Prepare procurement
Assessing the need for the clause
Before initiating procurement, you need to assess the need for the contract clause.
If Swedish labour law is not applicable, you are in certain cases required to oblige the supplier to fulfill the contract in accordance with the ILO fundamental conventions, if this is “necessary.”
Labour law conditions in procurement regulations (in Swedish only)
ILO Fundamental Conventions
The International Labour Organization (ILO) is the UN’s specialized agency for employment and labor issues. The ILO Declaration on Fundamental Principles and Rights at Work commits member states to respect and promote these principles, even if they have not ratified the fundamental conventions. There are ten fundamental conventions, covering five areas:
The core conventions are ten in number and concern five different areas:
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freedom of association and collective bargaining (ILO 87 and 98)
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forced labour (ILO 29 and 105)
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child labour (ILO 138 and 182)
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discrimination in employment (ILO 100 and 111)
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safe and healthy working environment (ILO 155 and ILO 187).
When conducting procurement, you must therefore perform a necessity assessment. This assessment should be based on the risk of unfair working conditions within the supply chain. It is hence not sufficient to only consider the location of final manufacturing. Products from Northern Europe may contain components or raw materials from countries with higher risks. However, the necessity assessment is simplified by the fact that it is sufficient that there is something that indicates that the clause needs to be imposed for it to be “necessary.” This means that the clause more or less always needs to be imposed for international supply chains.
For the Swedish Regions' prioritized procurement categories, a national necessity assessment has already been conducted, and the clause shall always be applied. For other categories, you can use the template, available on the country risk page.
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How to carry out a risk analysisStep 1: Mapping the supply chain The first step in a risk analysis consists of mapping the supply chain to find out its structure. This includes identifying in which countries the work is carried out, and if possible also in which regions. This is particularly relevant if the work is carried out in any region known to have high risks. Within certain industries such as food, textiles and IT there is a lot of information. For other industries such as pharmaceuticals, however, transparency is low. To obtain this information, you can ask the category manager, the category councils, ask questions of suppliers, find out import data, read audit reports and market analyzes for specific industries. It is also important to identify what type of work is carried out and what type of actors in the supply chain that performs it. Is it, for example, an industry characterized by low wages and health-hazardous processes? Does the workforce consist of migrant workers or seasonal workers? Is the supply chain complex with many subcontractors and a lack of transparency? This type of information is important as both geographical risks, industry risks and product risks need to be taken into account. Step 2: Gather information from credible and independent sources Once you have mapped the origin and the supply chain, the next step is to gather information about the situation of human rights, workers' rights, the environment and business ethics in the relevant countries where the work is carried out, that is, both for final manufacturing, component manufacturing and raw materials. For this you need to turn to credible and independent sources such as international organizations, authorities, voluntary and civil society organizations and global trade unions. Sources Step 3: Identify and assess negative impacts The last step involves assessing the actual and potential negative impact the supply chain is associated with, based on the information that has been compiled in steps 1 and 2. This is to be able to determine which concrete measures need to be taken to manage the risks. Often several risks have been identified and to prioritize them you need to make a seriousness assessment. The most significant risks are prioritized based on probability and seriousness ( read more under point d in process requirement 2 )
Identifying and assessing adverse impacts
Identifying and assessing adverse impacts is important for understanding risks. It is also crucial for determining whether additional requirements are needed, such as for responsibly sourced minerals, and for defining what should be included in the transparency requirement.
The Swedish National Agency for Public Procurement offers a risk analysis service (in Swedish) that provides information on risks for high-risk products and tips on how to manage these risks.
Risk analyses
You can also identify and assess adverse impacts in the supply chain yourself.
