Supply chain transparency: Unilever, Symrise and Revieve highlight labor loopholes and D2C strategies

11 Nov 2022 --- Supply chain transparency offers companies the chance to enhance their reputation and reliability while enabling consumers to detect improvement opportunities, like an unneeded middleman, win over stakeholders, ship sustainably and make long-term plans more skillfully. PersonalCareInsights speaks with Unilever, Symrise and Revieve to investigate how they manage supply chains to ensure sustainability and ethics are not lost along the way.

Symrise works with more than 5,000 suppliers that provide the company with raw materials and services. According to a spokesperson, this represents “an enormous challenge” to procure these services in a sustainable and fair manner.

At the same time, the large number of suppliers presents an opportunity for Symrise to reinforce long-term relationships with them and foster partnerships. “Symrise has defined the conditions for responsible sourcing in its sourcing policy and its Code of Conduct, which apply to all suppliers,” the spokesperson affirms.

Working with NGO partners helps Symrise build sustainable supply chains and support farmers. Credit: Symrise.Similarly, a Unilever spokesperson tells PersonalCareInsights that “increasing transparency in our supply chain is a priority for Unilever and we believe transparency and traceability lead to transformation.”

“For instance, we want to know the exact plantations where our palm oil is grown. This allows us to identify and address deforestation, environmental risks and human rights risks – while building trust with our suppliers.”

Unilever ensures responsible sourcing via its Responsible Sourcing Policy (RSP). Compliance with the RSP “is a contractual obligation of all Unilever’s suppliers. The RSP includes requirements relating to labor standards and workers’ rights.” 

Helping the helping hand
The companies claim a lot is being done to ensure that the workers across the supply chains are paid well and treated ethically. “We are engaging directly with farmers and their communities,” says the Symrise spokesperson.

“To do so we are working with various NGO partners. They help us build sustainable supply chains, support farmers in developing sustainable cultivation practices via farmer field schools and other education programs.”

The spokesperson elaborates, saying that Symrise also encourages its partnering farmers to use sustainable cultivation practices by entering into long-term relationships with them and paying them fair prices.

“This benefits all stakeholders – the farmers by making them economically resilient, us by reliably receiving high-quality raw materials from known and (often) certified sources, our customers by receiving quality ingredients for the finished products from sustainable sources, consumers by receiving sustainable quality products.”

Reality of child labor 
Addressing the labor loopholes in many developing countries, Unilever’s spokesperson tells us that “unfortunately, child labor remains an endemic issue in some global supply chains. Our Living Income commitment is critical as one vital element to eradicate child labor, particularly in agriculture.”Child labor remains an endemic issue in some global supply chains, a Unilever spokesperson says.

Having had a closer look at this commitment – which the spokesperson provided us with – we saw Unilever added the principle of a living wage to its Code of Business Principles fairly recently, in 2020.

The principle reads: “We will work with our business partners to raise standards so that their employees are paid a living wage and are not subject to forced, compulsory, trafficked or child labor.”

“We know that child labor exists within the cocoa sector, so we’re developing impact programs with our partners, certifiers and suppliers to ensure that we source from cocoa co-operatives that have monitoring and remediation systems in place that assess and address child labor cases,” the company says.

As highlighted in Unilever’s RSP, “the effectiveness of the supplier’s system is regularly monitored to prevent the hiring of minors and to check the adequacy of efforts to protect children’s rights.”

The company also says that women’s empowerment is essential for the prevention of child labor. To complement this work, Unilever seeks to provide training and chances for income diversification to 2,000 women who live in cocoa-producing households.

Middle-man maneuvers 
A long and complicated supply chain makes ethical business trickier for companies. There are more steps to pay attention to, more people involved to protect and often more negative environmental impacts to mitigate.

Revieve says cutting the middleman and delivering directly to consumers leads to a lower carbon footprint.“The demand for more transparent supply chains is also giving rise to new beauty brands to be conceived sustainably, offering clean beauty products or introducing new business models like D2C,” Sampo Parkkinen, CEO and founder at Revieve, tells us.

“In beauty, direct-to-consumer businesses are known for cutting the middleman and delivering directly to consumers to decrease the number of steps in the supply chain, leading to a lower carbon footprint and providing more operational efficiency.”

To manage high complexity and ensure full traceability, transparency and sustainability, Symrise relies on direct relationships with farming communities and it has “proven to be very helpful” for the company and “beneficial to its stakeholders,” according to the Symrise spokesperson.

“We are sourcing thousands of natural raw materials from all over the world, such as vanilla from Madagascar, where we have established a backward-integrated value chain that serves as a model for many other countries.”

Furthermore, Unilever’s spokesperson did not comment on how the company shortens its supply chains to ensure each individual employee involved is looked after. However, the spokesperson did elaborate on Unilever’s direct suppliers, saying that “in January 2021 we made a commitment that everyone who directly supplies goods or services to Unilever will earn at least a living wage or living income by 2030.”

Unilever made this commitment because the company believes “there is both a strong business case for raising wages beyond poverty wages and a high cost to business and society of not doing so.”

By Mieke Meintjes