Background note on ICTI Code of Business Practices
For some years now ICTI has had in place a Code of Business Practices which outlines its specific commitments on the subject of business and social responsibility. Good business sense, moral responsibility and legal obligations are just some of the reasons which lie behind the development of the ICTI Code.

Proposed changes to the ICTI Code of Business Practices
Two revisions to the ICTI Code of Business Practices have been proposed for minimum age and employee representation. The minimum age requirement has been revised to include reference to the Minimum Age Convention, C138, (1973) and Worst Forms of Child Labour Convention, C182, (1999) of the International Labour Organisation. A condition to allow for employee representation, as provided by local law, has been added.

Factory Audit Manual
The purpose of this document is to provide manufacturers with an evaluation protocol for the ICTI Code of Business Practices. The protocol to determine if a manufacturer is meeting the requirements of the ICTI code is the Appendix II Auditor Checklist. In order for consistent use and interpretation of the intent of the Appendix II Auditor Checklist questions, a Guidance Document is being prepared and is expected to be ready at the end of the year. It is intended that the Appendix II Auditor Checklist be used in conjunction with the Guidance Document.

Where deficiencies and/or discrepancies are found during the audit they must be communicated to the manufacturer so that they are corrected. This is known as the corrective action process to which the Appendix III Corrective Action Plan should be referenced.

The manual is divided into four appendices as follows:
Appendix I Methodology for evaluating compliance which describes how to get started with conducting a survey and developing a business practices assurances programme Appendix II Auditor Checklist contains the checklist questions Appendix II Guidance Document will provide clarification for constant use and interpretation of the checklist questions. Appendix III Corrective Action Plan provides an understanding of how to implement corrective and preventive action and how to use those efforts to support a continual improvement process.

The manual is intended to provide comprehensive knowledge and insight on the subject of interpretation and measurement of the ICTI Code of Business Practices.

As with any successful programme, management commitment is essential. Good management practices require the development and implementation of policy and procedures to ensure that the objectives are met.

While the manual will suffice as a tool for the users and implementation of the programme, it must be acknowledged that the ultimate success or failure of a programme of this type will depend upon the level of support it receives from top management.

Management must initiate and support all elements of the business practice assurance programme and use the programme itself as a tool for meeting its objectives and supporting the continual improvement process.

Appendix II Auditor Checklist The auditor checklist is designed to assist in a survey of a company's existing programme and/or in the development of a programme.

The checklist addresses the following areas:

1a  Company overview
1b  Company organisation
1c  Number of employees
1d  Languages spoken
1e  Production process
1f  Floor plan
2   Working hours
3   Wages and compensation
4   Underage labour
5a  Forced labour
5b  Prison labour
6   Disciplinary practices
7   Discrimination
8   Employee representation
9   Facilities
10  Fire protection
10a Emergency procedures
10b Exit and evacuation
10c Housekeeping
10d Electrical
10e Special hazards (e.g. flammable liquids, gas cylinders etc)
10f Alarms and extinguishers
11a General environment health and safety (EHS)
11b Health and safety
11c Environmental
12a Welfare - dormitories
12b Welfare - canteen/cafeteria services
12c Welfare - medical services

Appendix II Guidance Document
The addition of a Guidance Document is intended to reduce confusion and disparity between factory and auditor understanding of the Code's requirements. It will be a protection against arbitrary interpretation of the auditor checklist. It teaches how an audit is to be conducted whilst allowing factories to know what to expect.

Altogether once published the guidance document will make the ICTI audit process better than audits carried out against other current audit documents.

The Appendix II Guidance Document addresses exactly the same areas listed under the Appendix II Auditor Checklist referred to above.

Appendix III Corrective Action Plan
Once the audit survey has been completed, the next step is to compare the factory's programme with the information collected on the checklists. This assessment will assist in the identification and determination of those areas that need improvement. It is likely that existing procedures and policies may require a few improvements.

The assessment also serves as a basis for determining what needs to be done and in what priority. The Corrective Action Plan of Appendix III is intended to correct any deficiencies. It is a written document that identifies objectives and sets priorities and projected completion dates.

Each objective should be S.M.A.R.T.:

• Specific
• Measurable
• Attainable
• Relevant
• Time-limited

The Action Plan starts with high priority objectives which require immediate correction such as a serious fire hazard and continues towards the completion of all the objectives set.

Appendix III is not intended to be a "pass/fail" document. The last page of the appendix has a grid which sets forth ten choices, both "impact" and "feasibility". This process is believed to be more accurate that the classic QA "critical, major and minor".

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