2013 sustainability report

Transcription

2013 SUSTAINABILITY REPORT
table of contents
Letter from Scott Crutchfield, COO
2
Crocs’ Approach to Sustainability
3
Community
32
Crocs Cares
33
Retail Stores
Organizational Profile
4
34
Monetary Donations
Customer Satisfaction
4
35
Employee Community Engagement
Stakeholder Engagement
4
35
International Programs
Ethics and Governance
5
35
Biggest Accomplishments, Challenges, Opportunities
36
Crocs’ Sustainability Goals
6
Key Performance Indicator Table
8
About This Report
11
Workplace & Supply Chain
12
Our Factories
13
Our Workforce
14
Crocs’ Social Compliance Code of Conduct
15
Sourcing
19
Headquarters and Administrative Employees
20
Looking Ahead
20
21
Environment
37
Partnerships
38
Awards & Honors
38
Global Reporting Initiative Table
39
22
How a Shoe Is Made
23
Manufacturing Impacts
24
Facility Impacts
28
Greenhouse Gas Emissions Management
30
Transportation
30
31
crocs 2013 sustainability report
Recognition & Partnerships
page 1
letter from scott crutchfield, chief operating officer
factories and in those belonging to our
contract suppliers.
On behalf of everyone at Crocs, it’s my
pleasure to share with you our 2013
sustainability report.
At Crocs, our mission is to bring fun, color,
comfort and innovation to the world’s
feet. Part of the way we do that is through
responsible sourcing, manufacturing and
distribution processes that minimize our
environmental footprint and ensure a safe
and happy workplace for the people who
make our shoes. We also support the
communities where we live, work and do
business, and we strive to bring comfort
to people in need around the world.
Here are a few highlights from our
efforts in 2013:
•
Leveraging a new, global streamlined
social compliance audit form, we are
driving continuous improvement in our
social compliance program in all of our
owned and contract manufacturers.
•
Because employee safety is our first
responsibility, we bolstered fire safety
training and audits with all owned
factories and contract manufacturers
and conducted fire drills in all
manufacturing locations.
We updated our Social Compliance
Code of Conduct to better incorporate
the Fair Labor Association’s
Workplace Code of Conduct and the
Worldwide Responsible Accredited
Production principles. These represent
manufacturing workplace best
practices we follow, both in our owned
•
•
We achieved a 16 percent reduction
in the quantity of volatile organic
compounds (VOCs) produced per
pair of shoes, surpassing our target
of 10 percent. In 2014, we will continue
working to reduce VOCs by another
10 percent.
•
We completed our first inventory of
greenhouse gas (GHG) emissions for
our factories and headquarters. We
will use it as a baseline to plan for
future GHG mitigation.
•
We focused on re-using materials,
and an average of 6 percent of total
Croslite™ materials in each shoe were
reused Croslite™ scrap. Also in 2013,
we implemented a rubber scrap reuse
program at our primary rubber supplier.
•
•
On average, we create only 40 grams
of solid waste per pair of Crocs’ shoes.
We believe this to be among the lowest
in the footwear industry and we will
continue to seek progress in this area.
We opened our first LEED (Leadership
in Energy and Environmental Design)
-certified retail store in Syracuse, NY.
The store is certified at the LEED Silver
level and features a high-efficiency
LED lighting system and low-VOC,
sustainable building materials.
Community
•
Crocs donated more than 50,000 pairs of
shoes globally. Among other efforts, we
provided shoes to people in need in Haiti
and the Philippines and during disaster
relief efforts in Oklahoma, in New Jersey
and in Colorado.
•
In Colorado, Crocs employees spent more
than 200 hours volunteering for flood
cleanup. We also fed more than 1,000
people in need through our sponsorship
of a local food truck.
Environment
•
reducing our cost of bulb replacement
by 66 percent.
These are just a few of the ways Crocs
worked to be a responsible corporate citizen
in 2013. I encourage everyone to read our full
report and share their thoughts with us at
[email protected]. Our responsibility
journey continues, and we look forward to
more progress in the year ahead.
Sincerely,
Scott Crutchfield
Chief Operating Officer
Crocs, Inc.
We’ve switched to LED light bulbs
in 70 percent of our retail stores,
page 2
1
OUR
APPROACH
CROCS’ APPROACH
TO SUSTAINABILITY
With a spirit of innovation,
ingenuity and creativity,
we’re always striving
to be better. It’s this
spirit that guides our
efforts to operate in a
manner that respects and
enhances our people,
our environment and our
global community.
page 3
OUR APPROACH
ORGANIZATIONAL PROFILE
Crocs makes
more than
300
We didn’t tell people its purpose or how to
wear it. We simply put it out there and let
the world decide what to do with it.
different styles of
footwear for men,
women and children.
Turns out people — millions of people —
simply like being comfortable.
Crocs has approximately
600
owned and managed
retail stores.
Crocs works in
more than
90
From the very beginning, Crocs has always
been a little different. We’re colorful,
bold and innovative. We’re not afraid
to challenge conventions or push the
boundaries — all in the name of fun.
That spirit drives the products we make —
and the decisions we make. We don’t think
of sustainability as a practice to follow —
we think of it as part of our everyday work:
to make the world a more comfortable
place.
Customer Satisfaction
countries
with the help of more than
4,000
employees.
Crocs has corporate offices in
Niwot, Colorado, in addition to
Hong Kong, England, Brazil and
Amsterdam.
Crocs didn’t set out to create a shoe to
help people run faster or jump higher. We
just created a shoe that was really, really
comfortable. Nothing else looked like it.
Nothing else felt like it.
Crocs exists because of our customers.
To best serve them, we use surveys,
interviews, social media and online
product ratings to improve customers’
experiences in our retail stores, on our
websites, with our product and when
contacting our customer service centers.
We share the results throughout the
company and use them to improve our
business. For instance, our global return
policy was crafted using feedback from
our customers. We are proud of the fact
that our customer satisfaction rating is
over 80 percent globally.
TURNS OUT PEOPLE
— MILLIONS OF PEOPLE —
SIMPLY LIKE
BEING COMFORTABLE.
Stakeholder Engagement
Our stakeholders play an important
role in the success of our company. We
engage internal and external stakeholders
throughout the year both formally and
informally through scheduled meetings,
calls, surveys and ongoing dialogue.
We categorize our stakeholders in the
following groups:
> Employees
> Customers
> Investors and analysts
> Suppliers
> Advocacy organizations
> Industry groups
page 4
OUR APPROACH
ETHICS AND GOVERNANCE
We are committed to the highest ethical
standards, and our Business Code of
Conduct and Ethics applies to all Crocs
employees and representatives. The
Code sets guidelines for ensuring equal
opportunity, ensuring a harassmentfree workplace and guarding against
conflicts of interest. In each country
where we operate, we follow all Federal
Trade Commission Truth in Advertising
policies in our marketing practices and
empower our country teams to customize
advertisements for the local culture.
Compliance Council
Crocs’ Compliance Council oversees our
social and environmental compliance. The
Council meets approximately once a month
to discuss important compliance issues
such as human resources, product quality,
environmental concerns and data security.
The Council includes representatives from
across the company who report to the
Board of Directors and collaborate with
internal departments to drive our social
and environmental work. Additionally,
we demonstrate our commitment with
our annual Corporate Compliance and
Ethics week.
We are committed to
the highest
ethical standards,
and our Business Code of Conduct
and Ethics applies to all Crocs
employees and representatives.
page 5
OUR APPROACH
CROCS’ SUSTAINABILITY GOALS
Following our first sustainability report in 2012, we are benchmarking on 2013 goals and committing to multiple new goals for 2014.
2013 Goal
Progress Toward 2013 Goal
2014 Goal
In 2013, all owned and contract factories in Mexico, Italy,
China, Vietnam and Bosnia agreed to our new, universal
social compliance audit form.
Implement streamlined audit survey to all
owned and contract factories.
In 2013, our tier one contract manufacturers – three factories
in China, two in Vietnam – scored an average of 86 percent,
with none below a score of 82 percent – on our audit survey,
which covers 145-plus environmental, social and corporate
governance indicators.
Enhance social compliance performance
throughout our supply chain.
Streamline our social compliance audit
process across all owned factories and
contract manufacturers.
All factories are being audited to ensure that they
meet the Supplier Code of Conduct and comply with
laws and regulations. Our goal for 2013 is to ensure
that our rigorous audit process is in place for all
factories.
Enhance social compliance performance
throughout our supply chain.
Our goal for 2013 is to reach 90 percent
compliance for our contract manufacturers on the
Environmental, Social and Corporate Governance
Audit Survey (Audit Survey), which consists of
125-plus questions pertaining to various business
elements.
We have reestablished our goal and remediation plans are in
place to improve scores before the next audit.
By the end of 2014, all factories – owned and
contract – will be regularly audited on our Crocs’
Audit Survey to ensure compliance with Crocs’ Code
of Conduct.
By the end of 2014 and every year that follows, each
contracted factory will score 90 percent or higher
on our Audit Survey, which is comprised of 145+
questions pertaining to factories’ performance on
environmental, social and governance indicators.
The most common reason for scores lower than 90 percent
were operational in nature. This included one instance of
improper ventilation, two occurrences of waste separation
issues, three instances of improperly locked exits and some
minor EH&S issues.
Environment
MATERIALS
Reduce annual VOCs by 10 percent in 2013
against our 2012 baseline.
We aim to reduce our VOC emissions to 24.3 grams
per pair in 2013, a 10 percent reduction over our 2012
baseline of 27.0.
We exceeded our goal. We reduced average VOCs per
pair of Crocs to 22.6 grams, a 16 percent reduction over
our 2012 baseline.
Reduce average VOCs by 10 percent in 2014
over our 2013 baseline and 25 percent over
our 2012 baseline.
Through the use of water-based adhesives, we aim
to reduce our VOC emissions to 20.3 grams per pair
in 2014, a 10 percent reduction over our 2013 VOC
emissions of 22.6 grams per pair.
page 6
OUR APPROACH
2013 Goal
Progress Toward 2013 Goal
2014 Goal
In 2013, we increased the amount of Croslite™ scraps used in
new products. On average, 6 percent of the total Croslite™
used in each shoe is reused.
Increase percentage of reused Croslite™
material content to 6.5 percent.
In 2013, we formalized and initiated a rubber scrap reuse
program with our primary rubber supplier in Asia.
Reuse 5 percent rubber scrap in factories
with compression molding processes.
Environment
WASTE
Increase percentage of reused Croslite™
material content to 10 percent.
Croslite™ material is what gives the shoes their
bounce with each step. Our goal is to increase the
percentage of Croslite™ material scraps used in new
products to 10 percent, up from the 5 percent 2012
baseline.
Formalize rubber scrap reprocessing &
material scrap take-back programs.
