EICC s New Strategy IMPLEMENTATION PROPOSAL

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1 EICC s New Strategy IMPLEMENTATION PROPOSAL 1

2 Backgrund 2012: EICC apprved new gvernance and accuntability mdel 2013: Implemented gvernance & accuntability mdel. Began strategic planning Hired FSG t develp strategic review (shared value apprach) Cnsulted with senir executives and stakehlders 2014: Implementatin plan Missin & Visin Strengthening Standards and Accuntability Learning and Capability Building Sensing Emerging Issues 2015: Plan apprval and implementatin 2

3 FSG.ORG Baseline: EICC Is currently engaged in Five Main Activity Areas that Fall Int Tw Categries: Standards & Accuntability and Issues Wrk Emerging Issues: Mnitr, research, and/r engage directly n key issues (e.g., cnflict minerals, wrking hurs, envirnment) Slve Issues in the Value Chain Transparency: Share audit results and measure perfrmance Capacity Building: Develp educatinal materials n CSR issues Audit Prcess: Prvide a structure (VAP), validate auditrs, and develp tls Cde f Cnduct & Member Cmpliance: Develp and update Cde f Cnduct and ensure member accuntability Establish Standards & Accuntability FSG

4 Key Cnclusins EICC has a strng value prpsitin The Cde f Cnduct & shared implementatin tls are the cre f ur value T meet ur future, imprvement is needed: Transparency and Sharing Shared Standards and Accuntability Learning and Capability Building Issue Management Engagement and Partnerships 4

5 EICC s New Strategy MISSION & VISION 5

6 Missin and Visin Apprved by the EICC Bard f Directrs n Nv. 18, 2014: Visin: A glbal electrnics industry that creates sustainable value fr wrkers, the envirnment and business. Missin: Members, suppliers and stakehlders cllabrate t imprve wrking and envirnmental cnditins thrugh leading standards and practices. 6

7 EICC s New Strategy EICC S 2020 GOAL 7

8 2020: EICC Seal Develpment f cmmercially valuable and credible EICC seal f scial, envirnmental and ethical respnsibility recgnized and accepted by brands, gvernment prcurers and retailers One audit per facility used by all custmers. Incentives: better audit perfrmance and clsures = fewer re-audits Includes randm audits, in-huse training based n audit findings Includes equivalency Factries pay fr certificatin; EICC members require it 8

9 2020 Objective: Factry Certificatin Cncept: Certify Cde cnfrmance at the factry level that is cmmercially valuable and credible One audit per factry Accepted by all custmers, required by sme Value t factry: increase sales, fewer audits Value t custmer: Assurance & cnsistency f cnfrmance, fewer resurces spent n audits 9

10 Early Framing Ideas Allw ther audit appraches if equivalent fr cmpliance Based n benchmarking frm related Industry success stries and case histries Includes randm audits, in-huse training based n audit findings Factries pay fr certificatin; EICC members require it Regular cadence f audits Reduced frequency fr gd results 10

11 EICC s New Strategy MEMBERSHIP REQUIREMENTS 11

12 Key Principles fr EICC Membership A rising tide lifts all bats by building a bigger cmmunity f practice, bringing ALL cmpanies in the electrnics industry frward and encuraging all t jin the EICC t share ur Cde and tls, engage in peer netwrking and best practice sharing, and leverage ur trainings and ther resurces EICC is an inclusive rganizatin - EICC shuld be driving cntinuus imprvement recgnizing where cmpanies are n the maturity curve and encuraging them t imprve every year tward the highest membership categry. We prvide capability t help members prgress tward ur visin regardless f member s level f maturity. EICC will assist members t mve t higher membership categries by prviding supprt and educatin. 12

13 Membership Categries Supprter Learn Affiliate Cmmit Regular Cmply Full Verify Express supprt fr the missin and visin f the EICC and its Cde f Cnduct Senir executive signed cmmitment t Cde Cde psted t cmpany website Submissin f crprate SAQ 100% cmpliant t membership requirements* (Existing member have until Jan 1, 2017) Strengthened requirements fr AMA/CMA (third party verificatin f prgram. Clse all pririty findings Same activities as regular, but verified Achieve audit scre f 180 r better n initial r clsure audit fr 25% f at-risk member and supplier facilities** Publish crprate respnsibility reprt *Requirements include submitting SAQ n 100% f cmpany and supplier facilities cnstituting 80% f spend; audit 25% f at-risk facilities. Alternates exist fr sme requirements. **180 n a clsure audit means n pririty findings and tw r fewer majr findings left unclsed 13

