Late last year, the Federal Communications Commission (FCC) unanimously approved the establishment of a single, comprehensive database of permanently disconnected phone numbers. The decision, which comes after years of advocacy work from RILA, the Retail Litigation Center, and our members will not only help stop the ever-increasing number of robocalls and unwanted phone calls to consumers, but also provides a mechanism for legitimate callers to ensure compliance with the Telephone Consumer Protection Act (TCPA).
In addition to helping retailers avoid calling reassigned numbers, the database will give companies an important TCPA compliance tool, as well as significant protection from TCPA claims and litigation.
Some key highlights of the FCC's order are below.
- Establishment of a single, comprehensive database that will enable caller to determine if a telephone number has been permanently disconnected and therefore eligible for reassignment. No deadline was set for the establishment of the database.
- All telecommunications companies will be required to report permanently disconnected numbers monthly. Small telecommunications companies will be given an additional 6 months to begin reporting.
- To ensure the accuracy of the database, all telecommunications companies must wait at least 45 days before reassigning a previously permanently disconnected number.
- The new comprehensive database will be developed and administered by an independent third-party entity chosen through a competitive bidding process.
- All database users (i.e., telecommunication companies, callers including retailers, banks, hotels etc.) will pay user fees for access. The revenue from user fees will fund the database's ongoing operational costs. Initial startup costs for the database will be funded by the telecommunications companies, which will be refunded through future offsets to user fees.
- Importantly for RILA members, the order creates a safe harbor for database users from TCPA liability for any calls made inadvertently to reassigned numbers caused by database error.
RILA has long advocated for updated TCPA guidelines that create commonsense rules that protect consumers and businesses alike. Three recent comment letters filed by the Association to the FCC, with support from Meredith Slawe and her colleagues at Akin Gump Strauss Hauer & Feld LLP and Drinker Biddle & Reath LLP, can be accessed here (8/28/17), here (6/7/18), and here (7/9/18). The official announcement from the FCC can be found here and additional background on this issue can be found here.
Following this order, RILA will continue to urge the FCC to eliminate unnecessary and overly burdensome regulatory requirements while continuing to protect consumer interests.
For more information about RILA's TCPA advocacy work, please reach out to Deputy General Counsel Kathleen McGuigan.
It's no longer gossip, EPA has really released the final RCRA Pharmaceutical Waste rule (affectionately known as the "Pharm Rule"). The pre-publication copy can be found here. A few highlights that are relevant for retail are listed below.
As a quick reminder, this rule sets standards for the handling of hazardous waste pharmaceuticals. This rule applies to healthcare facilities and reverse distributors that "generate and manage hazardous waste pharmaceuticals" and not to pharmaceutical manufacturers. The term "healthcare facility" is fairly broad and in addition to treatment facilities it includes "any person that is lawfully authorized to … distribute, sell, or dispense pharmaceuticals, including over-the-counter pharmaceuticals, dietary supplements, homeopathic drugs, or prescription pharmaceuticals." As a result, health clinics and retailers of pharmaceuticals are affected by the rule.
EPA did not go forward with its proposal to classify all pharmaceuticals sent by a healthcare facility (the definition of which includes many retail facilities) to a reverse distributor as wastes starting at the healthcare facility. While EPA did finalize this approach for prescription pharmaceuticals, it reaffirmed that non-prescription pharmaceuticals and other retail items managed by a reverse logistics center are not wastes at a retail store if they have a reasonable expectation of being legitimately used/reused or reclaimed.
The new requirements are in 40 CFR Part 266, Subpart P – Management Standards for Hazardous Waste Pharmaceuticals and Amendment to the P075 Listing for Nicotine.
EPA acknowledged common sense by excluding "patches, gums and lozenges that are FDA-approved over-the-counter nicotine replacement therapies" from the P075 acutely hazardous listing in the final rule. Importantly, the Agency did not re-classify these items as non-acutely hazardous wastes, but rather excluded them from RCRA regulation entirely.
However, this exclusion from RCRA does not include e-cigarettes, e-liquids, or prescription nicotine replacement therapies.
