California Transparency Act

The California Transparency in Supply Chains Act of 2010 was introduced to provide consumers with greater clarity regarding how businesses address the risks associated with forced labor, slavery, and human trafficking in their supply chains. By requiring companies that produce or sell goods in California to disclose their efforts in these areas, the law enables consumers to make more informed purchasing decisions. In line with the objectives of this law, Allbirds has developed a robust approach to responsible sourcing, which focuses on safeguarding workers’ rights, encouraging fair labor practices, and actively combating modern slavery and human trafficking across its global supply chain.

Allbirds’ commitment to ethical sourcing is rooted in transparency and accountability. The company expects its suppliers to engage in open communication about their successes and challenges regarding labor practices and working conditions. This includes providing full visibility of their supply chains, sharing the identities and locations of subcontractors and other upstream partners. Allbirds believes that encouraging transparency at every stage of production helps foster trust and ensures customers are fully informed about how products are made and the working conditions under which they are produced.

In addition to transparency, Allbirds emphasizes the importance of clear agreements and ethical expectations. The company works with a select group of strategic suppliers that comply with local laws and international labor rights standards. New manufacturing partners are required to sign binding contracts that ensure their compliance with Allbirds’ Code of Conduct, which prohibits forced labor, slavery, and human trafficking in the countries where they operate. These contractual obligations help set a clear framework for ethical conduct and ensure legal compliance.

Before entering into production, Allbirds mandates that new factories undergo a thorough onsite evaluation by an independent third-party organization specializing in social audits. These evaluations assess whether the factories meet Allbirds’ standards for working conditions as outlined in the company’s Code of Conduct. The audit process typically involves confidential interviews with workers, review of relevant employment records, and inspections of health, safety, and labor conditions within the facility. Depending on the circumstances, audits may be announced or unannounced, and their scope is adjusted based on the specific risks associated with the region or industry.

Allbirds’ commitment to ethical sourcing doesn’t end after an initial assessment. The company continues to monitor suppliers and conduct follow-up audits to ensure ongoing compliance. The frequency and depth of these follow-up assessments are influenced by factors such as the risk profile of the region and the supplier’s past performance. In cases where forced labor or human trafficking violations are discovered, Allbirds has a zero-tolerance policy. Any such violation results in an automatic failure of the audit. In these cases, Allbirds will suspend production orders unless the supplier addresses the issues and takes corrective actions within an agreed-upon timeframe. This demonstrates the company’s firm stance on human rights violations and its commitment to ensuring compliance at every level of its supply chain.

Beyond audits and assessments, Allbirds emphasizes long-term improvement. The company works closely with suppliers to address any issues and implement corrective action plans. These plans focus on identifying the root causes of issues rather than applying short-term fixes, helping suppliers establish stronger management systems and accountability practices. The company closely monitors the progress of these corrective actions to ensure that improvements are meaningful and lasting.

Employee education also plays a critical role in Allbirds’ responsible sourcing efforts. Those involved in supply chain management receive specialized training to recognize and mitigate the risks associated with human trafficking and forced labor. This ensures that Allbirds’ internal teams are well-equipped to address potential concerns and effectively uphold the company’s ethical standards.

Through its focus on transparency, rigorous assessments, continuous improvement, and education, Allbirds is working towards creating a more responsible and ethical global supply chain. These efforts reflect the company’s belief that protecting workers’ rights is not only vital for legal compliance but is also essential for creating a more sustainable and humane future in the apparel and footwear industry.