2014 report
Transcription
2014 report
2014 SUSTAINABLE DEVELOPMENT REPORT CHALLENGES AND MANAGEMENT 2 Decathlon in figures 3 Interview 6 Sustainable development governance 8 Sustainable development issues 12 Liberating energy 14 Understanding climate issues 15 Decathlon Foundation 18 PRODUCTS AND SERVICES 20 Innovation lovers 21 Eco-design 24 Environmental labelling 28 Choosing the right product components 29 Customer satisfaction and continuous improvement 32 Repairing your product 34 Customer input events 36 TRANSPORT AND STORES 38 Managing our sites 39 Storage and transportation 43 Stores and their community involvement 46 Managing health and safety 48 Promoting employee development 50 RESPONSIBILITY IN PRODUCTION 54 Working sustainably with our subcontractors 55 Adopting a progressive HR stance 59 Wastewater treatment: a global approach to supplier support 64 METHODOLOGY 66 Our social performance indicators 67 Our environmental performance indicators 72 Our societal performance indicators 72 Correlation table 73 Methodological note 79 Statement of one of the statutory auditors 83 CONTENTS / 1 CHALLENGES AND MANAGEMENT 2 / CHALLENGES AND MANAGEMENT 2014 SUSTAINABLE DEVELOPMENT REPORT Decathlon in figures Innovation lovers, for the happiness of people: such is the sentiment shared by almost 65,000 Decathlon employees worldwide. Our aim is to place innovation at the heart of everything we do, from designing our products to our after-sales service; and at each stage of our activities, from manufacturing items to delivering them to stores. Our 20 Passion brands, the brands developed by Decathlon, are working hard to offer our customers technically sophisticated, aesthetically pleasing and user-friendly products that are always priced as low as possible. Our business culture hinges on two key values: Vitality and Responsibility. These values are intrinsic to anyone who enjoys sport and who is keen to experience the pleasure and benefits that sport has to offer. OUR EMPLOYEES IN THE WORLD number of employees: 64,934 64 ,934 GROWTH IN NUMBER OF EMPLOYEES WORLDWIDE 65,000 50,000 55,000 60,000 2011 OUR EMPLOYEES WORLDWIDE Europe = 80.7% Asia = 12% Russia = 3.8% America = 2.4% India = 0.9% Africa = 0.2% BREAKDOWN OF EMPLOYEES BY AGE 20 – 29 = 65% 30 – 39 = 21% 40 – 49 = 7% < 20 = 6% 50 + = 1% 2012 2013 2014 OUR EMPLOYEES BY ACTIVITY WORLDWIDE Business and services = 78.9% Logistics = 9.9% Design/Production = 5.9% Support activities = 5.3% BREAKDOWN OF EMPLOYEES BY GENDER Men = 59% Women = 41% CHALLENGES AND MANAGEMENT / 3 2014 SUSTAINABLE DEVELOPMENT REPORT OUR ACTIVITY IN THE WORLD TURNOVER BREAKDOWN OF TURNOVER our annual turnover: 8.2 International = 60.5% France = 39.5% billion of euros GROWTH IN TURNOVER GROWTH IN TURNOVER IN 2014 IN BILLIONS OF EUROS 6 6,5 7 7,4 2010 2011 2012 2013 8,2 2014 OUR BUSINESS ACTIVITY ZONES WORLDWIDE One zone consolidates all of Decathlon’s activities operating within a geographical area: distribution to stores and online, production, transport and logistics and support services. Africa Zone : Marocco, Tunisia, Egypt, Madagascar. Asia Zone : China, South Korea, Taiwan, Singapore, Indonesia, Vietnam, Cambodia, Thailand. America Zone : Brazil. Europe Zone : France, Spain, Italia, Polond, Portugal, Germany, Belgium, Hungary, United Kingdom, Romania, Czech Republic, Turkey, the Netherlands, Sweden, Bulgaria, Croatia. India Zone : India, Bangladesh, Sri Lanka. Russia Zone : Russia. 4 / CHALLENGES AND MANAGEMENT 2014 SUSTAINABLE DEVELOPMENT REPORT BREAKDOWN OF OUR POS BY COUNTRY BE BR BG CN HR CZ FR DE HU IN IT MA NL PL PT RO RU ES SE TU GB Stores 884 22 18 4 115 1 9 288 23 16 20 100 2 5 44 24 13 24 128 1 9 18 Openings 2014 103 2 3 2 32 1 2 3 2 0 10 6 0 2 9 0 1 8 13 0 3 4 103 new points of sale in 2014, bringing Decathlon’s total to 884. 44 warehouses ehouses worldwide ldwide 20 Passion brands (Decathlon’s brands) OUR PRODUCTION AREAS Our production areas bring together the countries where Decathlon teams have a physical presence and organise product manufacturing with subcontractors. Africa production area : Marocco, Tunisia, Egypt, Madagascar. America production area : Brazil. North Asia production area : China, Taiwan, South Korea. South-east Asia production area : Cambodia, Indonesia, Singapore, Thailand, Vietnam. South-west Asia production area : Bangladesh, India, Sri-Lanka. Europe production area : France, Portugal, Italy, Turkey, Roumania. CIS 1 production area : Russia. 1. Commonwealth of Independent States. CHALLENGES AND MANAGEMENT / 5 2014 SUSTAINABLE DEVELOPMENT REPORT Interview It doesn’t matter whether you’re an employer, a customer or a member of the public, anyone can tackle sustainable development issues at Decathlon. Decathlon’s Sustainable Development Director Isabelle Guyader and CEO Michel Aballea team up to provide the answers. “ I tell our teams: go on, take some risks! Push your sustainable development boundaries!” — Michel Aballea, Decathlon CEO. Interview with Isabelle Guyader and Michel Aballea Decathlon sustainable development director and CEO respectively. Why work at Decathlon? Michel Aballea: Firstly, my main reason is the same one that brought me to Decathlon 25 years ago: because I love sport! Our young employees join us primarily because of their love of sport. The second reason is because Decathlon’s purpose, “Innovation lovers, for the happiness of people”, very much resonates with me and makes me want to be part of this adventure. Lastly, our business is keen to boost performance through employee satisfaction, particularly by allowing them plenty of freedom linked to genuine responsibility. Isabelle