P R E S E N TAT I O N

BUREAU VERITAS

STANDARD

SOCIAL AUDIT

2024

S U P P LY C H A I N T R U S T S O L U T I O N S

T e s t i n g • I n s p e c t i o n s • A u d i t s • C e r t i f i c a t i o n •

A d v i s o r y • A c t i o n a b l e I n s i g h t s

B E N E F I T O F A N

E F F E C T I V E

S A P R O G R A M

01

P O R TA B L E

A S S E S S M E N T

S E R V I C E

- PA S

02

B O O K I N G

v i a

I N S P E C - B V. C O M

03

SUMMARY

P R O P O S A L

O N

A U D I T P R I C E

04

B E N E F I T O F A N

E F F E C T I V E

SA PROGRAM

01

SOCIAL COMPLIANCE

SCOPE

01 02 03 04

06 07 08

Laws and

Regulations

Child Labor Forced Labor Harassment

Discrimination Wages and

Benefits

Health and

Safety

09

Freedom of

Association and

Collective

Bargaining

05

10

DISCIPLINARY

PRACTICES

ENVIRONMENT

BENEFITS OF AN EFFECTIVE SOCIAL COMPLIANCE PROGRAM

1

Allows a company to understand the realities of conditions under which

products are manufactured

2

Allows a company to determine if products are being manufactured in safe,

lawful and human conditions

3 Strengthens and protects Company’s brand name and image with consumers

4 Positions a company to respond to stakeholders

5 Provides positive assurance to a company’s supply chain partners

6 Leverages other supply chain initiatives – e.g. Testing & Inspection

P O R TA B L E A S S E S S M E N T S E R V I C E

PAS

02

PAS (PORTABLE ASSESSMENT SERVICE)

PAS, is known as Portable Auditing System, is BV reporting instrument.

This tool helps in recording exceptions to compliance requirements in BV's

proprietary scorecard reporting platform, which allocates different

numerical weightings to individual requirements and sections of the BV

scorecard reporting tool depending on the severity of the audit nonconformance.

Initial / Annual Audit:

 ≤ 100 employees: 1 MD

 > 100 employees: 2 MDs

Follow-up Audit: 1 MD

AUDIT DURATION

SCOPE OF AUDIT

BV Reporting instrument is comprised of 14 sections. Each section is

rated based on its significance and risk level. In addition, a color code

(Red, Orange, Yellow and Green) is assigned based on most severe nonconformance to indicate the relative risk of the supplier delivering

product. The scope of PAS covers:

Laws and regulations

Child labor

Forced labor

Harassment

Wages and benefits

Hours of work

Health and safety

Non-discrimination

Women’s rights

Freedom of association and

collective bargaining

Environment

Subcontracting

Communication

Monitoring and compliance

PRODUCT/SECTOR

Apply to all industry

CLIENT CODE OF CONDUCT

If client has its own social compliance audit standards, Bureau Veritas can

provide the audits following the client’s training and approval

If client has special requirements, Bureau Veritas can leverage the BV

social compliance PAS to help revise the requirement

Bureau Veritas can also help the client establish the customized social

compliance audit program

AUDIT PROCESS

O P E N I N G M E E T I N G

FA C T O R Y T O U R - O B S E R VAT I O N S

D O C U M E N T R E V I E W

M A N A G E M E N T I N T E R V I E W

E M P L O Y E E I N T E R V I E W S

P R E PA R E S U M M A R Y O F F I N D I N G S

C L O S I N G M E E T I N G

R E P O R T A N D C A P

AUDIT REPORT – SCORING CRITERIA

1) BV Scorecard reporting is facilitated through the BV Portable Auditing System (PAS)

׀ Records exceptions to compliance requirements

׀ Allocates different numerical weightings to individual requirements and sections depending on severity of non-conformance

׀ Overall result consists of a percentage figure plus a color code risk level

2) The BV Scoring System

׀ A data-driven process

׀ Enables benchmarking between suppliers to make logical and quantifiable sourcing decisions

׀ Enables effective monitoring and evaluation of improvement at the facility and supply chain level

׀ Scorecard calculations can be customized to meet specific customer or industry risk priorities

3) Defining Degree of Compliance

׀ F: Full Compliance

׀ D: Deviation

׀ N: Non-Conformance

׀ N/A: Not Applicable

4) Question Risk Weighting (QRW) Levels

Critical ׀

High ׀

Medium ׀

Table 1: Question Risk Weighting Levels in relation to Degree of Compliance and Attainable Score

Table 2: Question Risk Weighting Levels in relation to Degree of Compliance and Levels of Non-Conformance

AUDIT REPORT – SCORING CRITERIA

** A scoring system based on minimum net score is not appropriate when elements are recorded as N/A, as this decreases the maximum achievable score. The BV

Scorecard’s evaluation results are therefore based on a percentage of the maximum score, and the maximum score changes according to the number of N/A results used.

Scoring based on relative performance and

weighting for identified criteria

▪ Green – Full compliance

▪ Yellow – Noted deviations for medium-risk clauses

(questions) or isolated deviations in an

environment where a management process exists

to address the associated requirement for high-risk

clauses

▪ Orange – Noted deviations for high-risk clauses

(questions) in the absence of a management

process or isolated deviations in an environment

where a management process exists to address

the associated requirement for critical-risk clauses

▪ Red – Noted deviations for critical-risk clauses

(questions) in the absence of a management

process

Table 3: Section Weighting Factors

5) Section Weighting Factors

AUDIT REPORT – SCORING CRITERIA

6) Audit Results & Definition

Total Compliance Level to Standard: A % figure calculated based on the attainable scores for risk-weighted clauses as

summarized in Table 1, and by applying the section weighting factors in Table 3 above, reflecting the overall result for compliance with the

standard.

