidance (BPG) details audit procedures on conducting ethical

trade audits;
 Measurement Criteria – Details what will be examined at the audit;
 Report format – A template where all findings will be recorded;
 CAPR (Corrective action plan) format – Records a summary of the audit

findings and corrective actions discussed.
4.1 SMETA Best Practice Guidance
SMETA Best Practice Guidance, Measurement criteria, report format and

CAPR were developed by the Sedex Stakeholder Forum (formerly AAG) in
response to the challenge from Sedex members to provide a report format for
ethical trade audits that could more easily be shared and to give greater
transparency into the auditing procedure, measurement criteria, auditor
qualifications and practices that underpin reports.
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Ethical trade/social audits are commissioned all over the world to various
standards. The Best Practice Guidance is not an attempt to re-invent ethical
trade auditing, and it should not be viewed as a new methodology for ethical
trade auditing. Rather, it is an attempt to compile the best of current practices.
SMETA Guidance includes:
 Suggested time plan for the audit;
 Number of worker interviews suggested for the size of company;
 Training and experience requirements for auditors;
 Suggested pre-audit communication.
SMETA is based on labour standards issues covered by ILO Conventions, ETI

Base Code, SA 8000 and so on. Sedex members can use the information on
the system to evaluate suppliers against any of these codes or the labour
standards provisions in individual corporate codes. Sedex itself does not
specify a particular code or state that suppliers have ‘passed’ or ‘failed’.
4.2 Contents
The Best Practice Guidance is a common set of criteria to supplement

professional audit companies’ own systems.
The document details the training and experience requirements that third-party
auditors should meet in order to conduct best practice ethical trade audits. It
further describes the key steps from pre-audit communication and audit
planning through to the conduct of the audit itself and reporting.
These steps are taken based on best practice in the field of ethical trade audits
conducted by third-party auditors and rely heavily on the controls that already
exist within third-party audit firms that are accredited to a quality management
system such as ISO9001 or ISO 17021 (the accreditation standard for audit
bodies).
4.3 Usage
The Best Practice Guidance document is designed with the following uses in
mind:
 To provide Sedex ‘A’ and ‘AB’ Members who are being presented with
SMETA audit reports with an overview of the recommended methods
employed in the conduct of ethical trade audits.
 To be used by third-party audit firms, together with their own more

detailed internal rules and procedures, to ensure that audits undertaken
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against this best practice guidance follow a common set of criteria, thus
making it easier for audit reports to be shared by multiple retailers/brands.
 It is recommended that Sedex members commissioning audits should

assure themselves of the qualifications of the auditors and their ability to
meet the requirements set out in this document.
4.4 Review
The Best Practice Guidance has been piloted by members of the Sedex
Stakeholder Forum (SFF), and input was sought from Sedex B members who
had had SMETA audits, NGOs and other stakeholders through a stakeholder
engagement process.
It is intended that the Guidance will be reviewed every six months, and a similar
engagement process will be employed. All feedback will be reviewed and
considered by the SSF and the Sedex Board of Directors. Revised versions will
be launched periodically.
Further information on Sedex and the latest version of SMETA may be found at
www.sedex.org.uk.
5. THE STRUCTURE OF SMETA BEST PRACTICE GUIDANCE
SMETA comprises five chapters, nine sections which are divided into clauses and
sub-sections:
5.1 Chapter 1 (Section 1-3): Introduction
1 Background
1.1 Sedex and SMETA
1.2 SMETA and the Ethical Trading Initiative (ETI) Base Code
1.3 SMETA 2 – Pillar and 4 Pillar Audits
1.4 SMETA and the UN Guiding Principles
2 SMETA BPG Application
3 Supporting Documents
Chapter 2 (Section 4-5): Audit Planning
4 Risk Assessment
4.1 Sedex Self Assessment Questionnaire (SAQ)
4.2 Pre-Audit Site Profile

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4.3 Pre-Audit Information Pack
1.1.2 Some detailed guidance
5 Types of Audit
5.1 Category of Auditor
5.2 Notification of Audit
5.3 Sequence of Audits
5.4 Labour Codes
Chapter 3 (Sections 6-7): Audit Execution
6 Overview of the Audit Process
6.1 Audit Request
6.2 Preparation for an Audit (for Auditors)
6.3 Selecting the Auditor / Audit Team
6.4 Audit Body Management System
6.5 Communication with the Site
6.6 Preparation for an Audit (Site of Employment)
7 Audit Execution
7.1 Opening Meeting
7.2 Tour of the Employment Site
7.3 Management and Worker Interview
7.4 Document Review
7.5 Pre-closing Meeting
7.6 Closing Meeting and Summary of Findings.
Chapter 4 (Section 8): Audit Reports and Audit Outputs
8 Audit Reports and Audit Outputs
8.1 Audit Report Completion
8.2 Describing non-compliances, observations and good examples
8.3 Sedex and Uploading the Audit

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8.4 Information Management
8.5 Audit records
Chapter 5 (Section 9): Audit Follow-up
9 Audit Follow-up
9.1 Follow-up Audits
9.2 Appeals and Disputes
6. STRUCTURE OF SMETA MEASUREMENT CRITERIA
The measurement criteria for conducting SMETA audits has been developed by the
current members of the Sedex Stakeholder Forum (SFF). The measurement criteria
cover the mandatory 2 pillars of Labour Standards and Health and Safety as well as
the additional options of Environmental and Business Ethics. The content includes
as follows:
Background
Introduction
The Audit Process
Audit Report Completion
Useful Documents
Measurement Criteria by Clause
O.A. Universal Rights covering UNGP
O.B. Management Systems & Code Implementation
1. Freely Chosen Employment
2. Freedom of Association
3. Health and Safety
4. Child Labour
5. Wages and Benefits
6. Working Hours
7. Discrimination
8. Regular Employment
9. No Harsh or Inhumane Treatment is Allowed
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10. Other Issues
10A. Entitlement to Work
10B2. Environment 2 – Pillar
10B4. Environment 4 – Pillar
10C. Business Ethics
11. Community Benefits
Measuring Impact
Encouraging Worker / Management Dialogue
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Session Three
Interpretation of SMETA,
Clauses 0 – 4
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INTERPRETATION OF SMETA, CLAUSES 0 – 4

OBJECTIVES
When you have completed this topic you will be able to:
 Understand and interpret the SMETA Best Practice Guidance requirements for:
- Universal rights covered by UNGP.
- Management system and code implementation.
- Freely chosen employment.
- Freedom of association.
- Health and safety.
- Child labour and young workers.
KEY POINTS
 Universal rights covered by UNGP.
 Management system and code implementation.
 Background to freely chosen employment.
 Summary of SMETA requirements on freely chosen employment.
 Background to freedom of association.
 Summary of SMETA requirements for freedom of association.
 Summary of SMETA requirements for safe and hygienic working conditions.
 Prioritising hazards in the workplace.
 Background to child labour and young workers.
 Summary of SMETA requirements for child labour and young workers.
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The main points and interpretations of Clauses 0 to 4 are set out in this Session.
For ease of reference, the paragraph numbers follow the clause numbers of SMETA
Measurement Criteria and direct quotations from the Measurement Criteria are presented
in italics.
O.A. UNIVERSAL RIGHTS COVERING UNGP
This is a global standard for preventing and addressing risk of adverse impacts on
human rights linked to business activity, and there is an expectation that businesses
will identify how the activities impact on the human rights of people and communities,
within their sphere of operation. As a result, SMETA 6.0 includes an investigation
into how Universal rights are protected within global supply chain.
Code
The aim of the Universal Rights covering UNGP section is to focus on assessing the
extent to which businesses and their respective sites understand and manage their
human rights impacts. Information will be gathered as observations rather than non-
compliances, as specific non-compliances are captured in the other relevant sections
of this report. Should the site be unaware of or unfamiliar with these details it is
recommended that they address these issues with their head office for clarification.
Additional information can also be found in the Best Practice
Guidance.
O.A. Guidance for Observations
0.A.1 Businesses should have a policy, endorsed at the highest level, covering
human rights impacts and issues and ensure it is communicated to all appropriate
parties, including its own suppliers.
0.A.2 Businesses should have a designated person responsible for implementing

standards concerning Human Rights.
0.A.3 Businesses shall identify their stakeholders, their impact and salient
issues.
0.A.4 Businesses shall measure their direct, indirect and potential impacts on
stakeholders’ (rights holders) Human Rights.
0.A.5 Where businesses have an adverse impact on Human Rights within any of
their stakeholders, they shall address these issues and enable effective
remediation.
0.A.6 Businesses shall have a transparent system in place for confidentially

reporting, and dealing with human rights impacts without fear of reprisals towards
the reporter.
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O.A.1 Guidance for Observations
Management system investigation and document review including management

interview.
0.A.1 Is there a policy or statement which expresses the businesses commitment to

respect human rights.
0.A.2 Has the policy or statement been communicated to the employers’ relevant
stakeholders? e.g. workers, communities, customers, suppliers, the public etc.
0.A.3 The name and position of any designated person with responsibility for
management of Human rights impacts. The auditor should comment on the
designated person’s understanding of legislation and client applicable standards
and their procedure for keeping up to date.
0.A. 4 Do employees have access to a transparent system for confidentially

reporting, and dealing with any Human Rights issues without fear of reprisals
towards the reporter and are workers aware. The auditor should give details on
what system is in place and whether workers are aware of the system.
0.A.5 What training (if any) is given and how is it recorded. Especially relevant to
those employees working in stakeholder facing roles. The auditor should check for
any specific training for relevant management and workers.
0.A.6 Has the site has completed the SAQ and made it available to the auditor for
prereview?
0.A.8 Has any policy or statement been communicated to the relevant stakeholders.
e.g. workers, communities, customers, suppliers, the public etc.
0.A.9 Are Human Rights impacts communicated across relevant internal functions
and if so how.
0.A.10 Are there processes in place to ensure these Human Rights impacts are
managed and eliminated/minimised.
0.A.11 Does the business have a system in place to address any Human Rights
impacts and where possible remediate them.
0.A.12 Isis there a clear communication / training on how to deal with any salient
human rights issues including how concerns should be communicated and dealt
with?
0.A.13 Does the site go beyond to make direct & indirect impacts a training theme
in for all employees.
0.A.14 Does the business enable access to remedy tools where human rights
impacts have been identified.
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0.A.15 Does the business continuously monitor its impact and report on its
progress.
0.A.16 Is there any documentary evidence of these practices and if so what are
they. The auditor should record the details in this section.
0.A.17 Are there procedures for data privacy for workers.
0.A.18 How are procedures for ‘worker respect and privacy’ implemented.
0.A.19 Are business partners / suppliers requested to conduct Human Rights due
diligence and/or have grievance mechanisms in place.
0.A.20 Interviews appropriate personnel to establish if they are aware of any site
policies concerning Human Rights and whether appropriate personnel know how to
report their concerns about any issues.
0.A.21 Checks on the level of understanding and/ or any training received by

appropriate personnel on how to deal with any Human Rights issues when
confronted with them at work.
0.A.22 Checks whether employees know of what to do if they encounter any Human
Rights abuses and who they report to if they have any other concerns about Human
Rights
0.A.23 Checks whether if workers are aware of the grievance mechanisms and
procedures if they are found to be involved in unethical human rights practices.
0.A.24 Has there been an exercise of mapping out stakeholders impacted by the
business and how have the Human Rights impacts been measured.
0.A.25 Is there a senior manager or Human Rights manager responsible and

accountable for the businesses Human Rights impacts.
0.A.26 How are these impacts communicated to stakeholders and relevant

employees / departments?
0.A.27 How does the site remediate / enable access to remedy tools
O.B. Management systems and code implementation
It is expected that suppliers will implement and maintain systems to ensure that the
SMETA code is complied with. As a first step, suppliers are to appoint a senior member
of management who shall be responsible for compliance with the Code and communicate
the Code to all employees and their suppliers.
Where reasonably practical, suppliers should extend the principles of this Ethical Code
through their supply chain.
The aim of the audits is to provide confidence that compliance with the Code can be
ensured over the long term which requires:
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O.B.1 Code
0.B.1 Suppliers are expected to be operating legally in premises with the correct
business licenses and permissions and to have systems to ensure that all relevant
land rights have been complied with Suppliers are expected to implement and
maintain systems for delivering compliance to this Code.
0.B.2 Suppliers shall appoint a senior member of management who shall be

responsible for compliance with the Code.
0.B.3 Suppliers are expected to communicate this Code to all employees.
0.B.4 Suppliers should communicate this code to their own suppliers and, where
reasonably practicable, extend the principles of this Ethical Code through their
supply chain.
The assessment shall consider that:
- The facility management has implemented systems to ensure that all

requirements are being consistently met.
- The site has applicable business licences, and all legally required permits
and licences to operate.
- The site has all applicable/ required land rights, licenses and permissions.
The auditor checks and give details on whether the site has access to
documents (title, certificate, deed, lease, rental agreement, or other written
evidence) relating to ownership and/ or leasing of the land.
- The site has any policy, procedures and monitoring mechanism on complying
to issues related to land rights.
- The code and any additional specific client expectations have been effectively
communicated to employees.
- The level of communication and roll-out of the code through the facility’s
supply chain is evaluated although the Code points out that this is not a
specific requirement of the Code.
Therefore, the auditor:

- Evaluates The level of communication and roll-out of the code through the
facility’s supply chain is evaluated although the Code points out that this is not
a specific requirement of the Code.
- Looks for specific policies covering all issues and in particular discrimination,
freedom of association, discipline, land rights and general human rights
issues.
- Checks that the facility is aware of any specific management system
requirements their clients may have and has systems in place to manage
compliance (e.g. labelling, quality requirements, etc.).
- Evaluates the management system and its implementation.
- Reviews how the effectiveness of systems and procedures is measured,
reviewed and what systems are in place for improvement.
- checks that all policies and procedures have been communicated and
evaluates the effectiveness of such communication – are they available in
local language? Is there training/briefing available for those who are less
literate?
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- checks that the ETI Base code or client-specific codes have been
communicated to all workers and reports on how this has been done, e.g.
poster on wall, worker briefings, etc. and how effective this has been.
- Establishes what actions the facility is taking to communicate and roll out the
code to its own supply chain.
The Code notes that the auditor should check that the management system is
appropriate for the size and nature of the business – formal documented systems
are not necessarily expected for smaller organizations.
O.B.2 Interpretation
For those organisations already operating quality or environmental management systems,

the requirements of the SMETA for implementation will not be onerous. However, there will
be some organisations with fairly limited experience of such systems and there, where
systems and documentation are minimal, audit evidence may be more anecdotal.
The purpose of Sedex is to identify, develop and promote good practice with respect to
implementing codes of labour practice, health and safety, environment and business ethics.
Critical areas include monitoring and verification, and transparency and disclosure, to
determine and communicate whether standards embodied in SMETA are being achieved.
Sedex members accept the general principles set out in the SMETA upon which to develop
or refine their search for best practice.
The purpose of these requirements is to ensure that the SMETA Best Practice Guidance
and the requirements of the code are established and understood by all employees, and to
check that the system is working effectively.
1.3 Representatives
There are three representatives identified in the SMETA in total, the representative
responsible for implementation (clause 0.B.2), the worker representatives (clause 2.3)
and the representative responsible for H&S (clause 3.5). Two of these are Management
Representatives appointed by the organisation, and could indeed be the same individual
performing the two roles. The third is a representative chosen by the workers to
communicate between them and management. This could be a trade union
representative, or could be a committee of individuals.
The auditor should ensure that the members of management have been appointed – and
should have an appropriate level of responsibility and authority to ensure they can
undertake the role. They will be heavily involved in the audit process.
1. SUMMARY OF SMETA REQUIREMENTS ON FREELY CHOSEN

EMPLOYMENT
Code
SMETA requirements:
1. Forced Labour
1.1 There is no forced, bonded or involuntary prison labour.

