Compliance & Sourcing
Global audit results
- Active factory status is shown in pie charts.
- The audit rating table reflects percentage of all factory audits conducted.
| Green | Yellow | Orange | Red denied | Red disapproved | Red unauthorized | Red failed | Audit incomplete | Industry audit |
| Low-risk | Medium-risk | Higher-risk | Higher-risk | Egregious | Egregious | Egregious | Low-/medium-/higher risk | Low-/medium-/higher risk |
| Reaudited after two years | Reaudited after one year | Reaudited after 180 days | Reaudited as soon as possible | Barred from business with Walmart for one year | Indefinitely barred from business with Walmart | Permanently barred from business with Walmart | Reaudited as soon as possible | Reaudited according to industry program schedules |
Regional challenges and updates
As we work to purchase products responsibly, we are tailoring our compliance program to address the challenges in each market. Our Responsible Sourcing team has noted the following issues in each sourcing region. These issues apply generally to the relevant geographic area and are not intended to comment on our business with the region.
Region A
Cambodia, Indonesia, Malaysia, Vietnam
| 2013 | 1.5% | 16.3% | 61.1% | 0.8% | 0.1% | 0.0% | 0.0% | 0.3% | 19.9% |
| 2012 | 3.2% | 33.3% | 31.8% | 2.2% | 1.0% | — | — | — | 28.5% |
| 2011 | 2.3% | 33.8% | 29.1% | 0.6% | 0.2% | 0.2% | 0.8% | — | 33.1% |
Regional challenges and updates
Exploitation of migrant workers in the seafood and canning industries is becoming more evident. We’re engaging the International Labour Organization’s (ILO) Better Work Program and others to drive positive changes. Additional challenges include failure to pay increased minimum wage and related worker strikes. We’re leveraging our capacity building programs to address workforce issues.
Region B
India, Sri Lanka
| 2013 | 3.5% | 27.1% | 67.5% | 0.9% | 0.0% | 0.9% | 0.0% | 0.1% | 0.0% |
| 2012 | 5.4% | 47.8% | 45.0% | 1.1% | 0.3% | 0.1% | 0.2% | — | — |
| 2011 | 9.1% | 66.1% | 22.9% | 0.8% | 0.2% | 0.4% | 0.2% | 0.2% | — |
Regional challenges and updates
We continue to engage with multistakeholder initiatives to address the issue of Sumangali in India. Guidelines developed through the Tirupur Stakeholder Forum are being implemented. Concerns in this region continue around management of contract labor, egregious working hours and nonpayment of overtime.
Region C
Europe, Turkey
| 2013 | 12.1% | 31.4% | 56.0% | 0.5% | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% |
| 2012 | 17.3% | 71.1% | 10.5% | 1.2% | — | — | — | — | — |
| 2011 | 17.5% | 71.7% | 10.3% | — | — | — | — | 0.4% | — |
Regional challenges and updates
Due to data protection regulations, facilities in Europe often deny access to pertinent employee information during audits. Records availability for agency workers and workplace safety matters are being addressed through our Factory Audit Orientation and Violation Correction Training programs.
Region D
China, Hong Kong, Japan, Philippines, Taiwan
| 2013 | 0.7% | 35.4% | 55.8% | 0.9% | 0.9% | 0.0% | 0.0% | 0.2% | 6.1% |
| 2012 | 0.9% | 58.8% | 23.3% | 1.4% | 1.7% | 0.2% | 0.3% | — | 13.4% |
| 2011 | 1.4% | 55.0% | 24.9% | 0.9% | 1.5% | 0.2% | 0.2% | 0.4% | 15.5% |
Regional challenges and updates
Raw materials cost, labor cost and exchange rates result in some factories moving to inland China, closing or moving to other countries. Lack of infrastructure creates obstacles to compliance with environmental standards. For wage and hour challenges, Violation Correction Training and the Orange School Program have been implemented broadly.
Region E
Central America, North America, South America
| 2013 | 23.0% | 17.4% | 58.2% | 0.7% | 0.0% | 0.0% | 0.0% | 0.1% | 0.6% |
| 2012 | 29.3% | 50.5% | 18.6% | 0.6% | 0.1% | 0.1% | — | — | 0.8% |
| 2011 | 48.0% | 37.4% | 13.8% | 0.7% | 0.1% | — | — | — | — |
Regional challenges and updates
Some countries in this region face issues related to limited knowledge and application of local labor law, wage payments made in cash to avoid legal wage deductions, as well as lack of labor hours tracking. Fresh produce packhouses experience labor shortages due to rising migration of workers from fields to cities or other countries, and often these migrant workers are employed without work permits. Walmart is engaged in a multistakeholder initiative specifically focused on challenges related to agriculture, starting in the U.S.
Region F
Africa, Bangladesh, Israel, Jordan, Pakistan
| 2013 | 4.9% | 28.6% | 48.3% | 0.8% | 0.3% | 7.7% | 6.5% | 0.3% | 2.8% |
| 2012 | 3.4% | 61.5% | 25.8% | 1.0% | 0.9% | 3.5% | 0.8% | — | 3.1% |
| 2011 | 2.7% | 51.9% | 30.7% | 1.0% | 0.9% | 11.0% | 0.2% | 0.2% | 1.3% |
Regional challenges and updates
Two prevalent issues in this region are unauthorized subcontracting and fire safety. In the event of an emergency, workers commonly face challenges such as structural hindrances, lack of preparedness and panic. Political unrest, wage discrimination and factory management’s resistance to paying increased minimum wages are also problematic. Lack of infrastructure for electric and gas utilities, as well as environmental compliance, make it difficult for factories to meet our standards. Our new zero-tolerance policy and enhanced fire safety protocols are being implemented to address some of the concerns in this region.
Total
| 2013 | 7.1% | 29.2% | 57.0% | 0.8% | 0.5% | 0.4% | 0.3% | 0.1% | 4.6% |
| 2012 | 7.3% | 56.17% | 24.01% | 1.25% | 1.12% | 0.37% | 0.25% | — | 9.54% |
| 2011 | 12.9% | 51.7% | 22.1% | 0.8% | 0.9% | 1.0% | 0.2% | 0.3% | 10.2% |
Regional challenges and updates
Over the course of 2013, Walmart expanded its Responsible Sourcing audit program. The number of factories included in the program has more than doubled. Typically, factories that are new to Walmart’s program improve over time as they respond to audit findings and improve their processes. Because many factories began their process in 2013, some regional audit averages are lower than in previous years.