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Factory workers

Supply Chain

Our Approach

The ALDI SOUTH Group, in collaboration with its business partners, assumes responsibility throughout the supply chain. This relationship is based on mutual respect and trust and forms the foundation for our supply chain activities.

We expect our business partners to comply with all our social and environmental standards and we pay particular attention to production conditions in countries where adherence to these standards cannot yet be taken for granted. In these countries, we want to contribute to the improvement of working conditions and the protection of the environment.

As many of our products are not sourced directly from producers, we value our business partners as key allies in improving working conditions in production facilities used for ALDI. Therefore, we maintain an ongoing dialogue with our business partners, work together on projects as well as monitoring their activities to ensure that our requirements are implemented and adhered to in all production facilities used for ALDI production.

Our Actions

ALDI Social Standards in Production

The ALDI Social Standards in Production are our definitive standard for cooperation with business partners for our food and non-food products. They were first published in 2010 and were further revised in 2014. These standards are based on the following:

The ALDI Social Standards in Production are contractually binding for all business partners and we expect them to communicate and implement these requirements, in addition to all legal requirements, at the production facilities and then monitor compliance against them. We strive to ensure that our business partners are able to fulfil our requirements and we collaborate with them in order to achieve continuous improvements.

Social Monitoring Programme (SMP)

In order to be able to monitor compliance with these social standards at production facility level and to continue to foster these together with our business partners, we have developed and implemented our Social Monitoring Programme. Business partners are integrated into this programme according to an assessment and prioritisation of their respective supply chain risks (based on commodity groups and sourcing countries).

All main production facilities in high risk areas used for the manufacturing of ALDI products have to have a valid third party audit. On-site audits performed by independent experts are a key component of the programme. ALDI recognises audits and certificates according to the standards including:

Following every audit, a Corrective Action Plan (CAP) is developed which sets out an individualised timeline for eliminating any issues that may have been found. Our business partners are obliged to implement the measures together with the production facility’s management. Our CR departments closely monitor the process to ensure successful remediation.

ALDI Social Assessments (ASAs) & ALDI Producer Assessments (APAs)

We consider third party social audits to be an important first step in gathering social compliance information about our production facilities and initiating improvements. However, we are aware that they may not always provide a true picture of working conditions. From our experience, we know that on-site presence can lead to greater transparency and fosters strong partnership with business partners and production facilities. Since 2011, we have been supplementing third-party audits with our own on-site visits for certain high-risk commodity groups.

These ALDI Social Assessments (ASAs) are assessments of main production facilities that are carried out by ALDI employees together with external auditors and business partner representatives. These ASAs mainly take place in amfori BSCI risk countries.

We have started to conduct ALDI Producer Assessments (APAs) on food plantations in relevant countries of origin. This enables us to carry out spot checks to verify how the producers work in our supply chain and how our requirements, in particular the ‘ALDI Social Standards in Production’, are being implemented and met.

Following every assessment, if necessary, a Corrective Action Plan is agreed which lays out an individualised timeline for eliminating potential issues. Our business partners are obliged to implement the measures together with the production facility’s management. Our CR departments closely monitor the progress and successful remediation.

 

World map visits and assessments

Corporate Responsibility Supplier Evaluation (CRSE)

As the majority of our products are sourced from business partners who commission the manufacture of the products, establishing strategic long-term relationships with business partners with a good CR performance is an essential factor in achieving our sustainability goals in the supply chain.

We have therefore adopted an annual Corporate Responsibility Supplier Evaluation (CRSE), an approach that goes beyond conducting audits. The CRSE is a comparable and transparent evaluation based on quantitative and qualitative indicators. The indicators focussing on our business partners’ social and environmental compliance management systems as well as their production facilities’ CR performance are derived from our CR Requirements, which form part of every contract.

The fulfilment of our CR Requirements is a key criteria during price negotiations. Business partners will be rated from A-D regarding key factors such as their CR set-up, their support for and relationship with production facilities or growers as well as their due diligence. We are committed to source the majority of our buying share from best-rated A and B business partners. Business partners with a D rating have to improve their CR performance and will be delisted if they do not demonstrate credible improvements for two consecutive years.

To ensure transparency, we share the evaluation results including a comprehensive status quo analysis with business partners. This analysis is then used by our business partners to improve their social and environmental management systems throughout the year. To support our business partners to better understand and implement our CR requirements, they are invited to participate in capacity building activities.

The results of this evaluation increasingly influence our buying decisions. The CRSE supports long-term relationships with those business partners who demonstrate a strong CR record and provides incentives for continuous improvement.

