SMETA Audit Explained: What Importers Need to Know

SMETA Audit Explained: What Importers Need to Know

If you source products from factories in Asia, Latin America, or other manufacturing regions and sell to major retailers in the UK, Europe, or North America, you have almost certainly encountered the term SMETA. It is one of the most widely used ethical audit standards in international trade, and understanding it is essential for any importer who works with retailers that require social compliance.

This guide explains what SMETA is, how it works, who requires it, and how to prepare your suppliers for a successful audit.

What Is SMETA?

SMETA stands for Sedex Members Ethical Trade Audit. It is an audit methodology developed by Sedex (Supplier Ethical Data Exchange), a global membership organisation dedicated to responsible sourcing practices. Sedex hosts the world's largest platform for sharing social and environmental supply chain data, with over 85,000 member companies across 180 countries.

SMETA is not a standard or a certification — it is an audit methodology. This is an important distinction: unlike SA 8000 (which is a certifiable standard), SMETA provides a framework for conducting audits against a combination of established standards and codes of conduct. The primary reference standards are:

• ETI Base Code (Ethical Trading Initiative) — covers labour standards based on ILO conventions
• Local labour laws — the audit assesses compliance with the laws of the country where the factory operates
• Universal Declaration of Human Rights

SMETA audit reports are shared through the Sedex platform, which means a factory that completes a SMETA audit can share the results with multiple buyers — reducing audit fatigue and duplication. This is one of SMETA's key advantages: one audit satisfies multiple customers.

2-Pillar vs 4-Pillar SMETA

SMETA audits come in two versions, differing in scope:

2-Pillar SMETA

The 2-pillar audit covers:

1. Labour Standards — working hours, wages, freedom of association, no child labour, no forced labour, no discrimination, disciplinary practices, employment contracts, and worker rights
2. Health & Safety — fire safety, emergency procedures, machine safety, chemical handling, PPE (personal protective equipment), first aid, building structural safety, and sanitation

The 2-pillar version also includes a management systems assessment (how the factory documents and manages its ethical compliance) and an entitlements to work check (verifying workers have the legal right to work at the facility).

4-Pillar SMETA

The 4-pillar audit covers everything in the 2-pillar version plus:

1. Environment — waste management, emissions, energy use, water use, chemical storage and disposal, environmental permits and compliance
2. Business Ethics — anti-bribery and corruption, conflicts of interest, fair business practices, accurate record keeping, whistleblowing procedures

Which Version Do You Need?

Most retailers specify which version they require. If your buyer has not specified, the 2-pillar audit is the minimum standard. The 4-pillar audit is increasingly requested by retailers with strong sustainability commitments (particularly European retailers). When in doubt, ask your buyer directly — or opt for the 4-pillar audit, which covers everything the 2-pillar does and more.

Who Requires SMETA Audits?

SMETA is the most widely accepted social audit format globally. Major companies that require or accept SMETA audits from their suppliers include:

UK and European Retailers

• Marks & Spencer — requires SMETA for all tier-1 suppliers
• Tesco — accepts SMETA as part of its responsible sourcing programme
• Sainsbury's — SMETA is the preferred audit format
• ASDA / Walmart — accepts SMETA along with its own audit protocols
• Primark — requires SMETA for all factories producing Primark goods
• ASOS — accepts SMETA, particularly 4-pillar
• Inditex (Zara) — accepts SMETA as one of several recognised audit formats

North American Companies

• Amazon — accepts SMETA for its Responsible Sourcing programme
• Target — accepts SMETA alongside other recognised audit formats
• Costco — accepts SMETA for supplier compliance

Consumer Goods and Food Companies

• Unilever — SMETA is the primary audit format for its supplier base
• Nestlé — accepts SMETA as part of its responsible sourcing programme
• Reckitt — requires SMETA for key suppliers

If you are selling to any of these companies — or to companies that source from them — your factory will likely need a current SMETA audit on the Sedex platform.

