NEW YORK, Jan. 27 /PRNewswire/ -- The International Center for Corporate Accountability (ICCA) today released audit results of manufacturing facilities of major Mattel, Inc. suppliers in China. The ICCA reports were commissioned by Mattel (NYSE: MAT) as part of Mattel's commitment to upholding its Global Manufacturing Principles (GMP) code of conduct. They are intended to provide an unbiased, third party analysis of working conditions in Mattel's manufacturing facilities. While voluntary audit reports of Mattel-owned manufacturing facilities have been published since 1999, today's report marks the first effort to broaden the scope of the analysis to include the facilities of Mattel's major vendors. The current audit covers 12 manufacturing facilities in China that are among the major suppliers of Mattel, constituting approximately 50 percent of Mattel's total vendor business in China in terms of dollar amount. Dr. S. Prakash Sethi, chairman of ICCA and University Distinguished Professor, Zicklin School of Business, Baruch College, commented, "With the conclusion of this audit, ICCA has determined that while supplier facilities face many challenges, Mattel's GMP has been instrumental in motivating facilities to achieve or even surpass compliance standards in safety, maintenance, employee communications, payroll and working conditions. We were especially pleased to see significant progress between an initial visit to the plants two years ago and when we returned to conduct the formal audit." Sethi noted, "Mattel is the first and only global consumer products company to apply a required standards system to both its own manufacturing facilities and those of its major vendors, and to independently monitor and publicly disclose the results. It is our desire that more companies adopt and uphold such standards in their manufacturing facilities worldwide, as it is an extremely important initiative that can benefit workers everywhere." "I'm proud of the progress made by our vendors and am also proud of Mattel's efforts in leading this effort. This audit has also fulfilled the vital function of helping us to identify important areas of performance that demand improvement," said Tom Debrowski, executive vice president of worldwide operations for Mattel. "That is why we commission these regular audits -- now that the challenges are known, we can work with our vendors to ensure they make the appropriate changes to come into compliance with our GMP standards. Suppliers understand that compliance is not an option, it is an absolute requirement if they want to continue doing business with Mattel." Summary of Report Findings Following is a summary of the findings of the ICCA report released today: -- Manufacturing facilities visited by ICCA have shown significant improvement in a number of areas, and the current audits indicate that Mattel has committed considerable resources to advise and assist its vendors in order to improve their level of compliance with Mattel's GMP. -- The minimum worker age of 16 is strictly enforced; investigators did not find any workers under the age of 18. -- There has been definite improvement in payment of minimum wages. With one or two exceptions, all plants were found to be in compliance for payment of legally mandated minimum wages for regular and normal overtime working hours. -- Areas showing significant improvement include safety of the workplace, dormitories and canteens, workers' access to all levels of management, and lack of discrimination or promotion based on sex, race or ethnic origin. -- Some plants showed inadequacies pertaining to environmental issues, including disposal of wastewater and poor ventilation. Improvements are also needed with regard to worker safety training and proper use of personal protective equipment. -- Areas needing improvement include availability of records to verify that workers who performed overtime work on rest days received either double pay or a day off, and consistent application of regulations with regard to fringe benefits such as maternity leave and paid annual leave. -- Most facilities exceeded the maximum overtime hours limits for peak production periods (called consolidated work hours), authorized by the local labor bureaus. Mattel is pleased with the progress made by vendors under the rather difficult competitive manufacturing and procurement environment in China, and recognizes the challenges that lie ahead in bringing all vendors into full compliance with GMP. To achieve this goal, Mattel will work with suppliers, and in consultation with ICCA, to design and implement a plan of action to correct deficiencies to set the stage for continuous improvements in all of its overseas facilities and operations. This plan should be finalized within the next 90 days. "We strive to continually improve our facilities, both Mattel-owned and supplier-owned, and for our actions and results to be transparent. In this way we uphold our commitment to our GMP and to fully responsible corporate conduct," Debrowski said. The full text of the ICCA report can be viewed on ICCA's Web site at www.ICCA-corporateaccountability.org and on the Mattel corporate Web site located at www.mattel.com/about_us/Corp_Responsibility/default.asp. Mattel's Global Manufacturing Principles (GMP), launched in November 1997, form the cornerstone of the company's ongoing commitment to responsible manufacturing practices around the world. Adherence to GMP seeks to ensure that wages, working and living conditions and employee access to management are just and fair, as well as to assure protection of the environment. As part of Mattel's GMP, the company's primary suppliers are also subject to compliance with the standards set in the GMP. Mattel contracted with ICCA to perform regular audits of its owned manufacturing facilities and those of its major suppliers. ICCA's responsibility is to evaluate and publish findings on these manufacturing facilities' compliance with GMP. ICCA's audit protocols are designed to verify vendors' compliance with Mattel's GMP standards in a manner that is comprehensive, objectively measured, interpreted in a meaningful manner and independent of any other consideration except the compliance standards specified in the GMP. About ICCA Directed by Dr. S. Prakash Sethi, the International Center for Corporate Accountability (ICCA) is a not-for-profit, independently incorporated organization comprised of a council of experts in labor issues worldwide. ICCA encourages and assists multinational corporations in creating, implementing and arranging independent monitoring of codes of conduct. As an academically-affiliated organization, associated with the Zicklin School of Business of Baruch College-The City University of New York, ICCA also undertakes independent field research on aspects of corporate governance and accountability that normally fall outside the purview of corporate boards of directors, and engages in dialogue with a wide range of stakeholders. About Mattel Mattel, Inc. is the worldwide leader in the design, manufacture and marketing of toys and family products. The company's best-selling brands include Barbie(R), Hot Wheels(R), Fisher-Price(R) and American Girl(R). With headquarters in El Segundo, California, Mattel has offices and facilities in 36 countries and sells its product in more than 150 nations throughout the world. The company's website can be found at www.mattel.com.
SOURCE International Center for Corporate Accountability