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1.2 Workers are not required to lodge "deposits" or their identity papers with their
employer and are free to leave their employer after reasonable notice.
The aim of the requirement is to ensure that:
 there is no forced, bonded or involuntary labour;
 there are no deposits of money or ID on commencement of employment;
 employees are free to leave after reasonable notice;
 employees are free to leave at the end of their shift.
1.1 Background to Freely Chosen Employment
The SMETA requirements are designed to protect the rights of individuals to

take and leave employment and to be paid for their labour. The requirements
are derived from the ILO Conventions (C29 and C105).
1.1.1 Forced labour
In some countries forced labour is endemic; the most obvious example of

this is Burma (Myanmar) where the military dictatorship in the region
encourages the use of forced labour.
In other areas it is often found in conjunction with child labour and in

some sectors and countries it is fairly common for children to be sold by
their parents to work.
1.1.2 Bonded labour
Where an individual owes a large debt and has to work for someone to
pay off that debt, this is seen as forced labour. It is quite common where
an individual has paid an organisation to assist them to migrate to
another country and start working.
1.1.3 Prison labour
Where prison labour is used, it is not necessarily a violation of the Base

Code. If the prisoners have the choice as to whether or not they work
and get paid for their work, it is not regarded as forced labour.
However in some countries prisoners are made to work without choice

and with no pay. In these circumstances it would be seen as being forced
labour.
The definition of forced labour has been discussed, and it is important to

recognise that forced labour is different from forced overtime.
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1.2 Evidence of forced labour
There are several different types of evidence that can be identified and
evaluated by auditors to determine whether or not there is forced labour in an
organisation.
1.2.1 Lodged deposits, passports and ID papers
A review of personnel files may reveal copies of passports and other ID which
is used by the organisation to check ages and legality to work. So long as they
just have copies and not originals then there should be no problem.
1.2.2 Freedom of movement
The auditor should investigate the freedom of employees to move in and out of
the facility, especially if there are dormitories on site. If there are security
guards, their contracts should be checked and both guards and workers
interviewed as to their role.
1.2.3 Interviews and observations
Workers should be interviewed, however it is important to realise that if workers

are being forced to work, they are likely to be reticent and may not speak for
fear of retribution. Other observations include reviewing the demeanour of
workers, including their physical appearance. For example bruises or marks on
workers may indicate that they are being physically forced to work. However,
care must be taken in all circumstances not to jump to any conclusions purely
on this basis alone.
2. SUMMARY OF SMETA REQUIREMENTS FOR FREEDOM OF

ASSOCIATION
Code
SMETA requirements:
2 Freedom of Association
2.1 Workers, without distinction, have the right to join or form trade unions of
their own choosing and to bargain collectively.
2.2 The employer adopts an open attitude towards the activities of trade
unions and their organisational activities.
2.3 Workers representatives are not discriminated against and have access
to carry out their representative functions in the workplace.
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2.4 Where the right to freedom of association and collective bargaining is

restricted under law, the employer facilitates, and does not hinder, the
development of parallel means for independent and free association and
bargaining.
The aim of the requirement is to ensure:
 that workforce rights are recognised;
 that union officials/facility representatives are fairly selected and perform their
duties to the benefit of the workers.
2.1 Background to freedom of association and the right to collective

bargaining
The purpose of the requirements in SMETA for freedom of association and the
right to collective bargaining is to protect workers’ rights to join a union of their
choice and to bargain collectively for wages and other conditions of
employment. Additionally the rights of representatives to communicate with
workers needs to be upheld. These requirements reflect the ILO Conventions
(C87, C98 and C135).
In some countries the right to join a trade union is restricted by law and union
membership can be very controversial with links to unfair discipline of union
representatives and discrimination.
The fundamental requirement is that the organisation must allow workers to join
trade unions of their choice. In some countries, such as China, this is not
possible as there is only one trade union allowed by law so the workers have
no choice over the union they join.
In these circumstances the organisation has to facilitate “parallel means” to

allow workers to associate and bargain. Examples of this may include a worker
council, or various committees set up with worker representatives to deal with
different issues, for example a H&S committee; a wages committee etc.
Worker representatives must not be discriminated against and must have

access to their members in the work place.
3. SUMMARY OF SMETA REQUIREMENTS FOR HEALTH AND SAFETY
Code
SMETA requirements:
3 Health & Safety
3.1 A safe and hygienic working environment shall be provided, bearing in

mind the prevailing knowledge of the industry and of any specific
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hazards. Adequate steps shall be taken to prevent accidents and injury to

health arising out of, associated with, or occurring in the course of work,
by minimising, so far as is reasonably practicable, the causes of hazards
inherent in the working environment.
3.2 Workers shall receive regular and recorded health and safety training,
and such training shall be repeated for new or reassigned workers.
3.3 Access to clean toilet facilities and to potable water, and, if appropriate,
sanitary facilities for food storage shall be provided.
3.4 Accommodation, where provided, shall be clean, safe, and meet the
basic needs of the workers.
3.5 The company observing the code shall assign responsibility for health
and safety to a senior management representative.
 that workers are not being exposed to risks in the workplace;
 that there are adequate systems in place to ensure that proper procedures will
be followed and that H&S will not be compromised in the future.
Clause 3.1 outlines the requirement for some sort of risk assessment and
management process, to enable the organisation to identify hazards in the workplace
and the risk they pose to the employees and to manage them effectively to provide
the safe and healthy working environment.
Clause 3.2 requires that training be provided on a regular basis.
Clauses 3.3 and 3.4 provide for the detailed requirements for the provision of toilet
facilities, potable water, food storage and accommodation.
A Senior Manager must be appointed to implement this requirement (clause 3.5).
3.2 Prioritising hazards, risk assessment and management
Those hazards that potentially have the worst consequences and those that
occur most frequently are key for an organisation to manage, and for an auditor
to recognise.
3.2.1 Prioritising
Hazards that are associated with an acute danger of death tend to be the
highest priority. Acute danger means that if the hazard occurs it can
cause immediate death. Examples include fire; explosion; electrocution;
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drowning; suffocation; asphyxiation; falling from height; vehicles and

machinery; and certain chemicals.
Chronic danger of death is where a hazard occurring will cause death

over a period of time, but not immediately. For example, exposure to
asbestos; carcinogenic chemicals; and some biological agents.
Disablement can include either permanent or temporary. Examples

include loss of sight or hearing; muscular disorders, such as repetitive
strain injury; and loss of digits or limbs.
Many hazards cause lost time in the workplace, and include slips, trips
and falls; minor cuts and abrasions.
3.2.2 Risk assessment
Risk assessment processes involve the identification of hazards, their

consequence and likelihood, giving rise to a level of risk that the hazard
presents.
Clause 3.1 requires the detection of potential threats, or hazards, and

although the terminology “risk assessment” is not used, it is implied within
the clause.
4. SUMMARY OF SMETA REQUIREMENTS FOR CHILD LABOUR AND

YOUNG WORKERS
Code
SMETA requirements:
4.1 There shall be no new recruitment of child labour.
4.2 Companies shall develop or participate in and contribute to policies and

programmes which provide for the transition of any child found to be
performing child labour to enable her or him to attend and remain in
quality education until no longer a child; "child" and "child labour" being
defined in the appendices.
4.3 Children and young persons under 18 shall not be employed at night or in
hazardous conditions.
4.4 These policies and procedures shall conform to the provisions of the
relevant ILO standards.
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4. SUMMARY OF SMETA REQUIREMENTS FOR CHILD LABOUR AND YOUNG

WORKERS, continued
- that there is no evidence of children employed/working in the facility;
- that there are systems in place to check the age of all workers particularly
at the point of recruitment;
- that the facility management knows the local laws in relation to this topic;
- that there is a clear policy concerning young workers and that policies relating to
children and young workers are displayed and communicated;
- that training schemes/apprenticeships are not being used as a way to avoid

paying the full wage for the job;
- that young workers, defined as children under the age of eighteen, are not being
put at risk because of the nature of the duties they are being expected to perform,
such as working in hazardous functions, with hazardous machines, or at night.
Definitions of a ‘child’, ‘young person’ and ‘child labour’ are in Appendix 1.
Some limited child labour is permitted under exemptions to the ILO Conventions, for
example light, part-time work for a family member. Under such exemptions, the
standard stipulates the specific requirements for total hours of work, travel and school
to be no more than 10 hours, and that any such work is not hazardous.
Hazards that could adversely affect children include night time working; chemicals;
heavy lifting; working with machinery or equipment and so on. Children are generally
more vulnerable to hazardous conditions due to a lack of awareness of risks and also
due to their state of physical development.
4.1 Background to child labour
The purpose of this clause of the standard is to protect the rights of children to
an education and to develop safely. The requirements have been derived from
the ILO Conventions (C138, R146 and C182).
4.1.1 Why children work
The United States Department of Labor published a report, “By the Sweat
and Toil of Children”, which came to three main conclusions as to why
children work. An understanding of these factors can assist both auditors
and companies in dealing with the issue of child labour.
The three conclusions can be summarised as follows:
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4.1.2 Poverty of resources
In many countries there is inequality between rich and poor and often
poor parents are unable to support their children. This leads to children
working in order to bring in some additional income to support the family.
4.1.3 Poverty of opportunities
In many developing countries there is a lack of access to schooling for

children, either because there are no schools, or because the cost of
schooling cannot be met by parents who are struggling to bring in
sufficient income to feed and clothe their family.
In some countries there is a gender split, and it is common for boys to be

educated in school and for girls to go out to work. An example of this was
found recently in Afghanistan under the Taliban regime.
4.1.4 Availability of work
Children are cheap labour and can easily be exploited due to their lack of
experience and understanding of their human rights. Children are
generally quite pliable and will bow to authority. They are a large pool of
cheap labour and are often considered to have particular skills due to
dexterity and size.
4.2 Current situation
There are still many millions of children working all around the world, in many
different industries, including textiles, agriculture and domestic service. So
although the ILO Conventions have been in existence for many years, this
requirement of the SMETA remains pertinent.
For example, children were found working in Pakistan and India stitching
footballs; recent news reports revealed slave children in West Africa working on
cocoa plantations; 17.5 million children are working in Central America in
mining, farming and fishing; many children working in garment factories in
China; 1.2 million children working in the sex industry and domestic slavery in
Africa, SE Asia and the Balkans; in some US states 12 year old children are
legally allowed to work full time on farms; and in the UK companies have
recently been prosecuted for children working too many hours.
It must be recognised that the issue of child labour is unlikely to be solved over
night, but the SMETA does provide for means of working children out of the
system.
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Session Four
Clauses 5 – 9
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OBJECTIVES
 Understand and interpret the SMETA requirements for:
- Wages and benefits.
- Working hours.
- Discrimination.
- Regular employment.
- Subcontracting and home working.
- No Harsh or inhumane treatment is allowed.
KEY POINTS
 Summary of SMETA requirements for wages and benefits.
 Summary of SMETA requirements for working hours.
 Background to discrimination.
 Summary of SMETA requirements for discrimination.
 Summary of SMETA requirements for regular employment.
 Summary of SMETA requirements for subcontracting and home working.
 Background to harsh or inhumane treatment.
 Summary of SMETA requirements for harsh or inhumane treatment being not

allowed.
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The main points and interpretations of Clauses 5 to 9 are set out in this Session.
For ease of reference, the paragraph numbers follow the clause numbers of SMETA
Measurement Criteria and direct quotations from the Measurement Criteria are presented
in italics.
1. SUMMARY OF BASE CODE REQUIREMENTS FOR A LIVING WAGE
SMETA requirements:
5. Wages and benefits
5.1 Wages and benefits paid for a standard working week meet, at a
minimum, national legal standards or industry benchmark standards,
whichever is higher. In any event wages should always be enough to
meet basic needs and to provide some discretionary income.
5.2 All workers shall be provided with written and understandable Information
about their employment conditions in respect to wages before they enter
employment and about the particulars of their wages for the pay period
concerned each time that they are paid.
5.3 Deductions from wages as a disciplinary measure shall not be permitted

nor shall any deductions from wages not provided for by national law be
permitted without the expressed permission of the worker concerned. All
disciplinary measures should be recorded.
 for ETI compliance that employees are paid a living wage. In the absence of a
defined process for establishing the living wage, this will be taken as National
Minimum Wage;
 that all hourly and piece rate employees are paid at least the legal minimum
wage rate;
 that wages are properly calculated and meet the minimum wage for the period;
 that all applicable withholdings are properly calculated, withheld and promptly
paid over to the appropriate government agency within the specified timelines;
 that there are no payroll deductions for employment broker fees, housing
allowances, food allowances etc. (unless allowed by local labour law);
 that overtime wage rates are paid at the legally mandated rate;
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1. SUMMARY OF BASE CODE REQUIREMENTS FOR A LIVING WAGE, continued
 that all legally mandated allowances and benefits are provided to the
employees;
 that all employees are provided with a written and understandable statement of
their pay for each pay period;
 those contracts are in line with the law.
2. SUMMARY OF SMETA REQUIREMENTS FOR WORKING HOURS
6. Working Hours
6.1 Working hours must comply with national laws, collective agreements,
and the provision of 6.2 – 6.6 below, whichever affords the greater
protection for workers. Sub clauses 6.2 – 6.6 are based on International
Labour standards.
6.2 Working hours, excluding overtime, shall be defined by contract and shall
not exceed 48 hours per week*.
6.3 All overtime shall be voluntary. Overtime shall be used responsibly, taking
into account all the following: the extent, frequency and hours worked by
individual workers and the workforce as a whole. It shall not be used to
replace regular employment. Overtime shall always be compensated at a
premium rate, which is recommended to be not less than 125% of regular
rate of pay.
6.4 The total hours worked in any 7 day period shall not exceed 60 hours,
except where covered by clause 6.5. below.
6.5 Working hours may exceed 60 hours in any 7 day period only in
exceptional circumstances where all of the following are met:
 This is allowed by national law.
 This is allowed by collective agreement freely negotiated with a

workers’ organisation representing a significant portion of the
workforce.
 Appropriate safeguards are taken to protect the worker’s health and

safety; and
 The employer can demonstrate that exceptional circumstances

apply such as unexpected production peaks, accidents or
emergencies.
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2. SUMMARY OF SMETA REQUIREMENTS FOR WORKING HOURS, continued
6.6 Workers shall be provided with at least one day off in every 7 day period
or, where allowed by national law, 2 days off in every 14 day period.
The aim of the requirement is to:
 measure standard and overtime hours against the local laws and the ETI Base
Code;
 ensure that the facility management knows the local labour laws in relation to
this topic;
 verify whether appropriate waivers are in place and agreed (if applicable) or
 ensure that working hours are accurately recorded and that double books are
not being kept.
2.1 Interpretation
In summary, the standard working week for employees should be no more than
48 hours per week, unless the law states that the standard working week is
less than 48 hours, in which case the law is more stringent and therefore
prevails.
Any work over 48 hours (or the level the law or contract states) is classed as
overtime and should not be performed regularly to replace normal working
hours. In this case, “regular” is not defined and the auditor’s judgement must
prevail on a case by case basis. However, the amount of overtime and regular
working time must not exceed a total of 60 hours. So the maximum number of
hours that a worker can work in total is 60 hours in a week, unless in
exceptional circumstances.
Exceptional circumstances are where the business cannot predict the client’s
needs. An example is given where a peek in business due to harvest time is
not exceptional as this is a regular occurrence but a client doubling an order,
for example, without prior notice can be considered exceptional.
The ETI Base Code states that the prevailing standard to be used is the one
which affords greater protection for workers and the ETI Base Code
recommends an overtime premium minimum of 125%. However there may be
circumstances where less than 125% does not disadvantage the worker and it
is key that the auditor completes the audit report fully in order that those
judgments may be made.
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2.1 Interpretation, continued
The recommendation of the SSF (The organisation that issues the SMETA
Guidance) is that less than 125% overtime pay, (which does meet the law)
should be raised as an NC against the ETI Base Code to keep visibility on the
system.
This clause also has a requirement for rest days, which is that there must be
one day off in every seven day period also and two rest days in fourteen could
be acceptable if allowed by law. As with so many other clauses of SMETA, an
auditor will need to assess each situation on its merits.
3. SUMMARY OF SMETA REQUIREMENTS FOR DISCRIMINATION
7. Discrimination
7.1 There is no discrimination in hiring, compensation, access to

training, promotion, termination or retirement based on race, caste,
national origin, religion, age, disability, gender, marital status,
sexual orientation, union membership or political affiliation.
 that workers are treated equally in all matters;
 that there are adequate systems in place to ensure that no form of

discrimination occurs either during recruitment or employment.
3. 1 Background to discrimination
Discrimination is different treatment of an individual based on a characteristic

other than their skills and ability to perform a task. The purpose of the
requirements in the SMETA is to protect workers from unfair discrimination
throughout the job cycle. This implements the ILO Conventions relating to
discrimination (C100, C111 and C159).
Discrimination may be deliberate or accidental and may be carried out by the

organisation or by other employees. Unfair discriminatory practices can occur
at any stage of employment, including recruitment, remuneration, training,
promotion, termination or retirement.
There must also not be any harassment of workers in relation to their race,
caste, national origin, religion, disability, gender, sexual orientation, union
membership, political affiliation or age.
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3.2 Interpretation
In summary the requirements mean that unfair discrimination is not acceptable

at any time. In addition, the organisation must take into account certain
practices which may form an individual’s needs. For example, providing a
prayer room; allowing workers to take leave in line with their religious holidays
and so on.
4. SUMMARY OF SMETA REQUIREMENTS FOR REGULAR EMPLOYMENT
8. Regular Employment
8.1 To every extent possible work performed must be on the basis of

recognised employment relationship established through national law and
practice.
8.2 Obligations to employees under labour or social security laws and

regulations arising from the regular employment relationship shall not be
avoided through the use of labour-only contracting, sub- contracting, or
home-working arrangements, or through apprenticeship schemes where
there is no real intent to impart skills or provide regular employment, nor
shall any such obligations be avoided through the excessive use of fixed-
term contracts of employment.
 workers are provided with continuous employment;
 the facility is not using regulations concerning temporary workers in order to

avoid liability for pay and benefits that would be accorded to permanent
employees.
4.1 Interpretation
The requirements ensure that organisations do not exploit workers, for example
by employing them on recurring short-term fixed contracts so that the worker
does not gain the rights of a permanent employee.
Similarly the exploitation of workers through false apprenticeship schemes is

not acceptable. For example, if the worker is not retained after the
apprenticeship they must have learned transferable and recognised skills so
that they can be employed elsewhere. Otherwise, they are simply working for
very little money during the apprenticeship and gaining nothing for themselves.
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5. SUMMARY OF SMETA REQUIREMENTS FOR SUBCONTRACTING,

HOME WORKING AND EXTERNAL PROCESSING (SCH&EP)
Code
8A.1 There should be no sub-contracting unless previously agreed with the main
client.
8A.2 Systems and processes should be in place to manage sub-contracting,

homeworking and external processing.
 where sub-contracting are in place this is with the knowledge / agreement of

the main client.
Sub-contracting and external processing can be carried out through complex chains
of agents. The auditors should note whether the facility has a good knowledge of
where their products are being made and summarise their findings by mapping this
chain and gathering evidence of systems to manage and monitor.
If Sub-contracting and external processing is taking place, then the extent should be
recorded and the systems that are in place shall ensure that all workers are working
in good conditions.
The aim of this audit is not to carry out a full audit of the sub-contracting and external
processing supply chain, but to highlight where it is
happening with some basic information and provide visibility. The supplier/retailer
can then decide if further work is needed. If this is the case, the supplier/brand/
retailer may wish to do this themselves or pass on to an auditing body.
The auditor:
 requests details of any Sch&EP used in the production process. It should be

noted that the factory may only have details of the agents used as
intermediaries and the level of information available should be noted;
 checks the existence of terms and conditions of engagement for Sch&EP;
 clearly states the law on the country in respect of homeworking and if the
country has ratified the ILO convention on home working.
 ascertain and notes as a non-compliance where sub-contracting is taking place

without express permission from any retailers concerned. This can be verified
in many different ways such as open questions to workers, checks on
production records vs order books, internal inspection checks etc. The auditor
can also look at order books and check in a busy month if they had enough
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workers on site to do any processes that are typically outsourced – e.g.

