CA Transparency in Supply Chains Act

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On January 1, 2012, the California Transparency in Supply Chains Act of 2010 (SB 657) went into effect in the State of California. Under the law, large manufacturers and retailers are required to disclose their efforts to eradicate slavery and human trafficking within their supply chains. The law’s underlying purpose is to educate consumers, so they can make informed decisions and purchase goods from companies that responsibly manage their supply chains.

At Target, we hold ourselves and our vendors accountable to high ethical standards wherever we do business. Target works diligently to ensure Target’s products are produced ethically by our suppliers and in accordance with Target's Standards of Vendor Engagement (“Target’s Standards”) and Target's Vendor Conduct Guide, which our suppliers are subject to as a condition of doing business with Target. On November 14, 2016, we announced our enhanced efforts to monitor for forced labor within Target’s supply chain and our commitment to take swift action when indicators are discovered. Today, Target undertakes social compliance verification efforts for our suppliers producing Target owned-brand goods, Target exclusive goods and for all national brand products for which Target is the importer of record, all of which are required to register their production facilities with Target. In 2016, we conducted nearly 1,600 unannounced social compliance audits of the registered production facilities.  In 2017 as well as 2018, with the implementation of our enhanced efforts, we increased that number by over 10%.
 
Stakeholder Engagement 
In addition to our efforts focused on Target’s supply chain, we also regularly collaborate with NGOs, brands, governments, international organizations and other expert stakeholders to help advance working conditions and eliminate forced labor from the global supply chain more broadly. For example, in 2010 Target adopted the Responsible Sourcing Network’s No Uzbek Cotton pledge to help eliminate forced labor and human trafficking within the global textile supply chain. In 2018, we updated Target’s policy to include a ban on Turkmen cotton. Target is also an active member of the Consumer Goods Forum Social Sustainability Committee devoted to working on a Forced Labor resolution, and we are a founding member of the Responsible Business Alliance’s Responsible Labor Initiative. In recognition of our adoption and commitment to the Employer Pays Principle, Target was admitted into the IHRB’s Leadership Group for Responsible Recruitment. The Leadership Group is a collaboration between leading companies and expert organizations committed to improving global recruitment practices of foreign contract workers.
 
Additionally, we are actively engaging our supply chain partners to collaboratively implement preventative programs with the International Justice Mission and the Ethical Trading Initiative. We also routinely seek input from experts such as Verité and Impactt as well as other organizations within the CSO and NGO communities, to help ensure Target’s evolving policies and oversight practices are effective in helping identify and eliminate unfair, unethical or illegal working conditions and/or labor practices, including the use of forced labor. Moreover, when stakeholders share information with us related to potential forced labor circumstances, we listen.
 
In early 2018, the NGO Transparentem shared with Target that they had identified indicators of forced labor at a factory used by one of our vendors in Malaysia. Although we were no longer doing business with the factory for unrelated reasons, we took swift action. Those actions entailed working with the factory’s other customers and a credible third-party expert in forced labor to validate the claims and then partnering with our vendor, the factory and its other customers to develop and implement a corrective action plan to address the issues. That work included, among other things, returning passports to the foreign contract workers employed there, requiring reimbursement to workers for the recruitment fees they paid to secure their jobs in violation of the Employer Pays Principle, and overhauling the factory’s management and hiring practices to ensure the issues would not recur. Now that remediation is complete and the indicators eliminated, we believe the overall effort will serve as a model for collective, multi-stakeholder remediation, both for Target and other importers, when indicators of forced labor are discovered in the supply chain.

Verification of Product Supply Chains 
All production facilities manufacturing Target owned-brand goods, Target exclusive goods and nationally-branded goods for which Target is the importer of record must be registered before Target will accept goods produced there. As part of our efforts to verify our suppliers’ compliance with Target’s Standards and applicable laws, each of those production facilities must complete a human rights and compliance questionnaire as part of the registration process and authorize unannounced compliance audits. Target utilizes a risk-based approach in our supply chain verification efforts, including how we prioritize our unannounced facility audits. Our main focus is the general conditions of the country where the goods are produced. We also leverage an internal, cross-functional team of company leaders and compliance personnel to evaluate proposed shifts or expansions in overseas production to ensure regional and/or commodity-related risks are accurately identified and appropriately weighed.
 