While reducing Croslite™ scrap is our first goal,
we also consume rubber and are setting a goal to
formalize a program to reuse excess rubber. This
cuts material use, which reduces our impact on the
environment and benefits our bottom line.
Our goal is to increase the percentage of Croslite™
material scraps used in new products to 6.5 percent.
In the manufacturing process we produce scraps
of rubber. We can reuse this scrap in new shoes
through a compression molding process. In 2014,
we will expand our rubber scrap reuse program and
reuse 5 percent of rubber scrap in our manufacturing
processes.
Ensure our solid waste per pair of shoes does
not increase from 2013 baselines.
Our shoe designs become more complex each year,
often resulting in varying levels of produced waste.
In 2016*, we will ensure our solid waste per pair of
shoes does not exceed 2013 levels.
*Given our product creation calendar, we are better able to
influence new style innovation in 2016.
GREENHOUSE GAS EMISSIONS
Conduct first greenhouse gas (GHG)
emissions inventory.
In 2013, we conducted our first greenhouse gas emissions
inventory, which included corporate headquarters and
manufacturing emissions of our owned and contracted
factories.
Expand greenhouse gas (GHG) emissions
inventory.
Drive sustainability further into the core of
our business.
In 2013, we engaged with the University of Denver to identify
topics of focus for the company throughout the year.
Leveraging our sustainability platform, drive
connectivity throughout our organization.
We will continue our work with the University of
Denver Executive MBA program to identify ways to
drive sustainability further into our business.
Also in 2013, we hosted an intensive planning session where
the sustainability leader met one-on-one with leaders
from relevant departments across the business to talk
about sustainability and review primary challenges and
opportunities.
In 2014, we will report sustainability progress
towards key objectives with Crocs footwear
innovation counterparts via formal quarterly
meetings.
An important part of our environmental footprint is
our GHG emissions. We will establish and publish our
benchmark inventory on corporate headquarters and
manufacturing emissions at our factories in 2013.
Building on the benchmark established in 2013, we
will expand our GHG emissions inventory in 2014.
Governance
page 7
OUR APPROACH
KEY PERFORMANCE INDICATOR TABLE
Indicator
2012
2013*
Total number of social compliance audits
Total audits completed: approximately 125 for Asia
manufacturers
-T
otal number of audits completed for contract
manufacturers and suppliers in Asia
Compliance score
Percent compliance for Tier 1 contract
manufacturers: 86 percent average, with no scores
below 82 percent
-P
ercent compliance for contract manufacturers on
audit survey
Human rights
- Number of child labor violations found (HR6)
Reported child labor violations: 0
Reported child labor violations: 0
- Number of compulsory labor violations found (HR7)
Reported compulsory labor violations: 0
Reported compulsory labor violations: 0
- Annual sick days per worker by factory
Annual sick days per worker
Annual sick days per worker
- Annual injuries per worker by factory
China 1: 0.200, China 2: 0, China 3: 0.200, Mexico: 0.200,
Italy: 4.400, Bosnia: 4.300
China 1: 0.152, China 2 0.016, China 3: 0.016,
Vietnam 1: 0.115, Vietnam 2: 0.038, Bosnia: 5.067,
Mexico: 0.195, Italy: 9.852
Annual injuries per worker
Annual injuries per worker
China factories: 0, Mexico: 0, Italy: 0.5, Bosnia: 0.3
China 1: 0.002, China 2: 0.003, China 3: 0,
Vietnam 1: 0.008, Vietnam 2: 0.005, Bosnia: 0.284,
Mexico: 0.019, Italy: 0.049
Employee safety (LA7)
- Annual serious injuries per worker by factory
- Total fatalities by factory
Annual serious injuries per worker
China 1: 0.003, China 2: 0, China 3: 0, Mexico: 0.004, Italy: 0,
Bosnia: 0
Annual serious injuries per worker
Total fatalities
China 1: 0.001, China 2: 0, China 3: 0.002,
Vietnam 1: 0, Vietnam 2: 0, Bosnia: 0, Mexico: 0, Italy: 0
China 1, China 2, China 3, Mexico, Italy, Bosnia: 0
Total fatalities
China 1, China 2, China 3, Vietnam 1, Vietnam 2, Bosnia,
Mexico, Italy: 0
Anti-corruption training (SO3)
-P
ercentage of employees trained in FCPA
anti-corruption policies and procedures
Percentage of employees trained:
Over 98 percent of Crocs employees completed
FCPA anti-corruption training
*2013 data includes two new contracted factories in Vietnam
page 8
OUR APPROACH
KPI TABLE
Indicator
2012
2013*
- Hazardous waste produced
Hazardous waste: 101,191 KG (111.5 tons)
Hazardous waste: 105, 211 KG (105.2 tons)
- Non-hazardous solid waste produced
Non-hazardous waste: 1,435,879 KG (1582.8 tons)
Non-hazardous waste: 1,866,510 KG (1866.5 tons)
Weight of downcycled: 46,176 KG (50.9 tons)
Weight of downcycled: 219,747 KG (217.7 tons)
Weight reclaimed: 330,453 KG (364.3 tons)
Weight reclaimed: 286,739 KG (286.7 tons)
Percentage of reused Croslite™ material: 5%
Percentage of reused Croslite™ material: 6%
Average VOCs per pair: 27.0 grams
Average VOCs per pair: 22.6 grams
Total energy use in factories:
100,960,894,400 (Kilojoules)
Total energy use in factories:
266,341,078,699 (Kilojoules)
Total energy use in headquarters: 730,400 kWh
electricity & 36,970 therms of natural gas
Total energy use in headquarters: 585,971 kWh
electricity & 34,220 therms of natural gas
Average energy used per pair of CrocsTM shoes
produced: 1.6 kWh per pair
Average energy used per pair of Crocs™ shoes
produced: 1.5951 kWh per pair
Environment
Total waste (EN 22)
Waste management (EN 22)
-W
eight of scrap material that is downcycled into
other products
- Weight of scrap materials reclaimed
-P
ercentage of reused Croslite™ material used in
shoes
Toxics (EN 20)
- Average VOCs per pair of Crocs™ shoes produced
Energy sse (EN 3)
- Total energy use factories
- Total energy use headquarters
-A
verage energy used per pair of Crocs™ shoes
produced
Greenhouse gas emissions (EN 16)
Total greenhouse gas emissions: 64,347 tons CO2-e
-T
otal greenhouse gas emissions (direct and
indirect) of owned manufacturers, contract
manufacturers and headquarters
Water use (EN 8)
- Total water use headquarters
Total water withdrawal by source in factories (m3):
Surface water: 0, ground water: 16,469, water
utilities: 457,086, rainwater: 0, all water sources:
473,555
Total water withdrawal by source in factories (m3):
Surface water: 0, ground water: 14,685, water
utilities: 1,229,524, rainwater: 0, all water source:
1,244,209
- Average water used per pair Crocs™ shoes
Total water use in factories: 125,099,000 gallons
Total water use in factories: 324,806,000 gallons
Total water use in headquarters: 1,606,000 gallons
Total water use in headquarters: 1,734,000 gallons
- Total water withdrawal by source factories
- Total water use factories
page 9
OUR APPROACH
KPI TABLE
Indicator
2012
2013*
Total monetary donations: $1.1 million
Total monetary donations: $165,000
Community
Giving
- Total monetary donations
Volunteerism
- Employee volunteer hours
Headquarters employee volunteer hours: Over 200
page 10
OUR APPROACH
ABOUT THIS REPORT
This report aligns with the Global Reporting Initiative (GRI) G3.1 guidelines at a Level B.
A full table is in the back of the report. We followed GRI materiality guidance for
identifying the topics most relevant to Crocs. During an intensive process, we interviewed
leaders representing departments from across the global organization including supply
chain, internal audit, factory management, retail, sourcing, corporate real estate,
philanthropy and giving, consumer experience, legal and the Chief Operating Officer.
We also asked external stakeholders for their input and reviewed information and best
practices from industry associations. These stakeholders comprise the categories listed
under our Stakeholder Engagement section (pg. 4). This report captures the most
relevant topics identified by our stakeholders, including social compliance, sourcing and
environmental impacts of manufacturing, which topped the list.
“It has been a pleasure to
work with Crocs because
of their corporate culture
and a team dedicated to
sustainability through
execution, measurement,
continuous improvement
and transparency via GRI
reporting.”
-B
ahman Paul Ebrahimi, Ph.D.
Daniels College of Business
University of Denver
The 2013 data covers our eight largest owned and contract factories. This includes two
owned factories — one in Mexico and one in Italy — and six contract manufacturers — three
in China, two in Vietnam and one in Bosnia. We excluded any factory that produces less
than 5 percent of our total product.
We’ve also included data from our United States headquarters and certain global retail
stores, where noted. In 2014, we are considering whether to incorporate these less
significant data sources.
In this report, we organize our information under three pillars:
> Workplace and Supply Chain
> Environment
> Communities
page 11
2
WORKPLACE
& SUPPLY
CHAIN
We believe our
company succeeds
when Crocs employees
have fair and safe
working conditions.
Accordingly, we
take seriously our
responsibility to the
people who work with
us around the world.
