Due Diligence for CSR Guidelines

Kenja’s Due Diligence for CSR Guidelines is a blockchain-enabled auditing system that provides full transparency and traceability of processes in supplier factories across the globe. It enables seamless long-distance auditing without need for travel and allows for smooth collaboration between clients and suppliers, simultaneously cutting on cost and improving efficiency.

The practice of factory auditing ensures that facilities adhere to industry standards, regulatory requirements, contractual obligations, and company policies. It is an assessment tool to vet potential suppliers and to confirm continuous adherence for ongoing supplier management. It can also be conducted after new policies and/or guidelines are introduced to ensure compliance.

However, depending on the size of the supply chain, factory auditing can be difficult and costly. This is because finding auditors with the technical and standards knowledge of the business being audited as well as the language fluency necessary to converse with client and factory staff is already challenging enough before considering their locations relative to the factories.

Rarely are qualified auditors located in the same geographic area as the factories they need to audit. It is more common for auditors to be required to travel. This isn’t a problem when the factories are located in one geographic area but they’re often scattered across the globe which lends its own challenges (i.e. data exchange and collaboration between the clients and suppliers).

One of Japan’s largest retailers faced these roadblocks when they launched an audit to ensure their newly-imposed CSR guidelines were being followed. With thousands of factories globally, conducting on-site audits proved expensive with the travel budget alone. Collaboration between the client and suppliers was also difficult with each of the factories operating as individual silos.

Seeking to create a system that would solve their problems and abide by their CSR guidelines to mitigate negative environmental impacts, Kenja worked with TÜV Rheinland to create the Due Diligence for CSR Guidelines. The solution is a blockchain-enabled auditing system that grants full transparency to processes in supplier factories and ensures compliance to CSR guidelines.

Data from all the facilities are congregated into the customized end-to-end platform, eliminating the issue of individual silos, and blockchain technology makes the data immutable. The solution thus removes the need for travel by allowing remote auditing and enables smoother as well as more efficient communication and information exchange between the client and suppliers.

Furthermore, the partnership with TÜV Rheinland ensures the inclusion of factory certification service by the global leader in independent inspection services as well as the solution’s compliance with international auditing system standards. All of these combined guarantee Kenja’s competitive advantage over other leading SaaS platforms in the international market.

Kenja’s Due Diligence for CSR Guidelines is a blockchain-enabled end-to-end platform for auditing with full integration to pre-existing systems. It is successfully operating as the quality assurance system for 2,000 factories abroad and has saved Japan’s largest retailer 37.5% compared to a global provider. The solution is fully customizable to suit the needs of other industries and is under consideration for joint implementation by other Japanese retailers.