Close up your drains because EPA finalized the prohibition on sewering hazardous waste pharmaceuticals. While drain disposal of non-hazardous pharmaceuticals are not covered by this ban, EPA discourages this practice. Traces of medicines are turning up in streams and lakes and the impact that drain disposal will have on the ecosystem and human health is still unknown.
The final rule will be published in the Federal Register in the coming weeks (could that be delayed because of the partial government shutdown?) and will become effective at the federal level six months after publication. The prohibition on sewering will take effect in all states at that time.
However, the rest of the rule will generally not become effective in the states until they act to adopt the rule (except for states like Iowa and Alaska that do not have their own authorized hazardous waste programs, or states like New Jersey and Pennsylvania that automatically incorporate new federal hazardous waste rules). All authorized states must eventually adopt the rule as EPA is taking the position that Subpart P, as a whole, makes the federal program more stringent than before (even though there are some less stringent elements). However, because the new exclusion for nicotine patches, gums, and lozenges is a less stringent provision, states will not be required to adopt that exclusion.
For useful links on Changes to RCRA, visit the CRC Hot Topics Page. To stay up to date on this and other regulatory changes, sign up for CRC Alerts.
This is a guest post by Jeff Ashcroft of the Supply Chain Network
Almost fifty years ago, way back in 1969 the Mass Retailing Institute was incorporated, which in 1976 changed its name to National Mass Retailing Institute (NMRI).
Our evolutionary story today, about the Logistics and Supply Chain conference, begins in 1984 when NMRI held their first Physical Distribution & Transportation Conference.
Then two years after that, in 1986, the NMRI merged with the Association of General Merchandise Chains (AGMC), and then a couple of years after that merger, in 1988 the name of the association was changed to the International Mass Retail Association (IMRA).
This is where I entered the story in 1989, when I attended the first retail logistics conference of my career which was the IMRA Physical Distribution & Transportation Conference in Orlando.
As an up and coming logistics executive at The Hudson's Bay Company, it was exciting to join a gathering of somewhere around 100 of the most powerful Logistics executives in North America for what were truly intimate, informative and candid conversations.
At that time almost all of the delegates were men and very pleased to report, as noted in the MRI/NMRI/IMRA/RILA logistics conference timeline graphic below, that in 2008 the Women in Logistics (now Women in Supply Chain Network) feature was added to the RILA Logistics conference and last year nearly 20% of the more than 2,000 attendees at the event were women, a number which can only grow going forward.
In 2011, the annual State of the Retail Supply Chain Report was introduced by RILA and the 2018 State of the Retail Supply Chain Report was the eighth annual installment of the study covering highly relevant topics that impact success or failure in the hyper-speed omnichannel retail environment.
The next evolutionary step for this event is when RILA Logistics became the Retail Supply Chain Conference in 2014. The focus of the event shifted to cover the entire end to end retail supply chain as highlighted in this RILA Supply Chain video.
As 2019 approaches, RILA Supply Chain is again evolving and this year RILA is introducing LINK, which is RILA's Retail Supply Chain Conference, reimagined.
This conference is the essential link in taking your supply chain organization into the future. It's about far more than the movement of goods, it's about the informal connections you have with peers at other retailers that you simply can't get anywhere else. It's about the amazing relationships you develop with the partners you need to build your supply chain future. It's about getting the information you need to drive business results, and the lasting connections you form that make your organization and ultimately your career successful. LINK2019 will link peers. LINK2019 will link partners. LINK2019 will link retailers and providers alike to a prosperous future.
Today, success means top retailers must master the demands increased customer expectations of variety and speed. For supply chain executives, this means optimizing network flexibility, increasing supply chain visibility, and becoming more responsive through emerging technologies and strategic relationships with service providers.
As always, I'm excited to attend this great event again in 2019, as all of the most important deals in my career were done with someone I met at the IMRA, RILA Logistics, RILA Supply Chain and who knows maybe even again at the RILA LINK2019 Conference!
In the end, the logistics and supply chain business is all about people and the strong links we forge with them. Each of us who attend the RILA LINK2019 event represent a link to our relevant past, the present with the many people in our wider personal and social networks, and most importantly the future that waits to be born out of our shared visions and interactions.