page 12
WORKPLACE AND SUPPLY CHAIN
OUR FACTORIES
ITALY
CHINA 1
SHENZHEN,
CHINA
81 employees
3,563 employees
BOSNIA
286 employees
CHINA 2
DONGGUAN,
CHINA
9,390 employees
CHINA 3
YANGSHAN,
CHINA
688 employees
VIETNAM 1
BINH DUONG,
VIETNAM
MEXICO
1,067 employees
1,435 employees
VIETNAM 2
TAY NINH,
VIETNAM
1,926 employees
CROCS OWNED
CONTRACT MANUFACTURER
page 13
China 1
China 1
female to male
male
age range
female to male
31 male
- 40
40+
18 - 25
26 - 30
female
OUR WORKFORCE
China 2
Male
female to male
female
China 1
31 - 40
male
40+
China 2
male
China 2
age range
China 2
female to male
31 -male
40
18 - 25 female to male
40+
26 - male
30
female
female
female
age range
18 - 25
26 - 30
age range
31
- 40
male
18 - 25
40+
26 - 30
female
31 - 40
40+
Vietnam 1
age range
female to male
31 - 40
18 - 25
male
female
40+
26 - 30
age range
m
female to male
31 - 40
male
40+
18 - 25
26 - 30
Vietnam 1
31age- range
40
female
40+
female to male
31 - 40
18 - 25
male
female
40+
26 - 30
age ran
18 - 25
26 - 30
China 2
female
male
female
age range
China 2
China 2
China 3 age range
female to male
Anhui female
Shaanxi
31 -male
40
18 - 25 female to male
40+
26 - 30
female
male
Vietnam 1
Guangdong
Guanxi
31 - 40
male
40+
female
age range
18 - 25
26 - 30
Vietnam 1
China 3
female
Sanxi
Hainan
Liaoning
Vietnam 1
Xinjiang
18 - 25
26 - 30
Hubei
31 - 40
male
40+
female to male
Hunanfemale
male
Jiangsu
age range
female
Shanghai
Jilin
Shangdong
Taiwan
female
age range
female
to male
31 - 40
18
- 25
male
female
40+
26 - 30
Mexico
female to male
40+
Jiangxi
mexico
male
18 - 25
26 - 30
age range
Vietnam 1
m
age range
female
age ran
age
rangeto male
female
to
male
31 - 40
18 - 25
female
31
- 40
40+
18
male
female 18 - 25
26-male
-25
30
40+
26 - 30
26 - 30
age range
female to male
40
18 - 25age range 31 -male
female
40+
26 - 30
31 - 40
18 - 25
40+
26 - 30
Vietnam 2
age range
female
mexico
31 - 40
male
40+
female
female to male
female
31 40+
18 - 25
26 - 30
Vietnam 2
female to male
31 - 40
male
40+
18 - 25
26 - 30
Vietnam 2
Zhejiang
31 -male
40 18 - 25
26 - 30
Vietnam 1
China 3
female
China 3
Fujian
mexico
male
age range
female
Vietnam 2
female to male
female to male
Heilongjiang
age range
female to male
31 - 40
female
40+
female
Vietnam 2
China 3
Vietnam 1
Hebei
age range
female to male
40
18 - 25 age range 31 -male
female to male
40+31 - 40
26 18
- 30- 25
male
female
40+
26
- 30
female to male
31 - 40
male
40+
mexico
Vietnam 2age range
female to male
31
- 40
18
- 25
female
male
age range
female to male
40+
26 - 30
31 male
- 40
18 - 25
female
40+
26 - 30
31 - 40
40+
18 - 25
26 - 30
age range
18 - 25
26 - 30
mexico
female to male
age range
Chongqing
male
Vietnam 2age range
age ra
18 - 25
26 - 30
Vietnam 2
age range
female to male
31 - 40
18 - 25
male
female
40+
26 - 30
Vietnam 1
age range
female
to male
31 - 40
18
- 25female to male
male
female
40+
26
31 -male
- 30
40
female
40+
female to male
Tianjin
Henan
female
Yunnan
Guizhou
18 - 25
male
26 - 30
Vietnam 1
China 3
female to male
age
range
female
to male
31 - 40
18 - 25
female
male
40+
26 - 30
Vietnam 2
31 - 40
40+
18 - 25
26 - 30
Gansu
female
China 3
China 2
Vietnam 1
female to male
age range
female to male
age range
female to male
age range
to male
31
-female
40
female
male
18 - 25
male
31female
- 40
31 - 40
18 - 25
male
18 - 25
female
40+
male
female
26
30
40+
40+
26 - 30
26 - 30
female to male
male
31 male
- 40
40+
China 3
China 2
ale
female to male
18 - 25
26 - 30
female to male
18 - 25
26 - 30
mexico
age range
China 3
age range
China 3
ale
18 - female
25 to male 26 - 30
China 1
Vietnam 1
age range
31 - 40
18 - 25female to male
40+
26
31 -male
- 30
40
female
40+
male
China 3
China 2
female to male
age range
age range
female to male
male
18 - 25
female
31 - 40
18 - 25
male
female 26 - 30
40+
26 - 30
female to male
female
By age
female
China 1
China 3
ale
Vietnam 1
age range
female to male
31 - 40
18 - 25
male
female
40+
26 - 30
China 1
China 2
female to male
female
female to male
18 - 25
26 - 30
Female
China 1
male
Vietnam 1
age range
male
female
By gender
China 1
31 - 40
40+
China 2
female to male
By region (China only)
age range
18 - 25
26 - 30
female
Vietnam 2
age range
female to male
31 - 40
18 - 25
male
female
40+
26 - 30
age range
18 - 25
26 - 30
Mexico
age range
18 - 25
26 - 30
female to male
31 - 40
male
40+
female
31 - 40
40+
Vietnam 2
age range
female to male
31 - 40
18 - 25
male
female
40+
26 - 30
age range
18 - 25
26 - 30
female to male
31 -male
40
female
40+
age range
18 - 25
26 - 30
31 - 40
40+
Sichuan
crocs
2013
sustainability report
Vietnam
2
age range
female to male
Vietnam 2
page 14
Vietnam 2
age range
female to male
age range
THE 12 WRAP PRINCIPLES ARE:
1. Compliance with laws and
workplace regulations
2. Prohibition of forced labor
3. Prohibition of child labor
4. Prohibition of harassment
or abuse
5. Provision of compensation
and benefits
6. Obeying of working hour
limitations
7. Prohibition of
discrimination
8. Assurance of a safe and
healthy work environment
and housing
9. Freedom of association
and collective bargaining
CROCS’ SOCIAL COMPLIANCE
CODE OF CONDUCT
Our Social Compliance Code of Conduct
guides all operations. It applies to the
workers and management at our owned
factories, our primary and secondary
contract manufacturers, material suppliers
and distributors. The Code of Conduct
reflects industry best practices and
follows guidance from the Global Apparel,
Footwear and Textile Initiative (GAFTI)
— a consortium of apparel and footwear
companies committed to creating universal
industry standards.
In 2013, we updated our Code of Conduct
to better incorporate the Fair Labor
Association (FLA) Workplace Code of
Conduct and Worldwide Responsible
Accredited Production (WRAP) Principles.
> Employee Dormitory
>F
reedom of Association &
Collective Bargaining
For 2013, we streamlined our audit
process across all owned and contract
manufacturers. All factories agreed on our
new, universal audit form, and our goal for
2014 is to implement the process at all of
our contract manufacturers.
THE FIVE-STEP PROCESS
1. Conduct Audit
2. Review Violations
Our Code of Conduct is only effective if
we enforce it. We conduct stringent audits
and regularly monitor our compliance. Our
factories and contract manufacturers are
subject to our thorough 145-plus question
Social Compliance Audit survey which
focuses on:
3. Develop Corrective Action
Plan
> Compliance with Laws
11.Compliance with
applicable customs laws
> Forced Labor & Child Labor
> Environment
Auditing and Monitoring
10.Compliance with
environmental rules,
regulations and standards
12.Maintenance of security
procedures to ensure nonmanifested items are not
included in shipments
> Employee Health & Safety
> Employment Relationship
> Harassment & Abuse
> Discrimination
> Compensation & Benefits
> Overtime
4. Implement Corrective
Actions
5. Verify Completion of
Corrective Actions
As a global company, our biggest
impacts exist in our international supply
chain — comprising both our contract
manufacturers and our material suppliers
and distributors. Because our owned
factories are smaller and heavily audited by
third parties through licensing agreements,
we focus our internal audits on our
contract manufacturers. The majority of
our contract manufacturers are audited
quarterly, and we conduct follow-up audits
as needed based on performance.
page 15
Customer and Third Party Audits
In addition to internal audits, outside
organizations regularly audit our factories.
For example, licensors sometimes leverage
third party auditors to inspect our factories
for compliance against their social
compliance standards. Specifically, in 2013,
third parties completed audits, as per our
agreement with a major licensor, at some
of our factories. The Fair Labor Association
also met with our staff in China to ensure
that we follow best practices in all of our
factories. They did not find major violations
in our factories.
Findings and Focus Areas
In 2013, we conducted approximately 125
audits with our contract manufacturers
and suppliers, nearly half of which were
completed at our contract suppliers in
China and Vietnam.
In 2013, we conducted
approximately
125 audits
with our contract
manufacturers in Asia.
In general, our auditors found that our
factories were in compliance with the
rigorous sustainability standards of
our Code of Conduct. In 2013, factories
achieved an average score of 86 percent,
with no score below 82. Because we fell
short of our goal of 90 percent compliance,
we have reset the 90 percent goal for 2014.
The most common reasons for scores
lower than 90 percent were related to
factory operations, such as one instance of
improper ventilation, two occurrences of
waste separation issues and three instances
of improperly locked exits. Remediation
plans are in place to improve scores before
the next audit.
AUDIT FOCUS AREAS
> Compliance with Laws
> Employment Relationship
> Forced Labor & Child Labor
> Harassment & Abuse
> Discrimination
> Compensation & Benefits
> Overtime
> Employee Health & Safety
> Environment
> Employee Dormitory
> Freedom of Association &
Collective Bargaining
Employee Safety
In 2013, our employee safety efforts
focused on implementing the Worldwide
Responsible Accredited Production
(WRAP) Principles and on bolstering fire
safety training and audits in all owned and
tier one factories.
Fire safety now includes regular drills,
firefighter equipment training and
maintaining free access to emergency
exits. In 2013, all of our factories, both
owned and contract, conducted fire drills.
Additionally, our factories are housed in
cement structures, which provide structural
integrity and help impede fire risk.
page 16
2013
Annual Sick Days
Taken Per Worker
Annual Injuries
Per Worker
Fatalities
China 1 0.152
0.002
0.001
0.000
China 2
0.016
0.003
0.000
0.000
China 3
0.016
0.000
0.002
0.000
Vietnam 1
0.115
0.008
0.000
0.000
Vietnam 2
0.038
0.005
0.001
0.000
Bosnia
5.067 0.284
0.000
0.000
Mexico
0.195
0.019
0.000
0.000
Italy
9.852
0.049
0.000
0.000
Fire safety is a priority at all of our
factories. Due to the flammability of
some products handled in our Mexico
factory, preventive measures are
extremely important. There, we regularly
ensure that firefighting systems meet
legal requirements, and we conduct fire
safety audits overseen by three different
government entities. Additionally, Crocs
Mexico has increased employee firefighting
equipment training.
Labor Protections
Our Code of Conduct follows the Fair
Labor Association’s 60-hour work week
limit. The standard is clear and well-known
within our teams. By law, China sets limits
at 432 hours of overtime work per year,
which ends up limiting work weeks to
approximately 48 hours a week. We ensure
that workers who work over 40 hours
receive proper payment for their time.
We found no evidence of child labor
in owned and contracted factories in
2013, nor did Disney when it audited our
Annual Serious
Injuries Per Worker
factories. We ensure everyone working in
our factories is of legal working age by
strictly scrutinizing and identifying workers
to guard against falsified identification
cards.
We maintain a good work environment by
offering our workers a fair wage. In 2013,
factory wages increased by approximately
20 percent in China factories.
As applicable under local law, we also
provide five social insurance payments to
China factory workers: injury, retirement,
unemployment, medical and maternity.
Workplace Quality
Maintaining a good-quality workplace for
our factory workers is very important to
our success. In 2013, we rolled out our
“5S” cleanliness program in Asia factories
and internal social compliance monitoring
systems.
