Partnership Approach

Our stakeholders are those people or organisations who affect or are affected by our operations. Companies do not operate in isolation from society and our stakeholders have a legitimate interest in the way we do business. adidas stakeholders are a diverse group and include the following:

• adidas employees
• Authorisers: government, trade associations, shareholders, Executive Board
• Business partners: unions, suppliers, service providers
• Workers in our suppliers’ factories
• Opinion-formers: journalists, community members, special interest groups
• Customers: professional athletes, distributors, retailers, consumers
• Peers: other multinationals, consumer goods companies and brands

The number of stakeholders is large and also subject to change periodically, for example due to specific issues or trends. In order to systematically identify these stakeholders, we use an extensive network of contacts - spanning across more than 60 countries - to pinpoint areas for dialogue and applicable parties to engage with. Using this feedback, we prioritise stakeholders based on criteria such as action radius, relevance, risk, willingness and capacity to engage. We also consider appropriate representation of different stakeholder groups. The prioritisation may change depending on the issue.

Operationally, this translates into a diverse range of engagements, including with local and international NGOs, labour rights advocacy groups, human rights advocacy groups, trade unions, investors, SRI analysts, national and international government agencies, and academics. adidas also participates in a series of long terms purpose-built fora and multi-stakeholder initiatives, including the Fair Labor Association (FLA) and the Bangladesh Accord, among others.

An analysis of adidas’ primary current stakeholder engagements is maintained on an ongoing basis and reviewed at least annually.

FORMS OF ENGAGEMENTS

Our policy towards our stakeholders is clear: we actively engage, we listen, we seek to understand their ideas and concerns and, where it is within our ability, we act. Relationship management ranges from passive to more active engagement, i.e. from informing to involving them. We engage with our stakeholders in a number of ways:

• Formal stakeholder consultation meetings/stakeholder dialogues with our industry peers, with workers, union representatives, non-governmental organisations (NGOs) and our business partners.
• Meetings with socially responsible investment (SRI) analysts
• Internal reporting and induction programmes with our employees
• Responding to enquiries from consumers, interest groups and the media
• Collaborating with other brands in joint initiatives or business forums
• Outreach to graduates and the academic community.

STAKEHOLDER MEETING REPORTS

In the following you find all reports from stakeholder dialogue meetings since 2001.

adidas holds strong relationships within the sustainability area. The following table summarises key collaborations and memberships of adidas in the sustainability area. We describe the principal reasons for our ongoing participation in each of these organisations.

As a company we support human rights and protect the environment. Therefore, our concerns over violation of human rights and negative environmental impacts, and the potential risks that these would pose to adidas, require our close engagement with governments in different countries.

For example, in partnership with the International Labour Organization (ILO), we engaged with the Cambodian government about the issue of prison labour. Together with other stakeholders, we signed a pledge calling for the Uzbek government to end the forced child labour happening every year in the cotton sector of Uzbekistan. In Indonesia we are in contact with the government to discuss the issue of foreign factory owners leaving the country and failing to fulfil their fiduciary duties during factory closures. And in Singapore, we were invited to offer our views on the role of business and human rights in a key workshop with ASEAN member states, which in turn led to our participation in an ASEAN business leaders round-table on human rights.

COTTON IN UZBEKISTAN

adidas is aware of and concerned about the social and environmental conditions that exist in certain areas of the cotton industry today. These conditions, in the worst cases, include child labour, human exposure to pesticides and environmental pollution. Due to ongoing concerns regarding the continued use of government-backed forced child labour during the cotton-picking season in Uzbekistan, we joined an alliance of international investors, brands and non-governmental organisations that urged the Uzbek government to eradicate this practice and to fully adhere to core conventions of the International Labour Organization.

In 2011, adidas along with several US and European companies representing a large number of brands and retailers signed a pledge calling for the Uzbek government to end the forced child labour happening every year in the cotton sector of Uzbekistan. While further maturing the traceability of our material, we have reminded our suppliers that we expect them to ensure, to the best of their knowledge, that no cotton and cotton materials used originate from Uzbekistan. Click here to find out more about the pledge.

PRISION LABOUR IN CAMBODIA

adidas joined five other major brands in writing to the Cambodian government to express concern over the reported development of a prison rehabilitation scheme that permits garments to be manufactured by prison labour. In the communications with the government, the international buyers shared their concerns over the need to ensure the integrity of global supply chains and the potential risks that stem from unauthorised subcontracting in the apparel sector in Cambodia.

Staff from the International Labour Organization’s (ILO’s) Better Factories programme – which monitors labour conditions in adidas supplier factories in Cambodia – provided us with regular updates on the situation and reached out to the government and other UN agencies, to obtain their perspectives and feedback. The brands’ concerns were formally acknowledged by the Minister of Commerce and were addressed through an inter-ministerial committee, which was formed to examine and safeguard against undisclosed or illegal subcontracting arrangements in the apparel and footwear industry. The Minister of Commerce subsequently made public the government’s efforts in regulating contract supply chains.

