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2015 Sustainability Report
published 2016/07/13

Social responsibility in the supply chain

Social responsibility has a very high priority at VAUDE. We are firmly committed to ensuring that the workers who are involved in the manufacture of our products are treated fairly and have good working conditions. We also monitor the observance of human rights, which requires intensive support of the factories with specially trained experts. While this entails considerable effort, we are convinced that it is the only way to achieve long-term improvements.

Overview

In the following section we will provide general information about the management of social standards and will address specific labor standards. In addition, we will report on the collaboration with our producers and on our commitment in high risk countries. All information is related to 2015.


Implementation of social standards in the supply chain

The presence of good labor conditions at our producer’s facilities is very important to us. To ensure this, we support them in implementing our required labor standards and monitor these as well. To accomplish this, we employ a team of four whose sole responsibility is to attend to the management at our suppliers in terms of social standards. This team consists of specially trained employees who are both in our facilities in Tettnang as well as at our main production sites in China and Vietnam. In addition, we have a Quality Control Team from our office in Asia that visits our production facilities regularly. These employees, who have been trained in social standards, assess both the quality requirements and the working conditions of our factories during operation.


VAUDE monitoring on site

With our own team of CSR experts, we actively support our producers in complying with social standards. Our CSR employees at the headquarters in Tettnang – which are also members of the interdepartmental VAUDE CSR team (more at CSR Team as a Driver of Sustainability) work together closely with the CSR local employees in Vietnam and China. Our producers are obliged to report directly to our CSR employees in Asia who coordinate the implementation of standards together with the CSR experts at our headquarters in Tettnang.

For the monitoring and implementation of social standards, it is of great advantage that our CSR employees in Vietnam and China work on site. They are locals who speak the local language and who are very familiar with the local culture and conditions. They are intensively trained on CSR issues, social standards and local laws.

With our CSR employees in Asia, we can specifically train and assist our producers. We offer them direct, concrete assistance in the implementation of social standards on site. We not only want to show our producers their shortcomings, but also to make our knowledge and our experience available to them at all times. Therefore, we provide ongoing support for improving working conditions.

Jointly committed with the FWF

It is important for us to have a competent partner at our side for the monitoring and implementation of labor standards. Therefore, we decided to join the multi-stakeholder initiative Fair Wear Foundation (FWF) in 2010. The approach of the FWF fits very well with our company philosophy. We especially appreciate the principle of shared responsibility; we are working with producers to gradually implement improvements with the aim of a holistic management system relating to social standards. Audits do not have "pass" or "fail" ratings, which would have an immediate consequence of severance with producers. This would be inconsistent with our corporate philosophy, because we feel responsible towards every single employee of our producers. In the audit, all relevant findings are recorded and inventoried in order then to work together and to find reasonable solutions. More information in a later section and Monitoring our Suppliers.

We are convinced that it is only possible to achieve sustainable improvements and, in turn, long-term business relationships on this basis.

We see it as our duty to advance this issue in countries where awareness of good working conditions and the observance of human rights is still scarce. So we are committed to continuing our vigorous efforts to make our producers realize how important these standards are.

The FWF provides us with the opportunity to cooperate with other member companies. If, for example, other manufacturers work with the same producer, we can perform a joint audit. This is advantageous in that the producer must be audited only once, reducing the waste of resources – neither the producer’s nor ours. Another positive aspect is that in working together, we have more influence on the producer. For example, after a joint audit or during joint training programs, we can work together with other member companies to enhance the effects of the improvement process. See also Production in Myanmar

The FWF focuses exclusively on sewing producers and, when required, their subcontractors, as the most labor-intensive processes occur in these facilities. This is because sewing processes are currently not automated. Material suppliers are not monitored by the FWF.


The FWF also evaluates the member company

As a member of the FWF, VAUDE must also meet specific requirements as an ordering customer. The FWF monitors whether we adhere to these requirements in the annual Brand Performance Check (BPC). From these results, our efforts are evaluated in terms of social standards. More in Leader Status with the FWF


Code of Labor Practice as foundation

The FWF Code of Labor Practice (CoLP) to which we have committed ourselves, forms the basis for cooperation with our producers. The CoLP is based on eight core labor standards of the International Labor Organization (ILO) as well as on the UN Human Rights Charter.


All of our producers have to sign the Code of Labor Practice as part of the contract. In addition to the VAUDE Quality Manual, the CoLP is an integral part of the contract, which is also a prerequisite for the establishment of a business relationship with VAUDE. Producers are fully educated about the requirements of the CoLP before a business relationship begins.


The CoLP must be posted in every production facility and be available for all employees in their own language. This includes the Complaints Hotline for the workers. More about the Complaints Procedures here


FWF auditors as well as our CSR employees check regularly whether the CoLP is posted in the local language.