One area in which we take specific care to
ensure workplace quality is noise exposure
prevention. As a first line of defense, we
page 17
provide ear plugs in all of our factories.
Where possible, we take additional steps
to minimize ambient noise. For example,
in one factory we reduced noise in
workspaces by building walls around the
area where EVA was compounded.
Employee Grievance Mechanisms
Crocs is committed to
PROVIDING
EQUAL
OPPORTUNITIES
in the workplace at all our
factory locations.
Our program for people with
disabilities in our China 3
factory is one way we show
this commitment. At the
China 3 factory, we provide
training and assistance to
all of our employees with
disabilities.
It is essential that factory workers know
their rights and speak up if they have
concerns. When workers are empowered,
overall factory conditions improve. To
that end, we post our Code of Conduct
in the local language on the factory
work floor, where it is visible to all. We
also provide factory workers several
mechanisms for notifying us of challenges
they face. Factories have terminals where
employees can anonymously email or call
in complaints and feedback, and boards
where workers can post letters with
concerns. Additionally, factories now have
hotlines for employees to anonymously
discuss or report concerns.
We will continue to monitor grievance
filings in 2014 to ensure that progress is
made in these two areas and to identify
additional problem areas that may arise.
Remediation
If our audits reveal any areas where a
factory or supplier is not living up to Crocs’
Code of Conduct, we work with factory
managers to address the problem at its
roots so that it won’t happen again.
No matter how minor the violation, a
remediation program always begins right
away. The chief operating officer reviews
the most serious issues immediately and
we take action.
We immediately institute a Corrective
Action Plan (CAP) to remedy any violations
or low audit scores. CAPs are tailored to
each factory’s needs and unique cultural
and legal contexts to ensure that the best
solution is found as soon as possible. We
work with factory management using a
root cause analysis to determine reasons
for any violations and develop a plan to
address and prevent future violations. We
ensure each factory CAP is implemented
properly through timeline requirements,
photographic evidence and follow-ups in
the next quarterly audit cycle.
Training and Capacity Building
Instilling a culture of social compliance at
our factories is important to our success.
Our factory managers need to know and
understand our Code of Conduct so they
can quickly identify potential violations.
We require our factory management and
factory auditors to attend training on the
Code of Conduct.
Throughout our supply chain, we also
host social compliance trainings and Tool
for Accountable Supply Chains (TASC)
trainings. Additionally, we provide
computer training and language classes
to factory workers and management.
Our training program is generally the
same at owned factories, as it is in our
contract manufacturers. While we have
direct control in our owned factories, our
contract factories are not under our sole
authority. At these, we place an even
greater emphasis on training. We don’t
leave anything to chance.
When workers are
empowered,
overall factory conditions
improve.
page 18
We centralize
sourcing governance
and ensure that we
have a dedicated
list of suppliers in
compliance with our
standards.
SOURCING
We try to source materials only from
suppliers who share our values. In 2013,
we took another step toward screening
suppliers by consolidating our sourcing
procedures. We use a single, central
database of approved suppliers, whom
we know comply with Crocs’ social and
environmental specifications.
We centralize sourcing governance and
ensure that we have a dedicated list of
suppliers in compliance with our standards.
Doing so gives us more control over quality
as well as the social and environmental
impacts of the products and materials we
purchase. We audit existing vendors on
these criteria, similar to the way we audit
our factories.
To become an approved Crocs’ supplier, a
vendor must meet our social compliance
audit and restricted substance standards.
If we find any areas of non-compliance,
they must work with us to address these
issues before they can become a Crocs
vendor. We also evaluate potential
suppliers based on their environmental
performance (e.g., whether they have their
own environmental programs or not).
In addition to providing a list of approved
vendors, our centralized material sourcing
system allows us to find the nearest
supplier that meets our social and
environmental requirements. Using local
suppliers also helps the environment by
eliminating unnecessary shipping.
page 19
HEADQUARTERS AND
ADMINISTRATIVE EMPLOYEES
Crocs’ employees work out of our
headquarters in Colorado, and in
Singapore, Netherlands, Japan, China,
Brazil, Mexico and more than 600 retail
stores globally.
Healthcare, Benefits and
Work-Life Balance
We provide our headquarters and
administrative employees with good
benefits, including vision, dental, workers’
compensation, maternity leave, retirement
options, vacation, time-off and medical
insurance.
LOOKING AHEAD
Crocs is always striving to improve
our processes to ensure that suppliers
adhere to our social compliance
standards. Over the next few years, we
will continue to conduct unannounced
internal audits at our factories and
supplier facilities to ensure that our
auditors receive an authentic picture of
working conditions. We are also going
to focus specifically on improving
fire safety practices and encouraging
factories to set up internal social
compliance systems.
Talent Development
Our employees are our greatest resource.
That is why we focused on building the
next generation of leaders at Crocs in
2013 and will continue that focus in 2014.
In an employee survey, 98 percent of
respondents said that they are interested
in professional development and growth
opportunities. One-hundred percent of our
full-time employees receive annual reviews
and professional development advice.
Crocs is always striving to
improve our
processes
to ensure that suppliers
adhere to our social
compliance standards.
We also focus on identifying employees
who aspire to leadership, and we
provide them opportunities to learn.
Our executives nominate rising stars
companywide who receive additional
career development opportunities. They
receive individual development plans
(IDPs) and mentors help them excel.
Our Crocs Leadership University, “Crocs
U,” is a global program that works to
provide our employees with opportunities
for leadership development. Facilitators
across our operations actively engage with
employees interested in furthering their
careers. Additionally, the University of
Denver provides classes for employees
at our U.S. headquarters.
page 20
Biggest Accomplishments
•
Enforcement of our fire safety trainings and protocols was the biggest social compliance
accomplishment in 2013. We focused in particular on keeping walkways to emergency
exits clear and rehearsing fire escape protocols by conducting drills at least once per
year.
•
All of our owned and contract manufacturers agreed to a new universal streamlined
internal social compliance audit form.
Biggest Challenges
•
Each of our factories is a little bit like a college campus. There are so many people
engaged in so many simultaneous activities that it makes accidents possible. Ensuring
employee safety is a top priority.
Biggest Opportunities
•
In 2013, we refined our social compliance standards to align further with the
international best practices set forth by the Fair Labor Association (FLA) and Worldwide
Responsible Accredited Production (WRAP). We also continued our engagement
with the Global Apparel, Footwear and Textile Initiative (GAFTI). Social compliance
challenges are often system-related and faced by our other apparel and footwear
companies as well. By addressing them as an industry, we provide better workplaces.
Furthering industry collaboration and international standardization in the coming years
is a big opportunity.
•
In 2013, we expanded our operations into two factories in Vietnam. We foresee
continued growth opportunities in Vietnam, including opportunities to share best
practices among our factories.
Crocs’ owned factory
– Leon, Mexico
page 21
3
ENVIRONMENT
At Crocs, we have two equally
important reasons for embracing
environmental sustainability.
First, minimizing waste and
saving energy just makes good
business sense. Doing so means
that our operations are more
efficient and our products are
more innovative. Second, we
genuinely believe that being
good environmental stewards
is part of the commitment we
make to our employees and
the communities in which
we operate.
page 22
How a shoe is made
ENVIRONMENT
Product creation process timeline
HOW A SHOE IS MADE
Product creation process timeline
Design
Design concept
review
- Design concepts
Production
Development
Initial review
Sales meeting
- Development
specs
- Sales samples
- Catalog
- Packaging
prototypes
- Initial color palette
Final design
review
- Final design
solutions
- Final color palette
- Final design pack
- Packaging
- Naming strategy
- Development costs
- Photography
- Price list
Final review
- Operational review
of all new products
- Order materials
- Final design
solutions
- Build time
- Final color palette
- Final factory
allocation
- Finalize color
- Global market
concepts
- Final design pack
Launch
- On-time delivery
- Marketing and
advertising
- Executive approval
- Packaging
- Naming strategy
- Development costs
page 23
ENVIRONMENT
Rubber (KG)
Leathers (KG)
Mesh (KG)
TPU - shells / rivets / components (KG)
Adhesives (KG)
Canvas (KG)
Counters (KG)
Lining (KG)
Reinforcement (KG)
Thread (KG)
Metal Rivets (KG)
Laces (KG)
PVC (KG)
MANUFACTURING IMPACTS
Materials
A pair of Crocs™ shoes contains up to
50 different materials. We strive to use
materials with lower environmental impact
whenever they are available and of the
same quality as existing materials. By
consolidating our list of approved vendors
in 2013, we laid the foundation for the
increased use of preferred materials in the
future. We also have a fuller picture of the
environmental impacts of materials we use.
Environment data table
300,000
286,739
275,000
Weight in Kilograms (KG)
250,000
219,747
225,000
When we choose materials, we consider
many different environmental factors.
Among these considerations is the need
to decrease the use of toxic materials
and increase the amount of reused scrap
material that go into Crocs™ shoes. For
example, our Ocean-Minded™ line uses
repurposed rubber.
The signature compound that makes Crocs
so comfortable is Croslite™ material. We
pay special attention to minimizing the
environmental impacts of this material.
In 2012, we set a goal to increase the
percentage of CrosliteTM material scraps
used in new products to 10 percent, up
from our 5 percent baseline. In 2013, an
average of 6 percent of the Croslite™
material in shoes was reused. Our goal
for 2014 is to increase the percentage
of Croslite™ material scraps used in new
products to 6.5 percent.
We also reformulated some of our
Croslite™ material to eliminate dialkyl
peroxide. While dialkyl peroxide is a safe
compound, it created a “new shoe” smell
that our customers told us they did not like.
200,000
175,000
150,000
125,000
We are phasing out polyvinyl chloride
(PVC) from all children’s shoes and using
an alternative, thermoplastic polyurethane
(TPU) instead. All the TPU and PVC we
use is in compliance with the strictest
international standards for phthalates.
100,000
75,000
50,000
25,000
EVA (KG)
TOTAL FOOTWEAR
MATERIALS 2013:
24.5 M KG
0
Weight of
scrap
materials
reclaimed
Scrap material that
is ‘“downcycled”
into other products
page 24
ENVIRONMENT
Toxics
Energy Management in Factories
We apply rigorous standards to our
handling of toxic materials.
Managing energy use at our factories is
not only important for the efficiency of
our operations, but it is also important for
lowering our environmental impact and
greenhouse gas emissions.
Volatile Organic Compounds
In 2013, we reduced VOC emissions by an
average of 16 percent per pair of shoes.
This exceeded our goal of a 10 percent
reduction and reduced emissions from 27.0
grams of VOCs per pair to an average of
22.6 grams.
In 2014, we plan to reduce VOCs emitted
per pair by another 10 percent.
