Suppliers’ feedback, Hong Kong
In 2007 the adidas Group hosted a one-day CSR workshop and stakeholder dialogue in Hong Kong. The purpose of the meeting was two-fold: to introduce the concept of CSR and its application within the adidas Group; and to obtain feedback on a variety of topics to help inform the development of the Group’s social and environmental strategies. Sixty managers and directors from a cross-section of suppliers attended, including manufacturing partners, material suppliers and international transportation and logistic operators. Some of the enterprises present were multinationals; others single, large-scale suppliers with one or more factories in Asia; most were publicly listed companies from Hong Kong and Taiwan.
The first half of the day focused more on information sharing from the perspective of adidas Group on our approach to CSR and why it is an important part of our relationship with suppliers. The second half of the day enabled adidas Group vendors to look more in-depth at specific issues related to:
- The environment
- The changing Chinese labour law
- Community investment
- Vendor perspectives on CSR in China.
The afternoon dialogue was facilitated by a Hong Kong social enterprise, CSR Asia. Labour, environmental and community experts from CSR Asia managed a series of parallel workshops, with suppliers participating in those breakouts that were of greatest interest to them.
The new labour law
In relation to the changing labour law in China, there are numerous supplier concerns such as:
- Lack of preparation time
- Staffing and employee relations (including contracts, retirement and social insurance, employee motivation and satisfaction, building effective relationships with employees, unions)
- Costs of change
- Concern over uncertainties
- An explicit desire to better understand the adidas Group’s interpretation.
Suggested actions which the adidas Group and suppliers could take included:
- Clear communication from the adidas Group regarding its ‘stance’, interpretation and expectations in relation to the new law
- Establishing a network for information sharing and dialogue
- Support for cost analysis to better understand the implications of the new law
- Developing a coordinated approach with other brands
- Capacity building.
Key concerns from suppliers in relation to the environment revolved around issues related to: water, energy usage, noise, wastage and packaging, designs, capacity and government regulations.
Suggested actions from participants that the adidas Group and vendors could take (depending on companies, sectors, etc.) included:
- Consider factoring environmental issues into prices
- Work with other brands to achieve change
- Educate consumers
- Develop environmentally friendly and ‘fair trade’ products
- Reduce excess packaging and hangtags
- Build capacity in the supply chain through workshops and other forums
- Consider approaches to deal with excess stock such as buying back
- Continue and further develop stakeholder dialogue
- Maximise orders, minimise samples and recycle where appropriate.
In relation to community investment as an aspect of CSR, there were varying degrees of interest and understanding of how to address this. Issues that were discussed included:
- Different levels of awareness and understanding
- Uncertainty over benefits
- Need for management buy-in and top-level support
- Lack of experience in working with the community
- Ad hoc versus systematic approaches
- Uncertainty over definitions
- Need to focus on labour issues
- How to involve government.
Actions that the adidas Group and vendors could take included:
- Leadership and encouragement
- Matching funds
- Training and capacity building
- Making available other resources on community investment
- Continued and increased stakeholder dialogue.
Summary of the findings
CSR is, by its nature, understood differently by different people and companies. For suppliers, issues such as employee well-being, motivation and retention, relationship with the community, the law, environmental concerns, health and safety and benefits were noted. Actions the adidas Group and suppliers could take which participants suggested included:
- Continuing to build a partnership approach (as opposed to a policing approach)
- Support for measurement, monitoring and evaluation to demonstrate costs versus benefits of CSR.
In all of the sessions there was a deep interest from the participants in what the follow-up might be from the adidas Group.
CSR Asia’s full report on the dialogue can be downloaded from our corporate website. During 2008 the adidas Group will prepare a short report offering feedback to suppliers on their views and suggestions.