The SMETA Audit Process

A SMETA audit follows a structured, multi-stage process. Here is what to expect:

Stage 1: Preparation and Scheduling

• The factory must be a registered member of Sedex (the "B" membership for suppliers)
• The factory completes a Self-Assessment Questionnaire (SAQ) on the Sedex platform, providing information about their workforce, operations, and existing compliance measures
• The audit is booked with an approved SMETA audit firm. Audits can be announced (the factory knows the date in advance) or semi-announced (the factory is given a window of several weeks, but not the exact date)
• Semi-announced audits are increasingly preferred by buyers because they reduce the risk of the factory preparing a "show" for the auditor

Stage 2: On-Site Audit (1–2 Days)

The on-site audit includes:

• Opening meeting: The auditor explains the audit scope, methodology, and agenda to factory management
• Document review: Payroll records, attendance records, employment contracts, age verification documents, health and safety records, fire drill records, training records, permits, and licences
• Site tour: The auditor inspects the entire facility — production floors, warehouses, dormitories (if applicable), canteens, toilets, chemical storage areas, emergency exits, fire equipment
• Worker interviews: Confidential, off-site (where possible) interviews with a cross-section of workers. Workers are selected randomly by the auditor, not by management. Interviews cover working hours, wages, treatment by management, safety concerns, and freedom to raise grievances
• Management interview: Discussions with factory management about policies, procedures, and how they handle compliance issues
• Closing meeting: The auditor presents preliminary findings to management and discusses the timeline for the formal report

Stage 3: Report and Corrective Action

• The audit report is uploaded to the Sedex platform, typically within 2 weeks of the audit
• Non-conformances are categorised as Critical, Major, or Minor
• The factory must prepare a Corrective Action Plan (CAP) addressing each non-conformance with specific actions and deadlines
• The buyer reviews the report and CAP through the Sedex platform and decides on next steps

Preparing Suppliers for a SMETA Audit

A well-prepared factory has a significantly higher chance of passing the audit with minimal non-conformances. Here is how to help your suppliers prepare:

Documentation

• Ensure all employment contracts are current and complete
• Verify payroll records accurately reflect actual hours worked and wages paid (this is the most scrutinised area)
• Maintain attendance records that match payroll — inconsistencies are a major red flag
• Have all business licences, environmental permits, and fire safety certificates current and available
• Prepare age verification records for all workers (ID copies, birth certificates)
• Document all health and safety training, fire drills, and equipment maintenance

Facility Preparation

• All emergency exits must be clearly marked, unobstructed, and unlocked during working hours
• Fire extinguishers must be current (check expiry dates), accessible, and properly mounted
• Chemical storage must follow safety data sheet (SDS) requirements — proper ventilation, secondary containment, clear labelling
• First aid kits must be stocked and accessible on every production floor
• PPE must be available and actually used by workers (not just stored in a cupboard)
• Dormitories (if applicable) must meet space requirements, fire safety standards, and have separate facilities for male and female workers

Worker Preparation

• Workers should be informed that an audit will take place and that they may be selected for confidential interviews
• Workers should NOT be coached on what to say — auditors are trained to detect coached responses, and coaching is itself a non-conformance
• Ensure workers know their rights: their actual working hours, actual wages, and how to raise grievances
• If the factory uses a worker hotline or suggestion box, verify it is functional

Common SMETA Non-Conformances

Based on thousands of SMETA audits across manufacturing countries, these are the most frequently identified issues:

Working Hours

The most common non-conformance category. Factories frequently exceed the maximum working hours allowed under local law or the ETI Base Code (which caps regular hours at 48 per week plus 12 hours overtime). Double-shift systems, peak-season overtime, and inadequate rest days are common findings.

Wages and Benefits

Underpayment of overtime premiums is widespread. The ETI Base Code and most local laws require overtime to be paid at a premium rate (typically 1.5× or 2× the regular rate). Some factories pay flat rates for all hours or miscalculate overtime by using an incorrect base rate.

