Integration and Reporting

Patagonia has a high level of engagement, regular communication and joint decision making across different teams to support RPP. This ‘4-fold approach’ involves the 4 teams of Quality, Social Impact, Environmental Impact and Sourcing (price, capacity, delivery, etc). Their weekly ‘4 fold’ meeting involves 10-20 people (directors and managers) from these departments, to review proposals for new finished goods or fabric suppliers as well as compliance concerns with existing
suppliers. Each team has equal veto in screening new factories and textile mills.

Patagonia also has a designated RPP taskforce that meets to discuss critical issues arising with existing suppliers, e.g., ways to minimise impacts of late material delivery or fluctuation in orders. There’s a high level of ongoing communication between Social Impact, Sourcing and Planning, for example moving excess orders from one factory to another (where materials had arrived late and workers were idle) therefore preventing excessive overtime in one factory and retrenchment in the other.

The adidas Responsible Sourcing & Purchasing Policy sets out their approach to working with their business partners to ensure that sourcing and purchasing decisions, and other supporting processes, do not impede or conflict with the fulfilment of their Workplace Standards. adidas has operationalised the policy through the development and application of ‘10 Buyer Commitments’. Performance against these commitments is tracked and monitored through supporting Key Performance Indicators (KPIs) which are subject to annual review process by the leaders in Sourcing and in Social & Environmental Affairs (SEA) teams. The fulfilment of these commitments has been supported by the rollout of an e-learning training for its global operations and sourcing personnel in 2022, reaching to more than 4,000 colleagues.

The Fast Retailing Responsible Purchasing Policy stipulates matters that must be taken into consideration when production departments or other purchasing-related departments place orders with a factory. For example, these departments are required to plan orders based on the production equipment and capacity at the specific factory, to place orders where product volumes and delivery dates are agreed in advance, and to only change order quantities or delivery dates with prior factory consent. Departments are also prohibited from taking advantage of the power dynamics between buyers and suppliers when negotiating order prices or payment terms. When negotiating order prices, purchasing personnel must consider relevant factors such as rising labour costs, the statutory minimum wage, and raw materials costs.

Fast Retailing’s Labour Management Team provides regular training on the policy for employees in the production and purchasing departments.  454 members of Fast Retailing brands received this training in 2022, across merchandising, product planning, R&D and production. It conducts regular surveys and interviews with partner factories regarding its own compliance with its policy and strives for  continual improvements.

Between 2021 and 2023, PVH ran multiple Responsible Business Practices workshops, engaging associates from entry-level to senior executives, across various functions. Participants worked together on a case study based on real situations, developed in partnership with one of the company’s strategic suppliers. This produced deep dialogue on how their cross-functional responsibilities and daily business decisions and actions impact the supplier’s ability to uphold good working conditions for workers and how to practically move towards a fairer, more equitable supply chain. In addition, in 2023, an e-learning module was released on PVH’s living wage strategy and their global purchasing practices commitments.

PVH’s Corporate Responsibility team is setting up collaborative taskforces with key stakeholders across the organisation to gain a deeper understanding of current purchasing practices and to devise improvement plans. This cross-functional approach is combined with the bi-annual ACT purchasing practices survey (completed by associates and vendors) and also integrating relevant KPIs in associates’ performance evaluations.