SMETA Audit - Sedex Members Ethical Trade Audit

SEDEX (Supplier Ethical Data Exchange) is a global membership organization that provides one of the world’s leading platforms for managing and sharing ethical supply chain data. It is not a standard-setting body, but rather a collaborative platform that helps companies improve transparency and manage risks associated with labor rights, health & safety, environmental impact, and business ethics. 

In supply chain management, SEDEX is used to: 

• Collect and store data on ethical and responsible business practices.
• Enable suppliers to share ethical audit results (such as SMETA) with multiple buyers.
• Help buyers assess risk and monitor compliance within their supply chains.
• Encourage continuous improvement across tiers of suppliers.

SMETA (SEDEX Members Ethical Trade Audit) is an audit methodology developed by SEDEX members to provide a standardized, widely accepted approach to evaluating ethical performance in supply chains, allowing comparability across suppliers and industries. It is one of the most commonly used social audit formats in the world. 

Key features that differentiate SMETA from other ethical audits: 

• Standardization: SMETA does not have its own audit standard, however it is based on best practices from International Labor Organization (ILO) conventions and the Ethical Trading Initiative (ETI) Base Code.
• Non-certification: Unlike other social audits (e.g., SA8000), SMETA is not a certification program. It results in a detailed audit report and Corrective Action Plan (CAPR) shared via the SEDEX platform.
• Sharing mechanism: Suppliers can decide to share the audit outcomes with multiple buyers, reducing audit fatigue and avoiding duplication.
• Pillar approach: SMETA audits can have a limited or extended scope (see question 5).

SEDEX is not a certification body. It does not issue certifications or compliance seals. Instead, SEDEX provides a platform for storing and sharing information related to: 

• Ethical audit reports (including, but not limited to SMETA)
• Corrective actions
• Self-assessments
• Risk assessments

The audits conducted (e.g., SMETA) are informational tools, not certifications. The purpose is to promote transparency and facilitate due diligence rather than endorse compliance.

SMETA audits are often requested by buyers, especially large retailers, importers, or brands seeking ethical assurance from their supply chain partners. These requests are typically cascaded to suppliers as part of a broader responsible sourcing policy or Code of Conduct. 

Supplier companies (manufacturers, farms, service providers) normally request SMETA audits to demonstrate ethical practices and compliance to their customer requests. They may also proactively undergo audits to show their commitment to ethical practices and attract more business. 

Regulatory bodies generally do not require SMETA specifically, although regulatory compliance elements (such as labor law adherence) are part of the audit.

SMETA audits are structured around 2-pillar or 4-pillar frameworks: 

2-Pillar SMETA (mandatory): 

     1. Labor Standards – Covers workers’ rights, fair wages, working hours, discrimination, freedom of association, etc.

     2. Health & Safety – Includes workplace conditions, emergency preparedness, accident prevention, and hygiene. 

4-Pillar SMETA (optional but increasingly common): 

     3. Environment (Extended) – Evaluates environmental impact, waste management, energy use, and legal compliance.

     4. Business Ethics – Reviews policies and practices related to corruption, bribery, and ethical business behavior.

• A buyer (brand/retailer) requests that a supplier undergo a SMETA audit. 

• The supplier registers on the Sedex platform and fills out a Self-Assessment Questionnaire (SAQ). These steps must be completed prior to the onsite audit. 

• The supplier chooses an approved third-party audit firm (such as TÜV SÜD) and schedules a date for the SMETA audit. IMPORTANT: audits are often announced, but they could also be semi-announced or unannounced depending on buyer requirements. 

• The supplier gathers documents and prepares for the audit (e.g., HR records, health & safety procedures, working conditions, payroll records). 

• The audit typically takes a minimum of 1 day on-site, depending on facility size and number of pillars. It always includes a combination of activities:  

• Opening meeting with management 

• Document review: payroll, contracts, hours worked, health & safety logs, etc. 

• Site inspection: factory floor, dormitories, canteens, restrooms, etc. 

• Worker interviews: confidential chats with randomly selected workers. 

• Closing meeting: summary of findings presented to management. 

• The auditor compiles findings into a SMETA Audit Report and Corrective Action Plan Report (CAPR), which are uploaded on the Sedex platform after review and approval by a quality control team. 

• The supplier decides which buyers / clients are granted access to the report on the platform.  

• If any non-compliances are found, the supplier implements corrective actions by set deadlines and uploads evidence (photos, records, etc.) on the platform. In some circumstances, the supplier may be required to undergo a follow-up audit for verification. 

• Buyers and suppliers can use the audit outcomes to improve practices, monitor risk, and build a more ethical supply chain. Re-audits may be required depending on the buyer requirements or risk level.