Proposal C3: Report publicly on length of factory relationships.

Report publicly on the average length of relationship with supply factories, as well as more detailed statistics on the number of factories with which the company has worked for various incremental number of years (e.g. 1, 3, 5, or more years) and where they are located.

Why?

Sportswear companies should be disclosing additional information to not only make it possible to measure the impact of restructuring and consolidation on workers in the countries that are losing jobs, but also whether and to what degree labour standards compliance factors into their regional and global sourcing decisions. Companies should be reporting on the length of business relationships with supplier factories, pricing policies and incentives that encourage and reward labour standards compliance, and overall integration of company social responsibility policies with sourcing decisions.

Responses

adidas

Adidas says only that it “could consider” publishing average length of relationships with core suppliers but not its indirect supply chain (managed by licensees and agents). The company has no plans to track the location of factories by length of relationship.

Full response

"We could consider publishing the average length of our relationships with our main suppliers, that is, those suppliers through whom we directly source our product. However, as some of these relationships extend upward of 20 years and other relationships are comparatively recent, especially among specialty suppliers, we are not clear as to the value of creating such an ‘average’.

"Within our indirect supply chain - which is managed through intermediaries such as licensee and agents - we recognize that seasonality and the turnover in suppliers is much greater, with smaller order volumes. As a consequence, the average engagement may be shorter, but we do not track this specific data. We currently have no plans to generate data to map the location of factories by length of service."

Lotto

Lotto reports it has “working relationships of more than 5 years with more than 50% of our suppliers (10% of our total suppliers longer than 15 years)” and that “these factories are present in China, Indonesia and Vietnam,” however the company has not committed to ongoing public disclosure of most of the information requested.

Full response

"We have working relationships of more than 5 years with more than 50% of our suppliers (10% of our total suppliers longer than 15 years), highlighting positive partnerships that have been established, and these factories are present in China, Indonesia and Vietnam."

Mizuno

Mizuno says it may consider disclosing the average length of relationship with “main” suppliers but the company will not publicize statistics on other suppliers.

Full response

"We may consider disclosing the average length of our relationship with our main direct suppliers if there is no difficulty to calculate out. With respect to our small suppliers and 2nd or 3rd suppliers we cannot provide the detailed statistics."

New Balance

New Balance notes that its relationship with “key” suppliers are long-term (10-20 years), but the company does not keep data on other suppliers and will not commit to publicly reporting the data it does have.

Full response

"Relationships with our key suppliers are long term, 10 to 20 years. We do not maintain data for secondary suppliers. Turn-over of suppliers in some non-core product categories would undermine the value of such statistics."

Nike

Nike believes “this would be very challenging” given its data collection methodology. While the company says it “may be able to consider this as part of a broader reporting effort on our focus factories,” it makes no commitment to do so.

Full response

"This would be very challenging, given our current data collection methodology and the design of our information systems. However, we may be able to consider this as part of a broader reporting effort on our focus factories."

Pentland

Pentland says it reports information “relating to presence of unions and collective bargaining agreements, length of relationships with factories,” in its annual reporting to the Ethical Trading Initiative; however that information is not available to the public.

Full response

"Annual reporting to the Ethical Trading Initiative. These reports are available to the tripartite partners within the ETI on a confidential basis. Information relating to presence of unions and collective bargaining agreements, length of relationships with factories and supplier selection procedures is covered in this reporting."

Puma

Puma says it has long-term relationships with 'key suppliers’ and that it can provide information on the length of relationships with strategic partners. However they cannot yet track information on licensee or subsidiary suppliers

Full response

"PUMA sources directly through WorldCat as well as through licensees and subsidiaries. Suppliers through licensees and subsidiaries are encouraged to apply to become WorldCat suppliers, which receive priority orders and key support in areas of quality, production and puma.safe compliance. We implemented a Strategic Partner Concept and Vendor Rating System in early 2005 for WorldCat suppliers, which essentially formalized the process in which supplier performance is rated. Key suppliers are reviewed against key strategic parameters, which are long term in nature, aside from Techical parameters of price, quality and delivery lead times. Adherence to puma.safe standards and commitment to PUMA are two key Strategic Criteria in the Vendor Rating System. PUMA maintains long-term relationships with key suppliers. Some suppliers in footwear have been manufacturing for PUMA for 20 years. By adding all suppliers to this rating system – including our long-term partners - we are able to apply an objective performance rating for each supplier. This helps them to identify areas of improvement which is a clear benefit of the Strategic Partnership. It is possible for PUMA to give accurate information on the length of our relationships with WorldCat suppliers. Information on licensee and subsidiary suppliers, however, is not available yet. "

Response Key

The brand claims to implementing all components of this proposal or has agreed to implement them within Play Fair's proposed timeframe.

The brand is currently implementing or has agreed to implement some of the essential components of the proposal but has refused to implement, has overlooked, or has raised issues with one or more important components; or, the brand agrees to implement the proposal but not within Play Fair’s proposed timeframe.

The brand has refused to implement the essential components of the proposal.

The brand has misunderstood or failed to comment on the proposal; or the brand is considering the proposal, but has yet to make a decision.