14 Requirements by Categry Public Cmmitment t Cde f Cnduct (Supprter = express supprt ) Supprter Affiliate Regular Full X X X X Cmplete crprate SAQ X X X C-level cmmitment signed X X X SAQs cmpleted fr 100% f wn facilities, 80% Tier 1 spend r equivalent risk assessment Cmplete VAP n 25% f at risk majr supplier facilities X* X X* X Clse ut pririty findings X X All audit scres 180 r higher fr 25% f at-risk facilities audited within 12 mnths** Issue crprate respnsibility reprt EICC-verified perfrmance * Existing members: Must be in cmpliance with regular by 1/1/2017 **Audit scres ver 180 allws fr up t tw pen majr findings (n pen pririty findings) X X X

15 Prgressing n the Maturity Curve Full Regular Supprter Affiliate Cmmitment t Cde Submissin f crprate SAQ 100% cmpliance t membership requirements ** CMA/AMA verified (if applicable) Clse all pririty findings 100% verified cmpliance Clse pririties and majrs CMA/AMA verified (if applicable) Publish sustainability reprt Access EICC tls and resurces Jin EICC cmmunity f practice ** Current members must be 100% cmpliant n later than January 1, New/applicant members must meet 100% cmpliance immediately t qualify fr this categry. 15

16 Nte: Fr the first transitinal year f the new membership categries, all EICC Full members will be placed in the Regular membership categry and all Applicant members will autmatically be placed in the Supprter categry. Member cmpanies can als pt int a categry f their chsing. In Year 2 f the prgram, all EICC members will have t declare t EICC their apprpriate member categry. Benefits by Categry Supprter Affiliate Regular Full EICC tls X X X X EICC training X X X X EICC cnferences and netwrking X X X X Ability t jin and participate in EICC wrkgrups X X X Use f EICC lg (Affiliate-member lg fr Affiliates) X X X Can vte n member-wide decisins (cde and member cmpliance revisins, etc.) Can serve in leadership rles in EICC wrkgrups X X Can run fr a psitin n the EICC Bard f Directrs X X X X

17 EICC s New Strategy LEARNING & CAPABILITY BUILDING 17

18 Intrducing the EICC Learning Academy Objectives: Lasting results and cntinuus imprvement Certify member s staff fr key tpics Cnnect L&CB t audit crrective actins Apprach: Needs assessment tied t audit findings, staff needs r ther demnstrated gaps Utilize the best training materials frm the mst capable prviders in each discipline Best-in-class resurce hub, featuring extensive training and guidance dcuments Cmprehensive, autmated Learning Management System (LMS), with certificates fr sub-disciplines 18

19 Path t Leadership 1. Create curriculum fr leadership paths Certificate example: Factry Lead, Supervisr, CSR Directr Intensive nline VAP auditr training Curricula geared twards verall EICC CSR prficiency 2. Earn certificatin f prficiency fr EICC prgrams 3. Certificate travels with the persn Creates an incentive fr cntinuus learning 19

20 EICC s New Strategy SENSE EMERGING RISKS 20

21 Sensing and Respnding Overview Step 1: Analyze data frm current prgrams VAP, L&CB, CFSI t establish baselines and bserve emerging trends Step 2: Increase and deepen understanding f member challenges with mre frequent and in-depth dialgue with members Step 3: Engage with and fllw external surces (news media, stakehlders, influencers and partners, events) Step 4: Summarize trends and perspective in annual sessin t priritize risks and pprtunities 21

22 EICC Reputatin Enhancement Strengthen the EICC brand t enable the calitin t attract and cnvene the right cllabratrs t slve prblems. Implement this plan t strengthen credibility and ensure the EICC can sense emerging issues. Update EICC cre cmmunicatins cntent and cllateral t reflect a strengthened and invigrated rganizatinal identity with a frward-mving brand. Increase and deepen membership t shw we re the premier supply chain sustainability calitin and the best-equipped t slve prblems. Practively engage with industry and stakehlders t educate, cllabrate and shw thught leadership. Practively wrk with news media and help shape member and industry messaging. 22

23 EICC s New Strategy IMPLEMENTATION TIMELINE 23

24 Implementatin Timeline December 2013: FSG reprt delivered January-March 2014: Draft implementatin plan develped by EICC staff March 14, 2014: Draft implementatin plan delivered t Bard f Directrs fr review March 21, 2014: Face-t-face feedback sessin n draft implementatin plan with Bard f Directrs during face-t-face meeting May 15-June 20, 2014: Bard f Directrs taskfrce wrks with EICC staff t review and develp implementatin plan June 20, 2014 (during Bard f Directrs face-t-face meeting): Final input frm Bard f Directrs July-August, 2014: EICC staff update and revise draft implementatin plan September 30-Octber 3, 2014: Review by SEAC and general membership as part f Twn Hall meeting December 10-11, 2014: Final review by the Bard and determinatin f cntinued member utreach and final apprval f membership categries and implementatin plan. June-July, 2015: Membership Vting Perid 24