Putting people first

Forced labour and child labour continue to be an international concern. According to the International Labour Organisation (ILO), in 2016, there were 40.3 million victims of modern slavery around the world with 152 million children forced to work, almost half of them between the ages of 5 and 11.

The UN’s 17 Sustainable Development Goals, part of its roadmap for significantly changing the world by 2030, include Goal 8: “Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all”.

Decathlon products are manufactured in more than 49 countries with widely varying national standards and regulations on health and safety, labour law and environmental impact, and where the issues identified by intergovernmental organisations (ILO, OECD68, etc.) are addressed at different speeds. In light of this context, our responsibility, regardless of where manufacturing takes place, is to ensure that working conditions comply with regulations and with our own requirements in the following areas:

Human Rights: child labour, modern slavery and forced labour, freedom of association, discrimination, etc.

Health and safety: decent pay, management environment, building safety, etc.

Chemical substances

Respect for the environment

Responsible materials

Corruption

Management and communication

These categories have been part of our Social Charter since 2003 and they are regularly monitored. In 2017, 69% of our rank 1 suppliers had brought human-related risks to an acceptable level and our goal is to reach 80% by 2019.

 

2017 Summary

We are expanding the requirements of our Code of Conduct, especially those related to environmental and societal issues.

We are seizing the opportunity presented by the Corporate Duty of Vigilance Law, which identifies social and environmental risks associated with our activities and those of our sub-contractors and suppliers, allowing us to consolidate our risk management practices.

We are strengthening our SD in Production Management Team to better implement our strategy to improve conditions as part of trust-based partnerships.

Incorporating new issues into our human responsibility in production approach

Human Responsibility in Production got its start at Decathlon in 2003 when the first Social Charter was adopted. Since then, the social and environmental issues associated with our supply chain have changed significantly and several major international events have gradually caused a shift in the wider context.

The California Transparency in Supply Chains Act was passed in the United States in 2010

The United Nations published its “Guiding Principles on Business and Human Rights” in 2011

The OECD published its “Responsible Business Conduct” Guidelines in 2011

The Rana Plaza factory collapse in Bangladesh in April 2013

The “UK Modern Slavery Act” was passed in the United Kingdom in 2015

The “Duty of Vigilance of Parent Companies and Instructing Companies” law was passed in France in 2017

In light of all of these changes, Decathlon reviewed its own supplier requirements and issued a completely revised and expanded Code of Conduct to take on board new environmental and societal issues.

All of the suppliers who help to manufacture Decathlon brand products are contractually bound to follow our Code of Conduct. They have committed to follow the standards and principles we set forth.

Our teams had several objectives in mind when updating the Code of Conduct:

Realigning our requirements with “soft law”77 guidelines

Incorporating new issues in the Code of Conduct

Strengthening the commitment to work on topics such as forced labour, freedom of association, wages and human resources management

To apply the new Code of Conduct, it was necessary to update the relevant audit criteria and clarifying the scope of audits. For example, the audit will now cover not only production sites, but also dormitories and transport provided by suppliers.

We also made changes to the format and structure of audit criteria to make it easier for suppliers to take them on board and use them for a practical internal management and monitoring tool.

We used participatory methodologies throughout 2017 while these changes were underway, relying on both external benchmarks and consultations with internal stakeholders: the network of SD in Production Managers, dedicated auditor teammates and the production teams.

With this collaborative approach, the goal was to involve local operational teams, increase their skills and grant them greater autonomy.

After testing under real-life conditions for three months, the new audit criteria have been in force since September 2017

Helping to standardise methodologies

Since 2014, Decathlon has been a member of the Advisory Committee that is writing an OECD guide on due diligence for textile and footwear supply chains. This guide was published in January 2017 with the title “OECD Due Diligence Guidance for Responsible Supply Chains in the Garment and Footwear Sector”.

Regular meetings between our teams and our suppliers

Our teams visit our suppliers’ premises regularly:

On a daily basis: because they regularly visit our suppliers’ sites, our production teams can detect any situations that pose a risk and create an action plan with the supplier.

During assessments: 25 Sustainable Development in Production Managers conduct most evaluations. These managers are local recruits who speak the suppliers’ language and understand the country’s culture. This makes their work more effective and helps to identify local issues. They are constantly training the production teams and some are also in charge of continuously improving the tools and methods they use. Another 37 teammates (who are involved in industrial production and who have received special training) have volunteered to become involved with this initiative.

In 2017, 66% of assessments were carried out by our internal teams. The remaining assessments were carried out by an external firm using the same criteria. The Decathlon teams and the external teams meet regularly to ensure compliance with our requirements met.

How our suppliers performed

Among the rank 1 production sites involved in our programme, 69% had A, B or C performance ratings (1% more than in 2016) as did 49% of our rank 2 production sites (no change from 2016). In total, 1,018 assessments were carried out in 2017.

Our suppliers’ performance levels rose slightly, and we are aiming for 80% of production sites with A, B or C ratings by 2019. We have noticed that while some of our suppliers have improved, others have gone down in performance because the results of the improvement action plans have not had a lasting effect. We are therefore seeing the same problems in successive evaluations.

In 2018, our process management teams will require more sustainable action plans from our suppliers and evaluator training courses will also highlight this need.