Standards FWF

Standards FWF

In this Sustainability Report, we report extensively on the content and requirements of the CoLP, our requirements of our producers, any discrepancies for each standard as well as our commitment in this regard. The content of the Code of Labor Practice can be found here:



Monitoring our producers

At VAUDE 99% of producers have monitoring status which means that almost all producers in high risk countries are audited. More on production in high risk countries here:

Whenever possible, we have new producers audited by the FWF before production starts. In 2015, six initial audits of production facilities took place.


Strict evaluation of new production partners

When we need a new producer (for strategic reasons, for example), we evaluate thoroughly in advance whether these suppliers meet our requirements in terms of quality, social standards and emission management. We have developed guidelines and a system for evaluating new partners. For organizational reasons, the FWF is not always able to carry out an audit before production starts. Therefore our CSR employee and quality managers pre-evaluate the conditions of the production facility using detailed checklists that, in addition to the criteria mentioned above, covers the requirements of the CoLP.


We also check whether the producer has been audited and if he has any other environmental or social certificates.


Audits and discrepancies in 2015

At VAUDE, 99% of producers have the monitoring status. According to the FWF, 90% of producers need to have the monitoring status by the 3rd year of membership. In general, we audit each producer early on, either before the start of production or in the first year of our business relationship.

To ensure objective examination of the working conditions at the production facility, the producers are audited by the independent auditors of the FWF.

During the audit, whether or not the producer is complying with the contents of the Code of Labor Practice and the applicable law is intensively examined. If there are discrepancies to the terms of the CoLP or in terms of laws, these are recorded in a corrective action plan (CAP).

A FWF Audit includes the following checks:

  • Complete inspection of the organization from inventory to finished products
  • Checking the documentation
  • Employee interviews both within and outside of the production facility
  • Talks with management


Interviews outside of the production facility are an important source of information, because the employee can answer questions more openly there. These interviews are always conducted anonymously.

In addition, for each of the eight standards, the FWF interviews local stakeholders regarding conditions and implementation of the standard in the country.


In the 2015 audits there were the following findings:

Production FacilityV1V2V3V4V17V 18Total VietnamC4C3C5C10C11C17Total ChinaB1=BulgariaOverall

VAUDE Purchasing Practices

1

1

 

1

 

1

4

3

3

1

1

1

1

10

1

15

VAUDE-Monitoring System

 

 

 

 

 

 

0

 

 

 

 

 

 

0

0

0

Management System-Producer

3

 

2

 

2

 

7

 

 

1

 

 

1

2

0

9

Communication

1

1

3

 

4

 

9

2

2

2

3

3

2

14

 

23

Forced Labour

 

 

 

 

 

 

0

 

 

 

 

 

 

0

 

0

Discrimination

1

 

 

 

1

 

2

 

 

 

 

 

 

0

 

2

Child Labour

 

 

 

 

 

 

0

 

 

 

 

 

 

0

 

0

Freedom of Association /Collective Bargaining

1

 

 

1

 

2

4

1

1

1

1

1

1

6

1

11

Payment of a living wage

8

2

1

3

 

2

16

1

1

3

2

3

1

11

1

28

Working Hours

1

 

1

 

 

1

3

2

3

2

3

3

2

15

 

18

Health and Safety

9

4

8

4

23

6

54

1

1

3

4

3

2

14

1

69

Legally binding employment relationsship

1

 

 

1

 

 

2

1

1

2

 

1

1

6

 

8

Total

26

8

15

10

30

12

101

11

12

15

14

15

11

78

4

183

Corrective Action Plan Implementation

After each audit, a binding corrective action plan (CAP) is jointly agreed upon by the audit team and the management of the respective production facility. Any discrepancies with respect to the CoLP and also with regard to the local laws are listed. We discuss this corrective action plan intensively with our producers. Together we develop joint solutions and also a schedule that specifies the date by which the respective discrepancies should be remedied. In most cases, the necessary measures can be implemented quickly and the complaints remedied. The challenge, however, is to systematically and sustainably implement the recommended measures. Sometimes there are also very critical discrepancies that must be stopped immediately while many improvements require more time before they can be implemented. If this is necessary, we give our producers the time needed, since this is the only way to achieve truly sustainable and systematic improvement.


Supporting the improvement process

Our CSR employee supports the producers throughout the improvement process. They make their expertise available to the producers and also perform regular follow-up visits, during which the status of corrective actions is tracked.

Moreover, once a year there is a review by the VAUDE CSR employee at all of our producers. We have developed a special checklist in which the all requirements are laid down which are strictly checked. The result is then discussed with the producer.


Regular Re-Audits

Re-audits are generally carried out every three years - this also corresponds to the guidelines of the FWF. If a producer does particularly poorly, we initiate a verification audit earlier to check what improvements have been achieved and what issues still need to be addressed.


