New York State Comptroller Thomas P. DiNapoli today announced that Fortune 500 retailers Dollar Tree and Dillard’s have agreed to new reporting standards that will help ensure greater transparency and safety in their suppliers’factories.  The agreements will help safeguard the companies and their investors against the financial and reputational damage that can result when suppliers fail to uphold recognized standards of labor and workplace safety. As a result of the substantive agreements, DiNapoli has withdrawn his shareholder proposals asking the companies to strengthen their supply chain accountability.

“There’s a growing community of corporations who understand that their suppliers’ability to maintain safe conditions is key to their business model,”Comptroller DiNapoli said. “Companies like Dillard’s and Dollar Store are helping to make progress, but there’s a lot more work to do.  I firmly believe that greater transparency and accountability surrounding workers’rights result in stronger, more sustainable companies and better returns on the Common Retirement Fund’s investments. Sadly, it took the deaths of more than 1,100 workers in a Bangladesh factory collapse one year ago to spur global action on these supply chain issues.  We will continue to urge our companies to embrace robust reporting standards on workplace safety.”

Dollar Tree, which operates nearly 5,000 dollar stores in 48 states, agreed to have its global suppliers report on their ability to meet internationally recognized requirements for workplace safety and labor standards.  The suppliers’disclosures are to be independently verifiable. The company has also created a new vice president position to oversee global sourcing and the administration of the company’s new auditing program.

Dillard’s, which has 300 department stores in 29 states, has created new workplace safety requirements for its overseas suppliers. Similar to Dollar Tree, Dillard’s agreed with Comptroller DiNapoli’s request that it require its suppliers to cooperate with audits of their adherence to the new safety code.

As of April 22, 2014, the Fund owned 598,200 shares of Dollar Tree valued at $30,723,552 and 58,708 shares of Dillard’s valued at $5,629,510.12.

Background:

Comptroller DiNapoli has engaged portfolio companies for several years in an ongoing effort to increase transparency and accountability in their supply chains.
2014 - Dollar Tree and Dillard’s agreed to increase transparency and accountability in their supply chains.
2013 - Best Buy and Bed Bath & Beyond agreed to encourage their suppliers to report on workplace safety, human and worker rights and environmental compliance. 
2012 - Leggett & Platt, a leading manufacturer of furniture and bedding, agreed to create a Supplier Code of Conduct which provided a uniform code of conduct throughout its world-wide supply chain. The code became part of the company’s standard contract terms and conditions.
2011 - Mohawk Industries, a leading supplier of flooring, agreed to adopt a labor code of conduct for its suppliers.
2010 - The Common Retirement Fund, in concert with other signatories of the United Nations Principles for Responsible Investment wrote to selected apparel and consumer durables companies asking them to call on their overseas suppliers to implement the core labor rights standards of the UN’s International Labor Organization (ILO) and to allow independent monitoring of their compliance.