In January 2020, Ethical Consumer viewed Aldi Sud’s corporate websites for information about how the company managed workers' rights in its supply chain. Aldi also provided Ethical Consumer with a completed questionnaire in March 2019 and May 2018 which were also used.

Supply chain policy (rudimentary)
Aldi Sud's 'Social Standards in Production', last updated in 2014, was downloaded which included adequate clauses freedom of association, forced labour, discrimination and child labour. However clauses regarding wages and hours were governed by local laws which often do not provide adequate protection for workers. It therefore received a rudimentary rating for its supply chain policy.

Stakeholder engagement (poor)
In response to Ethical Consumer’s questionnaire in March 2019 Aldi stated that it had a compliance hotline: "The ALDI AlertLine is a confidential way for employees and suppliers to report to report concerns about ethics. The AlertLine is operated by an independent company with multilingual operators on staff and is available 24 hours a day, 7 days a week. Employees may also choose to remain anonymous when reporting concerns." The company said nothing about whether the costs of using this hotline were born by the company or the employees; Ethical Consumer expects the company to cover all costs.
In response to its work within multi-stakeholder initiatives, Aldi stated that it had been a member of the German Partnership for Sustainable Textiles since 2015. Set up by the German Federal Ministry for Economic Cooperation and Development (BMZ) this multi-stakeholder initiative aims "to improve unsatisfactory social and environmental production conditions in the textiles industry".
The company also stated that it was "signatories of the Accord for Fire and Building Safety in Bangladesh to improve working conditions within the Bangladesh textile industry."
Aldi also mentioned its work with the following groups: Stronger Together, Business Social Compliance, Supplier Ethical Data Exchange, Food Network for Ethical Trade, Spain Supplier Ethical Trade Forum and British Retail Consortium (BRC). However, these were not considered to be multi-stakeholder initiatives at the time of writing.
In it's 2018 questionnaire the company stated, "We use certification schemes, such as Utz and Fairtrade to improve conditions for farmers across a range of commodities, including cocoa." However this was not deemed to constitute systematic input from an independent trade union or NGO to verify audits.
Overall the company was considered to have a poor approach to stakeholder engagement.

Auditing and reporting (poor)
Aldi stated in its questionnaire to Ethical Consumer that, “Every supplier to ALDI is contractually required to provide details of the main production facility or site of manufacture for each ALDI product. Our Social Monitoring Programme (SMP) specifically addresses social standards in high risk product groups and countries. As part of this programme, suppliers must become SEDEX or BSCI members and provide independent third party ethical audits for production facilities in high risk countries to demonstrate compliance with our ethical requirements.
"Our Assessment schedule is based on several factors, including inherent risks from particular product types and/or countries and strategic importance of supplier and/or production facility.
"We do not publicly disclose audit results as audits are only one part of our Social Monitoring Programme.
"We work with our suppliers on the basis of continuous improvement of ethical standards in our supply chain to remediate issues identified by our Social Monitoring Programme according to our Severe Risk Policy. Remediation is carried out on a case-by-case basis, dependant on a number of factors including the severity of the issue, progress against Corrective Action Plan and the willingness of the supplier and production facility to work jointly towards improvement. Following every audit, corrective action plans are drawn up which lay out an individualised timeline for remediating any faults. Our suppliers are obliged to implement corrective measures together with the production facility management. Our CR and buying departments closely monitor the process. If no progress is seen in the implementation of the action plan, or if the supplier or the production facility management do not take appropriate action to resolve significant issues, such as fire and building safety, late payment of wages, or producing in unauthorised production facilities, we may decide to take further action. This may include the temporary or permanent exclusion of the supplier and/or the production facility from future tenders. We aim to work together with our suppliers and production facilities whenever possible and exclusions are only implemented as a final resort if the situation cannot be collectively rectified.”
Aldi received a poor rating for its auditing and reporting due to the following reasons: Aldi did not appear to have a commitment to audit its whole supply chain. While its policy for dealing with Bangladesh was to commit to assessing 100% of its facilities it was not clear what proportion of its remaining production sites around the world were being audited. Furthermore it was unclear how regularly sites were being assessed following its risk analysis. Ethical Consumer asked that companies demonstrated a transparent audit schedule i.e. high risk suppliers will be audited every 6 months.
While Aldi did have a staged approach to dealing with non-compliance within its supply chain, there was no disclosure of audit results nor any mention of cost of audits. Therefore the company received a poor rating for its auditing and reporting.