embroidery;
 ascertains, where Sch&EP is in place what systems and policies are in place to
manage their ethical position and has the site carried out any audits there to
assess conditions;
 request evidence to show they’ve communicated the code of conduct;
 states the location and number of Sch&EP suppliers are sourcing from and
provide the name of whom through if via a contractor, subcontractor, sub-
subcontractor
 identifies in which part of the production process Sch&EP are used and which
period of the year.
 checks the systems in place for setting piece rate pay, gathers evidence of the
time and motion studies to establish rate of pay.
 checks if the supplier has implemented systems to carry our random checks on
homeworking/shed units to ensure that basic working conditions are
acceptable.
The purpose of this clause is to ensure that the requirements of the SMETA are not
only upheld by the organisation, but that there are also mechanisms in place to ensure
that nonconformities are not simply hidden in the supply chain.
The requirement on homeworkers is to ensure that homeworkers are afforded the

same rights as other workers of the organisation.
6. SUMMARY OF SMETA REQUIREMENTS FOR DISCIPLINE
Code
9. Discipline
9.1 Physical abuse or discipline, the threat of physical abuse, sexual or other
harassment and verbal abuse or other forms of intimidation shall be
prohibited.
 disciplinary practices are fair, non-arbitrary and effective.
 employers demonstrate respect for workers’ mental, emotional and physical

well-being with regard to any disciplinary action necessary.
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6.1 Background to disciplinary practices
The purpose of this requirement of the Base Code is to protect the rights of an
individual to be free from the threat of unfair punishment and treatment.
This does not mean that organisations cannot have disciplinary procedures but
unfair disciplinary practices are unacceptable at any level within the
organisation. These could include physical punishment, verbal abuse, mental
abuse, and also financial penalty.
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SESSION FIVE
Session Five
Clauses 10 – 11
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OBJECTIVES
 Understand and interpret the SMETA requirements for:
- Entitlement to work, migrant and agency labour.
- Environment.
- Business ethics.
- Community benefits.
KEY POINTS
 Summary of SMETA requirements for entitlement to work, migrant and agency

labour.
 Summary of SMETA requirements for environment.
 Summary of SMETA requirements for business ethics.
 Summary of SMETA requirements for community benefits.
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The main points and interpretations of clause 10: Other Issues, clauses 10A, 10B2, 10B4,
10C and 11 are set out in this Session.
For ease of reference, the paragraph numbers follow the clause numbers of SMETA Best
Practice Guidance and direct quotations from the Standard are presented in italics.
1. SUMMARY OF SMETA REQUIREMENTS FOR ENTITLEMENT TO WORK,

MIGRANT AND AGENCY LABOUR
Code
SMETA requirements:
10.A Entitlement to work
10A.1 Only workers with a legal right to work shall be employed or used by the supplier.
10A.2 All workers including employment agency staff, must be validated by the supplier
for their legal right to work by reviewing original documentation.
The auditor checks and reports on the processes used to manage labour standards
at the site in this area of ‘Entitlement to Work’. Auditor examines policies and written
procedures in conjunction with relevant managers to understand and record what
controls and processes are currently in place to manage entitlement to work, migrant
and agency labour. In this section, the auditor also checks whether the site knows
and is up to date with, relevant local, national, and international law as well as the
standards required e.g.
 Are there laws governing this area of the code and is the site up to date?
 Does the site have robust processes in place to verify all workers’ right to
work?
 Does the site have all legally required documentation to show compliance?
2. SUMMARY OF SMETA REQUIREMENTS FOR ENVIRONMENT
Code
SMETA requirements:
10B2 Environment
10B2.1 Suppliers must comply with the requirements of local, national and
international laws related to environmental standards.
10B2.2 The supplier should be aware of and comply with their end clients’
environmental requirements.
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 the facility is complying with international, national and local environmental laws
and regulations;
 the facility is aware of any client-specific requirements and has systems in place
to be able to ensure that they meet these.
SMETA makes the point that this is not a full environmental audit but a check on basic
systems and management approach.
The auditor checks and reports on the processes used to manage standards at the site
in this area of ‘Environment 2-Pillar (Shortened Version)’.
Auditors examine policies and written procedures in conjunction with relevant

managers to understand and record what controls and processes are currently in place
to manage this area of environment.
In this section, the auditor also checks whether the site knows and is up to date with,
relevant local, national and international law as well as the
standards required e.g.
 Are there laws governing environment, is the site aware of them and up to date?
 Do they have internal systems for checking they meet the law?
 Are these systems documented.
 Are there any government checks and if so, are they documented?
 Are they involved in a process of improvement of their environmental
performance?
 Is there any documentary evidence of these practices and if so what are they?
The auditor should record the details in this section.
10B4 Summary of requirements for Environment 4-Pillar
Use this section for an environmental assessment 4-Pillar SMETA, which includes a
recommended 0.25 audit days.
This is not a full environmental audit, but an assessment process over a

recommended 0.25 auditor days, which will support the reviewer in deciding if a full
environmental audit is necessary.
CODE
SMETA requirements;
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Below is the compliance criteria given in SMETA measurement criteria
 10B4.1 Businesses as a minimum must meet the requirements of local and

national laws related to environmental standards.
 10B4.2 Where it is a legal requirement, businesses must be able to
demonstrate that they have the relevant valid permits including for use and
disposal of resources e.g. water, waste etc.
 10B4.3 Businesses shall be aware of their end client’s environmental
standards/code requirements
 10B4.4 Suppliers should have an environmental policy, covering their
environmental impact, which is communicated to all appropriate parties,
including its own suppliers.
 10B4.5 Suppliers shall be aware of the significant environmental impact of
their site and its processes.
 10B4.6 The site should measure its impacts, including continuous recording
and regular reviews of use and discharge of natural resources e.g. energy
use, water use (see 4–pillar audit report and audit checks for details).
 10B4.7 Businesses shall make continuous improvements in their
environmental performance.
 10B4.8 Businesses shall have available for review any environmental
certifications or any environmental management systems documentation
 10B4.9 Businesses should have a nominated individual responsible for co–
ordinating the site’s efforts to improve environmental performance.
Guide for Observations
10B4.10 Suppliers should have completed the appropriate section of the SAQ and
made it available to the auditor.
10B4.11 Has the site recently been subject to (or pending) any fines/prosecutions for
noncompliance to environmental regulations.
10C Business Ethics
Code
SMETA Requirements;
Note: The aim of the Business Ethics Assessment is to give a better understanding of
these issues in global supply chains and by gathering information as observations and
not non-compliances, it is hoped that over time, appropriate standards can be agreed
upon. In addition, this is not designed as a forensic audit, rather a review of processes
and procedures to manage compliance
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10C. Compliance Requirements
 10C.1 Businesses shall conduct their business ethically without bribery,

corruption, or any type of fraudulent Business Practice.
 10C.2 Businesses as a minimum, must meet the requirements of local and
national laws related to bribery, corruption, or any type of fraudulent Business
Practices.
 10C.3 Where it is a legal requirement, businesses must be able to
demonstrate that they comply with all fiscal legislative requirements.
 10C.4 Businesses shall have access to a transparent system in place for
 confidentially reporting, and dealing with unethical Business Ethics without
fear of reprisals towards the reporter.
 10C.5 Businesses should have a Business Ethics policy, covering bribery,
corruption, or any type of fraudulent Business Practice.
 10C.6 Businesses should have a designated person responsible for
implementing standards concerning Business Ethics.
 10C.7 Suppliers should ensure that the staff whose job roles carry a higher
level of risk in the area of ethical Business Practice e.g. sales, purchasing,
logistics, are trained on what action to take in the event of an issue arising in
their area.
11 Summary of SMETA requirements for community benefits
SMETA requirements:
Community Benefits
In keeping with the Sedex Vision Statement, SMETA seeks to encourage organisations
to implement positive aids to the community. These may include aspects such as
hospitals, schools, community centre, sports/health programmes, transport to local
facilities such as doctors and markets/shops, AIDS programme, and so on.
The organisation is not compelled to implement such benefits but is encouraged to do

so. Such benefits may be documented in the audit report on the organisation.
4.4 Environment
D1 Suppliers shall seek to make continuous improvements in their

environmental performance and, as a minimum, complies with the
requirements of local and international laws and regulations.
D2 The supplier shall be aware of and comply with their end clients’
environmental requirements.
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WORKSHOP 2: AUDIT EVIDENCE / AUDIT TRAIL

Purpose
 To develop your understanding and application of the evidence needed to indicate

that certain clauses in the SMETA Best Practice Guidance are being implemented
effectively.
Task
 Read the case studies in the handout and decide what action you would take to
satisfy yourself that the situation is compliant with SMETA.
 Provide details of the possible audit evidence that could be available in order to verify
that the clauses are being met effectively.
Output
 Feedback from this workshop will be in the form of a group discussion lead by the Tutor and will
consider the:
- requirement.
- audit trail.
- possible evidence.
 All Learners will be expected to contribute to the discussion.
Time Allowed
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SESSION SIX
Session Six
Registration, Certification and

Auditor Competence
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REGISTRATION, CERTIFICATION AND AUDITOR COMPETENCE

OBJECTIVES
When you have completed this topic you will be able to:
 Explain the terms used in certification and accreditation.
 Describe the certification and accreditation process.
 Describe the requirements of ISO/IEC 17021.
 Distinguish between a Stage 1 and Stage 2 audit.
 Explain the purpose of surveillance visits.
 State the purpose and benefits of a certificated MS.
 Be aware of the various auditor certification schemes.
 Understand the competence needs of auditors.
 Explain the need for auditor confidentiality.
KEY POINTS
 Certification and registration of organisations.
 Competence of auditors.
 Personal characteristics of auditors.
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REGISTRATION, CERTIFICATION AND AUDITOR COMPETENCE

1. CERTIFICATION AND REGISTRATION OF ORGANISATIONS
1.1 THIRD-PARTY CERTIFICATION
There are strict rules and regulations laid down for the conduct of third-party audits
that are monitored by Accreditation Bodies through the International Accreditation
Forum (IAF).
In the United Kingdom, the national accrediting body is the United Kingdom
Accreditation Service (UKAS) which reports directly to the Government Department
of Trade and Industry. In the USA, the Exemplar Global fulfils a similar role, as does
the JAB in Japan.
The most important function of a national accreditation body is to “accredit”

organisations (certification bodies) to “certificate” or “register” other organisations
against National and International Standards. So UKAS accredits companies such as
SGS SSCE, BSI and Lloyds to carry out audits on organisations and to register those
which meet the requirements of the standard against which they are being audited.
The accreditation body will also agree the scope of accreditation with the certification
body. That is the certification body will only be able to award certificates within
specifically defined industrial sectors.
2. ISO/IEC 17021 CONFORMITY ASSESSMENT – REQUIREMENTS FOR

BODIES PROVIDING AUDIT AND CERTIFICATION OF MANAGEMENT
SYSTEMS
The Standard contains principles and requirements for the competence, consistency
and impartiality of audits and certification of all types of management systems.
2.1 ISO/IEC 17021: 2015
 establishes the process requirements for conduct of certification audits;
 requires certification bodies to implement a three year certification cycle

with a recertification audit;
 requires that this recertification audit and the decision on issuing the new
certificate must be performed prior to the expiry of the existing certificate;
 distinguishes between a Stage 1 and Stage 2 audit;
 requires corrective actions raised to address Minor nonconformities which

have been raised at Stage 2 to have been reviewed and accepted before
a certificate of registration can be issued;
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 surveillance audits in first and second years (the date of the first
surveillance audit following initial certification must take place no more
than 12 months from the last day of the stage 2 audit);
 surveillance activities to cover representative areas and functions on a

regular basis and take into account any changes.
These and the other requirements relating to the audit and certification process
are addressed in this Manual and on the Course.
The accreditation body (UKAS) will carry out regular monitoring of the activities
of the certification body against ISO 17021 and will raise nonconformity reports
as appropriate.
To achieve accreditation, the certification body must:
 have a formal, documented system of controls;
 be audited by the Accreditation Body;
 hold records on each auditor;
 prove knowledge and experience of applicable industry sector;
 employ or have access to auditors, including team leaders and technical

experts to cover all of its activities.
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3. CERTIFICATION PROCESS
3.1 Introduction
To achieve accreditation, the certification body must:
 have a formal, documented system of controls;
 be audited by the Accreditation Body;
 hold records on each auditor;
 prove knowledge and experience of applicable industry sector;
 employ or have access to auditors, including team members and

technical experts to cover all of its activities.
Certification of a management system provides independent demonstration that

the management system of the organisation:
 conforms to specified requirements;
 is capable of consistently achieving its stated policy and objectives; and
 is effectively implemented.
3.2 Initial certification audit
The initial certification audit of a management system is conducted in two

stages; Stage 1 and Stage 2.
The process is shown in Appendix 9.
Stage 1 Audit is addressed in Session 8.
Stage 2 Audit is addressed in Session 10.
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3.3 Initial certification audit conclusions
The audit team are expected to analyse all of the information and audit
evidence gathered during the Stage 1 and Stage 2 audits to review the audit
findings and agree on the audit conclusions.
3.4 Surveillance audit
These are “mini” audits to review the ongoing effectiveness of a registered

organisation’s management system. Surveillance visits take place regularly
throughout the period that an organisation is registered.
The duration of the audit is shorter than an initial audit and tends to be
focussed on a particular part of the overall system. A certification body is able,
therefore, to look at specific processes or areas in more depth.
Over the period of registration, the intention is that the whole of an

organisation’s management system will have been audited in this manner.
The surveillance audit programme must include, at least:
 internal audits and management review;
 a review of actions taken on nonconformities identified during;
 the previous audit;
 treatment of complaints;
 effectiveness of the management system with regard to:
- achieving the certified client’s objectives;
- progress of planned activities aimed at continual improvement;
- continuing operational control;
- review of any changes, and
- use of marks and/or any reference to certification.
Surveillance audits are conducted at least once a year. The date of the first
surveillance audit following initial certification is no more than 12 months from
the last day of the Stage 2 audit.
Surveillance visits may also form part of a supplier’s audit programme.
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4. CERTIFICATION OF AUDITORS
To ensure independence of the certification process, the organisation which

certificates auditors, is separate from that which certificates organisations.
An auditor certification scheme is one of the means for providing consistency and
accuracy in the interpretation of the Standard by auditors.
The purpose of the Auditor Certification Scheme is to certify than an auditor is

competent, auditors trained and qualified in the principles of auditing Management
Systems and SA 8000.
4.1 International schemes
Examples of international schemes are those provided by:
 CQI / IRCA (Chartered Quality Institute / International Register of

Certified Auditors) in the UK;
 Registrar Accreditation Board (RAB) in the USA.
 Quality Society of Australasia (QSA) covering Australia and New

Zealand.
4.2 IRCA auditor certification scheme
The scheme operated by IRCA comprises six categories of Management

System (MS) auditors:
 Provisional Internal Auditor

 Internal Auditor
 Provisional Auditor
 Auditor
 Lead Auditor
 Principal Auditor
Brief explanations of the categories of CQI / IRCA auditor are included in the
definitions in Appendix 1.
To maintain and manage the scheme, CQI / IRCA:
 sets the requirements for each grade of auditor which focuses on an on

an applicant’s training, work, information security and audit experience.
 approves and certificates auditor training courses.
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 maintains records of the Continuous Professional development (CPD) of

auditors.
The CQI / IRCA certification scheme is outlined on their website

(www.quality.org).
The CQI / IRCA Code of Conduct is set in Appendix 12.
The details of other schemes are published by the relevant auditor certification
bodies.
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5. COMPETENCE OF AUDITORS
Both ISO/IEC 17021-1 and ISO 19011 set out the desired personal behaviours and
competencies needed by an auditor.
5.1 Personal Attributes
An auditor needs to be:
 ethical
 open minded
 diplomatic
 collaborative
 observant
 perceptive
 versatile
 tenacious
 decisive
 self-reliant
 professional
 morally courageous
 open to improvement
 culturally sensitive; and
 collaborative.
In addition, the auditor must be appropriately educated, experienced and

trained.
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5.1 Personal Attributes, continued
The auditor should be competent in:
 Social Systems methods and techniques, including;
 Social Systems terminology;
 Social Systems tools and their application;
 relevant legislation, regulations and other requirements appropriate to the

Social System being audited;
 products, services and operational processes of the organisation being

audited.
In addition, auditors should maintain their professional development and

auditing abilities, by updating their general and specific areas of competence
and participation in SS audits.
Details on the initial and continual evaluation of auditors and audit team leaders
are provided in ISO 19011.
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SESSION SEVEN
Session Seven
Audit Definition, Principles

and Types
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AUDIT DEFINITION, PRINCIPLES AND TYPES

OBJECTIVES
 Understand the definition of audit.
 Explain the principles of auditing.
 Describe the difference in purpose and conduct between first, second and third party
audits.
 Be aware of the activities of an audit.
KEY POINTS
 Definition of audits.
 Principles of auditing.
 Audit activities.
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AUDIT DEFINITION, PRINCIPLES AND TYPES