Adhesives
Biodiversity
Our Italy factory is the only
factory in close proximity
to areas of high biodiversity
value. The EXO Italy factory
is situated approximately 4
miles from Colli Euganei Park
in Padova, an area identified
as having important
biodiversity features. Our
relationship to this park is not
subject to any environmental
laws, but we are mindful of
our potential impact.
In 2013, we continued our transition to
water-based adhesives without sacrificing
quality. Water-based adhesives reduce the
use of harsh chemicals and eliminate offgassing that is harmful to workers. We still
encounter situations where water-based
adhesives do not produce customer-ready
shoe quality and we must use traditional
adhesives. Nevertheless, the results from
water-based adhesives are improving
rapidly. We will continue expanding the use
of water-based adhesives while innovating
improvements in their formulations.
Restricted Substances
Since Restricted Substances (RS) lists may
vary by country, we apply the strictest
RS standards of any country in which we
do business across all of our operations.
This ensures that we are in compliance
with every country’s guidelines, and it
underscores our commitment to the safety
and well-being of our workers and our
customers. To become an approved Crocs
supplier, vendors must meet all Crocs’
standards, and we use only restricted
substance-compliant materials.
The biggest challenge in energy savings
is the frequent changes in injection molds
and colors being used in the injection
machines. These changes slow down
manufacturing and increase machine idling
time, which uses more energy. In 2013, our
factories used 1.6 kWh of energy per pair
of Crocs™ shoes, which is equal to our
2012 baseline.
Direct energy consumption
by primary energy source:
Natural Gas: 688,952 MJ
Liquified Propane Gas (LPG):
47,608,340 MJ
(Fuel Oil) Diesel: 76,703,615 MJ
Petrol: 419,496 gallons
Petrodiesel: 348,891 gallons
Indirect energy consumption
by primary energy source:
Electricity (Kilojoules):
266,341,078,699
Electricity (kWh) per
pair of Crocs™ shoes:
1.6 kWh
page 25
ENVIRONMENT
Total water use for factories
by source (m3)
Rainwater: 0
Surface water: 0
Ground water: 14,685
Water Management in Factories
Hazardous Waste
In 2013, we used a total of 324,806,000
gallons of water at our factories. While
we continue to monitor water use at our
factories, most is used in the dormitories
where some workers choose to live.
Hazardous waste is disposed of through
proper channels, including governmentapproved disposal systems for hazardous
waste.
The employees’ personal water use, for
showers, cooking and other needs is on
the same meter as the water used for
manufacturing. Crocs does not wish to
inhibit or restrict personal water use of
our employees.
Waste Management in Factories
Solid Waste
Non-hazardous waste:
1,866,510 KG (1,866.5 metric tons)
Equivalent to:
560 Pick-Up Trucks
Water utilities:
1,229,524
Waste reduction is one of our top
environmental priorities in our factories.
We take a comprehensive view of waste
management and identify areas for
improvement from start-to-finish, from
reducing and reusing scrap materials in
shoe production to altering packaging in
order to minimize waste.
Innovations play a big role in solid waste
reduction. For example, we strive to create
shoes with more rectangular patterns,
eliminating rounded edges that generate
scrap material in manufacturing. We set a
goal to ensure our solid waste per pair of
shoes does not increase in 2016 from the
2013 baselines. Non-hazardous is disposed
of through local municipalities.
Hazardous waste:
103,211 KG (105.2 metric tons)
Equivalent to:
33 Pick-Up Trucks
Packaging
We strive to reduce excess packaging
in shipping and with the end user. For
example, the boxes that we use to ship
our shoes contain at least 70 percent
recycled content.
In 2014, we will focus on keeping our
products and shipping materials light.
Shipping lighter boxes means using less
fuel and reduces environmental impacts.
Product Design
To us, the ideal design for a pair of Crocs™
shoes is the most simple design possible
— one that uses the fewest materials and
allows for the most efficient manufacturing
while maintaining quality. Forty percent of
our product line is comprised of molded
clogs (Crocs’ original shoe), which have an
extremely simple design.
In 2013, in an effort to design simpler
shoes, we expanded our use of single
injection stitch-out manufacturing.
This process increases efficiency and
reduces the use of cement in our shoe
manufacturing. In 2012, we started using
single injection stitch-out in our Mary
page 26
ENVIRONMENT
Jane line, and in 2013, we also started
using duel-injection manufacturing to
manufacture our Cabo Collection. To do
so, we tried to minimize the shoes’
complexity while maintaining their quality.
Simplifying the design of this shoe has
increased operational efficiency and
minimized product manufacturing impacts.
It has also created a better product for our
customers, one that offers more cushioning
with each step.
Here are some examples of shoe lines
where we have used particularly efficient
designs:
“We strive to
create traditional
footwear with
an iconic brand
perspective in line
with sustainable
design.”
Cheng Kue, Crocs Inc. Design Director
– Golf-Professional Footwear – Kids
•
CaboTM Collection: To create these
simplified CaboTM Collection shoes,
we use a patented shoe construction
process involving a single injection
of material that turns the sock liner,
foot bed and insoles into a single
piece that can be stitched to the
upper parts of the shoe. This requires
very little cement and reduces the
VOCs produced. Throughout 2014,
we will expand the use of this shoe
construction process to our flip-flops,
sandals, slides and closed-toe shoes.
•
Rough OutTM: Our Rough OutTM
collection uses premium materials to
minimize the number of layers that
must be used. For example, the men’s
Oxford and women’s wedge boot use
a single thick piece of hide to avoid the
necessity of multiple upper layers and
glue to bind them.
We have also been successful in creating
more efficient and environmentally friendly
manufacturing processes for several of
our other lines. In 2014, we will continue
to refine the design and molding of our
footwear to keep our products lightweight
and our manufacturing processes simple
and nontraditional. In the long term, we
hope to develop zero-waste manufacturing
processes for our footwear lines.
OCEAN MINDEDTM
Ocean MindedTM by Crocs is a
collection of eco-friendly & surfinspired footwear. For our Ocean
MindedTM line, we focused on
minimizing waste and incorporating
materials with lower environmental
impact whenever possible. The
product design allows us to reuse
tooling and to reuse rubber scrap
for the outsoles. It also allows us
to use water-based cements which
have a lower environmental impact
than other types of cements. For
example, the women’s Espadrilla line
focuses on creating a design that
incorporates natural materials, waterbased adhesives and environmentally
friendly outsoles created with a
reused rubber scrap mixed with a jute
compound. We are now expanding
this low waste design from a basic
ballet flat into four new Ocean
MindedTM styles.
To us, the ideal
design for a pair of
Crocs™ shoes is the
most simple design
possible.
page 27
ENVIRONMENT
FACILITY IMPACTS
Our Headquarters
Our headquarters in Niwot, Colorado,
near the cities of Denver and Boulder,
is specifically designed to minimize its
environmental impact. The building has
environmentally-conscious features such
as low VOC paint, lighting motion sensors,
energy efficient lighting fixtures and lowflow toilets.
We lease our headquarters, and we work
with our property manager to address
environmental issues. Our building is sub
metered, and we focus our efforts on the
areas where we believe we can have the
biggest impact: energy efficiency and
waste reduction.
34,220 therms
of natural gas
At our headquarters, we installed a new
printing system that greatly reduces
unnecessary paper waste. The new system
requires employees to use their badge at
the printer to complete the process, and it
defaults to double-sided printing. We are
satisfied with the results we have seen from
this new system, both in terms of reducing
paper use and in improving the security of
documents.
At our corporate headquarters, we have
undertaken several energy efficiency
measures, including:
•
Water
Motion sensors: Property management
outfitted the entire building with
motion sensors.
•
TA 6 Fluorescent: Every office,
conference room, restroom and
warehouse is now lit with TA 6
fluorescent fixtures. These new fixtures
both increase the amount of light in the
building and reduce our energy use.
•
Employee engagement: We ask our
employees to help us save energy and
turn off the lights when not in use,
and we remind them to do so through
signage and the employee intranet.
Total energy use
in headquarters:
of electricity
We do not handle hazardous waste in our
headquarters or in our retail locations.
However, we are committed to reducing
solid waste.
We also reduce waste at our headquarters
through a major recycling effort. Crocs
uses Green Girl for management of all
recyclable items, including proper disposal
of electronic waste items. We encourage
employees to recycle, and we have
numerous office recycling bins throughout
headquarters.
Energy
585,971 kWh
Waste
Our headquarters features low-flow
plumbing fixtures. We also regularly
encourage employees to use reusable
water bottles, as part of our headquarterswide effort to eliminate single-use water
bottles.
page 28
ENVIRONMENT
Our Retail Locations
Minimizing impact of our approximately
600 owned and managed retail stores is
an ongoing focus.
Energy
Some energy initiatives we have
undertaken in our retail stores include:
Crocs’ “Blue Water” Store
Lighting: We are upgrading our lighting
applications in both new and existing
stores to LED lamps and T8 or T5 ballast in
the fluorescent lighting of the ACT ceilings.
•
Through calculations based on raw data
from our lighting vendor, we estimate
that, on average, we consume 5 percent
less energy than when we used halogen
lamps.
•
So far, 70 percent of our stores
use LED bulbs, all with a 10-year
free replacement warranty. In 2012,
we spent $170,000 in light bulb
replacement. In 2013, we spent $57,393.
We estimate our bulb cost in 2014 to
be $30,000 or less with a continued
decrease over the next fivce years due
to the warranty.
Minimizing impact of our
approximately
600
owned and managed retail
stores is an ongoing focus.
Ninety percent of our retail stores lack
visibility into their energy use because the
landlord includes utilities in each store’s
lease payment. Therefore, it is difficult to
measure the total energy savings realized
from switching to LED bulbs. In 2014, we
will focus on increasing dialogue with
landlords where we can.
Waste
Retail stores generate waste unwrapping
shoe deliveries — plastic bags, tissue
paper, cardboard inserts and cardboard
shoeboxes. Many retail locations have
created an in-store recycling program in
conjunction with the mall or shopping
center where the store is located. Going
forward, we will engage with mall and
shopping center management to push for
increased recycling opportunities. This is
a retail-wide challenge that we will also
address with industry peers when possible.
Design
Crocs’ “Blue Water” concept incorporates
sustainable design features into new
stores. With this concept, all product
displays are versatile for multi-purpose use.
Additionally, at least 50 percent of wood
used throughout the store is recycled or
repurposed. Some unique features include
use of old lobster traps and baskets for
lighting features. Currently, seven stores of
this kind are being piloted worldwide.
In July 2013, we opened our first LEEDcertified retail store, “Destiny USA,” in
Syracuse, NY. We achieved LEED Silver
certification, which is one classification
level higher than the baseline standard.
