3. Supplier’s reporting obligation
Reporting obligation
In the event of severe deviations in your own operations or in the supply chains, you shall report to the contracting organisation and present the implemented and planned measures.
Contract clause
If Supplier has reasonable grounds to assume that a severe deviation is occurring or has occurred in its own operations or supply chains, Supplier shall within [two (2)] weeks report the actual circumstances and the implemented and planned measures in accordance with sections 2.1 – 2.7, to [contracting organisation].
Severe deviations refer to forced labour, child labour, working conditions that pose a danger to life, serious environmental harm, grand corruption and attacks on environmental and human rights defenders. The severe deviations are defined in appendix 1: Supplier Code of Conduct.
What is a severe deviation?
The severe deviations are defined in the Supplier Code of Conduct.
Code of conduct
Forced labour, child labour, working conditions that pose a danger to life, serious environmental harm, grand corruption and attacks on environmental and human rights defenders are severe deviations.
Serious environmental harm is defined as damage caused by polluting activities that have a severe adverse impact on people, water areas or ground water, species and habitat.
Grand corruption is defined as involvement in bribery, embezzlement, trading in influence, abuse of functions, illicit enrichment, laundering of proceeds of crime, concealment or obstruction of justice:
a) as part of a scheme that involves a high-level public official, and
b) that results in or is intended to result in:
- a gross misappropriation of public funds or resources, or
- grave or systematic violations of the human rights of a substantial part of the population or of a vulnerable group.
Forced labour and child labour are described in sections 2.2 and 2.3 of the code of conduct.
Code of conduct
2.2 Employment is freely chosen
a) There is no forced labour, bonded labour or involuntary prison labour.
b) Workers are not required to lodge “deposits” or their identity papers with their employer and are free to leave their employer after reasonable notice.
Code of conduct
2.3 Child labour shall not be used
a) There shall be no new recruitment of child labour. Child labour is any kind of activity or work which is harmful to the intellectual, physical, social and moral development of persons under 18 and undermines their education, preventing them from going to school, constraining them to abandon schooling too soon or requiring them to work and study at the same time.
b) The employer develops or participates in and contributes to policies and programmes which provide for the transition of any child found to be performing child labour, to enable him or her to attend and remain in education until he or she is no longer a child.
c) A worker under 18 may nonetheless have the right to work if he or she meets the age requirements for the type of work in question:
- For general work, the minimum age is 15.
- For non-hazardous work, the minimum age may be temporarily set at 14 in countries whose school-leaving age is lower than 15.
d) Persons under 18 shall not be employed at night or in hazardous conditions.
Working conditions that pose a danger to life and attacks on environmental and human rights defenders are not defined in the code of conduct. Below are circumstances to consider.
Working conditions that pose a danger to life
Working conditions that pose a danger to life are not defined in the Supplier Code of Conduct. In your assessment, you need to consider both the risk of workplace accidents and long-term exposure to hazardous working environments.
According to the WHO and the ILO, around 1.9 million people die each year as a result of work-related diseases and accidents. The majority of these deaths are caused by work-related diseases, including those resulting from long working hours and exposure to particles, gases, and fumes.
The assessment should therefore include, for example:
- exposure to chemicals, particles, gases, and fumes,
- hazardous machinery and work tasks,
- risks of falls, fires, and explosions,
- long working hours and insufficient recovery time,
- access to protective equipment and safety procedures.
Attacks on environmental and human rights defenders
Environmental and human rights defenders are individuals or groups working to protect human rights or the environment. This may include, for example, Indigenous peoples, trade union representatives, journalists, land and environmental defenders, or anti-corruption activists.
Defenders may be exposed to:
- threats and death threats,
- violence and harassment,
- arbitrary detention,
- judicial harassment and so-called SLAPP lawsuits,
- disappearances and killings.
Business & Human Rights Centre documented 790 attacks against human rights defenders linked to business-related impacts during 2025, including 53 killings.
When conducting risk assessments, you should therefore pay particular attention to:
- operations in conflict-affected or high-risk areas,
- impacts on Indigenous peoples and local communities,
- land rights and natural resources,
- conflicts linked to mining, agriculture, energy, or infrastructure projects,
- risks of reprisals against individuals raising complaints or criticism.
You may, among other sources, use:
Civic Freedoms & HRD Data – Business and Human Rights Centre
The Observatory For the Protection of Human Rights Defenders
What does reasonable grounds to assume mean?
Reasonable grounds to assume means that there is credible information or clear indications that a severe deviation is occurring or has occurred. Such information may, for example, originate from audits, authorities, civil society organisations, research institutes, or the media.