1. DEFINITION
ISO 19011 defines an audit as a:
Systematic, independent and documented process for obtaining audit evidence and
evaluating it objectively to determine the extent to which audit criteria are fulfilled.
In other words, a check that the Social System is operating effectively in accordance
with the system criteria.
ISO 19011, Guidelines on quality and/or environmental management systems

auditing, sets out the process by which audits are conducted.
ISO 19011 contains guidance on:
 the principles of auditing;
 management of audit programmes
 audit activities;
 the competence of auditors.
ISO/IEC 17021 Conformity assessment – Requirements for bodies providing audit

and certification of management systems sets the requirements for certifications
bodies to assess management systems certification bodies.
ISO/IEC 17021 contains requirements relating to:
 audit principles;
 legal and contractual matters;
 structural requirements;
 resource requirements;
 information requirements;
 process requirements;
 management system requirements
This Course is based on the requirements set in ISO/IEC 17021 and the guidelines
contained within ISO 19011.
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2. PRINCIPLES OF AUDITING
To ensure that auditing is an effective and reliable management tool, ISO 19011
contains a number of fundamental principles. Understanding and following these
principles will ensure that audit conclusions are relevant and sufficient, and that
auditors working separately from one another will reach similar conclusions in similar
circumstances.
2.1 Auditing principles
Three of the principles relate to the personal characteristics of auditors:
 Ethical conduct
The role of the auditor is one of trust, integrity, confidentiality and

discretion. Certificated auditors are bound by strict codes of conduct .
 Fair presentation
Audit findings, audit conclusions and audit reports reflect truthfully,

accurately and completely the audit activities. Any unresolved or
diverging opinions between the audit team and the auditee and any
obstacles encountered are reported.
 Due professional care
Auditors must exercise a degree of care appropriate to the importance of

the task and to the confidence placed in them by audit clients and other
interested parties. Having the necessary competence is an important
part of this.
Two further principles concern the audit process:
 Independence
Auditors must be independent of the organisation or activity being

audited. They must remain free from bias and conflicts of interest.
 Evidence
Audit evidence is verifiable. It is based on samples of the information

available, since the audit is conducted during a finite period of time and
with finite resources. However, the use of sampling must be appropriate
to the confidence placed in the audit conclusions.
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2.1 Auditing principles, continued
ISO/IEC 17021 provides a number of principles that should be applied as

guidance for the decisions that may need to be made during an audit. These
principles are intended to inspire confidence to all parties that a management
system audit meets requirements. The principles are:
 impartiality;
 competence;
 responsibility;
 openness;
 confidentiality and
 responsiveness to complaints.
3. TYPES OF AUDITS
There are three types of audit:
 First party.
 Second party.
 Third party.
3.1 First party (Internal Audit)
Definition:
 An audit by the organisation of its own systems and procedures.
Objective:
 To assure maintenance, development and improvement of the Social

System.
Requirement:
 SMETA , Clause O.B – Management Systems and Code Implementation
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3.2 Use of the internal Social System audit by external auditors
Certification bodies have always issued certificates with the understanding that
they signify organisations’ competence to effectively manage their own affairs,
(rather than the certification body overseeing every last detail of a system).
Since effective internal auditing has long been recognised as an integral

component of effective system management, the external auditor will evaluate
the internal Social System audit arrangements and results to determine their
effectiveness.
In other words, an auditor can, (and indeed, should) as a direct result of the
findings and opportunities for improvement concerning the effectiveness of an
organisation's internal audit system, amend the planning for an audit to suit
these findings.
The auditor may obtain information during a pre-audit or document review. For
example, if the pre-audit had revealed that the organisation’s audit staff had not
adequately audited certain key operations within the organisation during
previous audits, the external auditor would "plan-in" these operations during his
or her audit in order to ensure that these were "controlled".
Of course, the converse could apply; sampling could be reduced if the internal
audit system demonstrated complete and thorough auditing of certain
operations.
Essentially, an external auditor needs to determine whether the audit

programme(s) and methodology is based upon the:
 current policy, objectives and targets of the organisation;
 current management programmes of the organisation;
 operational controls of the organisation.
In order to be able to do this, it is essential for the external auditor to be

completely briefed in the scope and application of the Social System of the
organisation to maintain a constant "point of reference" for questioning.
The external auditor also needs knowledge of the policy and objectives and
targets as a further “point of reference” during the review of internal audit
performance.
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3.2 Use of the internal Social System audit by external auditors, continued
Certain key principles should apply no matter what organisation circumstances

apply:
 Examine the training of internal auditors - is it adequate in its:
- approach to the organisation’s social and ethical issues?
- "grounding" in audit methodology?
 Examine the audit program - is it:
- comprehensive in its coverage of the system?
- capable of change if circumstances dictate?
- demonstrating that previous audit findings are used?
- relevant to the critical aspects of the organisation?
 Examine the audit planning and preparation - is it:
- demonstrating allocation of trained auditors with impartiality and

objectivity?
- demonstrating use of checklists prepared to evaluate the system,

not just the standard?
 Examine the audit results - do they:
- document the complete audit activity, recording "good" and "bad"?
- demonstrate that auditor training was effective?
 Examine the Finding Statements/CAR's - do they:
- comply with any classification criteria identified?
- demonstrate that auditor training was effective?
- form a basis from which corrective action can be taken?
- demonstrate effective review of successful implementation of

corrective actions and "timely" preventative measures being
achieved?
 Examine the audit reports - do they:
- provide an adequate tool for top management's further review on

the basis of determining improvement and system effectiveness?
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3.2 Use of the Internal Social System audit by external auditors, continued
All of these principles require that the internal audits by an organisation must
focus on the Social System and the activities controlling service levels.
By implication, this also means that an organisation must ensure that the
personnel used for internal audits are trained in social and ethical issues in the
areas/activities they will be responsible for auditing.
Otherwise, it is unlikely that the internal auditor will be able to adequately judge
effectiveness.
3.3 Second party (External Audit)
Definition:
 an audit by the organisation on its suppliers and sub-contractors.
Objective:
 to determine suitability of suppliers.
 to appraise supplier/subcontractors performance in respect of Social

System management.
3.4 Third party audit (External Audit)
Definition:
 Audit carried out by an auditing organisation independent of the client and

the user, for the purpose of certifying the client's management system
(ISO/IEC 17021).
Objective:
 to determine whether an organisation’s Social System has been

established, documented, implemented and maintained in accordance
with a specified standard.
4. AUDIT PROGRAMMES
For any organisation, audit programmes must be determined, managed and

controlled in order to be effective and to demonstrate continual improvement.
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SESSION EIGHT
Session Eight
The Audit Process
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SESSION EIGHT
THE AUDIT PROCESS

OBJECTIVES
 Understand the audit process.
 Establish the purpose and objectives of the audit and define the audit scope.
 Explain the significance of audit criteria.
 Explain the need for pre-audit contact with the auditee.
 Identify the documents to be reviewed and information to be obtained from the audit.
 Produce an outline plan for the audit.
 Produce a checklist for the audit.
KEY POINTS
 The audit process.
 Planning the audit.
 Preparing for the on-site audit.
 Pre-audit contact with the auditee.
 Document review.
 Audit checklist.
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THE AUDIT PROCESS

1. GENERAL
1.1 Certification audit
There are a number of distinct activities that take place during a certification audit.
These form an audit programme and include:
 a two-stage initial audit;
 surveillance audits in the first and second year, and
 a re-certification audit in the third year before the expiration of the certificate.
1.2 Second-party audit
Some second-party audits may go through a similar two-stage process others

may be less structured depending on the requirements of the contract and the
complexity of system being audited.
1.3 First-party audit
Generally, internal audits are not so formally structured and the requirements
for these audits are set out in the clause of the Standard concerning Internal
Audits.
1.4 Course structure
This course follows the structure of an initial certification audit, differences in

approach between this and other audits will be addressed where appropriate.
The areas covered are:
 Audit planning;
 Stage 1 audit
 Stage 2 audit;
The initial certification audit process is shown in Appendix 3.
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2. PLANNING THE AUDIT
2.1 General
For an initial certification audit, the planning process will begin with the receipt
of an application from an audit client.
For a second-party audit this planning process may be initiated

through the tender process or before a contract is awarded or as part of an on-
going contract.
An internal audit programme will be planned taking into consideration the status
and importance of the processes and areas to be audited as well as the results
of previous audits.
2.2 Audit objectives
Within the overall audit programme, each individual audit should be based on
documented objectives, scope and criteria.
The objectives of an audit may include one or all of the following:
 confirming that the management system complies with all the elements of
the ‘Standard’;
 determining as to whether the management system is designed to

achieve and is achieving, regulatory compliance and continual
improvement of in the performance of the system processes;
 confirming that the organisation complies with its own policies and
procedures;
 evaluating the capability of the management system to ensure

compliance with legislative and contractual requirements;
 evaluating the effectiveness of the implemented management system in

meeting specified objectives;
 identifying areas of potential improvement of the management system.
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2.3 Audit scope
The audit scope describes the extent and boundaries of the audit in terms of
factors such as:
 physical locations;
 organisational units;
 activities and processes to be audited;
 the duration of the audit.
2.4 The audit criteria
The audit criteria may include applicable:
 the requirements of the management system Standard;
 policies;
 procedures;
 regulations;
 legislation;
 management system requirements;
 contract requirements;
 industry sector codes of conduct.
2.5 The audit objectives, scope and criteria
These should be defined by the organisation being audited.
As a consequence, any subsequent changes to these need to be agreed with

the client, audit programme management, and if appropriate, the auditee, after
consultation with the auditor.
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2.6 Feasibility of the audit
As part of the planning process, the audit programme manager should

determine the feasibility of the audit, taking into consideration such factors as:
 sufficient and appropriate information for planning the audit;
 business objectives, policies, products;
 adequate co-operation from the auditee;
 availability of time and adequate resources.
Where the audit is not feasible, an alternative should be proposed to the audit
client by the audit programme manager, in consultation with the auditee.
The feasibility of the audit should be reviewed after Stage 1 audit has been
completed, taking into account anything that had been identified during Stage
1.
2.7 Determining audit time
The audit duration will need to be determined and will affected by:
 the requirements of the relevant management system standard;
 the size and complexity of the audit client and their processes;
 the technological and regulatory context;
 whether there are any outsourcing of any activities included in the scope
of the management system;
 the results of any previous audits;
 the number of sites and multi-site considerations;
 the risks associated with the products, processes or activities of the

organisation;
 whether the audit is combined, joint or integrated.
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2.8 Multi-site sampling
For a large client with several or many sites it may be appropriate to sample
sites covering the same activity in various locations. The rationale for the
sampling plan shall be documented for each client.
3. THE AUDIT TEAM
3.1 Audit team selection
As soon as the audit has been declared feasible, the composition of the audit
team should be established:
The audit programme manager should appoint an audit team leader with the
appropriate skills and competence needed to achieve the objectives of the
audit.
The audit team will comprise an audit team leader and may comprise auditors,
auditors-in-training and technical experts, working under the direction of the
audit team leader.
However, if there is only one auditor, that auditor should perform all of the
duties of the audit team leader.
Consideration should be given to the following issues when deciding the size
and composition of the audit team:
 audit objectives, scope, criteria, location(s) and estimated duration;
 whether the audit is a combined, integrated or joint audit;
 the overall competence needed to achieve audit objectives;
 requirements of accreditation or certification bodies as appropriate;
 the language of the audit and understanding of the auditee’s social and
cultural environment;
 the need to assure the independence of the audit team from the activities
to be audited and to avoid any conflicts of interest;
 the ability of the audit team members to interact effectively with the
auditee and to work together.
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3.1 Audit team selection, continued
The audit client and the individual auditee have the right to request the
replacement of particular team members on reasonable grounds that should be
made to the audit programme management. Examples of reasonable grounds
may be those of conflicting interests (such as an audit team member was
former employee of the auditee or provided consultancy services) or previous
unethical behaviour.
The selected team auditors must have an understanding of the sector of

business in which they are auditing and of the key issues for the organisation.
They should be aware of the culture and ethics of the organisation to be
audited. This is important when evaluating the pro-active role of management
integration of business objectives, policy, and Social System requirements.
3.2 Auditor roles and responsibilities
3.2.1 Team leader responsibilities
During the audit, the responsibilities of the Team Leader are to:
 make final decisions for all phases of the audit;
 prepare the audit plan;
 assign team roles;
 brief the team;
 review working documents to ensure adequacy;
 communicate the audit team task to the team and auditee;
 represent the audit team at opening and closing meetings;
 report critical nonconformities to the auditee immediately;
 report any major obstacles encountered during the audit;
 submit the audit report.
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3.2.2 Audit team tasks
The audit team leader should assign to each team member responsibility
for auditing specific management system processes, functions, sites,
areas and activities.
Such assignments should take into account the need to maintain auditor
independence, competence and efficient use of resources.
The allocation of tasks must be made known the organisation being

audited. The audit team will:
 examine and verify the structure, policies, processes, procedures,

records and related documents of the organisation relevant to the
management system;
 determine that these meet all of the requirements relevant to the

intended scope of certification;
 determine that the processes and procedures are established,

implemented and maintained effectively, to provide a basis for
confidence in the auditee's management system, and
 communicate to the auditee, for action, any inconsistencies

between the policy, objectives and targets, and the results.
3.2.3 The responsibilities of team members
Team members should:
 review all relevant information related to their assigned tasks;
 prepare any work documents (including checklists) necessary to

carry out those tasks;
 comply with the audit requirements;
 carry out assigned duties effectively and efficiently;
 report nonconformities and audit findings to the Team Leader;
 co-operate and support the Team Leader.
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3.2.3 The responsibilities of team members, continued
During any audit, team members should:
 stay within the audit scope;
 communicate the audit requirements to the auditee;
 collate the evidence from the audit both for and against conformity;
 document any Corrective Action Requests (CARs);
 report the audit findings to the auditee;
 verify corrective actions taken in response to CARs;
 retain and safeguard all documents pertaining to the audit.
3.2.4 Communication during the audit
During the audit, the audit team must assess audit progress and
exchange information. The Team Leader may need to reassign work as
needed between the audit team members and periodically communicate
the progress of the audit and any concerns to the auditee.
Should the team uncover evidence that indicates that the audit objectives
cannot be met or suggests the presence of an immediate and significant
risk (e.g. safety), the Team Leader must report this to the auditee client.
Appropriate action must be taken which may include reconfirmation or
modification of the audit plan, changes to the audit objectives or audit
scope, or termination of the audit.
The Team Leader must review with the client any need for changes to the
audit scope which becomes apparent as on-site auditing activities
progress.
3.2.5 Observers and guides
3.2.5.1 Observers
The presence and justification of observers during an audit

activity must be agreed with the Team Leader and the auditee
before the conduct of the audit. The audit team must ensure that
observers do not influence or interfere in the audit process or
outcome of the audit.
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Observers may include members of the auditee organisation,

consultants, witnessing accreditation body personnel, regulators
or other justified persons.
3.2.5.2 Guides
On all third- and second-party audits, each auditor must be

accompanied by a guide, unless otherwise agreed to by the
audit team leader and the client. Guide(s) are assigned to the
audit team to facilitate the audit. It is the responsibility of the
audit team to ensure that guides do not influence or interfere in
the audit process or outcome of the audit.
The responsibilities of a guide can include:
 establishing contacts and timing for interviews;
 arranging visits to specific parts of the site or

organization;
 ensuring that rules concerning site safety and security

procedures are known and respected by the audit team
members;
 witnessing the audit on behalf of the client;
 providing clarification or information as requested by an

auditor.
4. SPECIALISED PLANNING FOR SOCIAL SYSTEMS AUDITS
In advance of any on-site auditing it is important for the audit team to have a good
understanding of relevant background information which may have an implication on
their audit plan and ultimately on their findings.
Such information may include the following:
 legislation;
 media reports;
 NGO reports;
 socio-economic data, such as employment and turnover rates; minimum

wages; information about the working population and so on.
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4.1 Stakeholder mapping
One useful technique in identifying the information required and the best
sources of that information is that of Stakeholder mapping. This process
essentially comprises the identification of as many relevant stakeholders of the
organisation as possible, along with their inter-relationships.
A pictorial representation of the stakeholder map can provide for the audit team
to identify, not only those stakeholder who would be useful in supplying
background information in advance of the audit, but also those who ought to be
involved during the audit itself.
Those stakeholders with many links to other stakeholders may prove very
useful to the auditor. The process may also discover other stakeholders which
may otherwise have been missed.
4.2 Selection of Stakeholders
Generally the more indirectly associated the stakeholder to the organisation,

the more general the information that will be available. So Multi-Lateral
Organisations (MLOs), such as UNICEF, may be able to provide background
research and base statistics, but will be able to provide very little local detail.
Where international stakeholders, such as international trade unions or NGOs

(e.g. Amnesty International or Human Rights Watch) are concerned, they are
more likely to be able to provide case studies, reports on the regional situation
and possibly access to local partners.
Local stakeholders may have specific experience of the facility to be audited,

and may even have direct involvement. However, this useful information must
be used with the understanding that there could be bias involved.
4.3 Use of stakeholders
The majority of the background research must be done in advance of the audit
to ensure that the audit itself will be effective. Therefore most indirect and some
direct stakeholders will generally be used in advance of the onsite audit to
assist with the planning of the audit.
Use of websites of stakeholders, including NGOs, the media, and others

identified, will usually provide the majority of the necessary information.
The stakeholder mapping process will also help in planning which stakeholders
need to be involved in the onsite audit alongside facility representatives and
workers. For example, trade union representatives, local community groups,
local religious groups, local education or health facilities or local NGOs. The
onsite audit therefore, may also incorporate some local activities away from the
facility.
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SESSION NINE
Session Nine
Stage 1 Audit
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STAGE 1 AUDIT
OBJECTIVES
 Identify the activities of a Stage 1 Audit.
 Understand the purpose of the pre-audit visit.
 State the purpose of the document review.
 Describe a typical document review process and outputs.
 Develop the audit plan.
KEY POINTS
 Initial contact with the auditee.
 Pre-audit visit.
 Document review.
 The audit plan.
 Work documents.
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STAGE 1 AUDIT
1. INITIAL CERTIFICATION AUDIT
The initial certification audit of a management system is conducted in two stages:

