Doing business the right way requires that our business partners do the same. Our suppliers are key to our success and to maintaining the high standards and reputation of our brands. We require our suppliers not only to be technically qualified, but also to commit to our ethical standards and business practices. Our Supplier Code of Conduct (SCoC) outlines the standards required to conduct business with Whirlpool Corporation. We require all of our suppliers to abide by the SCoC. Whirlpool Corporation’s suppliers are vital business partners, and together, these principles provide us with an opportunity to better the lives of the people we touch.

We approach sourcing in three ways:

  • Identify: We use a risk-based approach for our third-party audits to ensure compliance with our SCoC.
    • Unknown Risks—All new suppliers must go through an on-site audit by our third-party auditor prior to being selected for conducting business with Whirlpool Corporation.
    • Known Risks 1—All suppliers with issues identified are required to provide a corrective action plan and may be audited a second time based on the severity of the audit findings.
    • Known Risks 2—Risk assessment survey is a new tool launched in 2019 which assesses a supplier’s compliance risk based on high-risk locations, Whirlpool Corporation spend and industry risks. Our existing suppliers that may score poorly could be audited based on this risk assessment tool.
    • Potential or Observed Risks—Existing vendors continue to be audited/re-audited as potential opportunities for improvement are identified.
  • Mitigate: We conduct annual training for suppliers in high-risk regions to ensure clear understanding of our SCoC and audit actions to ensure compliance.
  • Remediate: All suppliers who undergo audits work with our third-party auditors to create and align on a Corrective Action Plan (CAP). Suppliers must provide evidence of resolving the CAP. In 2020, we assigned our auditors to follow up on all audits that were completed to verify that the findings were Closed to ensure continuous improvement in our processes. We had five remedial re-audits in 2020, and all of the suppliers have implemented corrective actions.

Environmental Assessments

Our environmental assessment, which is part of our SCoC audits, requires suppliers to comply with all local environmental laws applicable to the workplace, the products produced and the methods of manufacture. Additionally, suppliers must not use materials that are considered harmful to the environment and are encouraged to use processes and materials that support the environment. In 2020, we followed up with four suppliers with potential high-risk environmental issues and have identified improvement areas related to the environment. Their CAPs were approved by Whirlpool Corporation and implemented.

Human and Labor Rights

Whirlpool Corporation supports the human rights of everyone we work with, and we expect our global suppliers to do the same. We believe in global human rights, and our business practices reflect that commitment to ensure every person who works for us throughout all of our global operations does so of their own free will, in a safe and healthy environment. We oppose discrimination, slavery and child labor, and ensure we have controls and protections to avoid them. We support diversity and wage parity. We also respect the rights of our employees to associate with whomever they choose and to be involved in politics outside of work. These values are also reflected in Our Integrity Manual. In addition to our internal commitment to human rights, we also hold our suppliers accountable to comply with these same principles through our Supplier Code of Conduct. The SCoC states, in part, that suppliers must recognize and respect human rights, including any rights of workers to exercise lawful rights of free association, compliance with local and international laws regarding young workers, compliance with laws prohibiting human trafficking in any form (e.g., forced labor, debt bonded slavery), providing safe and healthy work environments, and respecting any legal right of workers to bargain collectively. All suppliers are also prohibited from using any type of involuntary or forced labor. Where there is no local legal requirement or if a local legal requirement is not as strict as the requirement included in the SCoC, suppliers are required to follow the requirements in the SCoC.

In 2020, we evaluated and adjusted our supply chain to help ensure compliance with our SCoC requirements. No instances of child labor or young workers exposed to hazardous work were found in any of the audited supplier facilities. We audit our suppliers to check for any child labor instances per our policy, which determines the minimum age for workers must be greater than: (a) 15 years of age or 14 years of age where local law allows such an employment age consistent with International Labour Organization guidelines; or (b) the age for completing mandatory (compulsorily) education; or (c) the minimum age established by law in the country of manufacture. In addition, Suppliers must comply with all legal requirements for the work of authorized young workers, particularly those pertaining to hours of work, wages, safety, working conditions, and the handling of certain materials.