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How to carry out a risk analysisStep 1: Mapping the supply chain The first step in a risk analysis consists of mapping the supply chain to find out its structure. This includes identifying in which countries the work is carried out, and if possible also in which regions. This is particularly relevant if the work is carried out in any region known to have high risks. Within certain industries such as food, textiles and IT there is a lot of information. For other industries such as pharmaceuticals, however, transparency is low. To obtain this information, you can ask the category manager, the category councils, ask questions of suppliers, find out import data, read audit reports and market analyzes for specific industries. It is also important to identify what type of work is carried out and what type of actors in the supply chain that performs it. Is it, for example, an industry characterized by low wages and health-hazardous processes? Does the workforce consist of migrant workers or seasonal workers? Is the supply chain complex with many subcontractors and a lack of transparency? This type of information is important as both geographical risks, industry risks and product risks need to be taken into account. Step 2: Gather information from credible and independent sources Once you have mapped the origin and the supply chain, the next step is to gather information about the situation of human rights, workers' rights, the environment and business ethics in the relevant countries where the work is carried out, that is, both for final manufacturing, component manufacturing and raw materials. For this you need to turn to credible and independent sources such as international organizations, authorities, voluntary and civil society organizations and global trade unions. Sources Step 3: Identify and assess negative impacts The last step involves assessing the actual and potential negative impact the supply chain is associated with, based on the information that has been compiled in steps 1 and 2. This is to be able to determine which concrete measures need to be taken to manage the risks. Often several risks have been identified and to prioritize them you need to make a seriousness assessment. The most significant risks are prioritized based on probability and seriousness ( read more under point d in process requirement 2 )
Mapping industry conditions
The possibilities for ensuring sustainability in supply chains vary between industries. Structural issues, such as a lack of traceability, can make this work more complex. In such cases, collaboration through industry initiatives and certifications can be a solution. Engage in dialogue with suppliers on industry challenges and solutions.
Early dialogue (in Swedish)
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How to carry out a risk analysisStep 1: Mapping the supply chain The first step in a risk analysis consists of mapping the supply chain to find out its structure. This includes identifying in which countries the work is carried out, and if possible also in which regions. This is particularly relevant if the work is carried out in any region known to have high risks. Within certain industries such as food, textiles and IT there is a lot of information. For other industries such as pharmaceuticals, however, transparency is low. To obtain this information, you can ask the category manager, the category councils, ask questions of suppliers, find out import data, read audit reports and market analyzes for specific industries. It is also important to identify what type of work is carried out and what type of actors in the supply chain that performs it. Is it, for example, an industry characterized by low wages and health-hazardous processes? Does the workforce consist of migrant workers or seasonal workers? Is the supply chain complex with many subcontractors and a lack of transparency? This type of information is important as both geographical risks, industry risks and product risks need to be taken into account. Step 2: Gather information from credible and independent sources Once you have mapped the origin and the supply chain, the next step is to gather information about the situation of human rights, workers' rights, the environment and business ethics in the relevant countries where the work is carried out, that is, both for final manufacturing, component manufacturing and raw materials. For this you need to turn to credible and independent sources such as international organizations, authorities, voluntary and civil society organizations and global trade unions. Sources Step 3: Identify and assess negative impacts The last step involves assessing the actual and potential negative impact the supply chain is associated with, based on the information that has been compiled in steps 1 and 2. This is to be able to determine which concrete measures need to be taken to manage the risks. Often several risks have been identified and to prioritize them you need to make a seriousness assessment. The most significant risks are prioritized based on probability and seriousness ( read more under point d in process requirement 2 )
Planning for monitoring
The supplier shall participate in and cooperate with you in the monitoring of the contract clause, through dialogue, self-assessment, supply chain transparency, and audits. Plan the monitoring already in the preparation phase. Ensure that you have the necessary resources and expertise to conduct monitoring effectively.
Procurement categories with particularly high risks are jointly monitored by the National Secretariat for Sustainable Procurement. The results are published on the website. You can also contact the office for information on which suppliers will be monitored during the year.
Buyers can also use Adda Central Purchasing Body's framework agreement for audits.
Adda Central Purchasing Body's framework agreement Audit and Advisory Services