Stage 1 and Stage 2.
1.1 Stage 1 audit
ISO 17021 sets out the function of the Stage 1 Audit:
a) audit the client's management system documentation;
a) evaluate the client's location and site-specific conditions and to undertake

discussions with the client's personnel to determine the preparedness for
the stage 2 audit;
c) review the client's status and understanding regarding requirements of the
standard, in particular with respect to the identification of key performance
or significant aspects, processes, objectives and operation of the
management system;
d) collect necessary information regarding the scope of the management

system, processes and location(s) of the client, and related statutory and
regulatory aspects and compliance (e.g. quality, environmental, legal
aspects of the client's operation, associated risks, etc.);
e) review the allocation of resources for stage 2 audit and agree with the client
on the details of the stage 2 audit;
f) provide a focus for planning the stage 2 audit by gaining a sufficient

understanding of the client's management system and site operations in
the context of possible significant aspects;
g) evaluate if the internal audits and management review are being planned
and performed, and that the level of implementation of the management
system substantiates that the client is ready for the stage 2 audit.
For most management systems, ISO 17021 recommends that at least part of
the Stage 1 Audit be carried out at the auditee's premises in order to achieve
the objectives stated above.
Stage 1 audit findings are documented and sent to the auditee. These should
include the notification of any areas of concern that could be classified as
nonconformity during the Stage 2 audit. Stage 1 audit findings are documented
and sent to the client. These should include the notification of any areas of
concern that could be classified as nonconformity during the Stage 2 audit.
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2. APPLICATION
An initial certification audit will commence with the receipt of an application from the
organisation wishing to be certified. The application will contain information
concerning:
 the scope of the certification;
 the general features of the organisation;
 general information such as activities, human and technical resources,

functions and relationship in a larger corporation, if any;
 information concerning all outsourced processes;
 the standards or other requirements for which the organisation is seeking

certification;
 information concerning the use of consultancy relating to the management

system.
Before proceeding with the audit, the certification body will review the application and
supplementary information for certification to ensure that the information about the
applicant organization and its management system is sufficient for the conduct of the
audit.
Assuming that the certification body goes ahead with the audit, the certification body
shall determine the competences it needs to include in its audit team and for the
certification decision.
3. INITIAL CONTACT WITH THE AUDITEE
The initial contact with the auditee may be formal or informal.
Depending on the situation, the audit programme manager or audit team leader
should contact the auditee to finalise arrangements for the audit. In an internal audit
this may be informal, but for some third-party audits, this may take the form of a
formal pre-audit visit (see below).
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3. INITIAL CONTACT WITH THE AUDITEE, continued
However it is done, the purpose of the initial contact is to:
 establish communication channels;
 provide information on proposed timings;
 obtain information for selecting the audit team;
 request documentation and records;
 make arrangements for the audit.
The need for accompanying persons such as observers, interpreters or guides for the
audit team should be mutually agreed.
4. PRE-AUDIT VISIT
4.1 The purpose and benefits of a pre-audit visit
The objectives of a pre-audit are:
 to provide the information for planning the certification audit by gaining an

understanding of the management system in the context of relevant
management issues, policy objectives and regulations;
 ascertain the organisation’s state of preparedness for audit.
The pre-audit should focus on the elements and requirements of the

management system, such as the monitoring of system performance through
internal audit and management review.
The purpose of a pre-audit is to:
 plan and allocate resources for further document review where required
and for the certification audit;
 provide an opportunity for immediate feedback of information to the client,

which may assist in the certification audit process;
 collect necessary information regarding the management system of the

organisation;
 clarify the extent to which the:
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4.1 The purpose and benefits of a pre-audit visit, continued
- management system is based on an adequate appropriate

information;
- management system is designed to achieve compliance with

regulatory requirements and policy;
- objectives contribute to continual improvement in performance;
- implementation of the management system justifies proceeding to

the certification audit;
- internal audit complies with the requirements of the Standard;
- additional documentation has to be reviewed and/or what

knowledge has to be obtained in advance;
- information gathered can be used to determine the way in which the

certification audit has to be conducted.
By identifying areas of non-conformity to the ‘Standard’ prior to the actual

certification audit the auditor provides the client company with the ability to
continue with its committed continual improvement programme (which should
have been a documented policy of the client company, according to the
‘Standard’), by revising its operational practices and/or system methods to
achieve greater management control of the management system.
4.2. Planning the pre-audit
4.2.1 Inquiry and information gathering
The Team Leader has to acquire some basic information before

determining his or her ability to perform a pre-audit and the resources
needed. This is normally done by a questionnaire and will provide
information:
 process or industry skills needed;
 legislative knowledge required;
 management system experience required;
 number of auditors required;
 number of days required.
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4.2.1 Inquiry and information gathering, continued
Once the entire information gathering is complete and decisions have

been made, the company can be presented with an accurate proposal of
costs and plan of action. Subject to contractual agreement, the audit is
then scheduled with the client.
The pre-audit process will then follow the audit stages covered in the
following Sessions.
The Team Leader can then identify if the:
 necessary skills needed;
 client organisation’s activity falls within an existing accredited scope

of operation.
4.2.2 Pre-Audit – Report and Follow Up
The report should be delivered to the client as soon as possible and

copied to the on-going certification file as an essential record of stage 1
activity – pre-audit – having been carried out.
There are benefits in this approach. The pre-audit visit should:
 impart a sense of co-operation between management of the

organisation and the auditor;
 identify any special needs for the audit team such as skills,
knowledge, facilities, protective clothing and so on;
 identify detailed layout of the facility to be audited and so permit an

accurate estimate of the number of team members and duration of
the audit;
 provide an opportunity for the company to deal with any ‘potential’

or previously unforeseen non-conformities raised by the auditor,
prior to the assessment visit.
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5. DOCUMENT REVIEW
The next stage in the preparation process is for the auditor (the audit team leader or
by an auditor nominated by the audit team leader) to study the documents relevant to
the audit criteria, objectives and scope of the audit. This is called the document
review or “desk study” or documentation audit.
The purpose of the review is to provide information to the auditor for the on-site audit
activities. The auditor will need to satisfy him- or herself that the management
system as described in the documented processes meets the requirements of the
audit criteria. For an initial certification, the audit criteria will be requirements of the
relevant the Standard.
In undertaking the review, the auditor will consider whether the system and the
processes referenced within the system are appropriate to the needs of the business.
Once satisfied that the system and processes are adequate and meet the
requirements of the relevant Standard, the auditor should use this information to:
 devise an audit plan to notify the auditee of the format for the audit;
 develop the necessary working documents for the audit.
Depending on the type of audit, and the objectives and scope of the audit, the auditor
will wish to review:
 the documented statements of policy and objectives;
 the documented procedures;
 other documents needed by the organisation so as to gain a thorough

understanding of the organisation and its processes. These may include:
- operational procedures,
- work instructions and so on;
 records.
In an internal audit, the auditor will probably concentrate on the documentation

(procedures or work instructions) covering the precise scope of the audit.
The documentation should be reviewed to determine the conformity of with the audit
criteria. The outcome of the pre-audit visit and the document review on an initial
certification audit will be contained in a Stage 1 Audit Report.
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6. CONCERNS AT STAGE 1
Stage 1 audit findings are documented and sent to the client. These should include
the notification of any areas of concern that could be classified as nonconformity
during the Stage 2 audit.
The audit should not continue until the deficiencies are resolved to the satisfaction of
the audit programme management in consultation with the audit client, the audit team
leader and, if appropriate, the auditee.
7. WORK DOCUMENTS
Work documents are those used by the audit team for the purpose of reference
and/or recording the audit. They can include:
 audit procedures, checklists and sampling plans;
 the audit plan;
 checklists, for recording information and supporting evidence;
 records of meetings;
 forms for reporting nonconformities and audit findings.
The use of these documents, such as audit plans, checklists and forms, should not
restrict the extent of audit activities.
Work documents should be retained, at least until audit completion. Audit team
members should suitably safeguard those involving confidential or
8. THE AUDIT PLAN
The audit team leader should prepare a plan for the on-site audit activities. The plan
should provide the necessary information to the audit team, auditee and audit client.
It should enable the scheduling and co-ordination of the audit activities.
The level of detail should be adapted to suit the scope and complexity of the audit.
The details may differ between initial and surveillance audits and between internal
and external audits.
The audit plan should include the:
 audit objectives and scope;
 audit criteria and reference documents;
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8. THE AUDIT PLAN, continued
 dates and places where the on-site audit activities are to be conducted;
 identification of the organisational and functional units and processes to be

audited;
 expected time and duration for audit on-site activities, including meetings with
the auditee’s management and audit team meetings.
The plan may also include, as appropriate:
 the identification of the sites, activities and management system processes that
are essential to meeting audit objectives in order to allocate appropriate
resources to critical areas of the audit;
 the identification of the auditee’s key representatives participating in the audit;
 the working and reporting language(s) of the audit where this is different from
the language of the auditor(s) and/or the auditee;
 the identification of roles and responsibilities of the audit team members and
any accompanying persons;
 the audit report topics (including any methods of non-conformity

classifications), format and structure, expected date of issue and distribution;
 logistic arrangements (travel, on-site facilities and so on);
 matters related to confidentiality;
 any arrangements for audit follow-up actions.
An example of an audit plan or itinerary is show in Appendix 5.
In planning on-site audits, auditors need to be aware of, and take into consideration,
any local customs or cultural issues that may have a bearing on the conduct of the
audit. These may relate to language, dress and personal conduct of the auditor.
Auditors must be sensitive to the needs and expectations of auditees.
The plan should be reviewed and accepted by the audit client and presented to the
auditee before the audit.
Any objections by the auditee should be resolved between the audit team leader, the
auditee and the audit client before continuing the audit.
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8. THE AUDIT PLAN, continued
The audit plan should be sufficiently flexible to permit changes, such as any changes
in emphasis that may become necessary as the on-site audit activities progress. Any
revised audit itinerary should be agreed between the parties concerned before
continuing the audit.
9. WORK DOCUMENTS
Work documents used by the audit team for the purpose of reference and/or
recording the audit can include:
 audit procedures, checklists and sampling plans;
 the audit plan described above;
 forms for recording information, supporting evidence, records of meetings and

audit findings.
The use of work documents, such as audit plans, checklists and forms, should not
restrict the extent of audit activities.
Work documents should be retained, at least until audit completion. Audit team
members should suitably safeguard those involving confidential or proprietary
information.
10. AUDIT CHECKLIST
The checklist is a valuable aid to auditing and is used as a working document, and a
record.
The compilation of a checklist is a way of analysing the processes involved.
The purpose of a checklist is to ensure that the objectives and scope of the audit are
met, and that every part of the audit is completed.
The checklist acts as a guide for the auditor. It is the auditor's main tool in carrying
out the audit successfully.
The advantages of using a checklist are:
 as an aid to preparation to the audit;
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10. AUDIT CHECKLIST, continued
 the number of questions and size of samples can be used to estimate the time
required to conduct an audit or parts of an audit;
 an aid to the auditor to control the depth of the audit;
 an aid to the auditor to control the pace of the audit;
 an aid to the auditor to ensure that all of the planned arrangements for the audit
are covered;
 a means of recording responses by auditees.
However, there are disadvantages with using a checklist:
 - the use of standardised checklists may stifle initiative and analysis of the
processes or procedures
 - may prevent the auditor from investigating significant incidents simply

because they were not on the checklist.
In preparing the checklist, the auditor should consider the:
 processes which are taking place;
 relevant procedures;
 documents and records which are being used;
 requirements of the SMETA Best Practice Guidance;
 -requirements of the social system.
The complexity or detail on a checklist will depend on the experience of the auditor.
The approach should be to develop a well structured and reasoned trail through
linked avenues of investigation concerning objectives/targets, previous audit results,
likelihood of accident & emergency situations, concerns of interested parties (as
appropriate).
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10. AUDIT CHECKLIST, continued
The auditor should consider the likely requirements for evidence of control and
should consider to the effective use of “vehicles” for the audit trail in areas
fundamental to the SS rather than a generalised / abstract approach based solely
around the requirements of SMETA.
Nonetheless, all clauses and sub-clauses of the SMETA Best Practice Guidance
relevant to the activity being audited should have been considered in the audit
planning and consideration given to their interpretation in the different
areas/situations defined in the audit plan.
For example:
If an auditor is to audit the records of operational control, in order to prepare an

adequate checklist it would be advisable to show the following system-based
questions AND the associated effectiveness-based questions (assume that the
records and verification periods shown are as per procedure).
Checklist item (Example)
 Does the department hold records of working hours monitoring?
 Is compliance to legislation demonstrated?
 If non-compliance is recorded is it reported to authorities?
 If non-compliance is recorded is corrective action taken?
 Is the responsible person trained in Base Code requirements?
This style of checklist format/creation is far more valuable to an SS audit than simple
analysis of each procedure, statement by statement. It focuses the auditors on the
need for review of effectiveness as well as implementation.
An example of a blank checklist is set out in Appendix 6.
An example of a completed checklist is shown in Appendix 7.
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WORKSHOP 3: AUDIT PLANNING

Purpose
 To enable Learners to practice the steps necessary to prepare for an on-site audit
against SMETA.
Task
 Review the background information and pre-audit questionnaire provided by the GBR
factory and determine the number of days needed to conduct the audit and prepare
an audit plan.
 You should consider issues such as:
 The number of worker interviews to be conducted.
 Whether any interpreters are required.
 Any other factors that you will need to conduct the audit effectively.
Output
 Be prepared to feedback your findings for discussion by the whole class.
Time Allowed
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SESSION NINE
WORKSHOP 4: AUDIT PLAN (DAY 2)

Purpose
 To enable Learners to exercise the knowledge gained regarding the requirements for
gathering sufficient information, the interpretation of that information, and for audit
planning.
Task
 Review the details of the first day of the audit at the GBR factory. You are asked to
plan Day 2 of the audit.
 In your team:
- Read the report.
- Re-plan Day 2 of the audit in line with your conclusions, to address the issues
that your team feels need to be examined and/or re-examined.
- Nominate a spokesperson to present and explain the reasoning and main

points behind the team’s proposals.
Output
 One or more teams will be chosen to make a presentation of their plan in the form of
an opening meeting to the management team at GBR.
Time Allowed
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SESSION NINE
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16-01-2018
SESSION TEN
Session Ten
Stage 2 Audit: Conducting the

On-Site Audit
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STAGE 2 AUDIT: CONDUCTING THE ON-SITE AUDIT

OBJECTIVES
 Explain the need for effective communication with the auditee.
 Conduct an opening meeting.
 Understand the need for auditors to be sensitive to local customs and the need for
protection of vulnerable employees.
 Understand the need for confidentiality throughout the audit process.
 Explain the process of, and different methods for collecting audit evidence.
 Describe the benefits and limitations of sampling.
 Describe the methods and approaches for interviewing workers.
 Explain the role of company management in an audit.
KEY POINTS
 Social system audit performance.
 The opening meeting.
 Overcoming bias.
 Social accountability audit tools and techniques.
 Focus groups.
 Questionnaires.
 Interviews and interviewing skills.
 Observation.
 Documents and records.
 Factors affecting sampling.
 Reliability and availability of evidence.
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STAGE 2 AUDIT: CONDUCTING THE ON-SITE AUDIT

1. STAGE 2 AUDIT
The purpose of the Stage 2 audit is to evaluate the implementation, and

effectiveness, of the client's management system. The Stage 2 audit will take place
at the site(s) of the client. The areas covered during the Stage 2 audit will include:
 information and evidence about conformity to the requirements of the

applicable management system standard or other normative document;
 performance monitoring, measuring, reporting and reviewing against key

performance objectives and targets;
 the client's management system and performance in respect of legal

compliance;
 operational control of the client's processes;
 internal auditing and management review;
 management responsibility for the client's policies;
 links between the normative requirements, policy, performance objectives and

targets, any applicable legal requirements, responsibilities, competence of
personnel, operations, procedures, performance data and internal audit
findings and conclusions.
2. SOCIAL SYSTEMS AUDIT PERFORMANCE
Effective performance of a social accountability audit is dependent on using the most

appropriate audit tools and techniques to gather audit evidence which may then be
evaluated objectively to determine the extent to which the audit criteria are fulfilled.
This is known as Audit Stage 2.
The outcome of this process is the audit findings, which will be discussed in a later
session.
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2.1 Overcoming bias
Reliable audit evidence is crucial in coming to the right conclusions about

conformity with audit criteria. It is therefore important to ensure that
unsubstantiated evidence, such as verbal evidence gained through interviewing
workers, is corroborated with additional evidence of either the same or,
preferably different types. For example, if during an interview you are told by a
worker that they regularly perform overtime, this verbal evidence could be
corroborated by review of the company records of working hours and
remuneration, which would demonstrate the regularity of overtime.
Sometimes it may only be possible to gather one type of evidence and in these
cases it is important to ensure that sufficient evidence is gathered from different
sources, for example by interviewing different individuals, to reach the right
conclusion.
3. OPENING MEETING
An opening meeting should be held with the management of the organisation being
audited or, where appropriate, those responsible for the functions or processes to be
audited. Records of attendance at the opening meeting should be kept.
The purpose of the meeting is to:
 present or to confirm the audit plan;
 clarify how the audit activities will be undertaken;
 establish communication.
The meeting should be chaired by the audit team leader and the following items
considered, as appropriate:
 introduction of the participants, including an outline of their roles;
 confirmation of the audit objectives, scope and criteria;
 confirmation of the audit plan and other relevant arrangements with the auditee,
such as the date and time of the closing meeting, any interim meetings
between the audit team and the auditee's management, and any late changes;
 methods and procedures to be used to conduct the audit, advising the auditee
that the audit will only be a sample of the information available and of the
element of uncertainty inherent in all audits;
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3. OPENING MEETING, continued
 confirmation of formal communication links between the audit team and the
auditee;
 confirmation that during the audit, the auditee will be kept informed of audit
progress;
 confirmation that any resources and facilities needed by the audit team are
available;
 confirmation of matters relating to confidentiality;
 confirmation of relevant work safety, emergency and security procedures for

