Scopes in Higg FEM Assessments: Definitions and Exceptions

The FEM is a facility-level assessment that is designed to be completed by a single business entity or manufacturing unit. It is understood that there may be complexities in defining this globally therefore, the following definitions and exceptions apply when determining the facility scope for the completion of a single FEM.

● The FEM shall cover the entire facility which is defined as all onsite business activities of a legal business entity as defined by the scope of the applicable business license/operating permit in the facility’s country of operation. This includes all owned and operated onsite processes, equipment, and areas (e.g., facilities cannot exclude specific operations or facility areas from the FEM).

● One (1) Higg FEM is required for each legal business entity as defined by the applicable business license/operating permit except in the following circumstance:

• Where multiple manufacturing units (facilities) are located at the same premises with different business licenses, however, the facilities are fully owned and operated by a single legal business entity, one (1) FEM can be completed.
  • Note: If the separate facilities are not legally owned/operated by a single parent business entity with a valid operating license, which includes ownership of all facilities, separate FEMs must be completed for each facility.
• Where a material or component supplier of the facility with a separate business license is located at the same premises and supplies 100% of its materials/services to the facility, its operations can be included in the facility’s FEM.
  • Note: If the material or component supplier provides materials or services to other facilities, it must not be included in the facility’s FEM scope and would require a separate FEM.

● Facilities located at two separate physical locations (i.e., different legal addresses) must complete one (1) FEM per location regardless of ownership (e.g., if two facilities are located at different physical locations, but their operations are covered under one (1) parent business license, separate FEMs are still required.)