Commercial Compliance
Our research has shown that order cancellations are a major concern for suppliers. As a solution, the Ethical Denim Council has collaborated with the Responsible Contracting Project (RCP) to develop a non-cancellation commercial compliance clause. We seek support for the Statement of Ethical Commercial Practices and two of RCP's complementary Buyer Codes to ensure a sustainable future for all.
Created in collaboration with Responsible Contracting Project
Statement Of
Ethical Commercial Practices
We believe and hope you believe that purchase agreements with various factories and other suppliers (collectively, “Suppliers”) which source, supply, manufacture and sell apparel products (“Products”) to the Brand, and the Brand has agreed to purchase Products from such Suppliers, in such quantities and upon such payment terms as may be agreed upon from time to time by the Brand and such Suppliers.
Should changes to the quantities purchased or payment terms of such Products be necessary, the Brand will ensure such changes are mutually agreed upon, and not to the detriment of Suppliers. That means any change that “costs” Suppliers any unexpected expense will be absorbed by the Brand.
In case of disagreement as to the amount or nature of these costs, the Brand agrees to go with Suppliers to a third-party arbitrator for resolution.
Buyer Codes by
Responsible Contracting Project
4.2)
When making changes to an order, Buyer will engage in a dialogue with its supplier to establish that the latter can adjust to the new requirements without running afoul of Buyer’s own human rights standards. If the supplier cannot adjust, Buyer will make commercially reasonable modifications to enable the contract to conform to Buyer’s own human rights standards, for example, by amending target delivery times and providing appropriate additional compensation. Likewise, should the supplier need to modify the contract/order so as to continue meeting Buyer’s human rights standards, Buyer will collaborate with the supplier to identify appropriate modifications.
4.10)
Buyer commits to paying all suppliers in accordance with the terms agreed at the outset of the contract, without attempting to change payment terms retroactively. Should changes to payment terms be necessary, Buyer will ensure that such changes are mutually agreed, and not to the detriment of, suppliers. To support this commitment, Buyer will provide its suppliers with clear and easily accessible guidance—in supplier’s own language—on payment procedures and corresponding dispute resolution mechanisms.