In the following please find some examples of our engagement with governments and public authorities:

We foster relationships with stakeholders from the civil society.

GREENPEACE DETOX CAMPAIGN

In 2011, Greenpeace International initiated the "DETOX Campaign" calling for the zero discharge of all hazardous and persistent chemicals at all points in global supply chains: from the cotton fields, to the mills and dye houses that make the fabric and the garment production. Greenpeace has directed its campaign primarily towards sporting goods companies and well-known apparel brands in the belief that they can act as a catalyst for change for the whole industry. As part of their campaign, Greenpeace demanded that targeted companies publish a formal commitment to support the goal of "zero discharge" and issue an individual roadmap specifying timelines and steps to meet this goal.

From the outset, adidas entered into an in-depth engagement process with Greenpeace. We publicly committed to support Greenpeace’s goal, but also stressed the fact that the management of chemicals in multi-tiered supply chains is a complex challenge, requiring many actors to play a role in achieving effective and sustainable solutions. In other words, that the change needed is of a scale that cannot be delivered by a single brand acting alone.

We therefore reached out and partnered with a group of like-minded brands to meet Greenpeace’s challenge. This coalition of brands has worked closely together to develop a comprehensive roadmap on how best to achieve zero discharge in our supply chains. In creating this roadmap, we have engaged with experts from the chemical industry and with other brands. Since then, more brands have joined us. Our vision is that the roadmap serves as a benchmark and that many more brands and other stakeholders will join us in our efforts. We firmly believe that collaboration is the key to success.

Click here to read more about our efforts when it comes to managing our chemical footprint.

Trade Unions and Freedom of Association in Indonesia

As one of the fastest-growing sourcing countries in Asia, adidas has witnessed steady progress and improvement in the workplace conditions in Indonesia. Nevertheless, we acknowledge and accept that our suppliers continue to face challenges as they strive to meet our Workplace Standards, as well as NGO expectations.

One area where we have engaged deeply with organisations such as Oxfam Australia, the ITGLWF, as well as local NGOs and unions, has been in the development of a Freedom of Association Protocol for Indonesia. adidas acted as the lead party in a supplier-brand caucus that was formed in 2010 to engage with Indonesia’s trade union movement, to develop a basic framework for the exercise of trade union rights in the workplace. A formal signing of the protocol took place in Jakarta in June 2011. The event was heralded by the international labour rights movement as a “historic pact” between sportswear brands, suppliers and trade unions.

We are hopeful that the protocol will set an important benchmark for suppliers and its provisions will close the gap in expectations and reduce misunderstandings between factory managers and trade union officials with respect to trade union activities, freedom of association etc., thereby improving the overall industrial relations environment. As part of our commitment to the FOA protocol, we have encouraged all of our suppliers to sign on to and agree to implement its requirements. adidas was also active in promoting the adoption of the protocol among other international buyers sourcing from Indonesia.

You can find the protocol here.

FURTHER EXAMPLES

In the following please find some examples of our engagement with civil society:

Corporate responsibility is an important topic at various sporting events around the world. Our brands are visible all over the world, especially through our presence at major sports events such as the Football World Cup or the Olympic Games. This draws attention to the way we do business and the conditions under which our products are made. Therefore, adidas is taking a proactive approach in engaging with stakeholders about its corporate responsibility practices, especially related to bigger sporting events where adidas is a sponsor. 

2015 LONDON DIALOGUE ON HUMAN RIGHTS IMPACTS OF MAJOR SPORTING EVENTS
Sport matters. It matters to the dedicated athlete who is trying to be the best he can be. It matters to fans all over the world as they follow their team. And it matters to us, because it lies at the heart of our business. For more than a decade we have been hosting stakeholder dialogues to gain insights and understanding of what matters to our stakeholders. In July 2015, we invited participants from academia, non-governmental organisations, UN agencies, and sports bodies to discuss The Human Rights Impacts of Major Sporting Events - the Role of Sponsors.

WHY THIS TOPIC, AND WHY NOW? When the UN Guiding Principles (UNGP) on Business and Human Rights were published in 2011 we made a public commitment to uphold those principles and the corresponding requirements in the revised OECD Guidelines for Multinational Corporations. In order to gauge human rights risks, the UNGP calls on business enterprises to identify and assess any actual or potential adverse human rights impacts with which they may be involved, either directly, or as a result of their business relationships. To properly assess risk, enterprises must utilise human rights expertise, as well as regular and meaningful consultation with potentially affected groups and other relevant stakeholders.

