Ethical Trading Policy

    1. Introduction
  1. We recognise the responsibility that we share with our suppliers to source products in an ethical manner. We want our customers around the world to be confident that the people who make our products are treated fairly, are not exploited and are not exposed to unsafe working conditions. Our Ethical Trading Policy is a core element of our commitment to buy and sell our products responsibly. It requires all our suppliers to comply with our Code of Conduct for Business Partners (CoC), which ensures key rights for workers, and is based on the Fundamental Conventions of the International Labour Organisation (ILO) and national and international laws, and on the Ethical Trading Initiative’s Base Code. We expect all our suppliers to have ethical processes and policies in place throughout their supply chain and to provide reasonable information as evidence of compliance to our CoC. Additionally, as part of our commitment to ethical trading all suppliers for ZALORA’s owned private labels will be monitored to verify compliance with this policy, either through direct site visits and /or through a range of other tools, which support our risk management, continuous improvement and capacity building of our suppliers.


  2. 2. Scope
  3. This policy applies to all suppliers to ZALORA and affiliated companies, and is applicable to the supply of goods for resale, direct or indirect, and goods and /or services not for resale. It also applies to all vendors using any of ZALORA’s e-commerce platforms, such as “marketplace”.


  4. 3. Implementation Principles Commitment to Ethical Trading
  5. Our Ethical Trading Policy is integrated into our commercial and supplier management activities and forms a key part of our Corporate Responsibility programme. We recognise the need to communicate our commitment to key stakeholders including the public, suppliers and the people who work for our suppliers.

    Suppliers’ selection

    We seek to develop long-term relationships with our suppliers who share our ethical standards. These relationships with suppliers are based on the principle of fair, open and honest dealings at all times. Only suppliers that share our standards and can demonstrate compliance will be considered appropriate to trade with ZALORA.

    ZALORA will assess all suppliers through a robust risk-based system and then monitor them accordingly. Our assessment tools will determine the level of ethical risk posed by each supplier, with the highest risk supplier sites being required to regularly demonstrate compliance and to ensure any non-compliance is addressed within the timescales appropriate to the criticality.

    Monitoring

    We will evaluate all reasonable evidence provided by suppliers, which demonstrates their own commitment to ethical trading and compliance with ZALORA’s CoC. Where this requirement is not met, ZALORA will reserve itself the right to inspect suppliers to assess their ethical trading practices. Through active monitoring we will measure the performance of our Private Labels’ suppliers against our CoC and identify emerging trends that required corrective actions.

    Improvements

    We encourage and support continuous improvement in supplier standards and we will regularly measure supplier improvement. We recognise our suppliers may need time and support to ensure compliance, however, all our suppliers must demonstrate that any breach of our CoC is addressed in timescales appropriate to the criticality. Where we are alerted to breaches of our CoC we will take action that we consider appropriate. We will work with suppliers to resolve ethical trading issues. If suppliers are unable or unwilling to address critical issues associated with any breach of our CoC within the required timescales, this will be considered a material breach and we reserve our right to terminate the relationship in accordance with our contractual rights.

    Transparency

    We will strive to be open and honest when we work with others and ensure reporting is fair and transparent.

    Capacity Building

    We are committed to providing guidance, support and training for our colleagues and suppliers to identify and resolve ethical issues.


  6. 4. Specific Supplier Requirements
  7. Suppliers and sites that manufacture our goods - (Privately owned labels)

    The responsibility for supplier’s sites and manufacturing units, which produce for ZALORA’s own private labels include:

    • To fully understand all applicable laws and regulations, all elements of ZALORA’s Ethical Trading Standards and all other ZALORA’s requirements and applicable policies, including ZALORA’s Code of Conduct for Business Partners;
    • To put in place the necessary investment, systems and controls to meet ZALORA’s Ethical Standards;
    • To demonstrate that ZALORA’s Ethical Trading Standards are continuously met throughout the production process, including requirements set forth in ZALORA’s Code of Conduct for Business Partners;
    • To ensure that ZALORA’s representatives, including third-party auditors, are given access to all sites used to manufacture ZALORA’s Private Label goods and that all records and documents presented are both accurate and complete;
    • To advise ZALORA in advance of any new sites intended for the production or processing of Private Label goods, including the intention to sub-contract any orders;
    • To voluntarily report any actual or likely inability to meet the Ethical Trading Standards; take responsibility for addressing all areas of non-compliance and for seeking help from ZALORA, or from other parties, where the site is not able to make the required improvements alone.


