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

This year there has been a huge leap in the number of workers reached through ETI member companies' ethical trade activities, from 6 million last year to 8.6 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

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.

Key indicators

• Member companies spent £18 million on ethical trade activities; up from £14 million in 2007/8.
• 416 full-time staff were dedicated to ethical trade; up from 404 in 2007
• 63% of member companies reported that they had promoted ETI and ethical trade within trade or employers' associations during the year; an increase from 49% in 2007.

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

Over time, we expect member companies to extend their ‘scoped supply base' - that is, the suppliers covered by ethical trade activities. This year the size of members' scoped supply base has increased marginally from 37,308 in 2007 to 39,992 suppliers.

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

Member companies are increasingly using external organisations such as trade unions to cross-check findings and provide a more rigorous assessment of workers' conditions. In most cases this is on an experimental basis.

Key indicators

• Some 22% of member companies worked with trade unions in some way during their audits, up from 6% in 2007.
• Member companies carried out a total of 13,556 inspections of supplier sites, up from 11,469 in 2007.

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

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.

Key indicators

• 4,700 internal staff received a total of 15,300 hours of ethical trade training
• 80% of companies helped suppliers improve their management systems for providing decent conditions.
• 1,824 worker representatives received some form of training in ethical trade - up from 308 in 2007.

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

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.

Key indicators

• Members reported that their suppliers had agreed to make a total of 84,520 separate improvements to workers' conditions.
• 52% of improvement actions were in health and safety; 15% were in wages and 17% 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

Relatively weak performance in this area reflects the major challenge all companies face in marrying commercial practices with ethical principles. However, several companies are making 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.

There is also 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.

Key indicators

• 39% of members' relationships with suppliers last for more than five years.
• 71% of our members require suppliers to comply with the ETI Base Code within a set timescale
• 83% of companies conduct a site inspection before placing an order with new suppliers, up from 78% in 2007