Risks and risk management Principal risks and uncertainties continued Risk How we mitigate Progress in FY21 BRAND DAMAGE • We have a range of policies specifying • Our ethical audit programme has been the quality of own brand products and extended to cover all warehouses that Description production processes which suppliers hold stock of Dunelm branded product Our customers expect us to deliver must adhere to. and selected Tier 2 sites. products that are safe, compliant with • Factories complete a profile • Unannounced audits taken place legal and regulatory requirements, and questionnaire to obtain a more holistic across a number of our Tier 1 and Tier fit for purpose. Increasingly, customers assessment. 2 suppliers outside of our period audit also want to know that products have • We operate a full test schedule for process to ensure factories remain in been responsibly sourced and that their all new own label products and on line with our expectations. environmental impact is minimised. a sample basis for ongoing lines, • Continued to roll out processes to We must also ensure that our suppliers overseen by our Specialist Product assess the environmental practices of share and uphold our approach to Technology team. Tier 1 sites including water, chemicals, business ethics, human rights (including • Food hygiene and allergen awareness emissions and energy use. safety and modern slavery) and the in our Pausa cafes is maintained • Introduced an assessment programme environment. through the adoption of clear for the verification of recycled operating guidelines and compulsory materials. Failure to do so could result in harm colleague training. Compliance audits • Developed online quality and ethical to individuals with the potential for are performed regularly. Monthly food assessment for secondary branded customers, colleagues and other safety committee meetings are products. stakeholders to lose confidence in the in place. • Launched supplier portal so own Dunelm brand. • All stock and food suppliers and the brand suppliers can access latest Link to strategy: majority of our other suppliers are product specifications and testing required to sign up to our Anti-Bribery requirements. Customer understanding Policy and Ethical Code of Conduct, Sustainability which is in line with international • All Tier 1 and Tier2 factories supplying Product development guidelines, and also covers modern Dunelm with food products are BRC Performance indicator: slavery. and/or SALSA approved to ensure that Product recalls they have suitable processes in place. • Periodic audits on all suppliers who Tier 1 suppliers complete an ethical/ Percentage of audits completed manufacture a finished product. safety risk assessment. within policy Specialist partner reviews and grades audits and follows up on corrective • Trained store colleagues and updated Executive responsibility: actions. allergen information for all Pausa Commercial Director products (available electronically on Reports to: • Code of Conduct sets out standards for in-store tablets). working conditions which all factories Chief Executive Officer supplying Dunelm branded products SUSTAINABILITY SECTION Impact compared to FY20: must adhere to. FROM PAGE 40 Board oversight: • Ethical trading/modern slavery/ responsible sourcing reviewed at least annually in depth by the Board. 82 DUNELM GROUP PLC ANNUAL REPORT & ACCOUNTS 2021