Below are examples of situations where suppliers, if the current contract clauses had been applicable, could have been considered to have had reasonable grounds to assume that severe deviations were occurring.
Forced labour in Xinjiang linked to Italian tomato products
In 2024, an investigation by the BBC and Source Certain found that Italian tomato products labelled “Made in Italy” contained tomatoes originating from Xinjiang in China. The region has for a long time been subject to international criticism related to the forced labour of Uyghurs and other Muslim minorities.
The investigation also identified specific companies and supply chains. Suppliers purchasing such products could therefore be considered to have had reasonable grounds to assume that there was a risk of forced labour in the supply chain.
Child labour in surgical instrument manufacturing in Pakistan
In 2015, Swedwatch reported that children were still working in the manufacturing of surgical instruments in Pakistan, despite several years of monitoring of the sector. Children carried out tasks such as grinding, polishing, and assembling surgical instruments, and were exposed to harmful substances and hazardous work processes.
Similar findings were later also reported by the Ethical Trading Initiative. Since the instruments were exported internationally, including to Sweden, suppliers could therefore be considered to have had reasonable grounds to assume that child labour was occurring in the supply chain.
Working conditions that pose a danger to life at Foxconn
In 2015, a worker died by suicide at Foxconn’s factory in Zhengzhou, China. The incident followed earlier reports of multiple suicides at the same facility and extensive criticism of the working conditions.
Investigations linked the incidents to excessive overtime, intense production pressures, and severe psychological strain. In light of the extensive international reporting, suppliers could therefore be considered to have had reasonable grounds to assume that working conditions posing a danger to life were occurring.
Serious environmental harm caused by the pharmaceutical industry in India
Since the 1970s, the pharmaceutical industry in Patancheru and Bollaram near Hyderabad, India, has been linked to extensive discharges of untreated or inadequately treated wastewater.
The pollution has caused serious impacts on local waterways, groundwater, and people’s livelihoods. Despite legal action and long-standing international attention, the problems have persisted for several decades.
Suppliers connected to pharmaceutical production in the area could therefore be considered to have reasonable grounds to assume that serious environmental harm is occurring.
Grand corruption in Malaysia's glove industry
In 2020, the UK Home Office published a report on Malaysia’s disposable glove manufacturing industry. The report described widespread corruption in the recruitment systems for migrant workers and linked this to debt bondage and forced labour.
As factories in Malaysia supply medical gloves to international markets, including Europe, suppliers could therefore be considered to have had reasonable grounds to assume that large-scale corruption was occurring in the supply chain.
Attack on British human rights defender in Thailand
In 2013, a British human rights defender was subjected to several civil and criminal proceedings in Thailand after contributing to a report by Finnwatch on alleged violations of workers’ rights at Natural Fruit Company.
The report described, among other things, child labour, underpayment, and hazardous working conditions. The legal actions against the human rights defender received international attention as an example of reprisals against individuals exposing abuses in global supply chains.
Suppliers connected to the sector could therefore be considered to have had reasonable grounds to assume that attacks against human rights defenders were occurring.
What does the reporting obligation cover?
You shall report the actual circumstances and the implemented and planned measures in accordance with sections 2.1–2.7 of the contract clause, i.e. the process requirements. This means that you shall:
Investigate and assess the actual circumstances, while paying attention to vulnerable groups and, where possible, engaging in a meaningful way with affected rights-holders.
Cease activities that cause or contribute to the severe deviation, if it occurs in your own operations or if you contribute to it in your supply chains.
Establish and follow up action plans to prevent and mitigate the severe deviation, if possible in meaningful consultation with affected rights-holders or their representatives.
Promote purchasing practices that do not make it more difficult for the sub-supplier to comply with the commitments, if the severe deviation occurs in the supply chains.
Enable affected rights-holders, their representatives and environmental and human rights defenders to make complaints related to the severe deviation.
Establish and implement remediation plans if you have caused or contributed to the severe deviation. If you are linked to the severe deviation, you should develop a plan for how to use your leverage to influence the party that caused or contributed to the deviation to provide remediation.
What happens if you do not report?
If you do not report severe deviations, the contracting organisation has the right to impose liquidated damages, temporarily suspend you from call-offs, and terminate the contract.
However, the deviation management focuses on improvements, in dialogue and cooperation with you.
Read more about deviation management under 3. Manage contract. Note that this page is part of the support to buyers.
PAGE CONTENT
What does reasonable grounds to assume mean?
What does the reporting obligation cover?
What happens if you do not report?
RELATED LINKS SUPPLIERS
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PROCESS REQUIREMENTS
1. Policies and responsibilities
3. Prevent and mitigate (causation/contribution)