This 2,646 square foot outlet store features
a high efficiency LED lighting system, low
VOC construction materials and a variety
of sustainable building materials. The store
also utilizes the rainwater harvest system of
the mall in which it is located.
We encourage recycling throughout our
retail stores, and this year our CrossIron
store in Canada had exceptional execution
and achievements in this area. CrossIron’s
sustainability recycling plan, which
included far-reaching goals, resulted in a
storewide 43 percent reduction in paper
use from 2012 levels.
page 29
ENVIRONMENT
GREENHOUSE GAS
EMISSIONS MANAGEMENT
In 2013, we conducted our first greenhouse
gas emission inventory. We monitored
and collected emission data from both our
corporate headquarters and our factories.
Greenhouse gas emissions
(direct and indirect)
U.S. headquarters:
688 metric tons CO2-e
Owned manufacturers:
6,318 metric tons CO2-e
Contract manufacturers:
Total greenhouse gas emissions:
TRANSPORTATION
We use high quality, responsible shipping
services for the transportation of our
products. In our effort to align with other
organizations that focus on sustainability,
we plan to utilize DHL and Deutsche Bahn
Schenker for all of our ocean shipments
in 2014. Both companies have a stated
commitment to sustainability and goals to
reduce their environmental impact.
page 30
ENVIRONMENT
•
We exceeded our anticipated volatile organic compound (VOC) reductions per pair of
shoes in 2013 by reducing the average VOC emissions per pair of shoes by 16 percent
from 2012 levels. We accomplished this through increased employee training, greater
use of water-based adhesives and innovations in shoe designs that reduced the need for
adhesives. VOC reductions are good for workers’ health and the environment and will be
a focus in 2014 as well. We have set a goal to reduce average VOCs per pair by another
10 percent next year.
•
Seventy percent of our retail stores have installed LED lights, which save energy and will
save us money over the long term.
Biggest Challenges
70%
of our retail stores
have installed LED
lights, which save
energy and will save
us money over the
long term.
•
Reducing VOCs is an ongoing effort. In the coming years, we plan to expand our shoe
lines to include more complex styles. These designs may demand more materials,
and the manufacturing processes for them may produce more VOCs if water-based
adhesives can’t be used.
•
Leasing our headquarters and retail spaces, rather than owning them, poses unique
challenges. Being a tenant makes substantial energy and resource efficiency
investments less likely to be economically viable since we may not be there for the long
term. Also, our landlords have little incentive to make these investments because they
do not pay the utility bills. Given this reality, we focus on encouraging employees to
reduce energy, water and waste.
•
Shoe design impacts waste and the energy, water and chemicals used in manufacturing.
Our design team is relentlessly focused on making shoes simpler and sleeker, while
regularly introducing new and different styles. These efforts result in better-quality
products with fewer environmental impacts. Continuing to drive environmental
efficiency into shoe design will be a focus in 2014.
•
Waste reductions are an ongoing opportunity in factories, headquarters and retail.
In 2014, we will particularly focus on increasing recycling opportunities in our retail
operations.
page 31
4
COMMUNITY
As a global leader in casual
footwear, Crocs looks out
not only for the comfort
of our fans, but also for
the health and well-being
of communities in need.
Giving back is a strong
part of our culture, and
programs like Crocs CaresSM
provide a platform for us to
support organizations that
benefit local and global
communities alike.
page 32
COMMUNITY
CROCS CARESSM
Through our philanthropic program, Crocs
CaresSM, we have donated millions of shoes
to people in developing countries, those in
areas hit by natural disasters, and families
in the United States who simply need a
little help.
In 2013, we donated over 50,000 pairs of
shoes globally. Through our partnership
with Feed the Children, we donated shoes
to numerous international sites including
Haiti and the Philippines. Closer to home,
we donated shoes for natural disaster relief
in New Jersey, Oklahoma and Colorado.
“Our nonprofit partners and
Focus of Crocs CaresSM in 2013
organizations frequently remind
Disaster Relief
me that our Classic shoes are
One of Crocs CaresSM focuses is on
natural disaster relief. After witnessing the
devastation caused by Hurricane Sandy in
New Jersey, tornadoes in Oklahoma and
floods in Colorado, we felt compelled to
help as a company, and our employees felt
compelled to help personally.
the perfect shoes for donations
in the areas that we give. The
Croslite™ material helps make
the shoes lightweight, durable
and easy to clean. The shoes also
give hope and comfort to children
needing shoes, which they cannot
otherwise afford, to get into
school. We continue to receive
around 20-30 requests for shoes
every month.”
- Crocs CaresSM Program Manager
Crocs employees spent more than
200 hours volunteering to clean up
communities affected by the Colorado
floods. Additionally, we helped over 1,000
people in need receive meals through our
month-long sponsorship of a RollinGreens
food truck.
In New Jersey, we donated 2,500 pairs
of CrocsTM shoes to victims of Hurricane
Sandy. Also, Crocs employees volunteered
with the Hurricane Sandy Rebuild Day in
partnership with Meredith Publishing.
We donated
5,000 pairs
of shoes to the people of
Haiti. Some of these shoes
went to an orphanage with
which we have maintained
a relationship for six years.
Our partner organization Feed the Children
often paired food donations with our
donations of shoes. Overall, we raised more
than $1 million for nonprofits, sponsored
$53,000 for local organizations in these
areas and donated over 50,000 pairs of
shoes this year.
Aiding Poverty Relief Efforts
In 2013, we continued our focus on
alleviating international poverty, and we
also turned our attention to poverty within
the United States.
In 2012, we began a new
partnership with National Relief
Charities, a nonprofit dedicated to
ensuring quality of life for Native
Americans living on remote and
poverty-stricken reservations.
Through Pine Ridge Reservation
and National Relief Charities, we
donated 4,000 pairs of shoes to
families on Indian reservations in
Mexico and South Dakota.
page 33
COMMUNITY
We also supported PSA Violence
Intervention in Los Angeles, an
organization assisting homeless children
living in and around the city. We provide
hundreds of shoe donations to children in
need through this program.
Partnerships
We partner with several organizations
around the world to help us distribute
shoes to people in need. Some of our
notable partnerships this year were with
Feed the Children, USO, IRD and Operation
Walk.
Feed the Children
Crocs is active in ensuring that our
international philanthropic initiatives
are as meaningful as possible. Feed the
Children is a perfect example. Through
our partnership with Feed the Children,
not only do communities in need receive
shoes to wear, but the same communities
receive help to break the cycles of
hunger and poverty including healthcare,
education, food, and more. Communities in
several countries-including Haiti, Peru, the
Philippines, Netherlands, South Korea and
the United States-have benefited from this
program.
RETAIL STORES
In addition to Crocs CaresSM, our retail
stores also play a major role in our
philanthropic efforts.
Through Soles4Souls, our in-store donation
program in over 80 locations, we continue
to collect shoes in our retail locations
across the country. We ask customers to
donate gently-worn shoes of any type,
and as our way of saying thanks, we
provide customers who participate with
a 15 percent discount on a purchase of
a new pair of CrocsTM shoes. Collected
shoes are refurbished and donated to
people in developing countries. We collect
an average of 2,500 pairs of shoes each
month.
A few of our stores deserve special
recognition for their efforts to collect and
donate shoes to people in need:
•
In April 2013, our Pembroke Mall
store teamed up with Crocs CaresSM
to donate 1,000 pairs of shoes to the
Carma Foundation, an organization
helping women and children in Haiti.
•
Also in April, our Crocs’ Iron Mills store
partnered with Amani Baby Cottage
in Uganda, donating $1,500 worth
of Crocs™ shoes to children at the
orphanage.
•
In June 2013, the Citadel outlet donated
325 pairs of shoes to the victims of the
Oklahoma tornadoes.
USO
This year, we donated 600 pairs of shoes
to be included in the USO’s R&R duffels.
These donations will support our soldiers
in Afghanistan as they deploy around
the world.
International Relief Development
We partnered with International Relief
Development to bring 1,500 pairs of
shoes to orphanages in Ukraine.
page 34
COMMUNITY
Aside from donating shoes, Crocs also
raises and donates money to support
communities in times of hardship. This past
year, Colorado-based retail stores collected
monetary donations to help victims of the
Aurora movie theater shooting and the
flood in Colorado. These efforts included
a donation of $50,000 to the Colorado
Nonprofit Development Center. Crocs also
raised $12,750 for the Red Cross for flood
relief through a two day sale on Crocs.com.
EMPLOYEE COMMUNITY
ENGAGEMENT
Employees at Crocs’ headquarters are also
involved in a variety of programs to give
back to our community in Colorado. In
2013, these activities included “adopting”
a Boulder park for cleanup, two blood
drives for the Denver Children’s Hospital
and flood disaster relief. Employees
volunteered over 200 hours in 2013.
INTERNATIONAL PROGRAMS
Several different international divisions
of Crocs have engaged in philanthropic
programs of their own in their countries.
All of these activities underscore our
commitment to give back to communities
around the world.
Crocs South Africa
Crocs South Africa supported Walking
the Daisies, an annual two day 50km
environmental hike to South Africa’s
premier eco-friendly music festival.
Additionally, through a partnership with
Ocean MindedTM, Crocs South Africa
donated boots to those participating in a
beach cleanup through Crocs CaresSM.
Crocs Puerto Rico
The Crocs team in Puerto Rico spent an
entire day with children at the Pediatric
Cancer Association Hospital, providing
shoes to each child and donating art for a
fundraiser held at Crocs retail.
Crocs Europe
Through our partnership with UNICEF, we
donated over 6,000 pairs of Crocs™ shoes
to children in Syria throughout the year.
2013 Giving
$60,100
60
Amount of money donated (in thousands of dollars)
MONETARY DONATIONS
55
50
$50,000
45
40
$35,000
35
30
25
20
$13,200
15
10
5
0
Children Colorado
state
support
Disaster
relief
Health
page 35
COMMUNITY
•
Total monetary donations: More than $158,300
•
Crocs employee hours: Over 200 hours
•
Total shoe donations: More than 50,000 pairs
Biggest Challenges
•
We are exploring ways to increase customer and employee involvement in our
community engagement programs.
•
The retail environment presents an opportunity for us to engage with customers about
our community engagement programs.
page 36
5
RECOGNITION &
PARTNERSHIPS
RECOGNITION AND PARTNERSHIPS
PARTNERSHIPS
Global Apparel, Footwear and Textile
Initiative (GAFTI)
GAFTI brings together leaders from a
variety of retailers, factories and mills
who share the common goal of creating
universal industry standards. Members of
GAFTI are often faced with similar social
compliance challenges, and industry
collaboration on these issues allows us to
foster better workplace environments.