Health and Safety

Common findings include: blocked or locked emergency exits, expired fire extinguishers, missing or inadequate PPE, poor chemical storage, lack of fire drill records, and insufficient first aid provisions.

Management Systems

Many factories lack documented policies and procedures for ethical compliance. Missing or inadequate: anti-discrimination policy, grievance mechanism, disciplinary procedure, health and safety policy, and corrective action tracking.

Young Workers and Age Verification

Insufficient age verification processes — not maintaining copies of identity documents, not having a system to prevent underage hiring — are flagged even when no actual child labour is found.

Remediation Timelines

How quickly the factory must resolve non-conformances depends on the severity:

Severity	Examples	Typical Remediation Timeline
Critical (Zero Tolerance)	Child labour, forced labour, life-threatening safety hazard	Immediate action required. Buyer may suspend orders until resolved. Follow-up audit within 30 days.
Major	Excessive overtime, locked emergency exits, significant wage underpayment	Corrective action within 30–60 days. Follow-up audit or evidence review within 90 days.
Minor	Incomplete training records, minor documentation gaps, minor housekeeping issues	Corrective action within 90–180 days. Reviewed at next scheduled audit.

Buyers may set their own, stricter remediation timelines. Some buyers will not place new orders until major non-conformances are closed.

SMETA vs Other Social Audit Standards

SMETA is one of several social audit frameworks. Here is how it compares:

Standard	Type	Accepted By	Key Difference
SMETA	Audit methodology	80,000+ companies via Sedex	Most widely shared via Sedex platform; one audit serves multiple buyers
BSCI	Code of conduct + audit	2,700+ amfori members	Scoring system (A–E); popular with European brands
SA 8000	Certifiable standard	Companies requiring certification	Formal certification lasting 3 years; most rigorous
WRAP	Certification programme	Apparel and footwear sector	Industry-specific; certification-based
Higg FSLM	Self-assessment + verification	SAC members (apparel)	Digital-first; combines self-assessment with third-party verification

For most importers selling to multiple retailers, SMETA offers the best combination of broad acceptance and practical sharing through the Sedex platform. If your buyers specifically require BSCI, read our BSCI audit guide.

How Tetra Inspection Can Help

Tetra Inspection offers social audit services including SMETA-aligned ethical audits across all major manufacturing regions. Our qualified auditors assess your suppliers' labour practices, health and safety, environmental compliance, and management systems. We deliver detailed audit reports with clear corrective action recommendations, helping you maintain compliance with your buyers' requirements.

Whether you need to prepare a factory for its first SMETA audit or need a social compliance assessment for a new supplier, explore our full range of services or view our pricing for transparent, all-inclusive rates.

Frequently Asked Questions

How long does a SMETA audit take?

A 2-pillar SMETA audit typically takes 1–2 days on-site, depending on the factory size and number of workers. A 4-pillar audit takes 1.5–2.5 days. The report is usually available on the Sedex platform within 2 weeks.

How much does a SMETA audit cost?

SMETA audit costs vary by region, factory size, and whether it's a 2-pillar or 4-pillar audit. Expect to pay $800–$2,000 for a standard audit. The factory also needs a Sedex B membership (approximately $500–$1,200 per year depending on company size).

How often do factories need a SMETA audit?

Most buyers require a SMETA audit every 1–2 years. Factories with critical or major non-conformances may require more frequent audits or follow-up visits until issues are resolved.

Can a factory fail a SMETA audit?

SMETA does not issue a formal pass or fail. Instead, the report lists all non-conformances found. The buyer then decides whether the findings are acceptable or require remediation before placing orders. Critical (zero-tolerance) findings such as child labour or forced labour will typically result in immediate order suspension.

What is the difference between SMETA and a factory audit?

A factory audit focuses on the factory's quality management systems and production capabilities. A SMETA audit focuses on social and ethical compliance — labour practices, working conditions, and health and safety. They serve different purposes and are often complementary.