Look forward to seeing you all again in February at LINK2019!
The retail industry is experiencing a period of great transformation. Nimble disrupters are entering the marketplace, online sales are growing rapidly, and new digital technologies are empowering consumers, giving them unprecedented transparency, choice and convenience. As companies compete in this new retail landscape, enhancing and improving consumer engagement, in-store and online experience, sourcing, delivery and product expectations are top of mind for America's retailers.
To better understand how retailers are navigating the current financial environment, RILA and EY are excited to share the results of the 2018 Retail Accounting Policy Survey.
Our goal for the survey was to understand how retailers are applying specific accounting principles in their financial reporting. Finance executives from across the retail industry answered more than 100 questions, which focused on the most commonly applied accounting practices related to inventory, accounts payable, sales incentives and more. More than 40 retailers from a wide variety of categories, including mass merchants, department stores, grocers and specialty retailers participated in the survey. The respondents also varied from middle-market companies to retailers with more than $20 billion in revenue and included both RILA members and nonmembers.
We wanted to delve deeper into the changes causing retail finance leaders to update or modify their financial reporting and learn more about the ways finance leaders are incorporating new technologies (e.g., AI, robotics, etc.) into their organizations.
The findings proved interesting. Since EY last conducted this survey in 2007, retailers have adopted a new revenue recognition standard. In response to the explosion of online sales, some retailers have changed the time at which e-commerce revenue is recognized from customer delivery to shipping point. Additionally, a small number of retailers are allocating online sales to stores.
Additional survey takeaways include:
- Since 2007 the number of retailers with physical stores and distribution centers outside the US has doubled
- The cost of shrinkage is evenly shared by companies (38%) and Vendors (38%), in 2007 the majority of retailers (55%) indicated shrinkage was shared by both the vendor and the company
- 93% of retailers offer coupons and other sales incentives to customers
- Only 15% of retailers are employing Robotic Process Automation (RPA)
The survey results also indicate that some retailer accounting practices remain unchanged. For example, the most widely used method for valuing inventories are continues to be cost averages and despite the growth of e-commerce and international operations, most respondents continue to report one segment.
Surprisingly, in a period of rapid advancements in technology, it was interesting to see how few retailers are using radio-frequency identification (RFID) in the physical inventory management process or RPA in the finance function. Perhaps this will be an area of development to come.
The information in this comprehensive survey provides an illuminating look at the current state of the retail sector accounting practices and financial reporting. We hope the collected insights will give the industry a sense of how retail companies' financial models and accounting practices compare with those of their peers' and assist brands as they continue to move toward the future.
To download a copy of the report, click here.
Mindy Dragisich is Partner at Ernst & Young LLP and Kathleen McGuigan is Executive Vice President and Deputy General Counsel for RILA
In today's highly competitive job market, retailers are looking to attract the best and brightest talent to help them innovate and succeed well into the future. It was with this goal in mind that RILA established the (R)Tech Talent Pipeline and Collegiate Network designed to help retailers engage young talent at the collegiate level and expose them to the career opportunities within retail. In November, RILA hosted two events to support this initiative: the Global Retail Challenge and InfernoHack.
RILA and the Bensadoun School of Retail Management at McGill University celebrated the finals weekend of the first inaugural Global Retail Challenge in Montreal, Canada, sponsored by Canadian Tire and VF Corporation. The competition tackled the pressing issues surrounding retail and the challenges facing our societies through an innovative retail case competition.
The Global Retail Challenge uniquely mixed 25 undergraduate and graduate level student teams who were mentored each week by retail experts from Aldo, IKEA, Oxford Properties, Closed Loop Partners, Canadian Tire, and Cirkla Modo.
This event was created to help expose students to one of the grand challenges impacting retail: sustainability and the circular economy. Its design thinking curriculum equipped teams to find solutions in innovative and forward-looking perspectives for the future of retail.
The top 12 teams from around the world came together for one weekend on November 15-17, 2018. Students participated in morning workshops before presenting their final presentations in front of judging panels.