Audits Snapshot: 2020
  NAR EMEA LAR Asia Total
New 3 9 0 22 34
Existing 4 11 7 115 137
Total Audited (in 2020) 7 20 7 137 171
COVID-19 special audit 4 7 6 56 73

In addition, Suppliers must ensure that on a regularly scheduled basis, except in extraordinary business circumstances, workers are not required to work more than (a) 60 hours a week, including overtime, or (b) the limits on regular and overtime hours allowed by the laws of the country of manufacture. In addition, except in extraordinary business circumstances, all workers are entitled to at least one day off in every seven-day period. In 2020, as a result of our SCoC audits, four minor incidents of labor risk related to hours of work were identified and are being remediated.

Our SCoC also prohibits harsh or inhumane treatment, including corporal punishment or the threat of corporal punishment, or forced labor. Our Suppliers must meet these requirements and be compliant with the law, codes and policies. Whirlpool also utilizes a cross-functional team led by Global Strategic Sourcing (procurement) and consisting of Legal, Ethics and Compliance, and Government Affairs to identify, review, analyze, and respond to any issues of forced or compulsory labor, including, but not limited to monitoring multiple public websites, periodicals, and reports that may identify forced labor violations or issues. Additionally, Whirlpool utilizes a Global Third-party Due Diligence Program that identifies forced or compulsory labor violations, claims, or past conduct against new and current suppliers. Based on due diligence findings, Whirlpool can respond appropriately to forced or compulsory labor issues and risks.

Material failures to comply with our SCoC may result in the termination of our relationship with a supplier. In order to ensure our suppliers are meeting our standard of integrity, we will continue to conduct independent audits of a representative sampling of our suppliers’ practices.

Mitigating Supply Risks During COVID-19

Despite all the challenges in 2020, we ensured that all existing and new suppliers were compliant with our SCoC through our robust supplier auditing program. In May 2020, we added questions focused on COVID-19/pandemic prevention to our standard audit questionnaire to assess suppliers’ capability to prevent and control the spread of COVID-19 in their premises. Some of the questions included (but were not limited to) assessing suppliers’ crisis management systems, employee health tracking, personal protection, prevention in the workplace, reporting, exception handling, training and communication.

We continue to identify and assess the impact of COVID-19 on our suppliers’ facilities and take proactive measures to ensure business continuity while maintaining compliance with our SCoC.

Improved supply chain transparency

In 2020, we evaluated our global supply chain and surveyed 100% of our in-scope suppliers to understand potential risks in their supply chains. We organized and analyzed their responses and have filed an annual Conflict Minerals Report to share our due diligence process. Our efforts have improved supply chain transparency and created increased awareness within Whirlpool Corporation regarding conflict minerals compliance. Going forward, this will allow us to further improve due diligence and mitigate risk in 2021 and beyond.

Conflict Minerals

Whirlpool Corporation has developed a conflict mineral due diligence framework that conforms with the internationally recognized due diligence framework developed by the Organisation for Economic Co-operation and Development (OECD). Per U.S. Securities and Exchange Commission (SEC) guidelines, we filed the Whirlpool Corporation Conflict Minerals Report for the year ended 2019.

Whirlpool Corporation has also taken a number of actions to support responsible in-region 3TG (tin, tantalum, tungsten and gold) sourcing, including the following:

  • We continue to enhance escalation, follow-up procedures and perform due diligence measures to improve the transparency of our supply chain and increase supplier response rates.
  • We have established a process to gather smelter information from the Responsible Minerals Initiative (RMI) on a continuous basis to validate the status of smelters and refiners identified by our suppliers. This has helped us identify the percentage of suppliers on our smelter list that are RMI compliant.
  • We are members of the RBA (Responsible Business Alliance) and actively participate in RMI, the multistakeholder group convened by the Responsible Sourcing Network and other industry groups to support solutions aimed at improving supply chain transparency.
  • We have made additional investments in conflict mineral due diligence tools.
  • We continue to monitor leading practices of peer companies to enhance our conflict minerals program.
  • We have implemented a process to identify new direct suppliers to Whirlpool Corporation and to include them in our Reasonable Country of Origin Inquiry efforts.
  • We continue to develop further awareness within the organization and supply base regarding conflict minerals compliance through outreach and training.
  • We have institutionalized our conflict minerals compliance program by improving our standard operating procedures, rolling out the procedures to identified business units, and identifying and prioritizing improvement opportunities.
  • In the event that any of our suppliers are found to be providing us with components or materials containing 3TG from sources that support conflict in the Democratic Republic of the Congo region, we have committed to working with them to establish alternative sources of 3TG.