Difficult issues (reasonable)
Aldi stated in its 2018 questionnaire: "In 2013, we established our CR Unit Asia to directly monitor and address difficult issues on the ground in our sourcing countries e.g. China, Bangladesh, India, Thailand and Vietnam. We regularly carry out announced, semi-announced and unannounced site visits and assessments of suppliers and production facilities in high risk countries. We believe this provides a more accurate picture of the issues affecting a production facility and directly tackles the issues of audit fraud, lack of freedom of association and the lack of transparency that may arise from third party audits." Ethical Consumer considered this to be addressing the issue of audit fraud.
Aldi stated in its questionnaire, “We run scheduled mandatory Corporate Responsibility training days for all new starters in Aldi’s Corporate Buying department, which include sessions on social monitoring and supply chain issues. All existing buyers are encouraged to attend the sessions and regular one-to-one training is also provided to buyers...We have held a number of supplier conferences for our suppliers on our Social Monitoring Programme and supply chain issues. In addition, we encourage all of our suppliers and their suppliers further down the supply chain to attend modern slavery workshops and access free training materials provided by Stronger Together, which ALDI has been a project sponsor of since 2013."
The 2018 questionnaire also stated, "We maintain long-term supplier partnerships and have been working with many of our key suppliers for several years." Ethical Consumer considered it to be addressing purchasing issues within its supply chain.
Aldi also stated that through the German Partnership for Sustainable Textiles it was attempting to encourage "the establishment of living wages". However, this programme only applied to one small section of its supply chain. No further information was given about efforts to address living wages or legal restrictions on freedom of association. Overall it was considered to have a reasonable approach to difficult issues.

Overall, Aldi received a middle Ethical Consumer rating for Supply Chain Management.

Reference:

www.aldi.co.uk/ (8 January 2020)

In June 2019 Oxfam released an update to its 2018 report on supermarkets. The report scored 16 of the biggest supermarkets in Europe and the US on how they tackled critical issues affecting the people working in their food supply chains. The specific areas covered were: transparency and accountability; respect for workers' rights; fair treatment of farmers; and fair treatment of women.

None of the supermarkets was found to be doing enough to ensure basic human rights in their supply chains. The report observed that some workers went to work and produced food all day, but went home hungry. All the companies were given marks out of 100 in each of the above categories. The lowest mark was 3% and the highest 38%.

Aldi South scored 19% overall – up from 1% in 2018 – broken down as follows:

transparency 31%

workers' rights 19%

farmers rights 17%

womens' rights 10%

As the supermarket received red (0-20%) or orange (21-40%) ratings across the board, it was marked down under Human Rights.

Reference:

Behind the Barcodes 2019 (12 August 2019)

In January 2020, Ethical Consumer viewed the Siepmann Stiftung and Aldi Sud family tree on the corporate database Hoovers. It showed that the group had one susidiary in China, which at the time of writing Ethical Consumer considered to be an oppressive regime.

Reference:

Generic Hoovers ref (2020)

In May 2016, Oxfam Germany published a report called: “Sweet Fruit, Bitter Truth: German Supermarkets’ Responsibility For The Inhuman Conditions Which Prevail In The Banana And Pineapple Industries In Costa Rica And Ecuador.”
The report followed an investigation undertaken by Oxfam Germany in 2008 which revealed the shocking conditions in the pineapple production industry in Costa Rica. In 2016 Oxfam found that little had improved.
Dr. Franziska Humbert, Advisor for business and human rights at Oxfam Germany and author of the report said “the conditions on plantations have barely improved over the past eight years. The water tanker is still needed to provide drinking water to the communities whose groundwater has been contaminated in the areas around pineapple plantations. Large companies which boast of their own sustainability dump their waste water right next to drinking water reservoirs, not even making any effort to hide it. Companies which share responsibility for the contamination of ground water do not pay any compensation to those affected, nor do they construct new waterworks. The workers’ complaints concerning their wages, working hours or the breaches of their trade union rights also shocked me.”
The report went onto blame supermarkets – in particular the German retailers including Aldi - for the untenable conditions which prevail in the banana and pineapple industries. It said “they abuse their market power in forcing down prices paid to producers and suppliers. For example, the import prices for pineapple decreased by around 45 per cent from 2002– 2014, despite increasing production costs. This contributes to the intensification of traditional exploitative structures in both countries, to the fact that the plantation workers’ wages in Costa Rica and Ecuador are too low to support a family, and to the perpetuation of unstable employment conditions. While the supermarket chains meticulously check the imported fruits’ appearance, refusing to accept entire deliveries due to even the smallest flaw, they take social and ecological criteria much less seriously. This investigation reveals (too) many violations of human and labour rights in the production of bananas and pineapples.”
The report talked about the use of highly hazardous pesticides and contamination of ground water. Many of the workers surveyed reported a high rate of disabilities, miscarriage and cancer in the areas around plantations. They also reported frequent respiratory disease, nausea, skin allergies and dizziness.
It said “The Ecuadorian banana industry uses highly poisonous substances such as Paraquat, which is not licensed for use in the EU, or the cancer-causing products Mancozeb and Glyphosate. Spraying pesticides from airplanes is standard. During a survey on a plantation which supplies Lidl amongst others, 60 per cent of the interviewed workers stated that they work on the plantations during or straight after airplane spraying has taken place – a clear violation of state-recommended re-entry safety periods. In Costa Rica too, workers of producers which supply German supermarkets report that pesticides are sprayed whilst they work on the fields.”
Issues such as repression of trade unions and precarious working conditions were also found.
Oxfam demanded that German supermarket chains do justice to their ecological and social responsibility.
Aldi lost whole marks in the categories of Pollution & Toxics and Workers' Rights in light of this story.

