WASHINGTON — VF Corp. outlined ambitious goals and addressed significant challenges in its global supply chain in the launch of its first sustainability and responsibility report and platform on Monday.
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The report and platform on its corporate Web site establishes a single, comprehensive source on VF’s companywide efforts to reduce its carbon footprint and environmental impact, and improve and strengthen workers’ rights and conditions in its massive global supply chain. Displayed prominently on VF’s homepage, the initiative encompasses a broad set of VF’s programs and goals, from auditing more than 1,800 foreign factories in 60 countries to reducing its greenhouse gas emissions by 5 percent by the end of 2015 and helping 4,000 cotton farmers produce 1 million metric tons of sustainable cotton through the Better Cotton Initiative.
“VF’s first sustainability and responsibility report highlights the work we are doing across our business platforms and brands to responsibly manage our business,” Eric Wiseman, VF’s chairman, president and chief executive officer, wrote in a letter released with the report. “This includes our careful use of resources such as energy, materials and water. It also includes some of the ground-breaking initiatives our brands are leading in sustainable product development — work that is shaping the future of the apparel and footwear industry.”
Among the challenges the company addresses in this new platform, which aligns all its initiatives across brands, is improving working conditions and workers’ rights in its vast supply chain. VF has 20,000 employees in 32 owned-manufacturing facilities, representing 30 percent of its production, around the globe, and monitors and audits working conditions at all factories where its brands and licensees source production.
The company said it conducted 1,848 audits of VF-authorized factories last year. The company said it refused to do business with 13 percent of existing or proposed factories that were not able to meet their initial corrective action plans or meet its basic requirements. More than 1,800 suppliers were accepted or classified as “developmental.”
Among the negative findings were 3 percent of factories that were noncompliant based on harassment and discrimination, 3 percent failed for issues related to forced labor, 2.5 percent failed for issues related to “juvenile” labor and 1 percent were noncompliant for failing to uphold freedom of association and collective bargaining rights. VF also reported one death of a worker as a result of chemical exposure combined with heat exhaustion, stating that the worker suffered from health issues that contributed to his reaction to the conditions. The factory was not held liable for the fatality.
VF also put a spotlight on Bangladesh, which has been trying to implement reforms in the wake of two tragedies that claimed the lives of more than 1,240 garment workers. The company has invested $17 million toward the health and safety of Bangladesh workers through factory upgrades and qualified supplier loans to provide financial support for workers impacted by factory inspections.
“We are incredibly dedicated to ensuring that workers in Bangladesh [and throughout the supply chain] have a safe working environment,” Letitia Webster, senior director of global corporate sustainability, said in an interview. “You see our work across many countries dedicated to ensuring workers have safe workplaces where they are respected and treated fairly.”
On the sustainability front, 98 percent of VF’s primary energy sources come from fossil fuels and the firm spends $125 million annually on energy, fuel and business travel worldwide. The company said it will pursue strategies to reduce its carbon footprint, including reducing greenhouse gas emissions by 5 percent by the end of next year from a 2009 baseline — a reduction equivalent to preventing 1.7 million gallons of gasoline combustion.
“This is despite anticipated revenue growth of 40 percent in the same time period and the addition of approximately 400 more owned facilities,” VF said.
Under the sustainability pillar, VF touted a new pilot project dubbed Chem-IQ launched in 2013 in partnership with University of Leeds in England and University of Massachusetts Lowell in the U.S. with the backing of the Natural Resources Defense Council Modern Testing Services, a global network of chemical laboratories. The program assists VF’s pool of foreign textile contractors in eliminating the worst chemicals from the production processes, using the Restricted Substances List as its base. The program was rolled out at select factories in Turkey, Mexico and Los Angeles in 2013 and expanded to all factory locations in China this year.
“So far, we have screened more than 1,000 chemicals from 102 factories and successfully removed 68 tons of non-preferred chemicals from our supply chain,” the report said.
VF said it expects to have Chem-IQ fully in place at all of its tier-one factories, globally, by the end of 2015.