Overall Risk Level for Supply: A color code (Red, Orange, Yellow or Green) assigned based on the most severe nonconformance to indicate the relative risk of the supplier delivering product.

Red (Critical) • At least one non-conformance with a Critical-risk clause

• At least one Deviation non-conformance with a Critical-risk clause or Orange (High)

• At least one non-conformance with a High-risk clause

• At least one Deviation non-conformance with a High-risk clause; or

• At least one non-conformance or Deviation non-conformance with a Medium-risk clause Yellow (Medium)

Green (Low) • No non-conformances with Critical, High or Medium-rated clauses

AUDIT REPORT – SCORING CRITERIA

6) Improvement Plan and Monitoring Frequency

PAS Sample

Report_SA 3.0

AUDIT REPORT – SCORING CRITERIA

WHY BUREAU

VERITAS

A Best Practice Approach

׀ Decades of working with high profile multinational retailers/brands and local vendors /

factories

׀ Save time & cost from our best practice approach and methodology

׀ Benchmarking available by country/region against prior period or industry averages

Experienced Auditors Globally

Strong Technical, Operational & Integrity Program

׀ Comprehensive training includes interpretation, report writing, scheduling, integrity

& consistency

׀ Auditors located in all key sourcing locations in Americas, EMEA and Asia

׀ Active and dynamic ethics and integrity program managed by dedicated integrity team

׀ Global Technical Services function facilitates repeatability of approach & results

׀ Global operational platform links to/from client platforms via EDI

Added Value Assessments

׀ Multi-skilled staff can conduct a multitude of differing inspections

׀ Available modules include social audit, security audit and environmental audit,

| No industry association fees

| Accepted by many organisations as social audit

| Benchmarked against global standards

| Only approved Bureau Veritas CPS can offer this

| Portable Audit System (PAS) is a digital tool for efficient reporting

| The report is an exception report so has a score, a colour,

and number/details of non-compliances so very easy to make

business decisions

BV PAS SOCIAL

AUDIT

SELECT THE

RIGHT AUDIT COST

EFFECTIVELY International standards VS BV Standard Social Audit

| Platform application fee

| Membership fee

| Annual subscription fee

| Accepted by many

organisations as social audit

| No Platform application fee

| No Membership fee

| No Annual subscription fee

| Apply to all industry

| High flexibility

| Time efficient

H O W T O

BOOK SOCIAL AUDIT ONLINE

03

H O W TO B O O K S O C I A L A U D I T O N L I N E ?

A S T E P- B Y-S T E P G U I D E O N I N S P E C B Y B V

APPLY YOUR AUDIT IN AN EASY AND FAST WAY

1 Select Audit Type 2 Select Audit Standard 3 Choose a date

4

Choose Factory

6 Confirm your order 5 Choose additional services Add factory/product details

INSPEC-BV.COM

ALL YOUR ORDERS IN ONE PLACE

All your completed, scheduled and

draft orders can be accessed easily

through your dashboard, with:

✓ Audits result quick view

✓ Audits reports available for download

✓ Details of user or vendor who placed

the order, with export capabilities

✓ Quick “Copy booking” function to reorder in an instant

VIEW YOUR REPORT ANYTIME

InSpec comes with a simple and intuitive report format.

You can review and download on InSpec anytime.

LET YOUR SUPPLIERS BOOK FOR YOU!

Buyer Inc. Retail LLC

Manuf. Co Ltd Vendor Pvt. Ltd. Supply SA

You vendors can get an individual online

account to book their audits.

The booking process is identical to yours

and allows them to work with multiple

buyers in total security.

You will be able to receive the report in 5

working days.

Your vendors will be invoiced according to

your man day rate.

KEY BENEFITS

Features Benefits

Real Time Quote Free Quote with Online Booking

Booking lead-time 5 Working days for Social Audit (1 working day for Inspection )

Reporting Speed 5 working days report for Social Audit & Factory Assessment / same day for Inspection

Service Coverage Social Audits / Factory Assessment / IPI / DUPRO / PSI

Booking Dashboard Show Draft / Scheduled / Completed Bookings

Working Week 7 Days a Week, 52 Weeks a Year (No Holiday Charges)

Payment Flexible (online payment available)

Pricing Inclusive Pricing Per Factory Country *

Insight Center Receive Regulatory News, TIC 101, Product Tips & etc.

Support ✓ Contact Your Existing Sales Representative for All Other Service Inquiries

* Some countries are MD + travel expense, check with BV for details

CUSTOMER TESTIMONIAL

BV SOCIAL AUDIT “Bureau veritas has proven to be a real

asset and a valuable partner for our social

audit campaigns. Besides fielding

competent auditors, Bureau Veritas makes

the difference by providing its client with

excellent back-office services, thus enabling

them to smoothly and efficiently run

extensive programs.”

“In case of a dispute or problems of interpretation, it

is always possible to speak to a senior supervisor,

which helps find tangible solutions for the current

and future audits. BV brings me an administrative

support in conformance with our accounting

processes and sends weekly reports.”

“Through several years we have used the

expertise of BV for audits towards different

Code of Conducts. We see BV as a reliable

and professional partner across our

markets both in regards to our customers

and supplier base. We have experienced a

high level of service from all divisions of BV

throughout the world.”

W W W . B U R E A U V E R I T A S . C O M