We want our customers to know that when they buy a product from Flying Tiger Copenhagen, we strive to ensure that it has been produced in respect of ethical, environmental and social standards and is safe to use. We believe this is critical for the success of our company, to protect our brand and to advance better social and environmental conditions in global supply chains. Consequently, our commitment to conduct our business ethically and responsibly cuts across the full value chain from sourcing to shipping and sales in stores.
Our responsibility framework ‘It’s about caring’ unites our five priority areas: People, Products, Planet, Partnerships and Policies
Each year our management conducts a materiality assessment to map key impact and risk areas in our value chain. The resulting prioritised list of key issues feeds into our strategy and is translated into concrete activities under our five priority areas as described below.
We recognize our corporate responsibility to respect human rights in all our operations and we work towards integrating human rights due diligence into our daily work in accordance with the UN Guiding Principles on Business and Human Rights.
Our commitment applies throughout our value chain. At the same time, we recognize that some stakeholder groups are more affected by our activities than others. To ensure that we focus our efforts on those areas where we have the greatest impact, we have defined four priority areas:
Customers: Safe products.
Employees: Treating our employees with respect and dignity.
Business relations: Responsible sourcing of products.
Local communities: Being a positive force where we operate.Download our Human Rights Policy here
Zebra aims to offer equal opportunities to men and women across its organisation, and it is company policy to promote equal opportunities regardless of gender, ethnicity, race, religion and sexual orientation.
When it comes to gender, Zebra aims at a balanced distribution among employees in leadership positions. Zebra’s management is currently composed of 53% male and 47% female members. Zebra defines management as district leaders, country managers, partners as well as managers at headquarters.
Relevant professional qualifications remain the key selection criteria for all positions in the Zebra organisation, and Management will continue to focus on diversity and to evaluate the need for initiatives within this area.
At the end of 2017, the Board of Directors of Zebra consisted of 100% male members (unchanged compared to 2016). It is the Board’s ambition to increase diversity, including gender representation on the Board.
In February 2018, the first female board member was appointed and Margaret McDonald joined the Board of Directors. It is the target to have at least two female board members before 2023. It is the current assessment that the Board has the required qualifications and composition to oversee Zebra’s strategic development. The target will be sought achieved in connection with ongoing changes to the composition of the Board, where special efforts will be made to ensure that female candidates are identified and participate in the selection process.
In the UK, the Gender Pay Gap legislation, under the Equality Act 2010, requires an employer with 250 employees or more to publish their gender pay gap for their employees.
Read our UK Gender Pay Gap report 2017 here
Read our UK Gender Pay Gap report 2018 here
Our products are the very core of our business. We want to offer our customers useful, fun, and fresh products at affordable prices. And we want our products to be safe and take significant measures to ensure that they have been produced under humane and responsible conditions in respect of international social, environmental and ethical standards.
We do not produce the products ourselves and in 2017, we purchased products from approximately 600 suppliers worldwide. Approximately 60 percent of these are based in China; approximately 30 percent are based in the EU and the remaining 10 percent are spread across the world. Most of our direct suppliers are trading companies who source from a range of different factories, enabling us to offer a broad array of novel products across a variety of categories.
During 2017 a strategic project to reduce the tail of small suppliers has been conducted to strengthen partnerships with our largest trading companies. The objective has been to ensure more effective supplier management and compliance with our requirements.
Product safety process
All products go through our product compliance process to ensure they are safe and compliant. This means that all materials must be approved prior to purchase through our Bill of Material (BOM) approval process. The BOM process is complemented by our test programme through which we ensure that our products are tested for hazardous materials. With very few exceptions, all our products are tested in the sample phase.
For those products considered to be high risk, e.g. toys, electronics and food-contact products, the testing is repeated during mass production. When we define our requirements, our policy is to comply with the EU requirements or the applicable national legislation, whichever sets the highest standards. In a number of areas, we go beyond the legal requirements. This means that we for instance prohibit chemicals like triclosan, formaldehyde, phthalates (all types of phthalates), formamide, heavy metals and coating materials that are based on halogens (bromine, chlorine, fluorine etc.).
In 2017, we have focused on two areas in addition to the development and kick-off of our Quality Programme:
· Strengthening and refining our product compliance process even further, including the tools applied in the process.
· Closer collaboration with our key suppliers to improve their capabilities to understand and meet our compliance and quality requirements.
Zebra Quality Programme
With a strategy of improving the quality of our products, Zebra developed a Quality programme focusing on physical inspections during production. A team of quality inspectors, a quality manager and supporting personnel was established in Shanghai.
Selection of the products subject to quality checks and description of the quality check points are performed at the headquarters in Denmark, but the inspections and handling are done by the local team and in the local language.
In Q4 2017, a total of 141 inspections were executed. The result is better quality for the inspected products but the inspections also create a higher awareness of our quality standards among our suppliers, leading to a continuously higher quality level for all products.
Through our social compliance process, we work to ensure that factories selected for production on our behalf can meet our requirements, and that the people producing our products are treated with respect and provided with fair working conditions.
We have an ongoing focus on continuously improving our social compliance process and our performance. In 2017, we have focused on strengthening our process by introducing an audit management tool linked to our product compliance process, allowing for a systematic and more thorough process.
The process follows three steps.
