• BSCI and Sedex Audits in China: What Importers Must Know

    Posted on 19 Comments

    BSCI Sedex audits in China

    Importers are facing more pressure from customers to ensure that their products are, at least to a certain extent, ethically produced.

    However, actively monitoring working conditions in a country far away, costs millions of dollars. In other words, ensuring social compliance in China is out of reach for any company that’s not on the Fortune 500.

    That’s where BSCI and Sedex comes in.

    What is BSCI?

    Business Social Compliance Initiative (BSCI) is a system meant to make supply chains more transparent and fair.

    Importers and manufacturers anywhere in the world can become BSCI members, which requires them to comply with the 11 core BSCI principles:

    • The Rights of Freedom of Association and Collective Bargaining
    • Fair Remuneration
    • Occupational Health and Safety
    • Special Protection for Young Workers
    • No Bonded Labour
    • Ethical Business Behaviour
    • Decent Working Hours
    • No Child Labour
    • No Precarious Employment
    • Protection of the Environment

    Audits are carried out, by accredited companies such as Intertek, to verify that the supplier complies with these principles.

    Each audit rates the supplier in one of the following categories:

    • A (Outstanding)
    • B (Good)
    • C (Acceptable)
    • D (Insufficient)
    • E (Unacceptable)

    However, BSCI is not a certification scheme. It’s based on gradual improvements over time.

    What is Sedex?

    Supplier Ethical Data Exchange (Sedex) is a non-profit membership organization that sets social compliance standards for both manufacturers and buyer’s.

    Similar to BSCI, Sedex is not auditing or certification suppliers. Instead, they develop a platform for social compliance standards, while accredited companies execute the on site inspections.

    A supplier or buyer can join Sedex by paying a yearly fee of around US$120.

    The membership gives the supplier access to an online platform for managing their social compliance data, and the Sedex e-learning databank.

    However, what really matters to Importers is whether a supplier has passed a SMETA audit.

    The Sedex Members Ethical Trade Audit (SMETA) covers the following:

    • Health and safety
    • Labour standards
    • Environment (optional)
    • Business ethics (optional)

    SMETA is also divided into a two tier system:

    • 2-Pillar SMETA
    • 4-Pillar SMETA

    4-Pillar SMETA also includes an environmental audit.

    What does it mean when a supplier BSCI or Sedex audited?

    A supplier can either pass or fail a BSCI or SMETA audit. Assuming they have passed, it means that they have passed an on site inspection carried out by an accredited company.

    The audit may have been ordered by another buyer, or the supplier itself.

    Either way, this has the following implications for you:

    a. A supplier that can pass social compliance audits are generally larger and better organized. This often goes hand in hand with decent quality systems and product compliance capability.

    b. You can save yourself the cost of paying for a BSCI or SMETA report, as the supplier already passed the audit.

    c. If you plan to sell to retailers in the US or Europe, you can expect them to require that you present audit reports proving that your suppliers in Asia passed a BSCI, SMETA or SA8000 audit.

    Where can I find a sample BSCI or SMETA report?

    Below follows two PDF sample reports:

    • BSCI Audit Report (Link)
    • SMETA Audit Report (Link)

    How do I know if the audit report is valid and authentic?

    The first thing you have to check is the supplier name, which should be stated on the first page of the audit report.

    Many trading companies, and even factories, send audit reports valid for completely unrelated companies, just to pass the screening process from prospective customers.

    The report must for obvious reasons be valid for the same supplier you are planning to buy products from.

    Second, you should always get the audit report verified.

    You can contact BSCI and Sedex directly to verify if the report is authentic and still valid.

    Also notice that BSCI and SMETA audit reports are only valid for a certain time, and may require that the supplier pass a follow up audit at a later date.

    How can I find BSCI or SMETA audited suppliers?

    Alibaba.com and Globalsources.com enables users to filter suppliers based various factors, such as ISO 9001 and BSCI. All you need to do is to do a supplier search and then tick the BSCI box.

    Now you will only suppliers that claim to have passed a BSCI audit report.

    Some suppliers also upload their BSCI or SMETA audit reports, for everyone to download.

    But, as explained above, you must still verify if that is actually the case.

    If you attend trade shows in Mainland China or Hong Kong, you will also notice that BSCI and Sedex suppliers advertise this by showing the logo of these organizations.

    Is BSCI and SMETA audits common among suppliers in China?

    No, it’s only a small fraction of all manufacturers in China that have passed a BSCI or SMETA audit. Most likely because most cannot pass a BSCI or SMETA audit.

    If you are looking specifically for social compliance audited suppliers, you need to limit your supplier selection to those that can provide valid audit reports.

    Can our company pay to make a supplier BSCI or Sedex certified?

    Yes, you can order a SMETA or BSCI audit from Intertek, Asia Inspection and other accredited inspection companies.

    However, only the more sophisticated suppliers in China (and other developing Asian countries) can pass a social compliance audit report.

    If you order an audit for a random supplier you’ve found online, you will probably end up wasting your money.