Corporate Responsibility Supplier Evaluation cycle

Transparency of supply chains

We attach great importance to sustainable production conditions in the manufacturing of food and non-food products. Supply chain transparency is the foundation for all our sustainability measures. Without the knowledge where our products come from, we cannot ensure compliance with our requirements, analyse risks, monitor or implement projects. We work with our business partners to increase the transparency of our supply chains so that we have a better understanding concerning the origin of every product we sell and the raw materials we use for our products.

Our Goals & Performance (2019)

Our Projects & Memberships

Anke Ehlers cutting cake on the opening of the Bangladesh CR office
International organisation
ALDI CR offices in Asia

Each of the ALDI SOUTH Group’s national organisations sources products from Asia. To minimise the risks relating to working conditions and ensure compliance with our high standards, the ALDI SOUTH Group, together with ALDI Nord, has been operating its own CR office in Hong Kong since 2012 and established a second CR office in Bangladesh in 2017.

The focus of these CR offices is to monitor our business partner’ production facilities and the performance of our business partners with regard to social compliance. For this purpose, the CR offices conduct ALDI Social Assessments in the production facilities on behalf of the ALDI SOUTH Group and provide support to business partners on how to implement them.

More on 'Company Profile'
Male and female people sitting around in circle
Project in Bangladesh
ALDI Factory Advancement (AFA) Project

ALDI is committed to promoting human rights in the garment industry. With the ALDI Factory Advancement (AFA) Project, the ALDI SOUTH Group, together with ALDI Nord, has introduced a programme which delivers change in factories that produce our garments in Bangladesh.

Launched in 2013, the AFA Project places factory workers and managers at the centre of its activities to find sustainable solutions for improved workplaces. Its core principle is the promotion of dialogue and cooperation between workers and managers. To date, approximately 85,000 workers and their managers of 40 participating factories have benefitted from the project and experienced positive changes in their day-to-day working environment.

More about 'AFA Project'
Picture drawn from a child showing the scene from a child care service
Project in Bangladesh
AFA Project Plus for child care services

From 2016 until 2019, the AFA Project PLUS addressed the critical need for quality childcare for the children of working parents in factories that produce our textile goods in Bangladesh. ALDI supported selected factories participating in the AFA Project in improving their internal day-care services.

Many workers are reliant on these services due to financial constraints and a lack of alternative care options. Together with local non-governmental organisations, we trained caregivers, childcare centre supervisors, nurses and parents working at the factory. 

More about 'AFA Project'
Workers in garment factory in Bangladesh
Special focus
Bangladesh

ALDI SOUTH was one of the first signatories of the Accord on Fire and Building Safety in Bangladesh in 2013 and 2017. By signing this independent, legally binding agreement we have committed to improve the safety of the Ready-Made Garments (RMG) factories in our Bangladesh supply chain.

As Bangladesh is one of our most important sourcing countries, we have intensified our regular ALDI Social Assessment (ASA) activities in this country to step up cooperation with business partners sourcing from there.

With the ALDI Factory Advancement (AFA) Project, the ALDI SOUTH Group, together with ALDI Nord, has introduced a programme, which delivers change in factories that produce our garments in Bangladesh.

More on 'AFA Project'
amfori BEPI
Logo of amfori BEPI
Since 2017
amfori Business Environmental Performance Initiative (BEPI)

For over 40 years, amfori has been the leading global business association for open and sustainable trade. Its mission is to support each of its members to enhance human rights, use natural resources responsibly, and drive open trade globally. It brings together over 2,000 retailers, importers, brands and associations. The ALDI SOUTH Group became a member of the Business Environmental Performance Initiative (BEPI) in 2017.

Working together

amfori is run by Board of Directors representing the member’s interests from different countries and businesses. In June 2019, Anke Ehlers, Managing Director for Corporate Responsibility International of the ALDI SOUTH Group, was elected to the Board of Directors of amfori to represent ALDI SOUTH and ALDI Nord internationally. This shows the continuing dedication of ALDI to enhance sustainable development in our global supply chains.

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amfori BSCI
Logo of amfori BSCI
Since 2008
amfori Business Social Compliance Initiative (BSCI)

For over 40 years, amfori has been the leading global business association for open and sustainable trade. Its mission is to support each of its members to enhance human rights, use natural resources responsibly, and drive open trade globally. It brings together over 2,000 retailers, importers, brands and associations. The ALDI SOUTH Group became a member of the Business Social Compliance Initiative (BSCI) in 2008.

Working together

amfori is run by Board of Directors representing the member’s interests from different countries and businesses. In June 2019, Anke Ehlers, Managing Director for Corporate Responsibility International of the ALDI SOUTH Group, was elected to the Board of Directors of amfori to represent ALDI SOUTH and ALDI Nord internationally. This shows the continuing dedication of ALDI to enhance sustainable development in our global supply chains.

