Responsible sourcing is an investment

Onsite visit in Dye House at Fulltide factory in Taiwan. Antje von Dewitz, CEO at Vaude together with Jim Chang, Vice President at Fulltide Co. Ltd.

Responsible sourcing is an investment

If audits and codes of conduct don’t do the job – is there a better approach to suppliers? Yes, says Dr. Anna Harvey, an expert on responsible sourcing.

The outdoor industry has been growing for several years, but is still small in comparison to the multinational companies within the sports and fashion segments. However, when dealing with suppliers, smaller companies have several advantages, believes Dr. Anna Harvey, consultant in the field of responsible sourcing solutions. Over the years, she has worked with multinational giants like Nike, Walmart and Marks & Spencer as well as smaller companies.

”Large companies like Nike and HM have had to deal with criticism from the media and NGOs for the past twenty years, about issues like working conditions and more. Over the years, they have already tried a variety of strategies to improve their supply chain. The small or medium-sized company that starts the journey later can take advantage and learn from what’s been done before,” says Anna Harvey.

The approach taken in the past has been to “police” the supply chain and make demands on what is required.

“This approach isn’t making enough change. It is time for brands to work more in partnership with suppliers. This means starting by focusing on opportunity that responsible sourcing brings, rather than just assessment and data collection.”

Share the vision

According to Anna Harvey, the best way to engage suppliers is to advertise a win-win approach. Seeking to exemplify the business opportunities for more sustainable business and highlighting the potential financial rewards will engage the suppliers to think differently about environmental and social issues, and to invest in their own futures.

One way to involve the suppliers more is to communicate the bigger picture. Anna Harvey explains:

“If the supplier understands – and feels part of – the vision and strategy of the client, it is much easier to explain the individual steps that need to be taken and why. Taking on board their perspectives and challenges will really help to build trusting relationships.

Another method that the big companies have tried and the smaller companies can follow, is collaboration around responsible sourcing with their peers. The outdoor industry in general has many long-term relationships between brands and suppliers, which is a benefit when it comes to problem solving and development around sustainability. But the smaller size can sometimes make it harder to get through. Where a brand has minimal leverage, due to a small proportion of production, it is hard to gain that much needed respect. Suppliers will work more with brands with whom they have stronger commercial relationships.

“Many companies within sports and fashion have joined forces in recent years. Pooling resources and parking commercial interests to one side, enables greater change at a much faster pace.”

There are many good examples of how groups of brands – often with their suppliers – collaborate around responsible sourcing, for instance AIM-Progress in the FMCG sector (fast-moving consumer goods).

Communication is a key

Also important to understand, is that suppliers and factories in international supply chains are not necessarily intrinsically bad. They don’t, for example, employ forced or child labor to gain a competitive edge – it is much more complex than that, says Anna Harvey.

“Cultural differences are obvious and what is acceptable is sometimes not the same as we may expect. Tackling challenges like forced and child labor needs a combination of education around ‘what is acceptable’ and ‘what is not’ alongside a deep dive in the or root causes of the situation. Why do children need to work? Why are they not at school? Can their parents survive financially if their children do not work?”

“Taking a more holistic approach, thinking about why there is a need for these suppliers to employ in such a way and tackling the issue at the root, can lead to a more prosperous future for all, in the longer term.”

Vaude goes upstream

Step by step, Vaude is setting sustainability goals together with suppliers in the upstream stages.

For the end consumer, it might be hard to realize how many stages an outdoor product has passed on its way to the retailer. A functional shell jacket, for instance, can consist of 50 components made by a wide variety of companies that deliver them to the manufacturer. Like many brands, Vaude has implemented high environmental and social standards at their main production facilities. However, since 2015, the company from Tettnang, in Southern Germany is taking this process further up in the supply chain in Asia, to spinning mills, weaving mills and dyeing works, etc.

The suppliers that choose to take part work together with Vaude’s team and external experts on environmental management and social standards.

“The project has been well received by a large proportion of our material suppliers. Up to today, 80 percent by volume of the primary and lining materials that we process are already included in the project. The goal is to roll out the project over the next few years for all material suppliers,” says Vaude’s CEO Antje von Dewitz.

Want to know more? At the OutDoor fair, Vaude’s project leader Bettina Roth will have a daily project presentation at the Greenroom Voice booth.

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Gabriel Arthur
gabriel.arthur@norragency.com