- ESG UQAM – Second Runner Up
- University of Notre Dame
- Birla Institute of Management Technology
- ESSEC Business School
- University of Calgary
- Arizona State University
- Texas A&M University – First Place
- University of Southern California, Marshall School of Business – Runner Up
- Paris Nanterre University
- McGill University
- Asheshi University
- Florida State University
- Claremont College
Simultaneously on November 16-17, RILA teamed up with Petco to host the first "(R)Tech InfernoHack" at Arizona State University. The event consisted of 50 engineering and business graduate students on 16 teams competing in a hackathon to improve Petco's voice commerce and customer service innovations through its new digital PetCoach store.
Hackers worked with either the Amazon Echo or the Google Assistant voice platform and
presented a multitude of new innovative possibilities for PetCoach. The winning team created a machine learning application called "Hungry No More!" designed to better coordinate automated shipments of pet food for Petco's online customers. The team will now have the opportunity to visit Petco's headquarters in San Deigo, CA to present their application to the company's chief innovation executives.
If you have any questions about RILA's (R)Tech Talent Pipeline or Collegiate Network, please contact Katie Nicholos.
By Tiffin Shewmake, Executive Director of the Center for Retail Compliance & VP, RILA
Retailers talk a lot about the ways in which technology is enabling the future of our industry. With the help of things like artificial intelligence, blockchain, and big data, retailers' approach in areas like product marketing, customer service, delivery, and everything in between is changing every day. But, what often gets overlooked, is not just how these technologies impact consumer-facing operations, but how they can transform internal operations for retailers as well. As RILA and the Center for Retail Compliance (CRC) worked on developing environmental compliance resources for retail, it became clear that this was an area that could stand to benefit from advanced technology.
While retail has not historically been the focus of environmental regulations and enforcement, the complexity and number of environmental regulations that apply in retail at the federal, state, and even local level, as well as recent settlements in areas such as hazardous waste and refrigeration management, illustrate the need for better compliance programs in retail.
That's why we developed the CRC Advisor—a secure and intuitive web-based application that helps retailers design and implement more effective programs. The CRC Advisor empowers corporate compliance managers to assess their programs in real time across areas like leadership and planning, compliance operations, support systems, and continual improvement. Users can also use the Advisor to conduct self-assessments and gap analysis, benchmark internally and with industry peers, set goals, track progress, and implement continuous improvement.
The CRC Advisor helps answer some of the most difficult questions that retailers face in building out their compliance efforts, such as:
- Where are our greatest risks?
- Are we over-complying and therefore wasting money?
- Is there a big issue we are unaware of?
- Are we missing opportunities to extract value from our compliance program?
Of course, there is no off-the-shelf program that would work for all companies. Consider the difference between a home improvement store that provides home renovation services and a clothing retailer in a mall. Or, the difference between a grocery store with refrigeration, bakery, and gas station and a pet store. Given this, each companies' approach to environmental compliance will be a little different, and the CRC Advisor handles that through delivering customized assessments.
For more information about the CRC and these new programs, please contact Tiffin Shewmake.
Day 2 began with the "back by popular demand" retailer-only roundtable style sessions. Privacy, crisis management, employment and talent retention were key points of discussion among counsel from the top retail brands in the country.
Retailer-Only Roundtable: Compliance with New Privacy Regimes: GDPR
The Entrepreneurial GC
In the age of digital disruption panelist discuss how general counsel today must be more entrepreneurial than ever as they navigate powerful new technologies that are driving the world.
Moderator: Linda Norman, Vice President, Deputy General Counsel, Microsoft
Panelists: Jodi Caro, General Counsel, Chief Compliance Officer & Corporate Secretary, Ulta Beauty, Inc., Chris Gassett, Vice President & General Counsel, HSN, Inc., Alon Rotem, General Counsel, thredUP
Journey to the Supreme Court
Pioneers behind the South Dakota v. Wayfair case provide an inside look on the years-long strategy to support the case and how they built a robust amicus strategy at both the cert and merit stages.
Moderator: Deborah White, SEVP & General Counsel, Retail Industry Leaders Association (RILA)
Panelists: Tom Goldstein, Partner & SCOTUSblog Publisher, Goldstein & Russell, Sarah Harrington, Partner, Goldstein & Russell, Eric Citron, Partner, Goldstein & Russell
Breakout Session Highlights
With five breakout tracks to choose from, inside and outside counsel attended sessions on the hottest topics in retail law, including class action exposure in the digital age, developing & managing retail store food safety programs, investigating and defending in the #MeToo movement, and more – from the practitioners themselves!