The ALDI SOUTH Group is also an active member of the amfori Project Group ‘Social Issues in Food’, which unites retailer and producer members of amfori to tackle shared social and environmental issues in the food sector. A representative from ALDI SOUTH chairs the group.

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ETI
Logo of ETI
Since 2019
Ethical Trade Initiative (ETI)

In line with our responsible sourcing strategy to mitigate adverse human rights impacts of our business activities, the ALDI SOUTH Group was accepted as a Foundation stage member of the ETI in 2019. ETI is a global alliance of companies, trade unions, and NGOs that promotes respect for workers' rights. Our Social Standards in Production are aligned with the ETI Base Code.

Working together

Since joining ETI, the ALDI SOUTH Group has become a member in several working groups:

  • Italian Agriculture Working Group to establish an Italian Ethical Trade Forum in order to address social and environmental challenges facing Italian agriculture particularly related to the cultivation of produce.
  • Peruvian Horticulture Working Group to engage with key stakeholders both local and international - and including workers - to identify and implement collaborative action plans, which address poor working conditions and improve the lives of vulnerable workers.

Over the next five years, the ALDI SOUTH Group intends to address issues within its high priority supply chains via a number of measures.

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IDH
Logo of IDH
Since 2019
IDH - The Sustainable Trade Initiative

IDH, The Sustainable Trade Initiative, brings governments, companies, CSOs and financiers together in action driven coalitions. The IDH orchestrates the powers of law, of entrepreneurship and investments to work together to create solutions for global sustainability issues at scale.

Working together

In 2019, IDH created the ‘Roadmap on Living Wages’ to develop aligned solutions for measuring and closing living wage gaps in global supply chains.  The ALDI SOUTH Group is part of IDH’s 'Living Wage Steering Committee' to address overall strategic issues related to the Roadmap  on Living Wages and oversee its development. Furthermore, the participating companies in the committee will monitor the implementation of the IDH Roadmap, including the development of tools to measure the living wage gap and approaches to close it.

Anke Ehlers, Managing Director Corporate Responsibility International (CRI) for the ALDI SOUTH Group: “A living income and wage are an important part of a successful and fair sustainable supply chain, it is a key way in which the ALDI SOUTH Group can protect human rights and reduce poverty. We are proud to engage with the IDH and work alongside our industry partners to improve the livelihoods of farmers and workers in global supply chains. We believe that the best way to create the greatest impact is through fostering alignment and through the continuation of long-term joint initiatives and partnerships.”

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Sedex
Logo of Sedex
Since 2017
Sedex - Members Ethical Trade Audit

Sedex is one of the world’s leading ethical trade service providers, striving to improve working conditions in global supply chains. Sedex provides practical tools, services and a community network to help companies improve their responsible and sustainable business practices, and source sustainably. ALDI became a member in 2017. ALDI UK is also part of the Sedex Board.

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UNGC
Logo of UNGC
Since 2017
UN Global Compact (UNGC)

In August 2017, the ALDI SOUTH Group was the first discount food retailer to join the United Nations Global Compact (UNGC). By joining this initiative, we have committed to implementing the UN Global Compact's ten principles in the areas of human rights, labour, environment, and anti-corruption as part of our corporate strategy and within the scope of our daily business operations.

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Sustainable Development Goals

4 Quality education 5 Gender equality 8 Decent work and economic growth 10 Reduced inequalities 12 Responsible consumption and production 15 Life on land 17 Partnerships for the goals

UNGC

Human Rights

Principle 1

Support and respect the protection of human rights

Principle 2

Not complicit in human rights abuses

Labour

Principle 3

Uphold freedom of association and recognition of right to collective bargaining

Principle 4

Elimination of forced and compulsory labour

Principle 5

Abolition of child labour

Principle 6

Elimination of discrimination in respect of employment and occupation

Environment

Principle 7

Precautionary approach to environmental challenges

Principle 8

Promote environmental responsibility

Anti-Corruption

Principle 10

Work against corruption in all its forms

GRI references

GRI 102: General disclosures 2016

Global Reporting Initiative 102-9

GRI 103: Management approach 2016

Global Reporting Initiative 103-1 Global Reporting Initiative 103-2 Global Reporting Initiative 103-3

GRI 308: Supplier environmental assessment 2016

Global Reporting Initiative 308-2

GRI 412: Human rights assessment 2016

Global Reporting Initiative 412-1

GRI 414: Supplier social assessment

Global Reporting Initiative 414-1 Global Reporting Initiative 414-2