Reebok 2006 Annual Report Download - page 68

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064 ANNUAL REPORT 2006 › adidas Group ›
Achieving Sustainable Compliance with Tailored Training
Our practices are geared to encourage suppliers to take
responsibility for compliance themselves in the longer term.
To achieve long-term sustainable compliance, we consider
training even more important than monitoring and policing
factories. Through training, factory managers become bet-
ter at communicating and creating the conditions for work-
ers to openly express issues that need improving. Therefore,
our SEA team offers specific training courses for suppliers’
supervisors and managers to help them apply our Standards.
Furthermore, we promote the establishment of sustainable
structures that actively involve the workers and manage-
ment of our suppliers, local employee associations and non-
governmental organizations. In this way, acceptable working
conditions become a routine part of business activities. In
2006, the SEA team conducted 173 (including Reebok) train-
ing sessions and workshops for suppliers, workers and adidas
Group employees (2005: 225, including Salomon excluding
Reebok). The training activities took place in our suppliers’
factories, in adidas Group offices and in regional workshops.
Assessing Non-Compliance through Monitoring Initiatives
The SEA team assesses compliance with our Workplace Stan-
dards by means of factory inspections. Team members also
act as change agents, actively advising our business partners
how to correct any instances of non-compliance and how to
prevent future non-compliance. Our SEA team collaborates
closely with other Group and brand functions such as Global
Operations, Marketing, Product Development and Human
Resources. It is directly involved in developing and updating
corporate policies and operating procedures related to social
accountability, product safety and compliance with environ-
mental laws and regulations. Our team members are repre-
sented locally in close proximity to supplier factories in Asia,
Europe, Middle East, Africa and the Americas. During 2006,
1,101 factory visits (including Reebok) involving management
and worker interviews, document review, facility inspections
and trainings, were conducted at different levels in our supply
chain (2005: more than 680 visits, including Salomon exclud-
ing Reebok).
External Independent Monitoring and Verification
In addition to the monitoring work of our SEA team, we value
independent assessment by third parties to demonstrate the
credibility of our internal program. In 1999, we joined the Fair
Labor Association (FLA), a non-profit multi-stakeholder coali-
tion of private corporations, non-governmental organizations
and universities. As a member, the adidas Group is subject to
external assessment by independent monitors, participation
in the FLA third-party complaint system and public reporting.
The organization publishes an annual report that includes a
transparent evaluation system for the results of participat-
ing companies. Following an extensive review of the Group’s
compliance program, the FLA accredited the monitoring
program of the adidas Group excluding Reebok in May 2005.
Reebok became the first company to receive this FLA desig-
nation when its footwear compliance program was accredited
in April 2004. In June 2005, Reebok’s apparel compliance pro-
gram was also accredited by the FLA. The programs apply for
re-accreditation every two years. Therefore, Reebok’s foot-
wear compliance program was re-accredited in October 2006.
Since joining the FLA, more than 200 Independent External
Monitoring (IEM) audits and verification visits were conducted
at adidas and Reebok suppliers.
Termination of Business Relationship as Last Resort
We work in partnership with our suppliers and give them
guidance and training where necessary to analyze the under-
lying causes of non-compliance and to implement corrective
measures. In case of continuous non-compliance with the
Workplace Standards, we see termination of the business
relationship as a last resort because, whenever possible, we
prefer to stay in partnership and to work from the inside to
help encourage factory improvements.