A 4-pillar SMETA audit assesses labor standards, health and safety, environmental performance, and business ethics. Each pillar encompasses specific criteria that must be evaluated. This article outlines the 4-pillar audit requirements and how to ensure your business is ready.
The 4-Pillar SMETA Audit: An Overview
SMETA, which stands for Sedex Members Ethical Trade Audit, is a widely recognized audit format developed by Sedex, a global organization focused on improving ethical business practices in supply chains. The 4-pillar SMETA audit expands on the 2-pillar version, which covers Labor Standards and Health & Safety, by adding assessments for Environmental Performance and Business Ethics. (While the 2-pillar SMETA audit does address environmental practices, the 4-pillar audit offers a more in-depth environmental practices verification).
Why 4-Pillars? This broader audit offers a more comprehensive evaluation of a company’s operations compared to the 2-pillar audit. You may choose the 4-pillar audit if you want to demonstrate a stronger commitment to sustainability and ethical business practices, as it provides greater visibility into environmental impact and ethical transparency across your supply chain.
The Four Pillars: What Is Assessed?
The 4-pillar SMETA audit evaluates companies across four key areas to ensure compliance with ethical, labor, and environmental standards. Below is an explanation of what each pillar assesses and recommendations for how to ensure you meet compliance requirements. These recommendations are not comprehensive, but highlight key areas that the SMETA 4-pillar audit assesses.
Labor Standards
This pillar assesses compliance with labor laws and regulations to ensure fair wages, reasonable working hours, and the prohibition of child and forced labor. It ensures that worker rights are respected, and the workplace is safe and hygienic.
You should have the following in place:
- Written employment agreements in a language workers understand.
- Personnel files for each employee.
- Policies that prohibit forced labor, child labor, and excessive recruitment fees.
- Procedures for ensuring workers’ freedom of movement is not restricted by the company or labor brokers.
Health & Safety
The Health & Safety pillar evaluates your company’s efforts to provide a secure working environment, focusing on accident prevention, emergency preparedness, and overall employee well-being. Auditors check compliance with occupational health standards and safety protocols to reduce risks in the workplace.
To comply, you should:
- Have procedures to ensure machinery is well-maintained and equipped with necessary safety devices.
- Provide employees with appropriate Personal Protective Equipment (PPE).
- Ensure access to clean and well-stocked first aid stations.
- Implement emergency response plans and conduct regular drills.
Environmental Performance
This pillar focuses on how well your company manages its environmental impact. It assesses waste management, resource use, and adherence to environmental laws and regulations. You are expected to show that you’re minimizing their environmental footprint through sustainable practices.
To comply, you should:
- Monitor and track energy and water usage.
- Set targets for reducing waste, emissions, and resource consumption.
- Have a system in place for managing hazardous materials and pollution prevention.
- Ensure wastewater is treated before off-site discharge.
Business Ethics
The Business Ethics pillar assesses transparency and integrity in your company’s operations. Auditors review policies related to anti-bribery, corruption, and responsible sourcing, ensuring that ethical practices are followed across the supply chain.
To comply, you should:
- Establish clear anti-bribery and corruption policies.
- Ensure transparency in supplier contracts and business dealings.
- Implement procedures to assess and select suppliers based on ethical standards.
- Maintain records of compliance and corrective actions taken in cases of ethical violations.
How Can My Business Prepare for the SMETA 4-Pillar Audit?
Here are a few steps to help you prepare for a successful audit:
- Conduct internal audits of labor, health and safety, environmental practices, and business ethics.
- Engage suppliers to ensure compliance throughout the supply chain.
- Implement corrective actions for any identified gaps, updating policies as needed.
- Train employees on safety, ethical practices, and environmental standards.
In addition to these steps, consider making use of available SMETA tools and resources. These may include:
- Self-Assessment Questionnaires (SAQ) – Used for suppliers to provide details about their operations.
- Virtual Assessments – Remote evaluations that can be useful when on-site access is limited.
- Third-Party SMETA Audits – Conducted in person following Sedex protocols for 2-pillar and 4-pillar formats.
- Corrective Action Plans – Outlining improvements following an audit to address any non-compliance issues.
By familiarizing yourself with these tools and ensuring processes are in place before the audit, your business can be better positioned to demonstrate compliance with ethical, labor, and environmental standards.