Breakout Session: General Data Protection Regulation (GDPR): First 180 Days
Breakout Session: The Future of Retail and E-Commerce - Are You Ready?
Breakout Session: Cybersecurity: Better Security Through Collaboration
That's a wrap. The night ends with a reception for attendees to relax and recap the day's events.
Did you attend #RLAW 2018? Don't forget to take the surveys in the conference app to let us know which session was your favorite! If you were weren’t able to attend this year, be sure to join us in Nashville for the 2019 Retail Law Conference!
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Follow us on Twitter @RILAtweets and use #RLAW to share your favorite moments from the conference with us!
To learn more about the conference, visit www.rila.org/rlaw
Austin Welcomes #RLAW 2018
Over 300 attendees touched down in Austin, TX today for the 2018 Retail Law Conference to network, share challenges and find solutions to the industry's most pressing problems with the leaders of the retail law community.
Who's attending the 2018 Retail Law Conference?
Kicking it off
RILA's Deborah White, Senior EVP and General Counsel, kicks off the first official day of the 2018 #RLAW Conference. This year, RILA and the Retail Litigation Center (RLC) achieved their greatest litigation accomplishment when the U.S. Supreme Court announced its decision in the South Dakota v. Wayfair case. White shared the behind scenes of journey to #SCOTUS and the next chapter for the RLC.
Collaboration is Key
Learning how to navigate working with state attorney generals can be a challenge. Tim Cheatham, @Walmart SVP & GC & @marthacoakley share how general counsel and attorneys general can work together to achieve shared objectives and foster ongoing working relationships.
Don't let someone dictate your narrative, make sure you get in their office.
- Martha Coakley, Former Attorney General for the Commonwealth of Massachusetts, and Partner, Foley Hoag
Disruption in a Time of Change
Erica Orange discussed emerging trends that are revolutionizing the future and how it will transform the current landscape for retail corporate counsel.
Having new eyes will get you closer to objectivity.
- Erica Orange, Vice President & Chief Operating Officer, The Future Hunters
Best in Class Networking
Day 1 of the #RLAW conference concludes with a night of networking and good company. Tonight, was great opportunity for attendees to connect with new and old friends.
Thanks to everyone who joined us for day 1 of the 2018 #RLAW conference. We look forward to seeing everyone tomorrow for another jam-packed day.
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Follow us on Twitter @RILAtweets and use #RLAW to share your favorite moments from the conference with us!
To learn more about the conference, visit www.rila.org/rlaw
It's no secret that retail is in a time of transformation. There has been a tectonic shift in the way consumers shop and what they demand. Consumer expectations have risen. The values, ethics, and core principals of a brand have moved to the forefront of customers' purchasing decisions. At the same time, retailers are navigating a myriad of regulations to ensure they are fully meeting those requirements efficiently. That is why it is important, now more than ever, for America's retailers to focus on integrating robust ethics and compliance programs into all areas of their business.
Retail Industry Leaders Association (RILA), in collaboration with Deloitte, surveyed RILA members—compliance and legal executives from America's largest retailers—about their companies' ethics and compliance programs. Our survey explored the different ways in which retailers' compliance programs have developed and matured in recent years to address increasingly varied risks as companies confront forces that are reshaping the industry.
Retail is a multi-regulated industry. There are legal compliance requirements that touch nearly all areas of retail operations from employment, environmental health and safety, product and food safety, and others that apply to more specialized retail operations, such as consumer finance and retail health and wellness/pharmacy. Retailers also support over 42 million Americans jobs and have global supply chains and national distribution networks. Because of this, retail operates in an environment of regulation at all levels of government- local, state and federal. These factors combine to make an organized response to ethics and compliance risks imperative.
The retail industry is rising to this challenge. Survey respondents indicated their companies' unanimous support for maintaining robust risk and compliance programs with nearly one-third of responding companies identifying their programs as "modernized" or mature enough to operate in synergy with business units, make use of advanced analytics, and articulate their value through a measurable return on investment.
