In April 2020 Ethical Consumer viewed Stada's website for information on how the company managed workers' rights in its supply chain. Although there was reference made to supply chain management, very little detail could be found, no supplier code of conduct could be found (although an employee code of conduct was mentioned), no details of audits and no discussion of the issues. As a result the company was rated as follows:
Supply chain policy (poor)
The company's website stated "Contracts negotiated since financial year 2016 pursuant to the Corporate Policies and which have been negotiated in connection with the production of finished goods include additional clauses on the topic of social responsibility within the scope of which STADA and its suppliers are increasingly obligated to comply with the ten principles of the UN Global Compact. This is associated with an obligation to, among other things, support and respect the protection of international human rights and ensure that neither party is complicit in any violations of human rights and commits to the removal of all forms of compulsory labor and to the elimination of child labor". The definition of the age of a child was not found.
A strong policy would also include the following commitments: permission of freedom of association, payment of a living wage, the restriction of working hours to 48 hours plus 12 overtime (without exception), no use of a child labour (under 15 or 14 if ILO exempt), no discrimination by race, sex or for any other reason.
Stakeholder engagement (poor)
Ethical Consumer deemed it necessary for companies to demonstrate stakeholder engagement, such as through membership of the Ethical Trade Initiative, Fair Labour Association or Social Accountability International. Companies were also expected to engage with Trade Unions, NGOs and/or not-for-profit organisations which could systematically verify the company's supply chain audits, and for workers to have access to an anonymous complaints system, free of charge and in their own language.
Auditing and Reporting (poor)
Ethical Consumer deemed it necessary for companies to have an auditing and reporting system. Results of audits should be publicly reported and quantitatively analysed. The company should have a scheduled and transparent audit plan that applies to their whole supply chain, including some second tier suppliers. The company should also have a staged policy for non-compliance. The costs of the audit should be borne by the company.
Difficult issues (poor)
Ethical Consumer also deemed it necessary for companies to address other difficult issues in their supply chains. This would include ongoing training for agents, or rewards for suppliers, or preference for long term suppliers. It would also include acknowledgement of audit fraud and unannounced audits, and measures taken to address the issue of living wages, particularly among outworkers, and illegal freedom of association.
Overall, Stada received Ethical Consumer's worst rating for Supply Chain Management and lost a whole mark in that category.
Stada website (8 May 2019)