Experimenting with pilot projects that go beyond compliance

Every country has its own regulatory framework. Sometimes, Decathlon’s requirements are stricter than the local laws currently in place. In order to meet our commitments around the world, we hold regular internal training sessions at production sites that are either led by local Decathlon teams with support from the home office, or by the relevant teams themselves. These pilot initiatives allow us to experiment, explore, learn and improve our methods so that we can later share the good practices we develop and collaborate with outside stakeholders. Here are three examples taken from among many showing how teams were able to transform risks into opportunities.

“Together for Sustainable Business” project (TSB), initiated in Bangladesh, tested in India and in China

Since 2014 we have participated in Impactt’s “Benefits for Business and Workers”85 programme, which allows us to work with supplier volunteers and their employees to co-create organisational and HR structures that involve employees in the company’s vision and focus on motivation, communication and more caring management practices. We have taken the lessons we have learned from this programme to develop our own methodology, based on three goals: better supplier production efficiency, employees that are engaged, motivated and paid better, and more stable business partners for Decathlon.

The first pilot project was overseen by Rabeya Hossan, Sustainable Development in Production Manager for three suppliers: AJ Super Garments Ltd, Snowtex Outerwear Ltd, Tarasima Apparels Ltd. in Bangladesh in 2015. The goal was to understand how a more engaged human resources organisation that communicates with and motivates employees can contribute to a more lasting performance.

Since the project was launched, Rabeya has continued to work with these two suppliers who have become Decathlon partners.

In particular, she helped them take concrete action to create job description sheets, review bonus practices, improve communication with regular events and meetings that bring together employees and managers, etc. Tangible results soon followed: in all three factories, absenteeism fell to less than 2% in 14 months.

In 2017, we rolled out the project in China and India after adapting some of the motivation factors to these new contexts. When it began in India in 2017, the project’s goal was to implement new human resources policies in production plants. This initiative was meant to address the problems of absenteeism and employee turnover, which can reduce productivity. Various actions were taken, including the implementation of a new policy on how leave is communicated and more in-depth exit interviews to find out why employees were leaving.

When we instituted the new dialogue system, absenteeism stabilised. Planning out worker leave helps the plant anticipate productivity spikes and employee turnover slowed after we realised that workers did not understand some policies (retirement conditions, for example).

In China, our suppliers were mostly concerned with reducing employee turnover. Our local Sustainable Development Team worked with Impactt and the Decathlon China Human Resources Team to share best practices with our partner suppliers: how to improve recruitment practices, how to onboard a new employee, how to reduce unplanned absenteeism through better communication, etc.

Makara PICH
Meeting with Makara PICH

Sustainable Development in Production Manager for Cambodia

and Leader of the Health and Safety Dialogue Pilot Project

What does the Health and Safety Dialogue project entail?
This pilot project was launched in 2017 to provide support for three factories in Cambodia. We also received help from SUS-A84, an organisation that specialises in social dialogue in the factory setting.
Above all, our approach was based on involving both employees and managers in the information, communication and decision-making processes.
Training sessions that brought together all of the different stakeholders allowed us to raise general awareness areas for improvement when it comes to health and safety. Training allows everyone to have more of a say about the actions to take.
Each factory faces its own challenges that we can identify using this dialogue process and then address as part of our continuous improvement initiative.
What were some concrete results you saw in 2017?
There were so many! For example, the JIT Textiles Limited plant provided all of its employees with new, more comfortable personal protective equipment.
The New Wide Garment plant worked to improve cleanliness and hygiene throughout the site.
Employees had also been complaining about it being too hot inside the factory. A cooling system was installed to solve this problem and we encourage employees to drink plenty of water.

After we had five training sessions throughout 2017, I observed tangible results at my plant, starting with fewer workplace accidents. People changed their behaviours and the entire staff gets involved and takes responsibility for any safety problems. They also suggest solutions proactively. This has helped improve the level of trust between site employees and managers. We’ve learned a lot about how to identify problems within the factory, how to understand their root causes and how to implement action plans. We’re also now better prepared to identify and stop dangerous behaviours.

Jason Hung,
Director of the New Wide Garment Co., Ltd plant (Cambodia)
Ronan LE MOGUEN
Animal welfare: using certified natural feathers
Meeting with Ronan LE MOGUEN

Sustainable Development in Production Manager for Human Responsibility in Production

How did the duck feather certification project get started?
Over the last few years, we’ve had several questions from customers about our use of feathers in our products. Some were worried about animal mistreatment, such as live plucking. We fully understand our users’ desire for transparency on this topic.
We began with an assessment of our supply chain. The challenge with this particular material is how many people are involved in producing it. We had to go all the way to the hatcheries and slaughterhouses in China and Vietnam to make sure conditions respected animal welfare. I went to evaluate the situation myself, visiting farms, slaughterhouses and other links in the supply chain up through the product finishing. We already had a traceability system in place, we just needed to certify it.
What were some of the major commitments you made in 2017?
Duck and goose down are by-products of food production. We recover these materials and use them in some of our winter jackets and sleeping bags because they are light weight and retain heat well.
As part of our Human Responsibility in Production approach, we decided we would work only with RDS (Responsible Down Standard)86 certified suppliers who guarantee that their feathers and down come from ducks and geese that were raised for their meat in a cruelty-free environment. We spoke with various internal and external stakeholders (brand associations, industrial partners, NGOs) before choosing this certification.
We’re now considering improving traceability for other raw materials.