Responsible sourcing is the process of considering the social, economic and environmental impacts of all sourcing activities and suppliers. Organizations that practice responsible sourcing take responsibility for what happens in the product lifecycle—from carbon emissions to workers’ rights.

In sustainable sourcing and sustainable procurement, a greater emphasis is placed on the environmental impacts of suppliers and vendors. These processes fall under the umbrella of responsible sourcing. The same is true for ethical sourcing, which encompasses both environmental and social impacts of the entire supply chain.

There is not yet a universal, codified set of standards for ethical sourcing; those practicing ethical sourcing may have a wide range of ethical considerations. There are, however, some legislative laws and policies that touch on ethical sourcing. For example, the UK Modern Slavery Act, the California Transparency in Supply Chains Act and National Action Plans (NAPs) on Business and Human Rights across several continents including South America, Europe, Africa and Asia.

It’s important to note that suppliers or vendors can claim to be ethical in one regard (such as being organic, fair trade of cruelty-free certified) but may not be ethical across their entire operations and global supply chains.

In general, an unethical supplier or vendor is one that:

Outside of ethical sourcing being good for people and the planet, there are strong arguments for its tangible business benefits as well:

Since there are no official standards or codes that guide ethical sourcing practices, the way an organization builds its own ethical sourcing program is unique. However, many organizations start by establishing a strong vetting process and then upholding their standards with ongoing audits.

To develop a vetting process, organizations may look to competitors for examples of similar ethics policies, codes of conduct and best practices. Then, companies may use this information, as well as their own existing policies around practices like sustainability, to build criteria for evaluating potential suppliers. If there are none, organizations can consult reputable outside policies, such as the United Nations Guiding Principles for Business and Human Rights. Then, organizations can incorporate these standards—and how non-compliance will be addressed—right into supplier contracts.

Organizations should be prepared for the potential that a supplier may engage in unethical practices at any time, no matter their past performance. Therefore, organizations may choose to monitor supplier practices throughout the duration of a contract. Continual audits ensure compliance to contractual agreements around ethics and allow organizations to identify areas for improvement, set goals and initiate corrective action.