PVH Corp. is implementing an enhanced global corporate responsibility strategy to address social and environmental issues, as well as continued commitments to improved workforce and manufacturing standards and conditions, the company said Monday in its annual Corporate Responsibility report.
“We believe corporate responsibility helps strengthen our organization by managing risk, maximizing efficiencies and driving value in a rapidly changing world,” Emanuel Chirico, chairman and chief executive officer, said. “I believe that through our collective efforts, we can continue to create value for both society and our business.”
Melanie Steiner, PVH’s chief risk officer, noted in the report that “the global apparel industry faces many complex challenges.”
“The world is gearing up for a clean energy transition, guided by the first universal agreement on climate change,” she said. “Political instability and sectarian violence in sourcing countries continue to pose risks to supply continuity, while free-trade agreements are altering the sourcing footprint. Globally, businesses are taking action to align their corporate responsibility efforts with the United Nations’ new Sustainable Development Goals, while stakeholders — from investors to consumers — are pushing for more transparency.”
The U.N.’s Sustainable Development Goals were agreed upon by 193 countries in 2015 and are aimed at helping guide global efforts to achieve sustainable development over the next 15 years.
“We have developed our new CR strategy to support the SDGs, as we renew our efforts to achieve positive impacts across our value chain,” Steiner said.
PVH’s CR program is structured with 10 commitments across three key focus areas: empowering people, preserving the environment and supporting communities.
The strategies support 14 of the U.N.’s 17 Sustainable Development Goals, including building safety, chemical management, greenhouse gases, inclusion, diversity and supporting the needs of women and children. The report also places an emphasis on the need to move beyond compliance to achieve sustainable protection of the rights, dignity and livelihoods of the nearly one million workers in the company’s supply chain.
PVH said the 2015 initiatives detailed in the report highlight how the company is working with various stakeholders to drive positive impacts around the world. These include the Global Supply Chain team’s efforts to help create a “best-in-class” apparel manufacturing industry in Ethiopia, Tommy Hilfiger partnering with the World Wide Fund for Nature to help safeguard water resources in the Taihu and Mekong river basins, Speedo partnering with Italian yarn maker Aquafil and Chinese supplier Parawin to transform nylon factory remnants into new swimsuits, and PVH’s role as the “lead” brand owner for the Accord on Fire and Building Safety in Bangladesh in all factories where the company has production.
In Ethiopia, PVH convened a private-public collaboration with suppliers, the Ethiopian government and donor groups to establish an industrial park in Hawassa, a small city in southern Ethiopia. The aim is that the Hawassa Industrial Park will be a development opportunity for sub-Saharan Africa and for the apparel industry.
Ethiopia is Africa’s second most populous country, with an average gross domestic product growth rate of 11 percent for the past 11 years and a stable government with a 2025 plan to become Africa’s leader in light manufacturing, PVH noted. Ethiopia is investing in its infrastructure, including by expanding clean energy generation and worker development. For the apparel industry, there is an opportunity to grow cotton and implement other stages of production within Ethiopia, the report said.
“At every step, we are sensitive to the challenges and conscious of the responsibilities inherent in industrializing a predominantly agricultural region,” PVH said in the report.
At the factory level, PVH said it’s working with suppliers to help them build systems to more effectively manage human rights and environmental risks within their factories. In 2015, the company worked closely with suppliers to resolve pressing issues, conducting more than 2,150 assessments and visiting about 1,400 factories outside of the usual assessment process to share practical strategies to improve working conditions and employment practices. In addition, it delivered more than 160 sessions to 7,525 internal and external partners to promote change, covering topics such as fire safety, human rights implementation, worker-management relations, chemical management, assessment practices and data management.
In addition to these external partnerships, PVH said it continues to drive internal efforts on CR, including calculating greenhouse gas emissions at all of its facilities, and inclusion and diversity initiatives.
PVH said it will participate in the Social and Labor Convergence Pilot, an initiative facilitated by the Sustainable Apparel Coalition that seeks to unite brand owners, manufacturers, civil society and other stakeholders to create a unified approach to social and labor assessments.
Tommy Hilfiger is making progress on its Sustainable Evolution strategy. This includes procuring more than 9.5 million pounds of Better Cotton, accounting for 11 percent of Hilfiger’s global cotton volume, more than eight times the amount sourced in 2014, and increasing the use of more sustainable materials such as organic cotton and Tencel by more than 70 percent compared to 2014, for a total of 2.9 million garments in select collections.
Hilfiger has also committed to procuring leather from certified sources, with about 13 percent of tanneries accredited by the Leather Working Group, a multistakeholder organization that establishes and promotes sustainable business practices within the leather industry. Hilfiger has also incorporated down certified by the Responsible Down Standard in the majority of PVH Europe styles for fall.
Last year also saw the global launch of PVH University online to expand learning and development opportunities for the 9,000 office-based associates.
PVH’s 2015 Corporate Responsibility Report was developed in accordance with the Global Reporting Initiative G4 Guidelines, an international framework widely used by organizations to report on their CR and sustainability performance.
PVH has more than 30,000 associates operating in more than 40 countries with more than $8 billion in revenues. The company owns the Calvin Klein, Tommy Hilfiger, Van Heusen, Izod, Arrow, Speedo, Warner’s and Olga brands.