Monitoring applies to subcontractors as well

The CoLP also applies to all subcontractors. Before we begin working with a producer, he must inform us of all production facilities in which he finishes our products. This applies both to his own factory as well as for subcontractors he might possibly use for production. These are, like all other production sites, visited in advance, reviewed and evaluated by us. On this basis we decide whether each subcontractor may be used for our production. All subcontractors who produce for VAUDE undergo the same monitoring as the producers with whom we work directly. This means that subcontractors are audited by the FWF, and if necessary, a corrective action plan is implemented together with the VAUDE CSR team in Asia.

In general, each producer is required at the beginning of the business relationship with VAUDE to inform us in advance and obtain our approval before he uses subcontractors. Our on site quality control system gives maximum transparency as to which production facilities are used for the production of our products.


If a production facility can not internally cover all production steps, such as embroidery, printing or washing, it must disclose its subcontractors. This year, we are beginning to train our production facilities in how they can monitor their subcontractors for the outsourced production steps over the long-term. We will report on this project in the next Sustainability Report.


Training und Knowledge Management – Training & Capacity Building

VAUDE trains its producers on site in order to provide targeted support and close existing knowledge gaps.

For this purpose, the FWF offers a Workplace Education Training (WEP) in a variety of countries. As part of the WEP, workers and managers of the production facilities are trained on the following topics: CoLP content, rights and obligations of workers and managers and local laws. Separate training courses are held for workers and for managers. Firstly, the content is specific for each target group. Secondly, an environment is created in which the workers feel freer to express questions or concerns that they might not say in the presence of their managers.
In addition, the WEP focuses on open communication between workers and managers. On both sides, an awareness should be created that contributes significantly to good internal communication, to meeting the requirements of CoLP and to improving working conditions. A thorough explanation of how the complaint mechanism can be used if internal problem solving does not work is also given. More here at Freedom of Association

Of all of our production countries, the FWF currently only provides WEP training in China and Vietnam. For this reason we have designed and implemented WEP training in Myanmar that is based on the FWF standards. More here at Production Myanmar. In 2015, 15 of our production facilities participated in the WEP and in total, 90% of our producers in the countries where the WEP is offered have already been trained.

Above and beyond the WEP, we recommend that our producers (depending on their deficits) also take part in other training or education programs themselves. See also Production Myanmar or Occupational Health and Safety


Internal communication on social standards

We want to anchor our commitment to social standards in the supply chain throughout the organization, particularly in the entire product development and production process. Therefore we provide ongoing information on this issue to our employees at our headquarters in Tettnang, with internal reports, information events and training.


To accomplish this, we use our intranet, our "VAUDE Academy" training program as well as our Collection Presentations that are held twice annually with all international sales representatives. In addition, the issue of social standards and all related issues is an integral part of the internal Update Meetings of all VAUDE product divisions. The theme is also regularly reported on to the company management.

GRI:   G4-HR10
percentage of new suppliers that were screened using human rights criteria
GRI:   G4-HR11
significant actual and potential negative human rights impacts in the supply chain and actions taken
GRI:   G4-LA14
percentage of new suppliers that were screened using labor practises criteria
GRI:   G4-DMA Supplier Human Rights Assessment
Disclosure on Management Approach Supplier Human Rights Assessment
GRI:   G4-DMASupplier Assessment for Labor Practices
Disclosure on Management Approach Supplier Assessment for Labor Practices
GRI:   G4-DMA Procurement Practices
Disclosure on Management ApproachProcurement Practices
GRI:   G4-Employment
Disclosure on Management Approach Employment
GRI:   G4-DMA Forced or Compulsory Labor
Disclosure on Management Approach Forced or Compulsory Labor
GRI:   G4-DMA Market Presence
Disclosure on Management Approach Market Presence
GRI:   G4-DMA Diversity and Equal Opportunity
Disclosure on Management Approach Diversity and Equal Opportunity
GRI:   G4-DMA Equal Remuneration for Women and Men
Disclosure on Management Approach Equal Remuneration for Women and Men
GRI:   G4-DMA Non-discrimination
Disclosure on Management Approach Non-discrimination
GRI:   G4-Child Labor
Disclosure on Management Approach Child Labor
GRI:   G4-GDMA Freedom of Association and Collective Bargaining
Disclosure on Management Approach Freedom of Association and Collective Bargaining
GRI:   G4-DMA Occupational Health and Safety
Disclosure on Management Approach Occupational Health and Safety
GRI:   G4-DMA Labor Pracites Grievance Mechanisms
Disclosure on Management Approach Labor Pracites Grievance Mechanisms
GRI:   G4-DMA Human Rights Grievance Mechanisms
Disclosure on Management Approach Human Rights Grievance Mechanisms
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