Motivating a retail company’s suppliers to respect human rights

A retail company, H&M, through H&M Production Office in Indonesia assists and motivates suppliers to participate in respecting human rights.

H&M has committed to leading the change in the fashion industry by promoting a circular, renewable, fair and equal business model. H&M partners with 1,668 suppliers in the world, including 131 suppliers in Indonesia, to increase their sustainable business performance.

 

“H&M realizes that we are not alone. Our business should grow together with the suppliers’ business.” Anya Sapphira, Regional Sustainability Manager H&M.

 

“H&M realizes that we are not alone. Our business should grow together with the suppliers’ business.” Anya Sapphira, Regional Sustainability Manager H&M. “We support our suppliers to go beyond  in social and environmental program.”

 


[1]HM. “HM 2017 Sustainability Report”. 2017. https://about.hm.com/content/dam/hmgroup/groupsite/documents/masterlanguage/CSR/reports/2017%20Sustainability%20report/HM_group_SustainabilityReport_2017_FullReport.pdf

[2] Ibid,.

[3] http://sustainability.hm.com/en/sustainability/downloads-resources/resources/supplier-list.html#


 

Source: H&M Sustainability Report 2016

 

“H&M is committed to make fashion industry more transparent. We have learned from our previous experiences that transparency is important for our shareholders and stakeholders.” said Anya Sapphira, Regional Sustainability Manager H&M. “For us transparency is to know where and how our products are made to make sure that human rights are respected, environmental conditions are sound, and under what conditions product are made. It is also important to share this information publicly.”

 

Not a philantrophy: embedding sustainability in the DNA of business process

“There is no such thing as philantrophy. We see investing in sustainability as a business opportunity. It provides us with long term sustainability. That is why embedding sustainability to business process in our supply chain is important” said Anya.

Philantrophy and sustainability are implemented separately by two distinct lines. H&M Foundation takes care of H&M owners’ fund for charity projects. Meanwhile, H&M Sustainability Team actually implement sustainability program related to H&M core business process.

“Integrating sustainability in business process is different from philanthropy and donation. Suppliers should have a competitive business capacity, yet remains sustainable and responsible.” said Anya.

“We look into the suppliers’ business process. How they can remain competitive, free from social conflict, have a good industrial relations and free from wage violations. Meanwhile sustainable material, resources efficiency, and waste management are also important for environmental perspective of business.” explained Anya.

Sumber: H&M 2017 Sustainability Report

 

 

Developing sustainability system according to suppliers’ need

The second largest clothing retailer in the world in 2018[1] has moved away from auditing system to developing suppliers’ capacity on sustainability.

 


[4] https://www.fastretailing.com/eng/ir/direction/position.html


 

“Compliance is the minimum requirement. We reward the extra mile.” – Anya Sapphira, Regional Sustainability Manager H&M

 

H & M uses the self-reporting method of the Sustainable Apparel Coalition using the Higg Index software. The H & M Sustainability Team will then verify reporting and determine what areas should be developed by suppliers.

“We are aware that suppliers need to achieve sustainability are diverse.” explained Anya. “Our suppliers’ development program depends on their individual needs, for example occupational safety and health (OSH), industrial relations with workers, waste management systems, environment, etc.” said Anya.

“We realize from evaluation that on average the factories already have system in place, but daily operation is sometimes challenging.” said Anya. “Sometimes hygiene is not maintained during peak season. Patchworks are left on the floor, even though OSH system is a priority. “Anya explained. “There were also employees who prefer ignoring their rights by moving to factories with more overtime to get a higher bonus.”According to the H & M Sustainability Team, socialization and training through the Sustainability Supplier Summit, which is held at least twice a year, is important to embed existing systems and policies in daily habits. Partnerships with various trade union forums, such as IndustriALL and international institutions, such as the International Labour Organization were also carried out.

 

Source: H&M Sustainability Report 2016

 

 

Rewarding the extra miles taken by suppliers

“Compliance is the minimum requirement. We reward the extra mile.” said Anya.

“We make sustainability a backbone of suppliers’ key performance index (KPI) and ranking.” Anya Sapphira, Regional Sustainability Manager H&M

According to Anya, it is a business case to choose more sustainable suppliers.

“Suppliers with better Occupational Safety and Health system tends to have better output of production force. Suppliers that have a well-functioning industrial relation also tends to be more stable and reliable in delivering production outputs.” said Anya.

“We make sustainability a backbone of suppliers’ key performance index (KPI) and ranking.” Anya explained. ” suppliers with higher rank will have a higher business commitment from

H&M.”

As a result, some H&M supplier factories have gone the extra mile in ensuring an inclusive working environment for women and people with disabilities. Some also have used renewable source of energy, such as solar panel.

Share this post