The scale of our member companies' influence over working conditions is growing every year

This year the number of workers reached through ETI member companies' ethical trade activities rose from 8.6 million last year to 9.4 million.

Member companies report to us annually on improvements to workers' conditions in their supplier sites, and their management time and efforts in five key areas. Trends in our member companies' performance in these areas are outlined below.

1. Demonstrate commitment to ethical trade

Companies should aim to publicly advocate for ethical trade, and have an adequate level of human and financial resources to implement their strategy.

Key trends and indicators

Most member companies are performing better in this area than any other. Overall, they are allocating an increasing amount of staff and resources to ethical trade and doing more to promote ethical trade, both to their suppliers, and within trade and employers' associations.

• Member companies spent £23 million on ethical trade activities; up from £18 million in 2007/8.
• 490 full-time staff were dedicated to ethical trade; up from 416 in 2007
• 63% of member companies reported that they had promoted ETI and ethical trade within trade or employers' associations during the year.

2. Assess workers' conditions in supply chains

This includes involving unions and workers' representatives in site inspections, and digging deep into the supply chain to areas that are more difficult to reach, but where there may be a higher risk of abuses of workers' rights

Key trends and indicators

Over time, we expect member companies to extend their ‘scoped supply base' - that is, the suppliers covered by ethical trade activities. This year there has been a slight reduction in the number of suppliers reported to fall within the scope of members' ethical trade activities from 39,992 to 34,720 suppliers. This is due to differences in the way some companies categorise their suppliers.

Member companies are going beyond the first tier of their supply chains to address particularly vulnerable workers, such as homeworkers.

While auditing is still central to companies' ethical trade activities, companies are increasingly acknowledging the limitations of audits. Some are beginning to put in place parallel schemes that place responsibility for decent conditions back in the hands of suppliers.

Member companies carried out a total of 13,391 inspections of supplier sites.

3. Build support and skills within the company and its supply base

Companies need to get buy-in for ethical trade, both internally and in their supply base, and give suppliers practical support to improve working conditions

Key trends and indicators

More companies are starting to develop comprehensive training programmes for buying staff. This year there has also been a significant increase in the provision of training and support for suppliers.

Although a few members are clearly attempting to find ways of working through their suppliers to educate workers about their rights, we have yet to see widespread progress in this challenging area.

This year, a total of 5,560 hours of training were delivered to staff across companies, including ethical trade staff as well as buying and technical staff and senior management.

4. Ensure suppliers take action to improve conditions

Companies need to have effective management systems for following up on their suppliers' plans to improve working conditions. The aim is to support suppliers to improve over time.

Key trends and indicators

Members are demonstrating a strong commitment to work in partnership with suppliers to help them resolve breaches of the ETI Base Code. The majority of improvements to workers' conditions are in health and safety, followed by working hours and wages. Violations of these principles are common in many countries, and they are relatively straightforward to detect compared with, for example, discrimination and restrictions on trade union rights.

• Members reported that their suppliers had agreed to make a total of 124,633 separate improvements to workers' conditions; a 47% increase from 2008.
• 54% of improvement actions were in health and safety; 17% were in wages and 13% in hours of work.

5. Integrate ethical trade into business decisions

This is one of the greatest challenges. Buying practices - for example, lead times and prices negotiated with suppliers, can either help or hinder a supplier's efforts to comply with the ETI Base Code

Key trends and indicators

Relatively weak performance in this area reflects the major challenge all companies face in marrying commercial practices with ethical principles. However, companies are making increasing efforts to raise the awareness of buying staff of the potential impact of their decisions on workers, and some are looking at how to incentivise them to ‘think worker' in their buying decisions.

Most companies provided narrative responses to the question of how ethical trade is integrated into buying practices like critical path management, making it difficult to make comparisons and assess progress. A few members reported that they have started engaging more with suppliers to ensure they have sufficient time and capacity to meet production deadlines.

In previous years there has been evidence that some companies are starting to develop closer relationships with their suppliers, which helps to build the trust and confidence suppliers need to invest in improving working conditions. This year this trend appears to have slowed.

31% of our members reported that their relationships with suppliers last for more than five years.