Reference:

SWEET FRUIT, BITTER TRUTH (May 2016)

In January 2020, Ethical Consumer searched Aldi's websites, and a questionnaire that Aldi had completed in March 2019, for information about its cotton sourcing policy.

The questionnaire stated that suppliers must not knowingly source cotton from Uzbekistan; they are encouraged to monitor and track their cotton supply chains on the Better Cotton Initiative website. However, it was not clear whether this policy applied to the whole company group, or how it was applied and monitored.

The questionnaire said it used organic cotton, but did not state it used only organic cotton. It stated ‘certified cotton is cultivated according to certain requirements which, for example, regulate the use of fertilisers and pesticides. In Germany and Austria we offer special buy textiles products containing cotton which is certified according to, for example, the Fairtrade standard, GOTS and the Organic Content Standard (OCS). In addition to this, cotton which is certified according to GOTS or OCS also originates from controlled organic cultivation.’

Regarding GM cotton it stated ‘We request that suppliers do not use GM ingredients and/or derivatives in our non-food products.’ It was not clear how it ensured and monitored this- especially as not all of its cotton appeared to be certified organic.

The Aldi CSR website stated that "We will increase the use of sustainable cotton and ensure that only sustainable cotton is used for our ALDI-exclusive garments and household textiles from 2025 onwards. By 2025, we will therefore require the cotton used for our ALDI-exclusive products to be of either recycled origin or certified according to one of the following internationally recognised sustainability standards: Fairtrade, Global Organic Textile Standard (GOTS), Organic Content Standard (OCS), Cotton made in Africa (CmiA), Better Cotton Initiative (BCI)"

However, Aldi was currently still using cotton that was not certified by these standards.

According to Anti-Slavery international (ASI) website viewed by Ethical Consumer in August 2018, Uzbekistan and Turkmenistan were two of the world’s largest exporters of cotton, and every year their governments forcibly mobilised over one million citizens to grow and harvest cotton. Due to the high proportion of cotton likely to have come from Uzbekistan and Turkmenistan and the prevalence of forced labour in its production, the company lost half a mark in the Workers Rights category.

The Organic Trade Association website, www.ota.com, stated in July 2018 that cotton covered roughly 2.78% of global arable land, but accounted for 12.34% of all insecticide sales and 3.94% of herbicide sales.

According to the International Service for the Acquisition of Agri-Biotech Applications (ISAAA), a non-profit pro biotech organisation, genetically modified cotton accounted for 80% of cotton grown in 2017.

Overall, Aldi was marked down under Worker's Rights and lost half a mark in this category due to its lack of a current policy for avoiding the use of Uzbeki cotton.

Due to the impacts of the widespread use of pesticides in cotton production worldwide the company also lost half a mark in the Pollution & Toxics category.

Due to the prevalence of GM cotton in cotton supply chains and the lack of any evidence that the company avoided it, it was assumed that some of the company's cotton products contained some GM material. As a result it lost half a mark under the Controversial Technology category.

Overall the company received Ethical Consumer's worst rating for its cotton sourcing policy.

Reference:

Ethical Consumer Questionnaire (14 March 2019)

In August 2017 the Gaurdian published an article entitled, 'Aldi Australia tries to gag truck drivers' union after claims of unsafe practices'. The article detailed how Aldi had moved to gag a workers' union who claimed that the company imposed unsafe work schedules on its drivers. "The Transport Workers Union accuses Aldi of using its wealth and size to bully drivers into unsafe practices including skipping rest breaks and truck maintenance in order to meet tight delivery times."

Aldi lost half a mark in the Workers' Rights category in light of this story.

Reference:

https://www.theguardian.com/australia-news/2017/aug/29/aldi-tries-to-gag-truck-drivers-union-after-c