the audit team;
 confirmation of availability, roles and identity of any guides;
 method of reporting including the classification of non-conformities;
 information about any audit appeal system.
At the end of the opening meeting opportunity should be given to the auditee to ask
any questions.
An opening meeting checklist is set out in Appendix 10.
In many audit situations, for example, surveillance audits or internal audits, the
opening meeting may consist of simply that an audit is taking place, so the above list
is neither prescriptive nor exhaustive.
The golden rules are:
 keep it brief and concise;
 keep control.
Following the opening meeting, auditors may request a short tour of the premises to
familiarise themselves with the layout of the organisation.
Opening meetings for internal audits may be less formal. Escorts, representatives,
formal opening and closing meetings may not be necessary for Internal Audits.
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4. SOCIAL SYSTEM AUDIT TOOLS AND TECHNIQUES
There are many types of audit evidence available when performing a social
accountability audit and this evidence can be gathered using a number of useful tools
and techniques. These methods of gathering evidence should be incorporated into
the audit plan so that they can be used effectively to help with the collection of
corroborating evidence.
4.1 Focus groups
Focus groups are used to gather evidence directly from workers through a
group interview. The reasons for using this technique are that it creates a less
threatening atmosphere than one to one interviews can do and it optimises the
use of time whilst increasing the sample size of individuals interviewed.
Focus groups are generally held with a maximum of eight to ten individuals who
must be selected by the audit team. This is usually done through review of the
payroll, or through selection whilst touring the facilities. Participants should be a
peer group, so that all feel free to speak during the focus group interview. The
process needs to be made as anonymous as possible, and several focus
groups are better than just one.
The timing of focus groups is important. They should last about 30-40 minutes
and be scheduled either just after a break or start time, and not at the end of
the working day. Workers interviewed must not be penalised financially or
otherwise due to participation in the focus group.
The location of the focus group interview is also important to create an

unthreatening atmosphere, as well as minimising disruption. On some
occasions a company meeting room will be available, other alternatives which
may be suitable include the canteen area or an empty office. The focus group
should be free from interruptions and interference from management.
Focus group interviews generally focus on a few topics only, and it is often
useful to run duplicate focus groups on the same topics. The auditor should
start off by introducing themselves and the purpose of the focus group and
should explain the anonymity to ensure workers are happy to participate.
The auditor should use open questions and try to ensure everyone gets a
chance to speak. One useful technique is to ask each worker what their job role
is and how long they have been at the facility.
The auditor should take notes openly and explain their purpose during the
focus group, however they should be cautious about ascribing interviewees
names.
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4.1 Focus groups, continued
At the end of the focus group interview the auditor should ensure
understanding of any key issues that have arisen before thanking the
participants for their time and contribution.
4.2 Questionnaires
Questionnaires have several uses during a social accountability audit. They are
a means of obtaining information from a much larger sample size than would
be feasible to interview.
They also provide an opportunity to interview staff from another shift, for
example the night shift, who may not otherwise be able to contribute
information to the audit process.
The questionnaire should be tailored to the facility in question and should not
be too long, for example it should take no longer than 5-10 minutes to
complete.
It is absolutely crucial to ensure that those completing the questionnaire are

able to do so, for example that they are literate and that appropriate language
and terminology is used.
The questions should be simple and easy to answer and the process should
again be anonymous. Some example questions are provided below:
How many hours did you work last week?
Less than 24 24 - 48 48 - 60 More than 60
How does last week compare to a typical week?
Last week was less Last week was typical Last week was more
than usual than usual
If you had any concerns about working conditions, who would you raise them
with?
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4.2 Questionnaires, continued
NAME or POSITION
Have you ever raised such concerns?
YES NO
If so, have they been adequately dealt with?
YES NO Not Applicable
The analysis of answers from questionnaires should not be too complex, and it
must be arranged that questionnaires are distributed and collected early in the
audit process to provide sufficient time to complete the analysis and to follow
up any issues identified.
Distribution should be direct to employees, or through their representative and

they should be collected anonymously, for example through a drop-box in the
canteen.
Questionnaire results tend to be fairly general in nature and will usually require
some follow up to verify information provided.
4.3 Interviews and interviewing skills
As well as performance of focus group interviews, auditors will also be

interviewing individuals, both management and workers, on a one to one basis.
The number of people involved in interviews (both group and individual)
depends initially on the total number of employees. The key to a successful
interview is the consideration of the following issues:
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4.3.1 Language
Interviews should be conducted in the local language of the interviewee.

The use of translators is not good practice due to the loss of information
in the translation process. It also does not put the interviewee at ease.
Body language should also be considered to ensure an open approach,
bearing in mind any cultural norms.
4.3.2 Gender
The auditor’s gender should match that of the interviewee, particularly

when sensitive issues are being discussed and also in certain
circumstances depending on cultural norms.
4.3.3 Anonymity
The interviewee’s anonymity should be maintained, by maximising the

number of individuals interviewed, interviewing in private and taking care
over the recording of names of interviewees.
4.3.4 Questioning technique
The auditor should put the interviewee at their ease and start off with
open questions to get them talking. They should progress to more
detailed questions and only use closed questions to confirm
understanding.
The key to good questioning technique is to listen actively to the

interviewee, don’t make assumptions and tailor subsequent questions to
the previous response. If an auditor sticks rigidly to a pre-set list of
questions, the interview can appear to be more an interrogation process.
The interviewee should feel able to speak and that they are being listened
to and should not be made to feel uncomfortable.
4.3.5 Location and Timing
Interviews may be performed whilst touring the facility, although it is likely

that in these cases there will be a management representative present
who is accompanying the auditor, so questions should remain simple and
uncontroversial. Alternatively, individuals can be interviewed in a room
away from interruptions, in a similar way to conducting focus groups.
Consideration should be made to the timing of interviews to be after
breaks, and to minimise disruption.
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4.3.6 Record keeping
Notes taken during interviews should be concise and should reflect the
key issues that have been raised. Care should be taken in documenting
individual’s names to minimise the likelihood that comments are attributed
to them. However, it is often useful to have name details, to enable cross
checking with relevant records such as pay, hours and training records.
4.3.7 Verification
Corroboration of evidence gathered through interview is important, as

otherwise it can be seen as an individual’s opinion. This can be achieved
in several ways – cross checking relevant records, making your own
observations, or interviewing more people about the same issue.
4.4 Observation
Observation is a method of gathering audit evidence used throughout the audit,

and includes using all the senses. Commonly observations are used during a
tour of the facilities and will be verified by having a guide to accompany the
audit team.
Detailed notes should be made of any key issues observed, and on some types
of audit, for example first or second party audits, photographs may be taken to
demonstrate the observed evidence. Examples of observations include the
interaction of management and workers; noise, odour and other potential
hazards; custom and practice in the work place.
However, it is important to ensure that the auditor remains unbiased and

therefore cultural and local knowledge can sometimes be crucial to
understanding and evaluating different situations that are observed.
4.5 Documents and records
There are numerous documents and records that an auditor may wish to review
as part of the audit. In fact, clause 9.14 of the standard states that:
“The company shall maintain appropriate records to demonstrate conformance

to the requirements of this standard.”
The audit team will therefore have to take a sample of records of each relevant
type for review.
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4.5 Documents and records, continued
Examples of relevant records include:
 payroll – indicating the number of staff, their age, their department and
level in the company;
 time cards – indicating the hours of work for each employee; training
records – specifically required for health and safety training;
 sickness records – can indicate underlying problems;
 recruitment procedure – to determine whether the company is

discriminating unfairly during recruitment;
 Material Safety Data Sheets (MSDS) – indicating that the company are
aware of the hazards of chemicals on site and are managing those
hazards appropriately;
 meeting minutes – for example; for Management Review, meetings of

worker committees and so on.
5. FACTORS AFFECTING SAMPLING
Throughout the audit the team has to take samples of evidence to determine the
extent to which the organisation conforms to the requirements. The key to successful
sampling is to determine an appropriate sample size which provides sufficient
evidence that the auditor can confidently evaluate to determine conformity with
requirements.
The following diagram provides some guidance on this process:
Potential Business Risk

and/or
Endemic Local Concern
High
and/or
Relative Heterogeneity of
the workforce
Level of Operator Competence

Factor and/or
Amount of Documentation
and/or
Quality of internal
Low monitoring
Small Large
Sample size
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5. FACTORS AFFECTING SAMPLING, continued
For example, if there is a high level of local concern about a particular issue, such as
the use of illegal workers, then the auditors should take a relatively large sample of
evidence to determine whether or not it is happening at this facility.
Similarly, if the workforce is highly heterogeneous, for example many different types
of individuals, the audit team will need to take a larger sample for interview than if the
workforce was all very similar.
If the company are performing high quality internal monitoring of their systems and
activities, the audit team can take a relatively small sample in those areas and have
confidence in the results they find.
6. RELIABILITY AND AVAILABILITY OF EVIDENCE
Experience in performance of social accountability audits has shown that in some

areas of the standard the evidence is less reliable and less available than in others,
as indicated on the diagram below.
In those areas where evidence is mainly verbal testimony and information from other
interested parties, the reliability and availability tend to be lower than those areas
where evidence can be gained from records, documents and auditor observation.
High
Hours of work Wages
Discipline
Health and safety
Reliability
of Freedom of
evidence Association
Child labour
Discrimination
Forced labour
Low
Low Availability of evidence High
The implications of this is that where evidence is less reliable and/or less available,
larger samples will be needed to give the auditors confidence in their findings. In
practice, audit findings tend to be skewed towards those areas where evidence is
more reliable and available, such as working hours, pay and health & safety.
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WORKSHOP 5: AUDIT PREPARATION

Purpose
 To enable Learners to conduct a document review and to prepare for a social

systems audit.
Task
- Read the case study material.
- Assess the content against the relevant requirements to determine conformity of

the documented information with the requirements.
Output
 You will be asked to present your report, checklist and findings for discussion by the
whole class.
Time Allowed
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WORKSHOP 6: FOCUS GROUP: ROLE PLAY EXERCISE

Purpose
 To enable Learners to participate in a role play exercise and to consider the technical
and emotional issues relevant to the process and allow evaluation of the tool in
Social System audits.
Task
 You will be provided with individual roles with which they should become familiar.
 You have to:
- Read, familiarise and prepare for the role play in character.
- Participate in role as you deem appropriate or as directed by the tutor.
- Provide self-evaluation and evaluation of the roles and techniques used.
Output
 Presentation of the group findings will be by course discussion.
Time Allowed
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SESSION ELEVEN
Session Eleven
Stage 2 Audit: Report and

Conclusions; Addressing
Corrective Actions
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SESSION ELEVEN
STAGE 2 AUDIT: REPORT AND CONCLUSIONS; ADDRESSING

CORRECTIVE ACTIONS
OBJECTIVES
- describe the purpose, structure, content and attendees typically at audit review
meetings;
- understand the processes of identifying and drafting finding statements;
- explain the methods for identifying nonconformities;
- describe the purpose and typical content of Corrective Action Plan Report (CAPR)
- describe the preparation, approval and distribution of audit reports;
- explain the roles and responsibilities for taking and verifying corrective action;
- explain the steps necessary to address corrective actions;
- identify the audit evidence that may be required to demonstrate effective
implementation of corrective and preventive action;
- understand the role of the management review;
- appreciate the steps necessary to follow-up and close out corrective actions.
KEY POINTS
 Audit review meeting.
 Audit findings.
 Finding statements.
 Corrective Action Plan Report (CAPR).
 Potential issues (opportunities for improvement).
 Presenting the findings.
 Reporting on the audit.
 Audit completion.
 Corrective action.
 Management review.
 Follow-up and close out.
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STAGE 2 AUDIT: REPORT AND CONCLUSIONS; ADDRESSING

CORRECTIVE ACTIONS
1. AUDIT REVIEW MEETING
When the audit is complete, the auditor team leader must conduct a private review of
the findings. Interim or end of day reviews may also be necessary. The review will
involve all the members of the audit team.
The review will include:
 a study of notes and/or comparison of notes with team members;
 a review of checklists;
 review and discuss the evidence presented;
 examine the observations made and reach consensus on the findings;
 determine the compliance status of each clause within the audit;
 examine specific documentation or evidence to verify identified non-

compliances;
 develop the CAPR.
2. AUDIT FINDINGS
Until it is classified, an audit finding may be a:
 nonconformity;
 non-conformance;
 non-compliance;
 opportunity for improvement (potential issue).
A nonconformity or non-compliance (ETI Base Code; SMETA) arises when the

process or procedure being audited is not being conducted or completed as it should.
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2. AUDIT FINDINGS, continued
A non-compliance or non-conformity may be a failure to:
 comply with the SMETA / ETI requirements;
 implement social system policy, procedure or documented requirements

specified by the organisation;
 implement a legislative or contractual requirement.
If there is no specified requirement, there can be no nonconformity. What an auditor

thinks should be done is not a specified requirement.
Non-conformities should be recorded and supported by audit evidence. Non-

conformities should be reviewed with an appropriate auditee representative to obtain
acknowledgement of the audit evidence. The auditee representative’s
acknowledgement indicates that the audit evidence is accurate, and that the non-
compliance is understood. Every attempt should be made to resolve any divergence
of opinion concerning the audit evidence, and unresolved points should be recorded.
Sometimes during an audit, an auditor may identify a deficiency that is then

effectively resolved by management before the closing meeting. In a situation such
as this, provided the auditor is convinced that the matter has indeed been resolved, it
should not be raised formally at the closing meeting. A record should be made by the
auditor to verify that the action implemented is complete and acceptable.
2.1 When are finding statements written?
A “finding statement” is a written account of the non-conformance or non-

compliance.
Some auditing organisations insist on finding statements being written out

immediately a deficiency is identified and the representative's signature
obtained. However, an auditor should ensure that all relevant evidence is
gathered before making a decision. The best practice is to:
 go over the facts verbally and agree the nature of the non-compliance
with the auditee, detailing the audit evidence;
 make notes and consult these later to make a statement;
 draft finding statements during a working lunch or at the end of the day,
then finalise at the private review.
When working as a member of an audit team, the auditor will need to review
the evidence with the team before deciding the wording of a finding statement
and its classification.
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3. FINDING STATEMENT
The finding statement should contain:
 overview of finding;
 description of the non-conformance or non-compliance;
 example of audit evidence;
 summary of the local law or ETI requirement.
Below are examples of finding statements:
Example 1:
Employees are contracted to work standard hours in excess of 48 hours per week.
For example, engineers’ shift rota comprises an average standard week of 56 hours.
The maximum standard working week is defined in ETI Base Code as being 48
hours.
Example 2:
Employees are not wearing PPE. For example, production personnel were observed
not wearing hearing protection in the production hall, which is designated as a
mandatory area for hearing protection and has signage to that effect. The ETI Base
Code 3.1 requires that the company provide a safe and healthy working environment
and take adequate steps to prevent accidents and injury to health.
A number of similar nonconformities may be grouped by process, function, procedure

or specification clause into a single finding statement.
4. CORRECTIVE ACTION PLAN REPORT (CAPR)
The Corrective Action Plan Report summarizes the on-site audit findings and a
corrective and preventative action plan that both the auditor and the organisation
believe is reasonable to ensure conformity with the ETI Base Code, local laws and
any additional audited requirements.
It is used to describe a nonconformity, non-conformance or non-compliance and

request action.
The CAPR is raised after careful consideration at the audit review prior to the closing
meeting with the organisation.
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4. CORRECTIVE ACTION PLAN REPORT (CAPR), continued
After the initial audit, the CAPR is used to rerecord actions taken and to categorise
the status of the non-compliances. The recommended completion date should be
discussed between the factory management and the auditor at the closing meeting to
agree on realistic timeframes. This date is only a guidance and it is the responsibility
of the factory to discuss exact dates or changes with their local client contact if
appropriate.
There are two signature lines on the CAPR:
Line 1 – Non-compliances agreed.
The auditor should make every effort to reach agreement with the facility and obtain
signature of the representative.
Line 2 – Where there are any unresolved non-compliances.
The representative should be invited to complete the second part of the signature
box.
5. SMETA AUDIT REPORT
5.1 Audit report preparation and content
The audit team leader is responsible for the preparation, accuracy and
completeness of the SMETA audit report. The audit report should provide an
accurate record of the audit and should contain audit conclusions on issues
such the extent of conformance to the audit criteria and details of the issues
raised. The audit report should include, or make reference to:
 the identification of the organisation or processes audited;
 the identification of the audit client;
 the agreed audit objectives, scope, exclusions and plan;
 the audit criteria, including a list of reference documents, against which the
audit was conducted;
 the identification of audit team members;
 the place(s), date(s) and times that the audit was conducted;
 a list of non-compliances table;
 a breakdown of workers employed;
 details relating to the facility audited;
 the audit results by clause.

