Private Brand/Supplier Compliance

Office Depot continues to work extensively with an independent, accredited third-party audit partner to conduct onsite supplier audits to ensure that our sourcing factories for our branded products are operating in accordance with our Supplier Guiding Principles.

Our Social Compliance team continues to actively reviewing and approving corrective action plans and, based on an internal grading system, re-audits are required and performed by the third-party audit partner. Office Depot takes a zero tolerance stance on certain breaches of our policies in which noncompliance by the supplier will result in termination of the relationship. We also ensure that factories receiving repeat “needs improvement” grades are monitored for corrective action through our continuous improvement process.

Office Depot continues to proactively train our vendors and factories on local laws, regulations and quality-of-life issues for their employees. During 2013, Office Depot conducted ten vendor trainings in our Shenzhen and Hangzhou offices. Empowering our partners to do the right thing and be accountable for social compliance is a cornerstone of Office Depot’s Corporate Social Responsibility Program.

OfficeMax Update

OfficeMax GSO has an internal compliance team to coordinate all third-party audits between vendors and service provider, review SCAR (Supplier Corrective Action Record) and monitor third-party performance. For all new vendors, the GSO team sends initiative letter and pre-audit notice to them to ensure all vendors understand and accept OfficeMax audit policy and will expedite OfficeMax audit policy implementation throughout the business process. A qualified third-party has been selected as the audit service provider. The GSO team also implements on-site monitor or sends surveys to make sure third-party performance and operations are in compliance with the SOP between OfficeMax and the third-party. In addition, a monthly meeting is scheduled with the third-party for reviewing the performance, challenges and opportunities. For the audit findings, the reviews the SCAR and completes on-site checks.

In 2013, OfficeMax used a scoring system for the audit result evaluation. The scoring system evaluates if the factory can reach OfficeMax compliance requirements in the social, health, environment and safety categories. A low score (<60%) or any critical violation will result in the factory failing the audit; a follow-up audit would then be required as well. If a factory fails the second audit, it would be considered inactive or suspended until the corrective actions are acceptable. For OfficeMax private brands products, the GSO compliance team must ensure that vendors and/or factories keep an active status through all steps in the order/shipment journey.