Social Audits. Marketplace Practices Audit

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Assertion:

The organization consistently interacts with its customers in a fair and honest way. They also treat competitors, contractors, suppliers and stakeholders with integrity and respect.

Consumer Protection

  • The organization will comply with all relevant consumer protection laws and
    regulations.

    • Discuss with management the organization�s procedures for complying with all consumer protection laws. How does the organization ensure product quality, fair price and meeting customer needs?
    • Obtain management�s representation and attorney letter concerning any consumer protection lawsuits that have been adjudicated or that are pending.  Perform a public record search, as considered necessary.
    • For not-for-profit organizations, discuss with management, operationspersonnel and accounting personnel how the organization ensures contributions/grants are used in accordance with donor/grantor restrictions.

Advertising and Marketing Practices:

The organization markets its products and services in a truthful way, avoiding false claims. The organization advertises and markets without discriminating against, or stereotyping, any person or group.

  • Obtain marketing policy and interview marketing personnel to understand marketing procedures. Review how the organization establishes its target market, what price it sets and how products will be promoted.
  • Interview customers/donors to gauge perception of marketing practices.
  • Discuss with management, marketing personnel and manufacturing/research personnel whether the organization has disclosed information about product content and identifiable risks appropriately.
  • For not-for-organizations, discuss with management how internal operations reflect the publicly stated mission and objectives.

Customer Satisfaction:

The organization publicly declares its customer satisfaction policies, including return policies, exchange policies, product guarantees, and a customer service telephone number. These policies are displayed prominently at the point of purchase and/or are made available to clients.

  • Interview marketing manager and customers to determine the extent of the organization�s customer satisfaction policies.
  • Determine if the organization engages the customer in conversations about products and social goals through interviews with management and customers.

Suppliers:

The organization makes fair and prompt payment to all contractors and suppliers.

  • Understand controls over disbursement cycle and vouch payments, as considered necessary, to ensure proper payment.
  • Discuss with the procurement agent and vendors whether the organization attempts to foster long-term stability in supplier relationships. Does the organization attempt to share information with suppliers and integrate them into the planning process?
  • Interview vendors to determine if the vendors have any formal social responsibility programs in practice.

Ethics Policy:

  • The organization has developed a policy of ethical conduct in the marketplace.
    • Review the code of ethics and discuss it with management, employees, human resources personnel, marketing personnel, accounting manager, procurement personnel and BOD members. Discussion should include awareness of Federal Sentencing guidelines and Foreign Corrupt Practices Act. Is the code specific, comprehensive, clear and unambiguous, realistic and enforceable?
    • Gain an understanding of the extent of the organization�s ethics program (i.e. ethics hot line, training, ethics officer, awareness of ethical climate) through discuss with management and Board members.

Dispute Resolution:

  • The organization resolves customer or supplier disputes quickly and fairly.
    • Discuss with management the organization�s procedures for resolving disputes. Review compliant files to determine the type of complaints filed and how long they were outstanding.
    • Interview customers and suppliers to determine if disputes have been handled satisfactorily.
    • Determine the number of complaints filed against the organization at the Better Business Bureau, Society of Consumer Rights or similar watchdog organization.

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