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 9.4 million last year to 9.8 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 £15.9 million on ethical trade activities
• 631 full-time staff were dedicated to ethical trade; up from 490 in 2009

Member companies are demonstrating increased awareness of the need to develop measurable outcomes in relation to their chosen areas of activity. We would like to see more of them embracing the challenge of developing targets that relate to tangible improvements in workers' conditions rather than simply the delivery of activities such as training and auditing.

2. 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

Member companies demonstrated improved performance in this area this year, although most companies continue to provide narrative responses to many questions. This makes it difficult to make comparisons and assess progress.

Trends include companies seeking closer collaboration between ethical trade and commercial staff, and more companies developing 'balanced scorecards'. These provide a framework for buyers to assess suppliers based on ethical as well as commercial criteria.

Building on a strong trend in recent years, member companies are investing more in training commercial staff in ethical trade. This helps embed a commitment to workers' rights throughout the business.

• Members reported delivering 3,910 training hours to buyers (2,800 in 2009) and 3,955 hours to technical staff (1,700 in 2009).

3. Building supplier capacity and skills

Companies need to support suppliers to improve working conditions, including giving them practical tools to do so. They also need to involve workers in the process.

Key trends and indicators

Member companies are increasingly recognising the importance of strengthening suppliers' human resources and management systems as an alternative to compliance auditing. Some are developing a range of new approaches in this area, from providing HR training to developing specific management tools.

There is increased recognition of the need to involve workers in the process of change, with some companies moving beyond simply training workers about their rights to developing projects aimed at empowering workers to start shaping their own destinies through the development of worker committees.

This year, a total of 267,307 hours of training were delivered to 91,170 supplier staff. Some 79,033 workers were trained.

4. Identifying problems in the supply chain

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 we have seen a slight increase in the number of sites inspected from 13,460 to 17,141 supppliers.

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 - particularly in relation to identifying violations of the ETI Base Code that are hard to identify, including those connected with the rights of workers to join and form trade unions, and to be free from discrimination. Some are attempting to make auditing more meaningful by conducting auditor training and develping alternative auditing techniques - for example, increasing the involvement of worker reps in the audit process.

5. 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.

A number of companies are starting to develop projects aimed at tackling the root causes of workers' rights violations and addressing broader socio-economic challenges. This is a positive development, as this is key to delivering sustainable change for workers.

• Members reported that their suppliers had agreed to make a total of 133,075 separate improvements to workers' conditions; a 7% increase from 2009.