    BSCI and SMETA audits can be fairly expensive, often costing more than $800.

    As such, you better have a good reason to pay for an unproven supplier to go through a BSCI or SMETA audit.

    Personally, I think it’s easier to just go to a supplier that has already passed an audit.

    How much does an BSCI or Sedex audit cost?

    Social compliance audits generally start from around $650 per factory audit.

    There may companies offering such audits for less, but keep in mind that a report is only of value if it’s issued by an accredited company.

    Why are not all suppliers BSCI or Sedex audited?

    The simple answer is that the vast majority of manufacturers cannot pass a BSCI or SMETA audit.

    A supplier must actively implement and enforce the protocols developed by either BSCI or Sedex to be able to pass an audit.

    However, the number of ‘BSCI and Sedex suppliers’ in China is growing, as more and more Importers (and their customers at home) demand that products are at least somewhat ethically produced.

    Can BSCI and SMETA audits be conducted in any industry?

    Yes, at least when it comes to consumer products.

    However, based on my experience,  BSCI and SMETA audits are more common among textiles and children’s products suppliers.

    For example, I find it far less common to find a BSCI or SMETA audited electronics manufacturer.

    Probably because buyer’s in these industries care more about social compliance, compared to others.

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  • 19 Responses to “BSCI and Sedex Audits in China: What Importers Must Know

    1. Dickson at 10:25 am

      Can you tell me the different of BSCI vs Sedex ?
      If a factory already pass BSCI audit, can we consider they need the standard of Sedex ?


      1. Fredrik Gronkvist at 5:07 pm

        Hi Dickson,

        BSCI and Sedex are different organizations. I would say that BSCI is sufficient.

      2. Petru at 3:01 pm

        Hi Dickson,
        BSCI has also a rating, based on the findings. SEDEX doesn’t have this option. For example, most of the BSCIs are rated C or D. A or B are rare. The most common issue of these audited factories is the Social Insurance.

    2. mike at 10:55 pm


      is there any database of already audited factories please?


      1. Fredrik Gronkvist at 6:39 pm

        Hi Mike,

        I think there are databases on the BSCI and Sedex websites. It was a while ago since I wrote this article so I cannot remember where to find them.

    3. Alex at 9:53 pm

      Hello Fredrik,

      Between these 2 ( BSCI and SEDEX) what would you choose and why?

      Thank you !


      1. Fredrik Gronkvist at 8:07 pm

        Hi Alex,

        I can’t say we have any preference. Few suppliers are either members of BSCI or Sedex, so we consider both as good signs.

      2. Petru at 2:59 pm

        Hello Alex,
        BSCI is more common in China, you will find more suppliers BSCI audited and if your client didn’t mention a certain rating – you will have a vast database of BSCI audited suppliers, most of them rated C.

    4. INOVACOMM at 2:21 pm

      Hi Fredrik,

      I have the same question as above one, what is the difference btw BSCI and Sedex? Which one is more high level? From your above answer, is Sedex more strict and more exigent than BSCI? If our suppliers have Sedex audit certification, can we say they have the BSCI’s level?
      Thank you advance for your prompt feedback?

    5. INOVACOMM at 3:23 pm

      Hi Fredirk,

      Or I asked my question in a different way: If our suppliers have the Sedex (4P) Audit certification, do they attain BSCI’s level?

      Kind regards,

      1. Fredrik Gronkvist at 7:59 pm


        No, not unless they are also audited according to BSCIs protocol.

      2. Petru at 3:06 pm

        The bad findings are almost the same for both audits. For example, if a factory doesn’t pay the Social Insurance for all the workers, you will have this finding in both audits and the BSCI’s rating will be affected by these findings. It is said that BSCI is more strict. My opinion is that a factory with BSCI, can pass a SEDEX as well. Now, it all depends on the findings – can have a SEDEX 2P but the BSCI can be rated C for the same factory.

        1. Fredrik Gronkvist at 8:22 pm

          Hi Petru,

          Thank you for your insights!

          1. Petru at 6:28 pm

            Hi Fredrik,

            Thank you too for this topic and your help in this matter, it is rare and important your work here.

    6. ADA at 9:39 am

      Hi Fredrik,
      We are a certification organization and what shall we do if we want to do audit of BSCI or SEDEX ?

      1. Petru at 4:26 pm

        Hello Ada,
        If your company is certified, the easiest way is to contact the same companies that issued the certifications. Other companies that can audit your firm are SGS, Intertek, Bureau Veritas. There are, of course, many others, but the above are one of the most recognizable and serious in the world. The cost differences are small.
        Dear Fredrik, please confirm my information.

    7. Britney Smith at 9:24 pm

      Hi I’m just wondering if there is a list of what abbreviations mean in this industry. For example what is ISO ?

      1. Fredrik Gronkvist at 7:15 pm

        Hi Britney,

        ISO stands for “International Organization for Standardization”. There are various ISO standards and frameworks applicable to everything from electrical safety to internal quality management.

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