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5.2 Report approval and distribution
The audit report should be issued within the agreed time period. If this is not
possible, the reasons for the delay should be communicated to the audit client
and a revised issue date should be agreed.
The audit report should be dated and signed by the audit team leader and
reviewed and approved as defined in appropriate documented procedures.
The audit report should then be distributed to recipients designated by the audit
client.
The audit report is the property of the audit client and confidentiality should be
respected and appropriately safeguarded by the audit team members and all
report recipients.
6. CLASSIFICATION OF CAPRS
The non-conformances as not classified as such but the more serious the non-
conformances the more immediate must be action taken by the organisation to
correct the deficiency.
7. OTHER POTENTIAL ISSUES OR OPPORTUNITIES FOR IMPROVEMENT
Auditors are expected to comment on other potential issues or “Observations”.
In many ways, these are the added-value part of the audit. They are the points on
which the auditor may wish to comment but for one reason or another, are not
reported as NCs.
A potential issue (opportunity for improvement) may include:
 areas of concern which are not yet serious enough to warrant CAPRs;
 situations which if not addressed may give rise to CAPRs at a later date;
 deficiencies for which the auditor is prepared to give the organisation the
“benefit of the doubt”;
 and suggestions for action to improve the effectiveness of the social

management system.
Potential issues provide a flexible method of reporting for the auditor in that although
they have no formal status, observations can make the difference between a positive
and negative audit.
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7. OTHER POTENTIAL ISSUES OR OPPORTUNITIES FOR IMPROVEMENT,

continued
Because potential issues (opportunities for improvement) can add value to an audit,
many organisations regard them in much the same way as CAPRs; that is, actions
taken in response to these are reviewed and evaluated during future audits.
8. PRESENTING THE FINDINGS
When the review is complete the auditor/team will present the findings to
management at a “closing meeting”.
8.1 Closing meeting
A closing meeting, chaired by the audit team leader, should be held with the
auditee's management and those responsible for the functions audited.
Records of attendance at the closing meeting should be kept. The aim of the
closing meeting is to inform and agree with the facility management the findings
of the audit and to verify their confirmation of the findings through signing off
the CAPR and agree timescales. It is intended that all issues be closed out by
the end of the meeting.
Appendix 11 contains a closing meeting checklist.
During the closing meeting, the auditor/team leader must:
 explain all findings and evidence carefully and precisely;
 be prepared to support and justify findings;
 avoid being drawn into an argument;
 apologise if an error transpires and alter or withdraw the CAPR if

necessary;
 refuse the 'quick fix' as a sole solution to the finding. The management
must investigate and attempt to correct the root cause of the problem to
prevent any recurrence.
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9. REPORTING ON THE AUDIT
9.1 Report approval and distribution
The SMETA audit report and CAPR is issued to the payee and any authorised
third parties in PDF within the agreed timescales.
9.2 Sedex Uploading
The auditor advises the auditee of the requirement and process of the Sedex
uploading and management process and associated fees for these services.
On receipt of the uploading prompt the audit body uploads the report and
monitors non-compliances and verifies the issues.
9.3 Retention of documents
Work documents and reports pertaining to the audit should be retained or

destroyed by agreement between the participating parties and in accordance
with audit procedures and any applicable requirements.
Unless required to do so by law, the audit team and audit programme

management should not disclose the contents of documents, the nature of any
other information obtained during the audit, or the audit report, to any other
party without the explicit approval of the audit client and, where appropriate, the
approval of the auditee.
10. AUDIT COMPLETION
The audit is completed when all activities in the audit itinerary have been concluded,
including the distribution of the approved audit report.
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11. CORRECTIVE ACTION
In processing CAPRs, the auditor and auditee have specific responsibilities. The
auditee's management must, in conjunction with the management representative:
 investigate and clearly identify the problem;
 propose a programme of long-term corrective action;
 agree a target date for completion;
 introduce changes;
 verify effectiveness by internal audit;
 notify auditor of conformity;
 link with continuous improvement measures.
At this stage, one of the responsibilities of the auditor is to advise on corrective

action at the closing meeting. The auditor will need to ensure the immediate
remedial action is taken and that long-term corrective action proposed will prevent a
recurrence of the non-compliance.
To resolve the non-compliance. The management of the area that has been audited
should:
 take immediate action to correct the non-compliance;
 analyse the effects of the non-compliance on the product or service;
 identify the root cause of the problem;
 initiate a similar investigation into other areas where the problem may exist;
 develop effective actions to prevent a recurrence of the non-compliance;
 implement and monitor the corrective action.
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12. MANAGEMENT REVIEW
The results on internal and external audits should be reported to the Management
Review. Here the results will be analysed and the status of corrective actions
reported. Further actions to prevent recurrence impacting on the wider business
policy, customer satisfaction, continuous improvement programmes and measures
should be identified and implemented if necessary.
13. PREVENTIVE ACTION
Information and data from the effective implementation of the social management
system, and internal and external audits should be analysed and reported to the
Management Review. Management should support processes, activities and actions
to eliminate the causes of potential nonconformities within the social management
system. Such actions will need to be appropriate to the effects of the potential
problems.
14. FOLLOW-UP AND CLOSE-OUT
14.1 Audit follow-up
The audit client or auditee is responsible for determining any corrective action
needed to deal with a non-compliance. Corrective action and subsequent
follow up actions, which may include additional audits, should be completed
within an agreed time period. The auditee should keep the auditor informed of
the status of corrective action activities.
Corrective action should be verified in accordance with the appropriate

documented procedure. A follow-up report may be prepared and distributed in
a manner similar to the original audit report.
The process of determining whether the corrective action requested has been
implemented is called "follow-up". This can be done by reviewing
documentation submitted by the client or by visiting the client's premises.
The action relating to the verification and acceptance of corrective action by the
auditor is called "close-out".
Methods of "close-out" will include re-audit of deficient areas, where physical

evidence has to be seen, or review of new and/or revised documentation.
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14.1 Audit follow-up, continued
The auditor will verify the effectiveness of corrective actions by visiting the
organisation by:
 carrying out an audit of available evidence;
 verifying that the corrective actions have been implemented;
 ensuring short and long term effectiveness;
 recording details of the follow-up;
 signing-off the forms.
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WORKSHOP 7: EVALUATING EVIDENCE

Purpose
 To enable Learners to exercise the skills of evaluating evidence against a set of

criteria.
Task
 You will be divided into teams and provided with a set of wage records, a calendar,
local law requirements and a check list.
- Read and evaluate the study material.
- Assess the content against the relevant requirements to determine conformity of

the documented information with the requirements given.
- Complete the checklist based on the case study material and the relevant
requirements for use during an audit of these areas.
Output
 You will be asked to present back your checklist and findings for discussion by the
whole class.
Time Allowed
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WORKSHOP 8: GATHERING EVIDENCE THROUGH MANAGEMENT

INTERVIEW
Purpose
 To enable Learners to practice using the knowledge gained in conducting an

interview.
Task
 You will conduct a simulated audit interview and review of evidence against the
scope and requirements of the documentation and relevant requirements of the
social system. Tutor(s) will act as interviewee’s and will use the exercise to highlight
some important issues.
 You are to:
- Conduct a simulated audit exercise with the tutors acting as auditees including:
- Brief opening meeting with auditee staff.
- Interview of staff (all delegates must participate in the interview process).
- Review and evaluation of evidence to test the effectiveness of the system.
Output
 No formal presentations, however, the tutor will debrief the teams on their
performance in the simulated interview.
Time Allowed
 Workshop: 10 minutes per group.
 Feedback: Ongoing.
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WORKSHOP 9: REVIEWING AND REPORTING ON AN AUDIT

Purpose
 To enable Learners to practice the audit review process and the documentation of
audit findings.
Task
 Lead Auditor. The team is to review the case studies and prepare appropriate CAR
reports.
 You are to:
- Hold an audit review meeting and discuss each case study to determine the audit
findings, including:
- whether any requirements of the standard have not been fulfilled; and if so.
- the severity of the non-conformity.
- Document your audit findings using the CAR report forms.
Output
 You will be asked to each submit a CAR form to the tutor for evaluation. Individual
feedback will be provided.
Time Allowed
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APPENDICES
Appendices
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CONTENTS
Appendix 1: Glossary of Terms and Definitions ................................................................. 169
Appendix 2: Relevant International Standards .................................................................. 178
Appendix 3: Initial Certification Audit Process ................................................................... 180
Appendix 4: Audit Length .................................................................................................. 181
Appendix 5: Example of an Internal Audit Report .............................................................. 183
Appendix 6: Audit Checklist............................................................................................... 184
Appendix 7: Example of a Completed Audit Checklist ....................................................... 185
Appendix 8: Flowchart of the On-Site Audit Process ...................................................... 186
Appendix 9: Facility Documents ........................................................................................ 187
Appendix 10: Opening Meeting Checklist .......................................................................... 189
Appendix 11: Closing Meeting Checklist ........................................................................... 190
Appendix 12: The Chartered Quality Institute Professional Code of Conduct .................... 192
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APPENDIX 1: GLOSSARY OF TERMS AND DEFINITIONS
AUDIT
Systematic, independent and documented process for obtaining

audit evidence and evaluating it objectively to determine the ISO 19011:2011
extent to which audit criteria are fulfilled
AUDIT CONCLUSION
Outcome of an audit provided by the audit team after

ISO 19011:2011
consideration of the audit objectives and all audit findings
AUDIT CRITERIA
Set of policies, procedures or requirements used as a reference ISO 19011:2011
AUDIT EVIDENCE
Records, statements of fact or other information which are

ISO 19011:2011
relevant to the audit criteria and verifiable
AUDIT FINDINGS
Results of the evaluation of the collected audit evidence against

ISO 19011:2011
audit criteria
AUDIT PLAN
Description of the activities and arrangements for an audit ISO 19011:2011
AUDIT PROGRAMME
Set of one or more audits planned for a specific time frame and
ISO 19011:2011
directed towards a specific purpose
AUDIT SCOPE
Extent and boundaries of an audit ISO 19011:2011
AUDIT TEAM
One or more auditors conducting an audit ISO 19011:2011
AUDITEE
Organisation being audited ISO 19011:2011
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AUDITOR
A person with the competence to conduct an audit ISO 19011:2011
CERTIFICATION BODY / REGISTRAR / AUDITING

ORGANISATION
An organisation that conducts management system audits to a

recognised standard
CHILD
Any person less than 15 years of age, unless the minimum age
for work or mandatory schooling is stipulated as being higher by
SA 8000:2014
local law, in which case the stipulated higher age applies in that
locality
CHILD LABOUR
Any work performed by a child younger than the age(s)

specified in the above definition of a child, except as provided SA 8000:2014
for by ILO recommendation 146
COLLECTIVE BARGAINING AGREEMENT
A contract for labour negotiated between an employer or group

of employers and one or more worker organisations, which SA 8000:2014
specifies the terms and conditions of employment
ORGANISATION
The entirety of any business or non-business entity responsible

for implementing the requirements of this Standard, including all
personnel employed by the organisation. Note: For example, SA 8000:2014
organisations include: companies, corporations, farms,
plantations, cooperatives, NGOs and government institutions
COMPETENCE
Demonstrated personal attributes and demonstrated ability to

SA 8000:2014
apply knowledge and skills
CONFORMITY
Fulfilment of a requirement ISO 19011:2011
CONTINUAL IMPROVEMENT
Recurring activity to increase the ability to fulfil requirements ISO 19011:2011
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CORRECTION
Action to eliminate a detected nonconformity ISO 19011:2011
CORRECTIVE ACTION
Action to eliminate the cause(s) and root cause(s) of a detected

non-conformance. Note: Corrective action is taken to prevent SA 8000:2014
recurrence
PREVENTIVE ACTION
Action to eliminate the cause(s) and root cause(s) of a potential

non-conformance. Note: Preventive action is taken to prevent SA 8000:2014
occurrence
CORRECTIVE ACTION REQUEST - CAR
A Form used by some auditing organisations to request that

action be taken to correct a non-conformance identified during
an audit
CUSTOMER
Organisation or person that receives a product ISO 19011:2011
DOCUMENT
Information and its supporting medium

NOTE 1: In this standard, records are distinguished from
documents by the fact that they function as evidence of
ISO 19011:2011
activities, rather than evidence of intentions.
NOTE 2: Examples of documents include policy statements,
plans, procedures, service level agreements and contracts
EFFECTIVENESS
Extent to which planned activities are realised and planned

ISO 19011:2011
results achieved
EFFICIENCY
Relationship between the result achieved and the resources

ISO 19011:2011
used
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FIRST PARTY AUDIT (also called Internal Audit)
An audit conducted by, or on, behalf of, the organisation itself

for management review and other internal purposes, and may
form the basis for an organisation’s self-declaration of
ISO 19011:2011
conformity. In many cases, particularly in smaller
organisations, independence can be demonstrated by the
freedom from responsibility for the activity being audited
FORCED LABOUR AND COMPULSARY LABOUR
All work or service that a person has not offered to do

voluntarily and is made to do under the threat of punishment or SA 8000:2014
retaliation, or is demanded as a means of repayment of debt
HOMEWORKER
A person who is contracted by the company or by a supplier,

sub-supplier or subcontractor, but does not work on their SA 8000:2014
premises
HUMAN TRAFFICKING
The recruitment, transfer, harbouring or receipt of persons, by

means of the use of threat, force, other forms of coercion, or SA 8000:2014
deception for the purpose of exploitation
INFRASTRUCTURE
System of facilities, equipment and services needed for the

ISO 19011:2011
operation of an organisation
INFORMATION
Meaningful data ISO 19011:2011
INSPECTION
Conformity evaluation by observation and judgement

accompanied as appropriate by measurement, testing or ISO 19011:2011
gauging
INTERESTED PARTY
Person or group having an interest in the performance or

ISO 19011:2011
success of an organisation
INTERESTED PARTY
An individual or group concerned with or affected by the social

SA 8000:2014
performance of the company
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INTERNAL AUDIT (also called First Party Audit)
An audit conducted by, or on, behalf of, the organisation itself

for management review and other internal purposes, and may
form the basis for an organisation’s self-declaration of
ISO 19011:2011
conformity. In many cases, particularly in smaller
organisations, independence can be demonstrated by the
freedom from responsibility for the activity being audited
MANAGEMENT
Coordinated activities to direct and control an organisation ISO 19011:2011
MANAGEMENT SYSTEM
System to establish policy and objectives and to achieve those

ISO 19011:2011
objectives
NONCONFORMITY
Non-fulfilment of a requirement ISO 19011:2011
OBJECTIVE EVIDENCE
Data supporting the existence or verity of something ISO 19011:2011
ORGANISATION
Group of people and facilities with an arrangement of

ISO 19011:2011
responsibilities, authorities and relationships
PERSONNEL
All individual men and women directly employed or contracted

by a company, including directors, executives, managers, SA 8000;2014
supervisors, and workers
PREVENTIVE ACTION
Action taken to eliminate the cause of a potential nonconformity

ISO 19011:2011
or other undesirable potential situation
PROCEDURE
Specified way to carry out an activity or a process ISO 19011:2011
PROCESS
Set of interrelated or interacting activities which transforms

ISO 19011:2011
inputs into outputs
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PROCESS FLOW DIAGRAM
A map of a sequence of events or a combination of activities,

inputs, controls and outputs
PRODUCT
Result of a process ISO 19011:2011
RECORD
Document stating results achieved or providing evidence of

ISO 9001:2015
activities performed
REMEDIATION OF CHILD LABOURERS
All support and actions necessary to ensure the safety, health,

education, and development of children who have been
SA 8000:2014
subjected to child labour, as defined above, and have been
subsequently dismissed
REQUIREMENT
Need or expectation that is stated, generally implied or

ISO 19011:2011
obligatory
REVIEW
Activity undertaken to determine the suitability, adequacy and

effectiveness of the subject matter to achieve established ISO 9001:2015
objectives
REWORK
Action on a nonconforming product to make it conform to the

ISO 9001:2015
requirements
SECOND PARTY AUDIT
Also referred to as a Supplier Audit. An audit conducted by

parties having an interest in the organisation, such as ISO 19011:2011
customers, or by other persons on their behalf
SPECIFICATION
Document stating requirements ISO 9001:2015
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SOCIAL SYSTEMS PROVISIONAL INTERNAL AUDITOR
This grade is suitable if you have attended an internal auditor

training course, but have not conducted any audits. We offer IRCA 1000
you formal recognition of your training and abilities.
SOCIAL SYSTEMS INTERNAL AUDITOR
This grade is suitable if you conduct internal ‘partial system’

audits of your own organisation’s management system, or a
IRCA 1000
supplier’s management system. You are probably not a full time
auditor
SOCIAL SYSTEMS PROVISIONAL AUDITOR
This grade is suitable if you have attended an internal auditor

training course, but have not conducted any audits. We offer IRCA 1000
you formal recognition of your training and abilities.
SOCIAL SYSTEMS AUDITOR
This grade is suitable if you conduct 'full system' audits as a

member of a team or as a sole auditor. They may be internal IRCA 1000
full system audits, second-party or third-party audits
SOCIAL SYSTEMS LEAD AUDITOR
This grade is suitable if you are a competent auditor

IRCA 1000
experienced at managing audits and leading teams.
SOCIAL SYSTEMS PRINCIPAL AUDITOR
This grade is suitable if you are a senior audit professional with

an extensive history of conducting full-system audits, but you
may no longer lead teams or audit regularly. Principal auditors IRCA 1000
have often moved into training, consultancy or management
roles.
SUPPLIER/SUBCONTRACTOR
Any entity or individual(s) in the supply chain that directly

provides the organisation with goods or services integral to,
SA 8000:2014
utilised in or for the production of the organisation’s goods or
services
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SUB-SUPPLIER
Any entity or individual(s) in the supply chain that provides the

supplier with goods and/or services integral to, utilised in or for
SA 8000:2014
the production of the supplier’s or the organisation’s goods or
services
SYSTEM
Set of interrelated or interacting elements ISO 19011:2011
TEST
Determination of one or more characteristics according to a

ISO 19011:2011
procedure
THIRD PARTY AUDIT
An audit of an organisation conducted by external, independent

auditing organisations, such as those providing registration or ISO 19011:2011
certification of conformity to the requirements of ISO 22000
TOP MANAGEMENT
Person or group of people who directs and controls an

ISO 9001:2015
organisation at the highest level
TRACEABILITY
Ability to trace the history, application or location of that which

ISO 9001:2015
is under consideration
VALIDATION
Confirmation. through the provision of objective evidence, that

the requirements for a specific or intended use or application ISO 9001:2015
have been fulfilled
VERIFICATION
Confirmation, through the provision of objective evidence, that

ISO 9001:2015
specified requirements have been fulfilled
WORK ENVIRONMENT
Set of conditions under which work is performed ISO 9001:2015
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WORKER ORGANISATION
An autonomous voluntary association of workers organised for

the purpose of furthering and defending the rights and interests SA 8000:2014
of workers
YOUNG WORKER
Any worker over the age of a child, as defined above, and

