Transparency in Supply Chains Act Disclosure

Introduction:

The California Transparency in Supply Chains Act of 2010 went into effect in California on January 1, 2012.  This law requires large manufacturers to disclose their efforts to eradicate slavery and human trafficking from their direct supply chain.  The goal of this law is to allow consumers to make informed decisions and buy products from companies which take their ethical responsibilities seriously.

From the very beginning, in 1974, Traditional Medicinals has upheld a high standard of ethical responsibility. We connect people to the power of plants to change lives, including the lives of the growers and collectors of our herbs across the more than 35 countries we source from.  In 1982 we were the first U.S. manufacturer to manufacture a range of herbal products packaged in cartons made from 100% recycled paperboard; in 1992 we joined Green America’s Green Business Network™ of socially and environmentally responsible businesses and became a Green America Certified Business; in 1998 we began marketing products made with Fair Trade™ certified ingredients; in 2004 we joined a global project to implement the International Standard for Sustainable Wild Collection of Medicinal & Aromatic Plants (known as the FairWild® standard); and in 2009 we initiated the first phase of our five-year Revive! Project® in Rajasthan, India with the non-profit organization WomenServe to improve the lives of our senna suppliers.

As part of our commitment to ethical business practices Traditional Medicinals became a Certified B Corporation in 2010, a voluntary certification provided by B Lab. Certified B Corporations are businesses that meet the highest standards of verified social and environmental performance, public transparency, and legal accountability to balance profit and purpose.  A company can only become a Certified B Corporation through the implementation of rigorous standards of social and environmental performance, accountability, and transparency. In 2019 Traditional Medicinals was named a “Best For The World” honoree by B Lab in recognition of our positive impact on the environment, our workforce, our local communities, our suppliers, our customers, and for our corporate governance, ranking in the top 10% of all B Corps across all of these impact areas.

Traditional Medicinals has taken the extra step of putting B Lab’s voluntary standards into legally-enforceable obligations by becoming a California benefit corporation.  California is one of 35 states that allows this corporate structure, which requires that Certified B Corporations amend their articles of incorporation to include creating a general public benefit, and any other public benefits that the corporation identifies, as the corporate purpose.  This means that, as a California benefit corporation, Traditional Medicinals directors are required to consider the stakeholder interests of employees, customers, suppliers, and the environment: the triple bottom line of profits, people and planet.  California benefit corporations are also required to produce an annual report on the work they do – Traditional Medicinals’ most recent report can be found here.

Verification:

Traditional Medicinals evaluates and verifies our supply chain risk for social and human rights factors through using our third-party certification partners: Fair Trade, FairWild, mabagrown®, the Utz Standard, and the Rainforest Alliance.  27% of our herb purchases in FY2017 by volume were either Fair Trade or FairWild certified, and one of our chief suppliers, Martin Bauer, uses the mabagrown®, the Utz Standard, and the Rainforest Alliance standard to verify their products in the supply chain and address risks of human trafficking and slavery.

Internally, Traditional Medicinals actively tracks the Fair-certification status and suspension of producers and our suppliers.

Traditional Medicinals also uses country-based risk assessment tools to evaluate countries on a variety of factors, including transparency and corruption; the rule of law; sociopolitical instability; and regulatory quality and government effectiveness. These evaluations help Traditional Medicinals to determine the general risks in our supply chain when sourcing from certain countries.

Supplier Audits:

While Traditional Medicinals’ supplier audits and the Traditional Medicinal Foundation’s social assessments cover labor practices generally, they do not specifically address human trafficking and slavery practices against a company standard.

Traditional Medicinals performs announced, first-party supplier qualification audits for all strategic suppliers and announced, first party audits for producers on a risk-assessment basis, specifically for Good Manufacturing Practices, Good Agricultural Collection Practices, and generally for social and environmental development perspective in addition to any relevant social certification documentation. Traditional Medicinals’ certifiers, like Fair Trade and FairWild, perform announced, second party quality audits and, where relevant, announced, annual independent third party social audits, the latter including requirements based on International Labor Organization standards, as part of their certification standards.

Certification:

Traditional Medicinals does not yet require suppliers outside of the United States to certify that suppliers or product materials comply with national laws regarding slavery and human trafficking in the countries in which they are doing business.

Accountability:

Traditional Medicinals’ internal accountability standards for our employees are found in our Employee Handbook.  All Traditional Medicinals employees must adhere to the company’s Standards of Conduct, and Traditional Medicinals investigates any violations of this policy and takes the appropriate action – up to and including termination.

Traditional Medicinals also has a Whistleblower Policy. If an employee believes that any policy, practice, or activity of the Company or any employee is in violation of law, the employee is obligated to report the matter so that it can be addressed.

Training:

Traditional Medicinals’ Sustainability Manager received training on social certification standards as they relate to human trafficking and slavery.  Currently, Traditional Medicinals does not provide other employees with training on human trafficking and slavery.