In addition to our standard audit process, we also assess workforce demographic risks, and where appropriate, we deploy auditors with deep subject matter expertise to conduct a supplemental assessment specific to foreign contract workers and supplier recruitment practices. This supplemental assessment includes reviewing hiring practices, interviewing labor agencies, analyzing migrant worker conditions, auditing living accommodations and generally understanding the migrant worker employment experience at a given facility.
 
Supplier Audits 
Target or our qualified, third-party auditors conduct mostly unannounced facility audits at registered facilities to verify our suppliers’ compliance with Target’s Standards, and we prioritize the higher risk facilities. For more information about Target’s supplier assessments, please review Target's Comprehensive Social Compliance Audit Process. We also regularly conduct product safety and quality assurance audits as well as CTPAT supply chain security audits (as part of the Customs and Trade Partnership Against Terrorism program, of which Target is a founding member) at our suppliers’ facilities. Quality/safety and security auditors are trained to spot potential social compliance concerns (including indicators of forced labor) and to escalate them for further investigation by our internal and independent 3rd party investigators.
 
Certification of Compliance with Laws 
As an additional condition of doing business with Target, all our suppliers warrant that the products they supply to Target are manufactured in accordance with all applicable laws, regulations and standards – both of the United States as well as their country of origin. Target’s Standards expressly prohibit our suppliers from utilizing any forced or compulsory labor and accordingly, we expect our suppliers to remediate indicators when identified. For additional information, please review our Labor & Human Rights policies. Target will not do business with a vendor that fails to warrant compliance with all applicable laws and will discontinue doing business with a supplier who fails to live up to that promise. Every year since 2016, we have reiterated to our suppliers, in writing, Target’s policy and expectations regarding forced labor.  We have also reiterated that this policy and expectation extends not only to our suppliers’ own operations and production facilities, but to their upstream material and component suppliers as well.
 
Accountability 
In the spirit of continuous improvement, Target’s approach to forced labor is consistently evolving as we adopt proven methods, and partner with reputable experts, to help discover and eradicate it from our supply chain. If forced labor indicators are found in a supplier’s production facility, we will work quickly to assess the situation and evaluate a variety of factors including the supplier’s and facility’s ability to remediate, the feasibility of providing meaningful remedy to impacted workers and the likelihood of sustained improvement. When remediation is achievable, the supplier is required to work with the facility, in consultation with Target and industry experts, to develop and implement an appropriate corrective action program in keeping with our ‘do no harm’ aspiration. If the situation is not conducive to remediation, then we will work to disengage responsibly from a facility. For additional information related to supplier performance, probation/termination processes and training, please review Target's Social Compliance Operations. Target also makes an Integrity Hotline available to Target team members, our suppliers and the workers in our suppliers’ production facilities. The purpose of the Integrity Hotline is to provide a vehicle for anonymously reporting concerns dealing with potentially unfair, unlawful or unethical business practices and to maintain a system through which Target can investigate claims and address complaints. The system has been an effective mechanism for identifying and remediating issues raised by workers within our suppliers’ production facilities. When received, worker allegations are investigated by our overseas’ and global investigations’ teams. At the conclusion of an investigation, Target takes appropriate actions in light of the findings, consistent with Target’s Standards. Such actions may range from Corrective Action Plans and remediation to the discontinuation of the business relationship.

Target Team Member and Supplier Training 
Target administers mandatory training for team members responsible for sourcing and merchandising decisions on an array of topics, including Target’s Standards and Target’s Social Compliance program. We also require all team members to comply with our Business Conduct Guide, which includes an annual review of Target’s Standards. Target has an extensive library of social compliance training available for our suppliers, as well as a factory education guide that includes a social compliance section. Target also provides in-person, in-factory and classroom training options for a variety of compliance topics, including forced labor and human trafficking. For example, Target collaborated with Verité to conduct trainings in select markets specifically on the topics of responsible recruitment and ethical management of foreign contract workers. Our training materials emphasize strong social compliance management practices and focus on preventing and managing related issues, including human trafficking and forced labor.

For additional information, please visit Target.com/HereforGood


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