A social audit is an evaluation of a company’s employment practice. During the audit the corporate social responsibility (CSR) mission, policies, code of conduct, records, social impacts are reviewed to find out more ways they can impact society. In majority cases (it depends on the standard) employees are interviewed to confirm the conformity in practice, this part of the audit is invaluable and adds value to the overall assessment.

Social auditing is extremely important because it provides information on how well a corporation is keeping the balance between making profits and social responsibility.

At the end all nonconformities found, shall be addressed and necessary actions have to be  taken to resolve them.

It is an assessment of how well the corporation is achieving its goals or benchmarks for social responsibility. Many times the CSR is misunderstood with only actions supporting the local environment or natural environmental protection or charity work, when it is more about the fair treatment of their employees and through the whole supply chain than outside environment.

A social audit is a way for a business to work out if the actions being taken are being positively or negatively received and relates that information to the company’s overall public image. It is also the way of corporate supply chain management and their CSR activity monitoring.

In the era of corporate social responsibility, corporations are often expected to deliver value to consumers and shareholders furthermore as meet environmental and social standards. Social audits on the one hand can help companies create, improve, and maintain a positive promotional material image on the other hand reduces negative impacts on earnings from bad press, share pricing, local environment and the consumers.

The social audits are performed against:

• Local labour law
• Local remuneration law
• Local health & safety law, work environment
• Local environmental protection law
• Client/Corporate code of conduct (ordered the audit)
• Clients’ special requirements with regard to the:
  • business continuity plan,
  • continuous improvement,
  • corruption policy,
  • subcontracting policy,
  • transparency within the organization,
  • community initiatives,
  • diversity within the workplace,
  • accounting and promotion transparency

The social audit is:

1. Multi-Perspective

Takes into account the commitment of all interested parties including NGO’s.

2. Comprehensive

Assess and present a report on all aspects of the organization’s work,   performance and compliance.

3. Regular

Repeated on the regular basis, focusing more on systematic improvement than punishing the manufacturer.

4. Comparative

This provides a way, whereby, the organization can compare its own performance annually and against appropriate external norms or benchmarks and supply for comparisons with organizations doing similar work and reporting in a similar fashion.

5. Verification

This ensures that the social accounts are audited by a suitably experienced person or third party company with no vested interest within the organization.

6. Disclosure

This ensures that the audited accounts are disclosed to stakeholders and therefore the wider community within the interests of accountability and transparency.

The benefits of a social audit are:

1. Mitigate the risk of business performance

It becomes a way to measure and evaluate corporate social responsibility to take mitigation steps against related risks, such as risks to its reputation, share pricing.

2. Gaps awareness

Management can identify gaps between performance and corporate social responsibility objectives

3. Allow continuous improvement

Companies can develop measures and set targets to improve corporate social performance, either from improving past performance or benchmarking with the industry’s best-performing companies.

4. Meet interested parties expectations

Implementing improvements which helps the company meet stakeholder expectations, enabling it to build a good relationship with them in the long term.

5. Achievements and management tools transparency

Publishing audit reports leads to better information transparency and accountability, improving the company’s public image.

6. Attract consumers

Improved transparency and accountability towards social responsibility attract more business customers and consumers as they increasingly make their purchasing decisions based on ethical factors

The limitations of social auditing are:

1. The EU Regulations with regards to data disclosure

Auditors’ access to data and information, is often limited, but experienced auditing company has their own lawful methods to get the necessary information not breaking the low at the same time

2. Conflict of interest assurance

Auditors shall be independent, risk of interest have to be excluded, otherwise results can be biased and not adequate to the existing situation

3. Audit organization within the organization

Strategic persons shall be present and available during the audit to allow auditors to confirm the compliance otherwise the situation will generate to many questions mark,

4. Investment in the SCR program

Auditing company have to be ready to invest financial and manpower resources  in order to be prepared for the audit, participate in the audit and implement corrective action after the audit

5. Consumer choices

Social responsibility may not be the only reason consumers buy company products, or suppliers sell inputs to companies, but for price reason

There are a growing number of corporates, brands and retailers now using Social Audits Programs  to step up their ethical business practices. Social audits are developing together with the market changing needs and will have to adopt to the stakeholders expectations. the companies are required to undertake meaningful ongoing due diligence, adapted to local contexts and with workers at the centre, rather than simply an in-and-out audit approach.

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Scrutiny made in the EU on food contact products.

Scrutiny has been made by the EU institutions that have shown that in recent years an increasing number of food contact materials and articles are placed on the market that is manufactured from plastic and to which bamboo and/or other ‘natural’ substances are added. A popular example is kitchenware or tableware, such as reusable plates, bowls and coffee beakers. These materials and articles are often similar in appearance and function to melamine tableware or kitchenware as they typically also consist of melamine plastic as the main structural component but also contain ground bamboo (‘bamboo-melamine’) or other similar constituents such as corn, as an additive, often functioning as a filler.  Other examples include, but are not restricted to, bamboo fibers that are added to a polymer resin binder to form a composite product. The number of these bamboo-melamine food contact materials and articles placed on the market are sold on the premise of being sustainable, recyclable and natural. They are labelled and marketed as ‘biodegradable’, ‘eco-friendly’, ‘organic’ or ‘natural’ or even in some cases ‘100% bamboo’, which does not reflect the true nature of the product. In many cases their trade name and description are used in support of that marketing approach and they are not readily identified as consisting of plastic.

High values of specific migration substances

The study indicates that, from a food safety perspective, these items are not necessarily suitable for use as reusable food contact products as melamine and formaldehyde were found to migrate from these materials into food at high temperatures. In addition to BfR’s own studies, these findings were also revealed by other German federal state market surveillance agencies. In many cases, higher quantities of formaldehyde and melamine were released from bambooware than from ‘conventional’ melamine resin items. On average, the specific migration values were found to be up to 30% higher for formaldehyde and 100% higher for melamine.

Compliance verification is obligatory.

Manufacturers or importers of bamboo-melamine food contact materials and articles may not consider these materials as being plastic materials and articles by mistake or by lack of knowledge over the applicable legislation. Consequently, no verification of compliance with Regulation (EU) No 10/2011 is undertaken. This may lead to the placing on the market of materials and articles from which substances, such as melamine or formaldehyde contained in the plastic, migrate in quantities above the SMLs.

It is important to remember, that if a melamine resin is used in plastic, Regulation (EU) No 284/2011 applies for those materials and articles that fall within the scope of this Regulation.

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