Auditing Our Suppliers
Third-party social responsibility audits provide suppliers with feedback about how well they are meeting both legal requirements and Ford’s expectations. They also help identify specific areas for improvement.
A New Protocol
In 2016, Ford became the first automaker to join the Electronic Industry Citizenship Coalition (EICC) and we began using the EICC audit protocol for our social audits. During the year, we conducted 31 new audits using the EICC methodology. Audits are generally announced and agreed with the supplier in advance.
The audit comprises 90 questions, covering health and safety, labor issues, management systems, ethics and – for the first time – the environment.
Third-Party Social Responsibility Audits: Assessment Results
Data notes and analysis:
- Program Total represents cumulative data from 2003 to 2015.
- 31 of these assessments used the new EICC methodology.
Taking Corrective Action
For most issues identified during an audit, the supplier is required to prepare immediate containment plans and longer-term corrective action plans, which Ford reviews and monitors. Regular reviews help ensure ongoing compliance with the agreed plan.
The most common noncompliances that were identified related to:
Working hours: Inadequate time off, and inadequate policies and systems to record and manage working hours
Child labor: Inadequate systems and policies to prevent the use of underage workers, either directly or indirectly through labor agencies and contractors
Performance management: The effective management of labor, health and safety, environment and ethics issues
Health and safety: The effective maintenance of emergency exits, conducting fire and emergency evacuation drills, and appropriate record-keeping
Approximately 5 percent of the non-conformances uncovered required immediate containment actions. Of these:
- 40 percent were attributable to working hours and consecutive days of work
- 30 percent were health and safety issues
- and the remaining non-conformances were attributable to improper payment of wages or social insurance, and actions that, if not resolved, could be viewed as discriminatory
Should a supplier be unable or unwilling to address certain audit findings within our expected timeframe, we first engage with our regional and global purchasing communities to attempt to resolve the issue. However, we reserve the right to end our relationship with any supplier that fails to comply with our Global Terms, which include compliance with local laws, or fails to address an agreed compliance plan within an agreed timeframe.