  8. Where independent brands and manufacturers’ brands and/or their agents supply product to ZALORA (Branded products and/or white labels)

  9. The responsibility for supplier brands and their agents’ responsibilities when providing product directly to ZALORA include:

    • To fully understand all applicable laws and regulations, all elements included in ZALORA’s Code of Conduct for Business Partners and this Ethical Trading Standards and all other ZALORA requirements and applicable policies;
    • To meet ZALORA’s Ethical Trading Standards in their own operations and business relationships with factories manufacturing products for resale by ZALORA, including ZALORA’s Code of Conduct for Business Partners or equivalent standards;
    • To provide ZALORA with sufficient evidence of due diligence practices and policies in enforcing and monitoring compliance with ZALORA’s Ethical Trading Standards or with other equivalent standards or certifications previously acknowledged by ZALORA;
    • To voluntarily report to ZALORA any actual or likely inability on the part of any manufacturer or factory to meet the ZALORA’s Ethical Trading Standards.


  10. Where indirect sellers and/or non-manufacturing suppliers or agents are used in part of the supply chain (Marketplace)

    The responsibility for supplier/agents, where non-manufacturing suppliers or agents are used in any part of the supply chain, include:

    • To fully understand all applicable laws and regulations, all elements included in ZALORA’s Code of Conduct for Business Partners and this Ethical Trading Standards and all other ZALORA requirements and applicable policies;
    • To meet ZALORA’s Ethical Trading Standards in their own operations and business relationships with factories manufacturing products for resale by ZALORA, including ZALORA’s Code of Conduct for Business Partners or equivalent standards;
    • To provide ZALORA with sufficient evidence of due diligence practices and policies in enforcing and monitoring compliance with ZALORA’s Ethical Trading Standards or with other equivalent standards or certifications previously acknowledged by ZALORA. In cases where this information is not available, suppliers and/or sellers who surpass an established business volume threshold with ZALORA, will be required to provide a compliance self-assessment form and agree to random compliance assessment visits by ZALORA or by any appointed representatives;
    • To voluntarily report to ZALORA any actual or likely inability on the part of any manufacturer or factory to meet ZALORA Ethical Trading Standards.

    5. Supplier Selection and Management
  11. We aim for all new vendors / suppliers to ZALORA to undergo a screening and selection process, which will include an assessment of their ability to meet ZALORA’s Code of Conduct for Business Partners. This will be carried out fairly, based on an evaluation of the supplier’s overall contribution, cost and capabilities. Suppliers will also need to agree to the terms and requirements of this policy, and to provide all required information, including that regarding manufacturing sites when applicable, priori to being considered as “active”. Orders cannot be processed with any vendor / supplier, unless they have been previously assigned a “provisional” or “approved” status.


  12. 6. ZALORA’s Code of Conduct for Business Partners
  13. The requirements of the CoC constitute minimum and not maximum standards and relate to ZALORA and any member company of the Global Fashion Group.

    Suppliers shall at all times comply with this code and with all applicable national and international laws, regulations, codes and standards, both in the country in which the supplier works, and in the country in which the product and/or services are sourced/provided.

    Suppliers shall ensure, as far as is reasonably practicable, that their suppliers, agent(s), subcontractors and consultants, who are directly or indirectly involved in the provisions of goods and /or services to ZALORA, or any company part of Global Fashion Group, comply with this code.


  14. 7. Implementation of ZALORA’s Ethical Trading Policy
  15. The above policy will come effective immediately and will be the responsibility of the Chief Executive Office at ZALORA, and of all appointed accountable leaders, to ensure its effective communication, rollout and execution. Global Fashion Group, through its Sustainability Committee and Global Sustainability function, will provide guidance and support to ZALORA, and each business unit, to ensure consistent implementation of this policy across all regions.