We conduct due diligence to help identify and address risks to people and the environment linked to our business practices. On this page, we describe how this applies to the products we sell, the goods and services we use and our business relationships.
Due diligence
How we work with due diligence
Due diligence is an ongoing process companies use to identify, assess and act on impacts and risks in their business. These could be risks to the environment or to people, including human rights. Due diligence helps inform our decisions on how we prevent, mitigate and follow up on risks and impacts.
Due diligence requires input from rights holders, stakeholders, business partners and other relevant actors. This is especially important where issues are systemic and cannot be addressed by one company alone, such as industry-wide labour conditions or environmental challenges. This engagement helps inform our understanding of risks and where action may be needed.
Our due diligence process
We base our due diligence process on internationally recognised standards, including the UN Guiding Principles on Business and Human Rights (UNGP) and OECD Guidelines for Multinational Enterprises on Responsible Business Conduct. These frameworks set expectations for how companies should identify, assess, prevent, mitigate and account for actual and potential negative impacts on people and the environment.
- Embed due diligence into policies and management systems
We regularly update our standards and policies so they remain valid and relevant. Clear governance and defined responsibilities help guide how our policies and standards are applied across functions and markets. - Identify and assess adverse impacts in operations, supply chains and business relationships
We use global and local procedures to regularly identify and assess risks. Our teams in production countries help us stay up to date with the local context, emerging issues and changes in risk levels. Grievance mechanisms and worker voice are also part of how we identify and follow up on risks in our supply chain. Depending on supplier risk level or case history, we may require or recommend a factory to invest in a digital grievance mechanism to support workers. - Cease, prevent or mitigate adverse impacts
We work to manage and mitigate adverse impacts through several approaches. These include monitoring programmes across our value chain, capacity-building programmes, partnerships and multi-stakeholder initiatives. - Track implementation and results
We monitor risks and impacts to follow up on our actions and identify where further measures may be needed. - Communicate how impacts are addressed
We communicate on our environmental and social due diligence through our annual reporting and on our website, including information on key risks, actions taken and relevant policies. We have reported on our sustainability work since 2002 and publish all reports on our website. - Provide for, or cooperate in, remediation where appropriate
Through our whistleblower channel, Speak Up, people can raise concerns about suspected misconduct connected to our own operations or business relationships. We do not tolerate retaliation against anyone who, in good faith, reports a grievance or participates in an investigation. We also encourage open and collaborative dialogue as a regular way of working.
In addition, a Global Framework Agreement with IndustriALL, a global trade union federation, and IF Metall, a Swedish trade union, is in place to support the resolution of grievances at our direct suppliers and their direct partners. Where we identify that we have caused or contributed to an adverse impact, we take steps to provide for or cooperate in remediation, depending on how we are linked to the impact. Our Remediation Guidelines help guide the approach we take.
Where relevant, we seek input from rights holders and stakeholders to support analysis that is inclusive and up to date.
Find out more about our approach to due diligence in our Responsible Business Conduct Due Diligence Policy, annual and sustainability report, our salient human rights issues and Modern slavery statement.
A due diligence example – onboarding a new supplier
Our supply chain includes hundreds of businesses around the world. When we onboard a new supplier, due diligence helps us assess whether they meet our environmental and social requirements.
Business partners are required to commit to The H&M Group Sustainability Standards for Business Partners and our Code of Ethics. When evaluating a new supplier, we share these minimum requirements early in the process to create a common understanding from the start. These requirements cover areas such as human rights, working conditions, environmental practices and anti-corruption. In some cases, corrective action may be needed to meet our requirements within a given period.
Due diligence does not stop once we have onboarded a supplier. We conduct periodic reviews to assess continued compliance with our requirements and identify where follow-up may be needed. If we identify non-compliance, we have processes to follow up on corrective actions. As a last resort, we have the right to pause business until the issue has been addressed. In some cases, we may need to cease the business relationship. If we take this decision, we follow the ACT’s Responsible Exit Policy.
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