Walgreens Boots Alliance, as a global corporate citizen, continues to recognize its responsibility to address and mitigate the risk of modern slavery and human trafficking in its operations. This statement sets out our commitment and actions taken to do our part to eradicate these abhorrent practices, as well as meet the requirements of the UK Modern Slavery Act 2015 and the California Transparency Act through the end of our fiscal year, 31 August 2016.
Structure, Business & Supply Chains
A description of the Walgreens Boots Alliance company structure, values, divisions and product brands can be found in the Corporate Social Responsibility (CSR) Report. CSR is not a simple initiative at Walgreens Boots Alliance; rather it is tied directly to our goal to operate a sustainable and profitable company. This is reflected in the fact that the CSR agenda is overseen by Ornella Barra, our Co-Chief Operating Officer. Ornella Barra has convened an internal body that includes Richard Ellis, Vice President of CSR, and a number of cross-functional and cross-divisional representatives from around the company to discuss CSR related matters.
Recognizing the important need to respond to the modern slavery crisis, we have also convened a global task force on the subject, with representation by senior managers from legal, compliance, human resources, procurement and our owned brands.
The Walgreens Boots Alliance Code of Conduct and Business Ethics, which is available on the Corporate Governance section of our website, provides the foundational standards for all aspects of our business, and is applicable to all of our employees and operations globally. The Code makes this clear commitment: “(w)e will also strive to ensure that slavery and human trafficking is not taking place within any of our supply chain business partners and will not tolerate such activities either within the supply chain or within any part of Walgreens Boots Alliance’s business.”
The Code further sets forth the responsibility of every employee to help ensure all of Walgreens Boots Alliance’s global activities meet our high standards for behavior and business ethics, and establishes accountability for compliance with law and policy.
The Code addresses the need for open dialogue about potential violations and concerns, and provides confidential reporting helplines managed by external services specializing in addressing sensitive matters. These contact points are available 24 hours a day, seven days a week, and include translation services.
The legacy Companies of Walgreens Boots Alliance had individual statements of required behavior for our business partners, such as the Boots Code of Conduct for Ethical Sourcing and the Walgreens Vendor Responsibility Standards. During our fiscal year 2016, we established a Walgreens Boots Alliance Ethical Trading Standards Policy that consolidated these requirements into a consistent worldwide set of standards. Primary among the provisions included therein is our opposition to the exploitation of workers through any form of forced or bonded labor, slavery, human trafficking or other labor practices that involve harsh or inhumane treatment. Walgreens Boots Alliance requires its vendors to comply with these principles and to share them with any subcontractors they may use. Each business division is responsible for implementation of this requirement and annual confirmation that it has taken place.
With regard to our own labor practices, the Code further sets forth our standards for a diverse workplace that provides a safe and healthy environment and that complies with or exceeds local law. The Walgreens Boots Alliance Global Human Resources Policy requires an effective program be in place to help ensure compliance with labor laws involving migrant and foreign national workers.
Of course, as a global company with business many countries around the world, local policies on these subjects provide additional guidance and detail. However, these policies may only enact standards that are equal to or stricter than the Walgreens Boots Alliance policies.
Due Diligence Processes
Walgreens Boots Alliance has contracted with service provider Dow Jones Risk & Compliance to provide due diligence reviews of business partners globally. These reviews include a check for adverse media, where modern slavery issues can and in fact have been found. For example, in one case a supplier was found to have a prior history of inappropriate labor practices, and was asked to provide access for an ethical audit to verify corrective actions and implementation of best business practices. Given the supplier’s lack of cooperation, the relationship with that company was terminated. Of course, simple termination of a contract relationship may not always be the most appropriate response based on circumstances, so substantive findings of adverse media about a business partner are handled on a case-by-case basis, according to the circumstances.
As described above, the Walgreens Boots Alliance Modern Slavery working group was formed to consider more fully our company’s risk of exposure to these practices and additional activities to help mitigate these risks. This began with a comprehensive review of the internal and external operations that could potentially be exposed to a modern slavery risk, including our own labor, suppliers and key countries. From this, we will be able to develop a continuing action plan that will target the highest risk operations. Given the scale and complexity of our Company, we accept that this will need to be a phased approach.
We have identified that one of our biggest current risks of exposure to modern day slavery sits within the product supply chain of our owned brands. To combat this, we have a well-established program of ongoing supplier assessment, which is delivered through our own Ethical Trading auditors or via a small number of pre-approved third party assessment bodies.
We developed this program over the last ten years to ensure our suppliers are fully aware of the standards and expectations we require. This is achieved through supplier manuals, contracts, technical agreements and mandatory ethical compliance assessments. In addition, these supplier contracts contain a provision that requires compliance with our ethical trading standards described above. Suppliers must further agree to provide evidence of their related compliance programs.
In the full fiscal year 2016, we conducted over 1,200 ethical compliance assessments on new and existing owned brand suppliers. Where we identified non-compliance, we worked with our suppliers on remedial action plans to help ensure issues are addressed and corrected. In the small number of cases where suppliers are unwilling to work with us to achieve compliance, we will, as a last resort, terminate our business relationships.
To help ensure our Walgreens Boots Alliance senior management team is aware of issues within our supply chain, we have developed a formal rapid escalation process whereby any modern-day slavery issues or other serious violations of our standards are reported within 24 hours, along with the conclusion of any investigations and remedial action plans. We share the assessment results on a monthly basis across our Walgreens Boots Alliance senior management team to ensure they have appropriate visibility of this program and an understanding of the risks within our supply chain.
We want to work with suppliers who are open and transparent, so in order to reinforce this commitment, we request that our suppliers agree to our right of unannounced assessments at any time in their operating day/week.
Training and Awareness
In response to the California Transparency in Supply Chains Act of 2010, Walgreens created an online training course that we require all relevant employees in that Division to complete annually. We expect to relaunch this course as a global e-learning package during fiscal year 2017.
We conduct regular supplier conferences where we discuss our ethical standards as part of an ongoing engagement with our supply base. We also provide a supplier manual that explains our Code of Conduct and Business Ethics, assessment requirements, capacity building and continuous improvement programs.
Effectiveness and Performance Indicators/Monitoring
We recognize that the risks from modern-day slavery change, and as such our approach to preventing modern-day slavery will be reviewed annually by the Walgreens Boots Alliance Modern Slavery working group. This approach will monitor and review:
- Effectiveness of risk assessment processes
- Staff training programs
- Assessment programs (where applicable); and
- Reporting and escalation processes.
This statement is made pursuant to the relevant legal requirements of the United States (including the individual states therein) and the United Kingdom.
Co-Chief Operating Officer
Walgreens Boots Alliance, Inc.
Leader of Corporate Social Responsibility