AWARDS & HONORS
Crocs is committed to producing
innovative products and providing a great
workplace for all employees alike. In 2013,
numerous organizations recognized these
efforts with the following awards:
•
Consumer Goods Technology (CGT)
Supply Chain Award
•
Consumer Goods Technology (CGT)
Most Innovative Company Award
•
Crocs was awarded multiple American
Business Awards — Stevie Awards:
Fair Labor Association (FLA)
The FLA is an organization of companies,
nonprofits and universities that work
together to better workplace conditions
in global supply chains. Crocs and other
FLA members are required to comply with
FLA’s Code of Conduct and allow FLA to
conduct independent audits.
•
Silver Stevie for Company of the
Year in the Consumer Products —

Durables Category
•
Silver Stevie for Human Resources
Executive of the Year, awarded to
Dan Hart
Global Reporting Initiative (GRI)
•
Gold Stevie for Product
Development/Management
Executive of the Year, awarded to
Dale Bathum, Crocs’ Chief Product
Officer
The GRI is a global standard for sustainability
reporting. Crocs is a member of GRI’s
Organization Stakeholder Program, a
network of over 600 organizations from
more than 60 countries. Through our
membership, we share our knowledge and
discuss experiences of other organizations.
•
American Masters of Taste “Superior
Quality” Gold Medal Seal winner by
Chefs in America for the Crocs @
WorkTM line, in the “Comfort Work
Shoe” category
•
Comfort/Wellness Footwear Brand
of the Year at the second annual UK
Footwear Industry Awards
•
Scott Crutchfield, Chief Operating
Officer, was named one of Supply &
Demand Chain Executive’s “Pros to
Know” Award winners
The University of Denver, EMBA Program
We continued to work with the University
of Denver to examine our operations and
communications and identify top areas for
focus in 2013. Our collaboration with the
University helps us find ways to improve
our sustainability performance.
page 38
6
GLOBAL
REPORTING
INITIATIVE
TABLE
GLOBAL REPORTING INITIATIVE
G3.1 Content Index - GRI Application Level B
STANDARD DISCLOSURES PART I: Profile Disclosures
1. Strategy and Analysis
Profile Disclosure
Description
Reported
Cross-reference/Direct Answer
1.1
Statement from the most senior decision-maker of the
organization.
Fully
Reference Letter from COO, pg. 2
1.2
Description of key impacts, risks and opportunities.
Fully
Reference Letter from COO, pg. 2
2. Organizational Profile
Profile Disclosure
Description
Reported
2.1
Name of the organization.
Fully
Crocs, Inc.
2.2
Primary brands, products and/or services.
Fully
Crocs, YBC, Jibbitz, Ocean Minded
2.3
Operational structure of the organization, including main
divisions, operating companies, subsidiaries and joint ventures.
Fully
Form 10 - K
2.4
Operational structure of the organization, including main
divisions, operating companies, subsidiaries and joint ventures.
Fully
Niwot, CO
2.5
Number of countries where the organization operates, and
names of countries with either major operations or that are
specifically relevant to the sustainability issues covered in the
report.
Fully
Form 10 - K,
2.6
Nature of ownership and legal form.
Fully
Form 10 - K
2.7
Markets served (including geographic breakdown, sectors
served and types of customers/beneficiaries).
Fully
Form 10 - K
2.8
Scale of the reporting organization.
Fully
Form 10 - K
2.9
Significant changes during the reporting period regarding size,
structure or ownership.
Fully
N/A
2.10
Awards received in the reporting period.
Fully
Reference Awards & Honors, pg. 38.
Reference Our Factories, pg. 13.
page 40
3. Report Parameters
Profile Disclosure
Description
Reported
3.1
Reporting period (e.g., fiscal/calendar year) for information
provided.
Fully
Jan 1 - Dec 31, 2013, which is following our financial calendar
3.2
Date of most recent previous report (if any).
Fully
Novemeber 1st, 2012
3.3
Reporting cycle (annual, biennial, etc.)
Fully
Annual
3.4
Contact point for questions regarding the report or its contents.
Fully
Rob Callaway: [email protected]
3.5
Process for defining report content.
Fully
Reference pg 4 About This Report, pg. 11.
3.6
Boundary of the report (e.g., countries, divisions, subsidiaries,
leased facilities, joint ventures, suppliers). See GRI Boundary
Protocol for further guidance.
Fully
Major owned (1 Mexico and 1 Italy) and contract manufacturers
(3 in China, 2 in Vietnam, 1 Bosnia) and U.S. Headquarters
where noted. See pg. 11 for additional details.
3.7
State any specific limitations on the scope or boundary of the
report (see completeness principle for explanation of scope).
Fully
Report does not include data for suppliers that produce less
than 5 percent of total footwear volume and does not include
retail stores (approx. 600) and administrative buildings outside
of the U.S. (European HQ, Singapore Administrative building,
Japan administrative building), unless where noted. We will
look to incorporate these in future reports as we expand our
reporting.
3.8
Basis for reporting on joint ventures, subsidiaries, leased
facilities, outsourced operations and other entities that can
significantly affect comparability from period to period and/or
between organizations.
Fully
Reporting covers entities noted in 3.7
3.9
Data measurement techniques and the bases of calculations,
including assumptions and techniques underlying estimations
applied to the compilation of the Indicators and other
information in the report. Explain any decisions not to apply, or
to substantially diverge from, the GRI Indicator Protocols.
Fully
The data collection followed the GRI G3.1 Indicator Protocols.
Greenhouse gas emissions calculated using: The WRI / WBCSD
GHG Protocol Corporate Standard and Corporate Value Chain
(Scope 3) Standard; Direct measurement (metered data), site
specific data estimation.
3.10
Explanation of the effect of any re-statements of information
provided in earlier reports, and the reasons for such restatement (e.g., mergers/acquisitions, change of base years/
periods, nature of business, measurement methods).
Fully
There are no re-statements of information provided in earlier
reports.
3.11
Significant changes from previous reporting periods in the
scope, boundary or measurement methods applied in the report.
Fully
Expanded scope to include two contract manufacturers in
Vietnam.
page 41
3. Report Parameters (Cont.)
Profile Disclosure
Description
Reported
3.12
Table identifying the location of the Standard Disclosures in the
report.
Fully
Reference GRI table, pgs. 39 - 52.
3.13
Policy and current practice with regard to seeking external
assurance for the report.
Fully
We did not seek external assurance
4. Governance, Commitments, and Engagement
Profile Disclosure
Description
Reported
4.1
Governance structure of the organization, including committees
under the highest governance body responsible for specific
tasks, such as setting strategy or organizational oversight.
Fully
Crocs Corporate Governance
4.2
Indicate whether the Chair of the highest governance body is
also an executive officer.
Fully
4.3
For organizations that have a unitary board structure, state the
number and gender of members of the highest governance
body that are independent and/or non-executive members.
Fully
4.4
Mechanisms for shareholders and employees to provide
recommendations or direction to the highest governance body.
Fully
Contact information located on Investor Relations website
4.5
Linkage between compensation for members of the highest
governance body, senior managers and executives (including
departure arrangements) and the organization’s performance
(including social and environmental performance).
Fully
Form 10 - K
4.6
Processes in place for the highest governance body to ensure
conflicts of interest are avoided.
Fully
4.7
Process for determining the composition, qualifications and
expertise of the members of the highest governance body and
its committees, including any consideration of gender and other
indicators of diversity.
Fully
4.8
Internally developed statements of mission or values, codes of
conduct, and principles relevant to economic, environmental,
and social performance and the status of their implementation.
Fully
Reference Crocs’ Social Compliance Code of Conduct,
Business Code of Conduct and Ethics on Investor Relations
site.
Reference Crocs’ Social Compliance Code of Conduct, pg. 15
page 42
4. Governance, Commitments, and Engagement (Cont.)
Profile Disclosure
Description
Reported
4.9
Procedures of the highest governance body for overseeing the
organization’s identification and management of economic,
environmental,and social performance, including relevant
risks and opportunities and adherence or compliance with
internationally agreed standards, codes of conduct and
principles.
Fully
Reference Compliance Council, pg. 5.
4.10
Processes for evaluating the highest governance body’s
own performance, particularly with respect to economic,
environmental and social performance.
Fully
Reference Crocs’ Ethics and Governance, pg. 5.
4.11
Explanation of whether and how the precautionary approach or
principle is addressed by the organization.
Fully
Our products undergo strict RS testing. Reference pg. 25.
4.12
Externally developed economic, environmental and social
charters, principles, or other initiatives to which the organization
subscribes or endorses.
Fully
Reference Partnerships, pg. 38.
4.13
Memberships in associations (such as industry associations)
and/or national/international advocacy organizations in which
the organization: *has positions in governance bodies,
*participates in projects or committees; *provides substantive
funding beyond routine membership dues, or *views
membership as strategic.
Fully
Reference Partnerships, pgs. 38.
4.14
List of stakeholder groups engaged by the organization.
Fully
Reference Stakeholder Engagement, pg. 4.
Reference Crocs’ Social Compliance Code of Conduct, pg. 15.
Reference Partnerships, pg. 38.
4.15
Basis for identification and selection of stakeholders with
whom to engage.
Fully
Reference Crocs’ Approach to Sustainability, pg. 3, 4.
4.16
Approaches to stakeholder engagement, including frequency of
engagement by type and by stakeholder group.
Fully
Reference Stakeholder Engagement, pg. 4.
Key topics and concerns that have been raised through
stakeholder engagement, and how the organization has
responded to those key topics and concerns, including through
its reporting.
Fully
4.17
Reference About This Report, pg. 11.
Reference About This Report, pg. 11.
page 43
STANDARD DISCLOSURES PART II: Disclosure on Management Approch (DMA)
G3 DMA
Description
DMA EC
Disclosure on Management Approach EC
Aspects
Economic performance
Reported
Fully
Our economic management approach is detailed in our Annual
Report and other financial filings.
Fully
Our commitment to strong environmental management
reaches the highest levels of the company.
Market presence
Indirect economic impacts
DMA EN
Disclosure on Management Approach EN
Aspects
Materials
Energy
Water
Biodiversity
Emissions, effluents and waste
Products and services
Compliance
Transport
Overall
Our Social Compliance Code of Conduct outlines our
commitment to minimizing environmental impact.
Crocs’ Global Sustainability Manager oversees environmental
performance in factories and reports directly to the Chief
Operating Office on factory performance and flags issues.
Read more about our audit process, which includes a review of
environmental performance, on pg. 15.
Crocs’ Compliance Council oversees environmental compliance
topics. The Council meets several times a year to discuss
important compliance issues and includes representatives
from across the company who report to the Board of
Directors and collaborate with internal departments to drive
our environmental work. Additionally, we demonstrate our
commitment with our annual Corporate Compliance and
Ethics week.
page 44
G3 DMA
Description
DMA LA
Disclosure on Management Approach LA
Aspects
Employment
Reported
Fully
Our commitment to ensuring the health and safety of the
workers in our owned and contracted factories reaches the
highest levels of our company.