Social compliance process:
1. Commitment to the Zebra Supplier Code of Conduct. All product suppliers must sign the Zebra Supplier Code of Conduct. The Code is based on international standards as defined by the United Nations (UN) and the International Labour Organisation (ILO). It defines our requirements in the areas of workplace health and safety, terms of employment, working hours, wages, environmental protection and business ethics. Among other things, it prohibits child labour, forced labour, dangerous or severely unhealthy working conditions and abusive disciplinary practices. No purchases can take place without a valid Code in place. Commitment to the Code must be renewed every 2nd year in writing.
2. Risk assessment and factory audits. Factories are selected for audit in a two-step process:
I. Factory information for all items is gathered from the BOM tool and items are automatically assigned a risk rating based on:
i) country of production; ii) purchase volume; iii) product category.
II. The automatic risk rating is combined with a manual process looking at: i) brand exposure of product; ii) audit history and performance of factory, including sub-contracting practices.
Items rated high-risk are selected for audit. On-site factory audits are carried out either by our China-based audit team or by Elevate, an organisation specialised in social compliance factory audits. All audits follow the Zebra Audit protocol which consists of 115 questions which assess practices in the areas of ethics, sub-supplier management, human rights, labour practices, and the environment. Audits include a combination of site assessment, documentation review, management interviews and anonymous workers' interviews. Audits can be announced, semi-announced and unannounced audits depending on progression of audits and types of findings in previous audits.
All factories are evaluated from A (compliant) to E (Zero-tolerance).
3. Improvement and remediation. All factories, apart from A rated factories, must implement a corrective action plan (CAP) within a defined timeline. The CAP is reviewed regularly until closure by Zebra, and the factory must go through a re-audit to verify improvements. Re-audits are semi-announced or unannounced. Factories that present severe zerotolerance issues are rejected (e.g. use of child labour, forced labour, severe safety and human rights issues, attempted bribery of auditor). In some cases, where good faith and procedural errors can be verified, the factory is put through a requalification process which includes training, a strictly monitored improvement plan and a re-audit. In case a supplier and/or factory is unwilling to improve, we will stop the collaboration permanently.
In 2017, we conducted 344 audits and re-audits among our suppliers in Asia.
Supplier engagement and capability building
We consider our internal product and social compliance processes critical tools to ensure compliance in our supply chain. But we have also learned that to drive genuine improvements, we must combine these processes with proactive capacity building and training of our suppliers and their factories.
In 2017, we took a big step in enabling a closer engagement with our suppliers by establishing a local Zebra office in Shanghai. Initially, the office will host our quality and social compliance teams to further strengthen our quality and social compliance programmes.
Also in 2017, we repeated a week of intensive product compliance, quality and social compliance training in Shanghai with 30 of our key suppliers, responsible for a large amount of our annual procurement.
The training included practical instructions on our requirements within product compliance, quality and social compliance as well as guidance on how to build management systems to monitor and promote performance among their core suppliers. We believe this cascading of capacity building and management systems is a precondition for sustainable change, and as such a strong supplement to verification via Zebra audits and controls.
Within CSR the annual training is complemented by individual dialogue meetings with our absolute top 4 suppliers responsible for more than 30% of annual procurement, throughout the year. Furthermore, bespoke training of these suppliers’ core manufacturers is an integral part of our preventive and corrective action activities. During 2017 we conducted trainings of more than 60 factories.
As a global company, we want and can do good for the communities where we operate. This includes creating employment and stores engaging in local charitable activities. At corporate level, we have partnered with, among others, the Red Cross in Denmark, the UK and Spain, as well as In Kind Direct in the UK. We donate a wide range of products to the organisations who then distribute further to people in need. For instance, via our collaboration with In Kind Direct, 452 charities across the UK have benefitted from our products, the majority focusing on child/youth care and community projects. From our warehouses in the EU, we have donated products of a total retail value of DKK 23.4m.
Our Environmental policy expresses our commitment to protect the environment and the climate by minimising our negative impact. A significant part of our impact derives from production in our supply chain. Consequently, our Supplier Code of Conduct further specifies our requirements for the environmental awareness and conduct of our suppliers.
Apart from seeking to minimise impact in the supply chain, we focus our resources where Zebra, as a retailer, has the highest impact. This includes reducing energy consumption in stores and offices, sourcing sustainable forestry products and minimising food- and other product waste via donations, as described below.
Sustaninable store inventory
When it comes to store furniture, we have promoted use of sustainable wood since 2012. At the end of 2017, approximately 96% of our stores have furniture made of FSC™ certified wood.
To minimise plastic waste and support a more sustainable plastic lifecycle, we have initiated a transfer to carrier bags based on 80% recycled materials. In 2018, all our plastic carrier bags will be of this type.
To minimise the environmental footprint of our stores, we began replacing traditional bulbs with LED bulbs back in 2013. Today we require that all new and refurbished stores install LED lighting. By the end of 2017, approximately 80% of our stores use LED bulbs.
Consistency and transparency is a key pillar in any responsibility work. We use our responsibility policy framework to clarify our positions, guide our decision-making and define expectations for our business partners. The framework comprises policies on business ethics, human rights, product safety and the environment. Within responsible sourcing, our Supplier Code of Conduct is the leading document. It has been complemented by policies on animal welfare, child labour and young workers, as well as home-workers. In 2017, we published our first transparency statement according to the UK Modern Slavery Act.
Our Business Ethics Code of Conduct outlines the ethical expectations to our employees. The Code is signed by all employees at Zebra A/S, all partners and subsidiaries, including their Headquarter staff, district and store managers. All our partners and the majority of employees in leadership positions at Zebra A/S have received face-to-face business ethics training.