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.
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.
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.
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.