Labor/management relations
Occupational health and safety
Our Code of Business Conduct and Ethics outlines our
commitment to ensuring ethical labor practices.
Training and education
Crocs’ Global Sustainability Manager oversees social
Diversity and equal opportunity
Equal remuneration for women and men
performance regards to labor conditions, on pg. 15.
Crocs’ Compliance Council oversees social compliance.
The Council meets several times a year and includes
representatives from across the company who report to the
Board of Directors and collaborate with internal departments
to drive our social and environmental work. Additionally, we
demonstrate our commitment with our annual Corporate
Compliance and Ethics week.
DMA HR
Disclosure on Management Approach HR
Aspects
Investment and procurement practices
Non-discrimination
Freedom of association and collective bargaining
Child labor
Prevention of forced and compulsory labor
Security practices
Indigenous rights
Assessment
Remediation
Fully
Our commitment to human rights reaches across our
operations and suppliers and is overseen by the highest levels
of our company.
Our Code of Business Conduct and Ethics outlines our
commitment to ensuring ethical labor practices.
performance regards to human rights, on pg. 15.
page 45
G3 DMA
Description
DMA SO
Disclosure on Management Approach SO
Aspects
Local communities
Reported
Fully
Our commitment to strong business ethics reaches the highest
levels of our company.
Corruption
Our Code of Business Conduct and Ethics guides this
commitment.
Public policy
Anti-competitive behavior
Compliance
performance regards to relationships with local communities,
on pg. 15.
DMA PR
Disclosure on Management Approach PR
Aspects
Customer health and safety
Product and service labelling
Marketing communications
Customer privacy
Compliance
Fully
Our commitment to product responsibility reaches the highest
levels of our company.
Our Code of Business Conduct and Ethics guides our
commitment to product responsibility.
Crocs’ Global Sustainability Manager oversees sourcing in
factories and reports directly to the Chief Operating Office on
factory performance and flags issues.
Read more about our audit process, which includes a review
of performance regards to sourcing and safety of materials, on
pg. 25.
page 46
STANDARD DISCLOSURES PART III: Performance Indicators
ECONOMIC
Performance Indicator
Description
Reported
Direct economic value generated and distributed, including
revenues, operating costs, employee compensation, donations
and other community investments, retained earnings and
payments to capital providers and governments.
Fully
- 1,193M revenue
Economic performance
EC1
- Selling, General & Administrative (SG&A) costs are 569.5M,
(equivalent to operating costs, employee wages and benefits)
- Payments to providers of capital: 1.0M
- Payments to governments (defined as income tax): 49.5M
- Charitable contributions (defined as community
investments): 0.6M
- Economic value retained: 1193M minus 549.5M minus 1.0M,
minus 49.5M minus 0.6M = 22.9M
EC4
Significant financial assistance received from government.
Fully
No significant financial assistance was received from the
government in the reporting period, except for one instance
with our Bosnia factory, which reported receiving government
subsidies - which encourage exports.
EN1
Materials used by weight or volume.
Fully
Reference Environment, pg. 24.
EN2
Percentage of materials used that are recycled input materials.
Fully
The Croslite™ material in our shoes contains an average of 6
percent reused Croslite™ scrap in each pair.
ENVIRONMENTAL
Materials
page 47
ENVIRONMENTAL (Cont)
Description
Reported
Direct energy consumption by primary energy source.
Fully
*Includes U.S. Headquarters
Energy
EN3
Natural Gas: 4,299,353 MJ
Liquefied Propane Gas (LPG): 47,608,340 MJ
Diesel: 76,703,615 MJ
Petrol:55,272,793 MJ
Petrodiesel:45,969,878 MJ
Reference Environment, pgs. 25, 28.
EN4
Indirect energy consumption by primary source.
Fully
Electricity: 226,440,353 MJ
Reference Environment, pg. 25, 28.
EN7
Initiatives to reduce indirect energy consumption and reductions
achieved.
Partially
We are conscious of energy use at all our factories. In
particular, many of our factories are saving energy by
powering down machinery and turning off lights when not
in use.
Total water withdrawal by source.
Fully
Reference Water, pg. 26.
Location and size of land owned, leased, managed in or adjacent
to protected areas and areas of high biodiversity value outside
protected areas.
Fully
Reference Biodiversity, pg. 25.
Water
EN8
Biodiversity
EN11
page 48
ENVIRONMENTAL (Cont.)
Description
Reported
Fully
Emissions, effluents and waste
EN16
Total direct and indirect greenhouse gas emissions by weight.
We used the following standards and methodology: The WRI
/ WBCSD GHG Protocol Corporate Standard and Corporate
Value Chain (Scope 3) Standard; Direct measurement
(metered data), site specific data, estimation.
EN22
Total weight of waste by type and disposal method.
Fully
Reference Waste, pg. 26.
Initiatives to mitigate environmental impacts of products and
services, and extent of impact mitigation.
Fully
Reference Environment, pgs. 24-27.
Monetary value of significant fines and total number of nonmonetary sanctions for non-compliance with environmental laws
and regulations.
Fully
No significant fines were reported in our manufacturing base.
Significant environmental impacts of transporting products
and other goods and materials used for the organization’s
operations, and transporting members of the workforce.
Fully
Reference Transportation, pg. 30.
Partially
Reference Our Workforce, pg. 13 & 14.
Products and services
EN26
Also, our Asia and Italy factories have implemented noise
reduction measures for certain machinery.
Compliance
EN28
Transport
EN29
SOCIAL: LABOR PRACTICES AND DECENT WORK
Employment
LA1
Total workforce by employment type, employment contract and
region, broken down by gender.
page 49
SOCIAL: LABOR PRACTICES AND DECENT WORK (Cont.)
Description
Reported
Fully
Vast majority of workers are covered under collective
bargaining agreements - including topics such as safety, fire
prevention and health screening. Employee participation is
encouraged, but some elect not to participate.
Labor/management relations
LA4
Percentage of employees covered by collective bargaining
agreements.
China 1: 20%, China 2: 100%, China 3: 100%, Vietnam 1: 100%,
Vietnam 2: 90%, Italy: 100%, Mexico: 80%, Bosnia: 80%
Occupational health and safety
LA7
Rates of injury, occupational diseases, lost days and absenteeism
and number of work-related fatalities by region and by gender.
Fully
Reference Workplace and Supply Chain, pg. 17.
LA8
Education, training, counseling, prevention and risk-control
programs in place to assist workforce members, their families or
community members regarding serious diseases.
Fully
Our factories offer a variety of health care education and
preventative measures to workers. In 2013, this included a
mental health education and counseling program at our China
1 factory, in partnership with a local university.
LA9
Health and safety topics covered in formal agreements with
trade unions.
Fully
Formal agreements with trade unions cover all health and
safety topics under the law of the countries of manufacturing,
including health and safety, personal protective equipment
and sanitation.
LA10
Average hours of training per year per employee by gender, and
by employee category.
Partially
China 1: 33, China 2: 7, China 3: 33, Vietnam 1: 5.7, Vietnam 2: 2,
Mexico: 15, Italy: 5, Bosnia: 4.5
LA12
Percentage of employees receiving regular performance and
career development reviews, by gender.
Fully
All Crocs employees receive annual performance reviews.
Factories report that a majority of employees receive
performance reviews.
Training and education
page 50
SOCIAL: HUMAN RIGHTS
Description
Reported
Investment and procurement practices
HR2
Percentage of significant suppliers, contractors and other
business partners that have undergone human rights screening,
and actions taken.
Fully
In the procurement process, all suppliers are screened to
ensure alignment with the Crocs’ Social Compliance Code of
Conduct.
HR3
Total hours of employee training on policies and procedures
concerning aspects of human rights that are relevant to
operations, including the percentage of employees trained.
Partially
100% of factory based employees are trained on the Supplier
Code of Conduct
Total number of incidents of discrimination and corrective
actions taken.
Fully
No incidents of discrimination reported.
Operations and significant suppliers identified as having
significant risk for incidents of child labor, and measures taken
to contribute to the effective abolition of child labor.
Fully
No incidents of child labor reported.
Operations and significant suppliers identified as having
significant risk for incidents of forced or compulsory labor, and
measures to contribute to the elimination of all forms of forced
or compulsory labor.
Fully
No incidents of forced or compulsory labor reported.
Percentage of security personnel trained in the organization’s
policies or procedures concerning aspects of human rights that
are relevant to operations.
Fully
100% of factory security is trained in Crocs’ Social Compliance
Code of Conduct, which covers human rights.
Non-discrimination
HR4
Child labor
HR6
Forced and compulsory labor
HR7
Security practices
HR8
page 51
SOCIAL: SOCIETY
Description
Reported
Percentage of employees trained in organization’s anticorruption policies and procedures.
Fully
Over 98% of our employees have completed training on our
FCPA anti-corruption policies.
Fully
Reference Customer Satisfaction, pg. 4.
Corruption
SO3
SOCIAL: PRODUCT RESPONSIBILITY
Product and service labelling
PR5
Practices related to customer satisfaction, including results of
surveys measuring customer satisfaction.
Crocs US Specialty Retail: 87% vs. benchmark of 80% US
Specialty Retail. EU Specialty Retail: 81% vs. benchmark
of 77% (UK) department store ave. APAC 84% vs. 75% for
Singapore department store ave. Japan 72% vs. 69% Apparel
& Specialty Retail.
ECOMM: US 82% vs. benchmark of 78% for internet retail.
EU 75% vs. 81% UK e-comm. APAC 70% with no known
benchmark. Japan 67% vs. 75% for online retail in Japan.
US CALL CENTER: 88% vs. 79% US call center benchmark.
AF Content Index
Profile Disclosure
Description
Reported
AF1
Code of Conduct and coverage.
Fully
Reference Crocs’ Social Compliance Code of Conduct, pg. 15.
AF8
Number of audits conduced and percent of workplace audited.
Fully
Approximately 125 audits conducted at our contract
manufacturers in Asia.
AF12
Incidents of the use of child labor.
Fully
There were no reported cases of child labor in the reporting
period.
AF18
Programs to replace organic-based adhesives and primers with
water-based adhesives and primers.
Fully
Average VOCs: 22.6 grams/pair.
AF23
Policy regarding the use of ‘home working.’
Fully
Home working is not permitted in Crocs factories. All contract
owned and contract manufacturers have policies outlining
these regulations.
AF25
Policy and practices on wage deductions that are not mandated
by law.
Fully
Crocs owned and contracted manufacturers maintain wages
that are at or above the minimum wage.
AF26
Policy on working hours, including definition of overtime, and
actions to prevent excessive and forced overtime.
Fully
Reference Looking Ahead, pg. 20.
page 52