Traceability & Risk Assessment
VS&Co is committed to tracing our product through every stage of the process, from finished goods to raw materials. We have traced 100 percent of our Tier 1 and Tier 2 supply chain for our lingerie and apparel products using Sourcemap, where a substantial majority of our facilities are located in the countries where the largest volume of our production takes place in Vietnam, United States, Sri Lanka, Indonesia and China.
Quarterly training on key topics such as human trafficking and modern slavery, forced labor and Supplier Code of Conduct standards are delivered to our Tier 1 suppliers. Additionally, training is delivered annually to VS&Co associates who have responsibilities related to supply chain management.
Our definition of tiers is aligned with the Sustainable Apparel Coalition and Science Based Targets initiative, as follows:
|TIER 1||Finished goods manufacturing|
|TIER 2||Facilities that supply Tier 1 facilities with fabrics, trims or components
Facilities that provide processing services (e.g., embroidery, printing, laundries)
|TIER 3||Raw material processing|
|TIER 4||Raw material extraction|
Victoria’s Secret & Co. Is committed to ensuring the traceability of cotton in our supply chain, and we align ourselves with suppliers who share this commitment.
We updated our Cotton Policy (Policy) in January 2022, to require all cotton fiber, cotton yarn, cotton fabric and cotton products be spun in or originate from one or more of the approved countries listed on the Policy.
We expect our suppliers to undertake appropriate due diligence to confirm compliance with this Policy. Suppliers are required to retain all documentation for the origin of raw material, processing and manufacturing to ensure transparency and traceability of our cotton supply chain. Independent Production Services (IPS) will conduct chain-of-custody audits to verify cotton fiber, cotton yarn, cotton fabric and cotton product originated from or was spun in one or more of the approved countries on our list. To view the full policy, click here.
We have a detailed risk assessment process to ensure we are working with business partners that are willing and able to comply with our standards.
The online system that IPS utilizes to manage Victoria’s Secret & Co.’s social compliance program allows our suppliers, auditors and associates to access critical information such as policies, guidance tools, supplier/factory information, audit reports, corrective action plans and remediation status at any time.
About the risk assessment process:
- An initial supplier verification and risk assessment is conducted to prevent involvement with high-risk suppliers.
- Once a supplier has passed the risk assessment, the relationship between Victoria’s Secret & Co. and a qualified supplier begins with a written master sourcing agreement wherein the supplier certifies that its factories and any that it may contract with will comply with Victoria’s Secret & Co.’s Supplier Code of Conduct, including codes and any applicable laws pertaining to slavery and human trafficking. No subcontracting is permitted without prior approval.
- Each supplier must agree to allow Victoria’s Secret & Co., or an independent third party hired by Victoria’s Secret & Co. to conduct an audit of their production locations without prior notice. IPS or a third-party auditing firm conducts announced or unannounced audits of each of our approved factories at least annually to ensure compliance with our Supplier Code of Conduct and supply chain standards. We may conduct more frequent reviews of factories located in countries designated as high risk by the U.S. State Department's Trafficking in Persons Report or identified through the company’s annual risk assessment process. Certain exemptions from annual audits may be granted to highly compliant factories with consistent and robust compliance. Victoria’s Secret & Co. requires a pre-production audit of all new factories to ensure the factory can meet our standards before production can begin.
In 2019, 107 pre-production audits were conducted for new factories, which resulted in eight factories not being approved because they did not meet our standards. The approval rate for pre-production audits in 2019 was 93 percent. In 2020, 64 pre-production audits were conducted for new factories, and all factories met our standards. The pre-production audit approval rate for 2020 was 100 percent. In 2021, 100 pre-production audits were conducted for new factories, and all factories met our standards. The pre-production audit approval rate for 2021 was 93 percent.
We conduct additional focused risk assessments on specific commodities, regions and groups such as migrant workers. In addition, all suppliers are required to certify that they have received, read and understand our no forced labor policy.