In 2013-14 we conducted a high level human rights risk mapping exercise of our business operations. The risk mapping forms part of our general human rights due diligence approach, which includes annual country risk appraisals, a third party complaint mechanism (see above) and associated remedial processes. The mapping exercise highlighted a number of potential risk areas, where more focused attention would be warranted. The human rights impacts arising out of our involvement in and sponsorship of major sporting events was one such area.

The London dialogue in 2015 focused on exploring the role of corporate sponsors in major sporting events with respect to upholding human rights and addressing the challenge of moving from principles to practice.  The intention was to help us move the bar on the issue, both internally and externally within the corporate sponsor community. With this in mind, the dialogue for the day broadly followed three core themes:

• The role of corporate sponsorship in major sporting events,
• Exploring the boundaries of responsibility on human rights, and
• Building Practical Action.

A full report of the 2 July, 2015 London Stakeholder Dialogue can be found here.

The dialogue identified both immediate short-term actions, as well as long term opportunities, for sponsors to engage with sporting bodies and other stakeholders over the human rights impacts of mega sporting events (MSEs). These are summarised below.

This critically important stakeholder feedback will help shape the company's future role and roadmap, as a sponsor, in responding to the human rights impacts associated with MSEs.

2014 WORLD CUP IN BRAZIL
As a long-term partner of FIFA, adidas regularly provides in-depth information about its sustainability programme to FIFA. We disclose supplier lists and share policies and guidelines with them and the public in general. With regard to the World Cup in Brazil, we are in close contact with non-governmental organisations and we also engage with public authorities so that we can closely follow any societal and environmental developments.

As is typical of major sporting events, we expect activities by advocacy groups before and during the upcoming 2014 World Cup in Brazil. We seek direct dialogue with all interested stakeholders and act upon any concern or allegation raised. In Brazil, we also support specific grass-roots community projects in cooperation with local partners. One such project is the "Ginga Social" initiative. This sports-based programme uses coaching to teach values and life skills to young people aged between 7 and 17. It will run from 2011 to 2014 in five low-income neighbourhoods in Sâo Paulo, Rio de Janeiro, Belo Horizonte, Porto Alegre and Salvador – FIFA World Cup 2014™ host cities.

Our partner organisation Gol de Letra helps local organisations implement the programme. Their "train the trainer" model equips local coaches to make an ongoing positive difference to the lives of vulnerable young people in their neighbourhood. The project will also invest in local sports facilities, vital in a country where 86% of its more than 190 million inhabitants live in cities where space for sports is often scarce and expensive.

2012 STAKEHOLDER DIALOGUE ON LONDON OLYMPIC GAMES (THE SUSTAINABLE OLYMPICS)
In preparation for the London 2012 Olympic Games, we hosted a stakeholder dialogue in London in May 2011 to capture a broad array of stakeholder views on adidas' role and responsibilities in relation to sponsoring major sporting events. Labelled as the world's first Sustainable Olympics, London 2012 presented new challenges as well as opportunities for the adidas.

It was the first Games to include a mandatory Sustainable Sourcing Code and a third-party complaint mechanism for companies supplying goods to the London Organising Committee of the Olympic and Paralympic Games (LOCOG). Building on our outreach from a stakeholder workshop in 2011, we continued to engage with key interest groups, including the UK's Trades Union Congress (TUC) and the International Textile, Garment and Leather Workers Federation (ITGLWF), among others.

As is typical of major sporting events, we saw a spike in the campaigning activities by labour rights groups – some held protests, others submitted petitions and a few staged stunts to take their message to the media and the public. Poverty and living wages featured prominently in the campaigns, as did freedom of association and working conditions in global supply chains.

In May 2012, the Play Fair Campaign, a civil society alliance, published a report called Fair Games? Human Rights of Workers in Olympic 2012 Supplier Factories highlighting issues and concerns over workplace conditions, stretching from Sri Lanka to the Philippines. Aided by our transparency in disclosing the locations of the factories making products for the London 2012 Olympic Games, the report featured many of our suppliers. Some of the issues raised in the report were subsequently used to form the grounds for complaints lodged under LOCOG's grievance mechanism. The complaint mechanism drew us into more in-depth and specific engagements with the TUC, ITGLWF, Labour Behind the Label, government agencies and other organisations in China and the Philippines. In 2013, we have been continuing our follow-up work in the Philippines which has been part of our formal commitments towards the complainants.

The media also played an active part in our engagement around the London Olympic Games, running stories on working conditions and wages in Bangladesh, Cambodia and Indonesia. Newspaper allegations over working conditions in Indonesia prompted an independent investigation by LOCOG, which reached very similar conclusions to our own findings.

We took all such allegations seriously and we immediately launched in-depth investigation into each issue raised. The results of our full investigations have been shared with LOCOG, who commissioned a third party to review our findings and conduct independent off-site worker interviews. The findings of that independent review are published by LOCOG on their website.