34 The Hershey Company | 2021 ESG Report Responsible Sourcing and Human Rights The Big Picture Our Company Cocoa Responsible Sourcing and Human Rights Environment Our People Youth Community About This Report Human Rights Across Our Value Chain For more than 125 years, The remarkable and diverse people we employ and our Human Rights Policy, which we Hershey has operated with and the individuals who work along our value developed using the UN Guiding Principles Bringing Due Diligence chain are some of our most important assets. on Business and Human Rights (UNGPs) to Life the understanding that we We use an approach that identifies, evaluates along with our Supplier Code of Conduct are integral members of and prioritizes action on the most significant, (SCOC) and Responsible Recruitment & In 2021, the qualification process of a relevant risks to people, enabling everyone Employment Policy. potential supplier in the Gulf region the communities where to exercise and enjoy their fundamental identified a labor practice that was we live and work. human rights. We have several standards and Our Due Diligence inconsistent with our Responsible expectations that guide our initiatives in this Recruitment and Employment Policy. space, including the Hershey Code of Conduct Our approach to human rights due diligence Consequently, our Responsible Sourcing is guided by the UNGPs and represents an and Human Rights teams determined that ongoing risk management process that enables further on-site assessment was needed us to identify, prevent and mitigate current and and engaged the sustainable business potential human rights risks throughout our consultancy twentyfifty to conduct an e value chain. It is informed by a risk methodology in-depth Participatory Human Rights c s c s A Assessment of the potential supplier. e that we developed with the leading human wat r an o d t nitation rights nonprofit Verité. sa C We had great engagement and support ild c lim from the supplier’s corporate leadership, h r h a We continually perform due diligence on C o a t b n e la ge our own facilities and on high-risk suppliers plant managers and workers (including identified through our risk assessment process. international migrant workers). The Our Responsible Sourcing and Responsible assessment involved a two-day on-site visit r m A of the facility and dormitories, participatory o n g c Recruitment Supplier Programs conduct b a g e r a c ie c specific due diligence on human rights and interviews, focus groups and a mapping l n e m i h v d u k a a s labor topics — see page 39 for more details. exercise for migrant workers to share their e h c n n s c Salient Issues c t journey, suggestions for improvements and r d f is e o We also include human rights risk screening o n ra m aspirations for their careers and futures. F a t Identifying and in our supplier qualification process to assess addressing the most s forced labor and other human rights risks before Many workers spoke positively of their entering into commercial relationships — see experience, with some of them having a La pressing human rights n page 39 for more details. worked at the company for 15 to 20 c nd issues across io years. Some important opportunities for q t ui rig our value chain ta In 2021, we strengthened language around improvement were identified, including a si h s forced labor in our commercial contracts more formal time and attendance system t e i t r on s/ fo for suppliers of plush cotton, palm oil and to monitor working hours, a new system for De renewable energy. This process goes above holding identity documents and human and beyond what is in our SCOC, with clear rights due diligence training for human requirements and expectations around resources staff. We are currently working w Li n’s production document records and traceability. v e t with the site on corrective actions and ag ing m nden i e o a nco and Wghts erm Finally, we used the Better Buying Survey will continue our ongoing monitoring and me Safety ri ow to research and explore the links between reporting activities. a p nd health em purchasing practices and human rights. For more information on this program, see page 39.