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Getting to Know Your Supply Chain

By Christine Parizo

The supply chain is an intricate global web of interdependent processes — and that means supply chain management professionals may need to be aware of an equally complex set of local, national and international regulations. In supply chain management, it’s not enough to know the companies involved in the supply chain; it also may be critical to know the laws and governing bodies that regulate the movement of goods and materials, and to understand the associated compliance and disclosure requirements. This includes regulations that are currently in development and likely to come into effect in the future.

Supply Chain Management Requirements for Preventing Human Trafficking


Recently enacted and proposed legislation in several countries focuses on preventing human trafficking, a term that covers various forms of exploitation including forced labor.1 In the U.S., legislation exists at state and Federal level. A key example is the California Transparency in Supply Chains Act, enacted in 2012, which requires large retailers and manufacturers headquartered or doing business in the state to disclose their initiatives to eradicate slavery and human trafficking from their direct supply chains.2,3 Subsequently, the Federal Acquisition Regulatory Council published detailed rules in January 2015 to strengthen protections against trafficking in federal contracts. These provisions require that any company doing business with the government, among other things, report suspected human trafficking and cooperate with investigating law enforcement agencies.4


Restricting Hazardous Substances and Conflict Minerals


For companies that sell products within the EU, strict regulations apply to the use of hazardous substances. The Restriction of Hazardous Substances (RoHS) act restricts the use in electronics and electrical equipment of metals including lead, mercury, cadmium, hexavalent chromium, and chemicals including polybrominated biphenyls, polybrominated diphenyl ethers, and phthalates.5 In the U.S., several states have enacted or proposed similar legislation. Some substances, such as lead, are also regulated at the federal level.6


Complying with Recordkeeping Requirements in Supply Chain Management


Different regulatory bodies also have stringent reporting and recordkeeping provisions to ensure safety and compliance in the supply chain. In the U.S., for example, Title 21 CFR Part 11 establishes Food and Drug Administration regulations for the use of electronic records and electronic signatures by companies in FDA-regulated industries, requiring the use of appropriate controls and documentation. Companies may need to train staff to make sure they follow the correct protocols.7


Building a Culture of Compliance


Supply chain management technology may help companies stay abreast of new regulations, but some experts say that it’s also important to develop a “culture of compliance” to ensure the internal process rigor required to avoid falling foul of regulations. 8


Some experts advocate Master Data Management (MDM) as a foundation for supply chain management applications, due to the ability to create a single view of consolidated product, raw material, and supplier data to support supply chain traceability efforts.9



As new regulations continue to emerge and come into force, it becomes more challenging to ensure compliance throughout the supply chain. Supply chain management technology can help, but a culture of compliance may also be critical.

Christine Parazio - The Author

The Author

Christine Parizo

Christine Parizo is a professional writer specializing in business and technology. She's written for a variety of TechTarget sites, including,, and, as well as HPE's Infrastructure Insights and The Pulse of IT.


1. “Human Trafficking”,U.N. Office on Drugs and Crime;
2. California Transparency in Supply Chains Act, Senate Bill No. 657. Cal. Civ. Code §1714.13.
3. "California Transparency in Supply Chains",U.S. Department of Labor Bureau of International Labor Affairs;
4. Federal Acquisition Regulatory Council, Subpart 22.17, Combating Trafficking in Persons.
5. "RoHS Compliance FAQ",RoHS Guide;
6. "Lead Regulations", U.S. Environmental Protection Agency;
7. "Part 11, Electronic Records; Electronic Signatures — Scope and Application", U.S. Food and Drug Administration;
8. "The ABCs of Supply Chain Compliance"Inbound Logistics; April 2016.
9. "How the Easter Bunny Ensures Supply Chain Traceability", ComputerWorld;

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