Card Factory plc - Modern Slavery Act 2015
Annual Compliance Statement - Financial Year 1 February 2018 to 31 January 2019
Card Factory recognises the importance of conducting its business and managing its supply chain responsibly to mitigate the risk of slavery and human trafficking being present. We take this responsibility seriously and our policy is not to do business with any party that may directly or indirectly finance or benefit from slavery or human trafficking.
Our structure and business
Card Factory is the UK’s leading specialist retailer of greeting cards, dressings and gifts.
Card Factory focuses on the value and mid-market segments of the UK’s large and resilient greeting cards market, in addition to offering customers a range of complementary products associated with card giving occasions.
Card Factory principally operates through its nationwide chain of over 975 Card Factory stores, as well as through its transactional web sites: www.cardfactory.co.uk and www.gettingpersonal.co.uk.
Our retail business is predominantly UK based with a small presence in the Republic of Ireland and a small number of overseas franchises. We have more than 7000 permanent employees and, during our peak trading period, employ an additional c6000 temporary employees to ensure we are able to meet the needs of our customers.
Our supply chain
Our supply chain includes buying agents, third-party manufacturers and distributors, logistics partners, our own, UK based, manufacturing facility and our distribution centre.
The majority of the greeting cards we sell in our stores are designed and manufactured within the Group in the UK. This vertically integrated model provides us with more direct control of this part of our supply chain.
The vast majority of the other products we sell in our retail stores and online are sourced directly from overseas suppliers based outside the EU. We also have a small number of UK and EU based suppliers from whom we source a small proportion of the goods we sell.
We take reasonable steps to mitigate against the risk of slavery or human trafficking occurring in our supply chain. Our Ethical Trading and Anti-Slavery policy underpins our commitment to operating ethically and supplements the steps we already take in this regard.
In spite of the steps we take, there remains a risk that third-parties and supply chain partners may outsource manufacturing or the provision of services to us without our knowledge or consent, impacting our ability to mitigate against the risk of slavery or human trafficking. Where this comes to our attention we will promptly take appropriate steps to ensure this does not expose our business to additional risks.
Our procedures and due diligence
Our retail business and UK manufacturing facility
Our retail business is predominantly UK based with a small presence in the Republic of Ireland and a small number of overseas franchises. Additionally we have a UK manufacturing facility which prints the majority of our greeting cards.
• Our policies and procedures ensure we comply with all laws covering the employment of our colleagues, their working conditions and environment.
• Our recruitment and ongoing employment processes mitigate the risk of slavery and human trafficking in the UK. We adopt fair employment practices within our workforce and our policies and procedures support these.
UK and EU Based Suppliers of stock and services
Products from our UK and EU based suppliers represent a small proportion of the products we sell and, in mitigating risks relating to these, we seek to deal with reputable suppliers who have their own assurance procedures in place and do not currently conduct our own audits.
Overseas Suppliers of stock
The vast majority of the other products we sell are sourced directly from overseas suppliers based outside the EU.
For these products our assurance programme comprises:
• pre-engagement desktop due diligence for new suppliers which typically includes identity verification, confirmation of manufacturing facilities being used, obtaining Modern Slavery Declarations and requesting copies of any applicable accreditations and audits;
• a factory audit programme for all suppliers using reputable third party audit firms (irrespective of any existing audits);
• technical audits (ISO9001 standard) and ethical audits (SA8000 standard) with ethical audits specifically addressing the ages of staff, remuneration, working conditions, working hours and health and safety;
• a managed programme for dealing with audit failures and any material issues raised in audits; and
• periodic visits by our own sourcing teams.
We also source some products through established trading companies and buying agents in the Far East and, over the course of the last year, have conducted ethical and technical audits of the factories used by these trading partners. These additional steps provide greater transparency over our supply chain and the assurance that our products are being produced ethically.
What we’ve achieved during the last year
Last year we set ourselves objectives that would supplement the steps we already take to mitigate the risk of slavery and human trafficking being present in our supply chain. We achieved all of those objectives and, during the last year, have:
• rationalised and audited (both ethical and technical audits) factories currently utilised by our trading company and buying agent partners in the Far East;
• supplemented our audit programme by ensuring those suppliers in the Far East from whom we directly source products are re-audited every two years and are therefore maintaining their production and ethical standards;
• refused to accept any products which are in production at a time a supplier fails a routine re-audit, until effective remediation of any material audit failures;
• completed our programme of ethical and technical audits of factories outside the EU from which we source products directly, irrespective of spend;
• formally adopted a “no audit no order” policy for all factories outside of the EU from which we source products directly;
• de-listed from our active supplier list, any product suppliers outside the EU who failed audits and did not take appropriate remedial action; and
• provided top-up training to our sourcing teams to ensure they understand our obligations and to provide practical guidance on what they should be looking out for on a day-to-basis, particularly when visiting suppliers and their factories.
Our continuing commitment and objectives for the next year
We remain committed to developing long-term relationships with product suppliers who share our commitment to eradicating slavery and human trafficking and whose business practices are responsible and ethical. In support of this we will continue to take all reasonable steps to develop our supply chain management procedures and our supplier audit programme to give assurance to our stakeholders that we take our commitment seriously.
During the next year we intend to further develop our supply chain management processes by:
• introducing a register of visits to monitor and document periodic visits to key suppliers from whom we source products directly and to ensure we have a first-hand view of their factories and the working conditions at least once every 3 years;
• implementing an online on-boarding system for overseas suppliers to expedite the process for new suppliers and provide an easily accessible repository for key supplier information, documents and commitments;
• transitioning existing overseas suppliers through the new supplier on-boarding process to re-confirm existing information, documents and commitments;
• reviewing our internal controls and procedures for key EU based suppliers of products and services; and
• introducing an assurance process for our UK based product suppliers to www.cardfactory.co.uk that includes their confirmation that they operate in compliance with our Ethical Trading and Anti-Slavery policy.
Approved and adopted by the Board of Card Factory plc on 17 July 2019
Karen Hubbard – Chief Executive Officer