SA 8000:2014
under the age of 18
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APPENDIX 2: RELEVANT INTERNATIONAL STANDARDS

With respect to human rights the most comprehensive standard is the United Nations
Universal Declaration of Human Rights. The most comprehensive and universally
applicable standard directly addressing the responsibilities of business operating
internationally is the International Labor Organisation's Tripartite Declaration of Principles
concerning Multinational Enterprises and Social Policy.
Another comprehensive standard addressing the responsibilities of business operating

internationally, and one that is applicable to all businesses operating internationally in or
from the United Kingdom is the Guidelines for Multinational Enterprises developed by the
Organisation for Economic Co-operation and Development (OECD). Another relevant
standard ratified by almost every member state in the United Nations is the United
Nations Convention on the Rights of the Child.
Responsibility for setting international labor standards is given by the international

community to the International Labor Organisation (ILO) which was established for this
purpose. The tripartite structure of the ILO, involving both employers' and workers'
representatives as well as governments, together with the technical expertise of this
organisation in all matters relating to the world of work, make the ILO the authoritative
and legitimate source of international labor standards.
ILO standards are set in Conventions, having the force of international law and binding for
states that have ratified them and in Recommendations which provide additional
guidance to governments. ILO member states must provide regular reports on the
application of ratified Conventions to the ILO. The findings of ILO supervisory bodies form
ILO jurisprudence.
With the adoption in June 1998 of the ILO Declaration on Fundamental Principles and
Rights at Work, all 174 ILO member states have an obligation, regardless of ratification,
to respect, promote and realise the principles contained in the core ILO Conventions.
These core Conventions and their accompanying Recommendations comprise:
 ILO Conventions 29 and 105 & Recommendation 35 (Forced and Bonded Labor)
 ILO Convention 87 (Freedom of Association)
 ILO Convention 98 (Right to Organise and Collective Bargaining)
 ILO Conventions 100 and 111 & Recommendations 90 and 111 (Equal
Remuneration for male and female workers for work of equal value; Discrimination in
employment and occupation)
 ILO Convention 138 & Recommendation 146 (Minimum Age).
 ILO Convention 182 & Recommendation 190 (Worst forms of Child Labor)
 ILO Convention 81 (Labor Inspection)
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 ILO Convention 122 (Employment Policy).
Although not core ILO conventions, other ILO standards especially relevant to the work of
ETI include:
 ILO Convention 135 & Recommendation 143 (Workers' Representatives Convention)
 ILO Convention 155 & Recommendation 164 (Occupational Safety & Health)
 ILO Convention 159 & Recommendation 168 (Vocation Rehabilitation &

Employment/Disabled Persons)
 ILO Convention 177 & Recommendation 184 (Home Work).
 ILO Convention 190 & Recommendations (Safety and Health in Agriculture)
 ILO Convention 154 (Collective Bargaining)
 ILO Convention 131 (Minimum Wage Fixing)
 ILO Convention 175 (Part time work)
 ILO Convention 183 (Maternity Protection).
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APPENDIX 3: INITIAL CERTIFICATION AUDIT PROCESS
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APPENDIX 4: AUDIT LENGTH
Below is an “auditor day” table setting out the number of auditor days, individual and
group interviews and sample size. Group worker interviews, as well as sample size for
review of files and time/ wage records. The table excludes audit preparation, travel,
Sedex “report uploading time” and report writing, but includes production of a CAP
(Corrective Action Plan) on site.
For best practice ethical trade audits, worker interviews must include a representative
sample of people and departments within the production site including agency, contract
and migrant workers. These suggested auditor days are only guidelines. Auditors use
their discretion and consider industry, location and individual facility knowledge when
defining the number of employees to interview.
A5.1.1 Table for Auditor Days and Sample Size Audit Days for Full initial and Full Re-
Audit.
Worker Effective
No. of
Total Files/ Time
Audit Workers Individual Group
Employees Time & Spent
days (excl. Interviews Interviews
Interviewed Wage on
Managers)
Records Interviews
6 or total
1 group
1 1-100 workers 10 10 2.5 hrs
of 4
if<5
4 groups
2 101-500 6 26 26 6 hrs
of 5
6 groups
3 501-1000 12 42 42 8.5 hrs
of 5
1001- 8 groups
4 20 52 52 12.5 hrs
2000 of 5
8 groups
4 2000+ 22 62 62 14hrs
of 5
 If a site has more than 2000 workers, the number of interviews is determined on a
case by case basis depending on the circumstances of the facility. The suggested 62
is a minimum and this should increase as worker numbers increase. This is at the
discretion of the auditor and in agreement with the audit requestor.
 For primary producers 2-Pillar: Where appropriate consideration should be given to

the size and spread and the number of growing locations to ascertain auditor days
required.
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 Higher numbers of auditor days may require the use of more than one auditor, 2 or
more auditors in an audit team will allow for a balance of skills, or improve the gender
balance. However, when deciding the size of team, consideration must be given to
the size of supplier site and the potential disruption caused by a large audit team.
 For a 4-Pillar SMETA Audit the guide is an additional 0.5 auditor days for the
additional procedures of extended environmental and business practices
assessment.
 Where a supply chain wishes to ‘top-up’ an existing 2-Pillar SMETA audits by

performing only environment and Best Practices, this should be discussed between
the audit requestor and auditor
NOTES: Since it may be impractical to arrange a 0.5 auditor days, a solution may be to
‘top-up’ during a follow-up audit.
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APPENDIX 5: EXAMPLE OF AN INTERNAL AUDIT REPORT
Organization:
Address: Date(s) on
site:
Lead Auditor:
Team
Member(s):
Standard(s):
Audit
Language:
Audit Scope &
Observations:
Criteria and
Reference
docs:
Area / Department / Process /
Date Time Auditor Key Contact
Function
Notes:
 Times are approximate and will be confirmed at the opening meeting prior to
commencement of the audit.
 Auditors reserve the right to change or add to the elements listed before or during the
audit depending on the results of on-site investigation.
 A private place for preparation, review and conferencing is requested for the auditor’s
use.
 Please provide a light working lunch on-site each audit day.
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APPENDIX 6: AUDIT CHECKLIST
Audit Reference: Sheet No.

of
Activity
Item Compliance
No. Requirement Comments/Remarks
(Yes/No/Not
Applicable)
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APPENDIX 7: EXAMPLE OF A COMPLETED AUDIT CHECKLIST
Audit Reference: Sheet No.

of
Activity
Item Compliance
No. Requirement Comments/Remarks
(Yes/No/Not
Applicable)
Management Review
Example agenda seen and

Is a Management Review
3.3 minutes from last two
carried out periodically? Y
meetings – held annually
Are top management Attendees at last meeting

3.4 involved in the Management included department heads
Y
Review process? and MD
Does the Management

Review process assess the Input to meeting included
3.5 adequacy, suitability and results of monitoring activities
Y
effectiveness of the
management system?
Not all actions from last two

meetings have been followed
Have system amendments
up or closed out. There is no
3.6 and improvements been
Y process for interim review of
implemented?
actions prior to next annual
review.
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APPENDIX 8: FLOWCHART OF THE ON-SITE AUDIT PROCESS

An overview of the on-site audit process from the gathering of information to the reaching
of audit conclusions.
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APPENDIX 9: FACILITY DOCUMENTS

Documents that could be available for the effective operation of the Social System at the
auditee organisation, "plant" or "facility".
This list provides examples; it is not intended to be fully comprehensive or fully inclusive.
Other documents may be necessary or available depending on the organisation, “plant”
or facility.
 Facility floor plan
 Applicable laws and regulations
 Labour contracts
 Employee handbook (terms and conditions of employment)
 Collective Bargaining Agreements (CBA)
 A list of all the chemicals and solvents used on this site
 Permits, operating licences, Certificates of Operations, etc.
 Government Inspection Reports, e.g., sanitation, fire safety, structural safety,
 Environmental compliance, etc.
 Machinery inspection/service logs
 Accident and injury log
 Emergency action procedures
 Evacuation plan
 Time records for the past 12 months
 Payroll records for past 12 months
 Piece rate records for the past 12 months (if applicable)
 Insurance, tax and other required receipts
 Production records
 Minutes of joint committees on OHS and disciplinary matters
 Previous ethical trade audit reports/Corrective Action logs
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APPENDICES
Facility polices:
 Child labour
 Wage and hours of work
 Disciplinary
 Benefits and allowances
 Health & Safety
 Environment
 Training
 Discrimination and harassment
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APPENDICES
APPENDIX 10: OPENING MEETING CHECKLIST
Item
Item
No.
Introduce self, position, organisation, experience

1
Introduce team
2 Ask those at meeting to introduce themselves
3 Confirm audit objectives, scope and criteria
Confirm audit plan:

 date and time of the closing meeting
4  any interim meetings between the audit team and the
auditee's management
 any late changes
Outline methods and procedures to be used to conduct the audit:

5  classification of nonconformities
 sampling technique
 element of uncertainty inherent in all audits
Establish formal communication links between the audit team and

6
the auditee
Confirm that during the audit, the auditee will be kept informed of
7
audit progress
Confirm that any resources and facilities needed by the audit team
8
are available
9 Confidentiality issues
10 Procedures relating to relevant work safety, emergency and security
11 Availability, roles and identity of any guides
12 Method of reporting including the classification of non-conformities
13 Audit appeal system
14 Any questions?
Also see SMETA BPG 2017
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APPENDICES
APPENDIX 11: CLOSING MEETING CHECKLIST

A closing meeting agenda will vary according to the type of audit conducted, but the
following list, which is neither exhaustive nor prescriptive, contains typical items on a
closing meeting agenda.
Item
Item
No.
Thank the management for their time and patience. Distribute

1.
attendance list
Remind them that they may challenge findings at this meeting, but
2.
any issues they have agreed to cannot be queried later
Ensure that any agreements or disagreements are clearly recorded

3.
on the CAP and that an outcome is achieved
4. Re-confirm the purpose and scope of the audit
Mention good working practices that have been observed during the
5.
day
Explain where instances have been observed that the facility is not in
compliance with ETI Base Code (clarify issue/date status ) with local
6.
law (if applicable ) and with the other requirements of the Sedex
members best practice guidance
Explain that the audit was based on a sample examination of their

7. facility and there may be some non-compliances that were not
observed
8. Suggest, or ask the management to suggest corrective actions
9. Ask the management to sign the CAP
If they do not agree with any finding, state that if they produce
10. evidence that shows the finding is incorrect, the audit team will
review it
If such evidence is produced, this should be verified via another

11. route such as employee interview, document review, and
observation before acceptance
If evidence is produced which clears a non-compliance, the non-

12. compliance can be cancelled, e.g. a fire certificate produced at the
closing meeting that previously had not been seen by the auditors
If a non-compliance can be corrected immediately, e.g. a blocked

13. gangway, it should be recorded as an observation. The auditor
should investigate and document how compliance will be maintained
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APPENDICES
Item
Item
No.
14. Ask the management team if they have any questions
Explain that the full report will be sent to the client who will be in
15.
contact with the facility
Inform the facility of the Sedex uploading and corrective action

16. management process and making them aware of their
responsibilities. Stress confidentiality
17. Obtain attendance list
18. Thank the management and leave
Also see SMETA BPG 2017
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APPENDICES
APPENDIX 12 THE CHARTERED QUALITY INSTITUTE

PROFESSIONAL CODE OF CONDUCT
For the purposes of this code “members” refers to all individuals whose competence is
recognised formally by The Chartered Quality Institute [The CQI]. This includes but is
not restricted to CQI members, IRCA registered auditors and individuals on other CQI
registers, as well as all members of the Board of Trustees, Advisory Council and other
governance bodies.
Statement of Personal Responsibility
It is the ethical and professional responsibility of all members to demonstrate the required
professional competence and behaviours in discharging the responsibilities of their role.
Members must uphold the highest ethical standards and integrity in exercising their
professional duties or other activities which might impact on the reputation of the
profession and of the CQI.
In support of these aims all members are expected to understand and comply with this
code of conduct.
Furthermore, the CQI reserves the right to suspend or withdraw membership and all
associated benefits from members who fail to comply with this code of conduct, in
accordance with the Enforcement Processes detailed below.
Professional Competence and Behaviour
In recognising the values and requirements of this code of conduct members shall:
1.1. Maintain professional knowledge and competence in order to successfully

undertake their role.
1.2. Act with due skill, care and diligence and with proper regard for professional
standards.
1.3. Undertake appropriate continuing professional development and record it in an

appropriate manner.
1.4. Ensure that clients, employers and others who may be affected by their activities
are not misled or ill-informed with regard to their level of competence and capability
to successfully discharge their responsibilities.
1.5. Seek appropriate support whenever they are aware that their level of competency
(knowledge, skills, behaviours and experience) might be lacking with respect to the
responsibilities they are assigned.
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APPENDICES
1.6. Accept responsibility and accountability for their own professional actions and
decisions.
1.7. Always act in a way which supports and upholds the reputation of the Quality
profession.
1.8. Work to ensure that the credibility and reputation of the CQI and all of its
stakeholders is protected.
1.9. Be mindful of the distinction between acting in a personal and in a professional

capacity.
1.10. When managing a team, ensure that those working for them have the appropriate
level of competence, supervision and support.
1.11. Co-operate fully with the Institute in assuring the effective implementation of this
Code of Conduct (including investigation and resolution of any alleged or actual
breaches).
Ethical Standards and Integrity
In recognising the values and requirements of this code of conduct members shall:
2.1 Seek to establish, maintain and develop business relationships based on

confidence, trust and respect.
2.2 Always act honestly in all matters relating to the Institute.
2.3 Demonstrate sensitivity for the customs, working practices, culture and personal
beliefs of others.
2.4 Safeguard all confidential, commercially-sensitive and personal data acquired as a

result of business relationships and not use it for personal advantage or for the
benefit or detriment of third parties.
2.5 Comply with prevailing laws.
2.6 Advise the CQI Executive in writing whenever there is a suspicion that this code of
conduct has been breached.
2.7 Be mindful of their responsibilities as professional people towards the wider

community.
2.8 Ensure potential or known conflicts of interest are declared at the earliest
opportunity to ensure professional judgement is not compromised or perceived to
be compromised.
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APPENDICES
Processes for Enforcement of this Code
All members, by virtue of their association with the Institute, have agreed to abide by the
following enforcement processes.
1. CQI0070 details the Misconduct Handling process for:
a. Reporting breaches of misconduct to the CQI .
b. Undertaking a Preliminary Investigation .
c. Conducting a Disciplinary Hearing .
d. Establish and acting on the Board’s decision .
e. Grounds for appeal .
2. CQI0058 details the Disciplinary Appeals process for:-
a. Submitting an appeal to the Advisory Council .
b. Preliminary review of the appeal .
c. Convening an appeal panel .
d. Reviewing the appeal submission .
e. Holding an appeal hearing .
f. Making an appeal recommendation to the Advisory Council .
g. Communicating the outcomes of the Appeal Panel (Preliminary Recommendation) .
h. Council review of recommendation.
i. Appeal decision announced and auctioned.
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APPENDICES
We hope you enjoyed your course!
You will be contacted by the CQI and IRCA for feedback on the course and your Approved
Training Partner.
Completing this short survey will help to ensure the continuing high standards of these
courses.
The CQI and IRCA offer a range of services to support you throughout your career. For more
information, please visit www.quality.org.
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Social Systems

Auditor Conversion Course

IRCA Certificated Course:

SS ACC Learner Guide

About the CQI and IRCA

IRCA is its specialist division dedicated to management system auditors.

Find out more about the CQI and IRCA at www.quality.org.

We hope you enjoy your course.

SS ACC Learner Guide

SS ACC Learner Guide

SS ACC Learner Guide

SS ACC Learner Guide

POLICY STATEMENT AND OBJECTIVES

IRCA COURSE CRITERIA – OBJECTIVES

Upon completion of this Course, Learners will be able to:

 Conduct and report an audit of social system of an organisation by interpreting the

 Knowledge of the ETI Code of Conduct

 Knowledge of SMETA Best Practice and Measurement Criteria etc.

SS ACC Learner Guide

Learners will be graded on the basis of:

 A continuous assessment of their performance against the Course learning

 Their marks obtained in the written examination.

To successfully complete the Course, Learners must obtain at least:

 A pass grade in the continuous assessment.

 70% or more of the total marks available in the examination.

SS ACC Learner Guide

4. CONTINUOUS ASSESSMENT, continued

 Explain the purpose, content and interrelationship of the SMETA Best

 Describe the responsibilities of an auditor and describe the role of audit in

Conduct and report an audit of social system of an organisation by interpreting

SS ACC Learner Guide

The exam is in three sections:

 Section 1 contains questions that require a brief written answer.

 Section 2 contains questions that require brief written answers.

 Section 3 contains a number of situations for which a Corrective Action Request

SS ACC Learner Guide

10. APPEALS AND COMPLAINTS

SS ACC Learner Guide

08.45 Course Registration

09.00 Course introduction

Session 1 Background to Social Accountability

Workshop 1 Working with SMETA

Session 2 Introduction to SMETA Best Practice Guidance

Session 3 Interpretation of SMETA: Clauses 0 – 3

SS ACC Learner Guide

Session 4 Interpretation of SMETA: Clauses 4 – 9

Session 5 Interpretation of SMETA: Clauses 10 – 11

Module Social Legislation

Workshop 2 Audit Evidence / Audit Trail

Session 9 Audit Stage 1

IRCA Examination Guidelines

18.00 End of Day 1

There will be a break of 15 minutes mid-morning and mid-afternoon.

SS ACC Learner Guide

 Audit review meeting

There will be a break of 15 minutes mid-morning and mid-afternoon

SS ACC Learner Guide

Workshop 8 Gathering Evidence through Management Review

Workshop 9 Reviewing and Reporting on an Audit

Examination Specimen Examination Paper

13.30 IRCA Review

14.00 Course Review and Summary

14.45 WRITTEN EXAMINATION