While the results indicate there is still room for retailers' compliance programs to grow and mature, it is encouraging to see the integration and acceptance of compliance throughout retailers' core business. Nearly half (46 percent) of respondents say that their company's compliance team is viewed as a partner to business units company-wide, hinting at how compliance might promote stability and competitive differentiation in times of change.
Nearly two thirds of respondents say their company performs an enterprise-wide compliance risk assessment. Three-quarters of those whose company performs such risk assessments indicate that they are done at least once a year and almost 60 percent of respondents also indicate that their organization measures compliance program effectiveness. These results show that not only are retailers focusing on moving their compliance programs from being reactive to proactive, but they are also taking measures to hold their programs accountable.
Looking to the future, nearly 40 percent of respondents expect to increase their compliance program budgets in 2018 and beyond. Retailers must continue to meet a changing regulatory environment and increased consumer demand with a structured, pragmatic approach to ethics and compliance. Budgeting wisely and increasing focus on integration can help reinforce and activate compliance throughout the company, help the business collaborate more effectively, make better decisions, and take smarter risks.
You can download your free copy of the report here.
Kathleen McGuigan, Senior Vice President and Deputy General Counsel for the Retail Industry Leaders Association and Kevin Lane, Principal, Deloitte Risk and Financial Advisory, Deloitte & Touche LLP
This publication contains general information only and Deloitte and RILA are not, by means of this publication, rendering accounting, business, financial, investment, legal, tax, or other professional advice or services. This publication is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified professional advisor.
Deloitte and RILA shall not be responsible for any loss sustained by any person who relies on this publication.
By Katie Nicholos, Manager, Research & Innovation
Each year, the Massachusetts Institute of Technology (MIT) hosts over 1,000 "hackers" – tech-savvy students – on campus for HackMIT. The event brings the next generation of tech talent together with companies looking for innovative solutions to the challenges they may face in real world business operations.
This year, RILA's (R)Tech Center for Innovation partnered with Qurate Retail Group to sponsor a retail-focused challenge at the hackathon. Qurate Retail Group, which is comprised of eight leading retail brands including QVC, HSN, zulily, Ballard Designs, Frontgrate, Garnett Hill, Grandin Road, and Improvements, came to Boston looking to tap the cutting edge in tech talent and creativity of students. They teamed up with Brand3D to provide 3D technology assets and environments to inspire students – but were looking for the most creative ways to engage customers, create new shopping experiences, and to change the way businesses operate. Amber Otero, Vice President of Customer Journey led the Qurate Retail Group team as they brought a retail perspective to the tech firm dominated weekend.
To kick-off the event, Qurate Retail Group sponsored an interactive workshop centered around video retailing and 3D augmentation. Students learned how to use gamification and 3D modeling to manipulate objects and apply that to their projects. Qurate Retail Group also highlighted the team's business goals and how the ideas presented could be applied to drive consumer engagement.
Hackers had the opportunity to engage with the Qurate Retail Group sponsor table by grabbing some cool swag, learning about IT internship and sponsor opportunities, and asking for help on technical questions related to their projects.
In the end, three teams walked away with Qurate Retail Group prizes. The grand prize went to a team that created a life size gamification tool that utilizes live stream messaging to manipulate a remote machine and view the results happening in real time. This group will have the opportunity to present at Qurate Retail Group's headquarters and receive a VIP tour. The runner up teams created a 3D shopping environment that can be personalized to the shopper, and a way to video conference in virtual reality with hologram like avatars, respectively.
The main takeaway from HackMIT? Students are starting to interact with retail differently. While the initial instinct is for technology and computer science students to set their sights on Silicon Valley for post-graduate plans, more students are seeing the retail industry as a great pathway to pursuing a career in tech.
Participating in collegiate hackathons is just one component of the (R)Tech Talent Pipeline strategy, which exposes and attracts young people with tech backgrounds – data science, engineering, behavior science, design, and strategy – to opportunities in retail. For more information or to get involved, contact RILA's Manager of Research & Innovation Katie Nicholos.