supplier code of conduct
Definition
A supplier code of conduct is a written document that a business gives to its vendors and suppliers, spelling out the ethical, legal, and operational standards those suppliers must follow in order to keep doing business with you. It typically covers things like fair labor practices, environmental responsibility, anti-bribery rules, and product quality expectations. Think of it as your rulebook for anyone you pay to provide goods or services to your company.
Example
If you own a clothing boutique and source products from overseas manufacturers, your supplier code of conduct would require those manufacturers to pay workers fairly and avoid using child labor, and you could drop them as a supplier if they violate those terms.
Watch Out
Without a signed supplier code of conduct in place, you could face serious legal and reputational consequences if one of your suppliers behaves badly, since customers and regulators may hold your business responsible for the actions of the companies in your supply chain.
See which terms appear in your contract?
This definition is for informational purposes only and does not constitute legal advice. Please consult with a licensed attorney for legal guidance.