Wesfarmers Health - Human rights and modern slavery

Wesfarmers Health recognises the importance of human rights. The company holds both its operations and supply chains accountable, requiring them to adhere to legal obligations and community expectations concerning human rights and ethical sourcing practices.

This commitment includes:

• Human rights due diligence: dedication to an ongoing process of human rights due diligence within its supply chain and business development activities.
• Risk identification and mitigation: adopting a proactive approach to identify and mitigate human rights-related risks.
• Advocacy for transparency: advocating for transparency, actively supporting national and international efforts aimed at addressing human rights issues.
• Taking remedial action: If Wesfarmers Health identifies human rights issues that it has caused or contributed to, the company commits to taking prompt corrective action.

 Ethical Sourcing Program and governance

Wesfarmers Health operates an Ethical Sourcing Program and commits to meeting the minimum standards outlined in the Wesfarmers Ethical Sourcing and Modern Slavery Policy (“the Policy”). This commitment extends to:

• identifying ethical sourcing and modern slavery risks within its supply chains; and
• collaborating with suppliers to address harm and report breaches, along with any remediation that may be required.
  

The Wesfarmers Health Ethical Sourcing Program is under the governance of the Wesfarmers Ethical Sourcing and Modern Slavery Policy, which stipulates that all Wesfarmers divisions and business units must work with suppliers to ensure compliance with all applicable laws and regulations.

The Policy is available on the Wesfarmers Health website, intranet and supplier portals. Wesfarmers Health has also updated a range of internal policies to incorporate ethical sourcing requirements.

Traceability and supplier due diligence

Adopting a risk-based approach, Wesfarmers Health assesses and mitigates human rights risks, monitoring private label suppliers, exclusive brands, direct imports and brand merchandise products suppliers, such suppliers providing Wesfarmers Health 'Own Brand’ goods for resale (Own Brand GFR).

In assessing risks in its goods supply chain, Wesfarmers Health considers not only Own Brand GFR manufacturing sites but also goods not for resale (GNFR) suppliers, in particular suppliers that manufacture products which contain high risk ingredients such as cotton, mica, rubber and polysilicon. Specific attention is given to these high-risk GNFR suppliers, and due diligence forms, the Sedex risk assessment tool and third-party social audits are utilised.

In managing the risks in sourcing services not for resale (SNFR), Wesfarmers Health focuses on services such as cleaning, waste disposal, security and catalogue distribution, where workers of vulnerable backgrounds are more likely to be involved.

Monitoring

Social audits, triggered by human rights-related concerns, are integral to the Ethical Sourcing Program. The monitoring system grades third-party social audits, reviews social non-conformances and updates internal teams on the site’s approval status. The total number of monitored sites has increased from 57 last year to 63, demonstrating a commitment to heightened vigilance.

Remediation

Wesfarmers Health addresses non-conformances in alignment with the Sedex Members Ethical Trade Audit (SMETA) methodology. Suppliers and sites unwilling or unable to rectify defined critical non-conformances face the risk of purchase suspension. The company places a strong emphasis on remediating issues related to excessive recruitment fees, bribery attempts and non-conformances threatening worker safety.

Suppliers and sites may potentially be exited if they are unwilling or unable to work towards continuous improvement and unwilling or unable to commit to remediate any substantiated harm they caused or contributed to.

Training, Support, and Grievance Mechanisms

A robust training regimen includes online modern slavery training and in-depth ethical sourcing training for team members. During the year, 320 hours of online modern slavery training was provided to 1,279 team members and 26 hours of in-depth ethical sourcing training.

The in-depth training seeks to educate team members so they can identify ethical sourcing and human rights issues in our supply chains, as well as help suppliers understand expectations under the Wesfarmers Health Ethical Sourcing Program. Wesfarmers Health also engaged a third-party service provider to deliver an online webinar in Mandarin to 16 of its own-brand manufacturing facilities and suppliers.

During the year, Wesfarmers Health updated its Whistleblower Policy, which refers to the Wesfarmers Health Ethical Sourcing and Modern Slavery Policy, and embraced additional in-country grievance mechanisms, such as 'Your Voice,’ a communication channel made available to approximately 726 supplier workers.

In circumstances where human rights-related issues are raised through the above channels, Wesfarmers Health will ask the supplier to investigate and to provide evidence that the Policy is being adhered to.

Continuous Improvement

Wesfarmers Health remains committed to working with suppliers and other stakeholders to drive continuous improvement. It aspires to increase monitoring of supplier performance encompassing more supplier categories, as well as monitoring manufacturing sites deeper into the supply chain.

Wesfarmers Health aims to integrate new businesses it acquires into its Ethical Sourcing Program, review ethical sourcing data in greater detail and enhance due diligence processes, maintaining a forward-looking approach to ethical business practices.