Guyader: Exactly, and I’m sure that enjoyment for all really only makes sense in the long-term; my role is to support the business’ sustainable development. All Decathlon employees are citizens first and foremost, and they don’t just leave their beliefs behind when they come to work. Our role is to provide them with a clear framework and to support them with training sessions and ways in which to work… We trust them because every day we give each of them the means to make their own decisions, within their own particular area. Michel: Do you think that we currently place sufficient trust in our employees? Isabelle: I think that we need to explain the purpose and that once we’ve shared this purpose we can then nurture that trust. Should I buy a product from Decathlon? Michel: Absolutely, because a Decathlon product looks good, is technologically advanced and is inexpensive. The values our products embody are safety, ease of use, practicality and lifestyle... 6 / CHALLENGES AND MANAGEMENT 2014 SUSTAINABLE DEVELOPMENT REPORT Isabelle: To that I would also add the concept of dialogue and sincerity with our customers, particularly with the environmental labelling project we’re working on. This project means we’ll be able to award our products an environmental performance rating. In this way, customers will be free to choose products based on this particular criterion. Michel: Do you mean that the information will be visible on the product label? And in the product information online? Isabelle: Yes, it will be on all labelling in store and online. What’s more, when we manufacture a product, we’re extremely vigilant about the conditions under which it’s made. We pay particular attention to the health and safety conditions of our employees producing these products. For me, our strength lies in our longstanding arrangement of working directly with our suppliers. Michel: And also perhaps the fact that we operate locally too, close to our suppliers. Isabelle: This proximity enables us to work with our suppliers to improve the efficiency of our production lines, our ergonomics and our safety. Such ambitious targets mean that we really are leading the way when it comes to improving working conditions in our factories. What is Decathlon doing to preserve the planet? Michel: We love sport, and we particularly love sport in the great outdoors. Nature is our playground! We like to say that we’re borrowing the Earth from our children. We have a responsibility to protect our environment in order to safeguard the joys of sport as we know them. Where do you think we should focus our efforts in the coming years? Isabelle: The product side of things is an extremely big issue. When we calculate the carbon balance of our activity, we can see that the product is a massive contributor to our CO2 emissions. We need all our teams to pull together to find the right solutions, so that products are designed with human progress in mind; in other words, so that they are more environmentally friendly but still incorporate this economic aspect. This requires innovation, because there’s no obvious solution out there. Michel: Decathlon’s purpose, “Innovation lovers, for the happiness of people”,supports what you’re saying. The message behind this is also to say to our teams: go on, take some risks! You also need to push the boundaries in terms of sustainable development by ensuring that our products are more ecologically friendly and safer for the people using them and manufacturing them. Isabelle: Absolutely; I’m in no doubt that innovation is one of the keys to sustainable development within our business. CHALLENGES AND MANAGEMENT / 7 2014 SUSTAINABLE DEVELOPMENT REPORT Sustainable development governance Sustainable development is a central issue. Our decision-making system therefore involves all of the company’s activities and conveys Decathlon’s key values of Vitality and Responsibility . Explanations for each role: sustainability.decathlon.com Reporting and communication Management SD Reporting Manager SD Communication Manager SD Director Steering Comittee SD Promoter Internal Auditors Internal Auditors Regulation SD Legal Expert TEAMS Environment Project Managers SD in Production Managers Tasked SD Assessors Tasked Environment Leaders SD Director: - Leads a team of experts and a cross-functional network within the business. - Defines SD policy in line with the key areas outlined by the team and in conjunction with the business’ strategy. - Ensures adequate human, financial and material resources to enable effective implementation of the policy. SD Promoter: - A member of the Senior Management team; co-opts strategy proposals from the SD team and introduces them to the business. Steering Committee: - Comprises representatives from the various branches of the business (retail, logistics, production, design and quality). - Approves SD strategies and manages them by means of quarterly progress reviews. SD Reporting Manager: - Collects quantitative information, implements internal reporting protocols and writes methodological notes. SD Communication Manager: - Gathers qualitative information. - Draws up the Sustainable Development Report in accordance with regulations. - Produces information campaigns designed to raise awareness of sustainable development at Decathlon, both internally and externally. SD Legal Expert: - Monitors all legal information pertaining to sustainable development and manages compliance status in terms of the various obligations. - Assists with implementing regulatory obligations. - Provides support with regard to day-to-day regulatory issues. 8 / CHALLENGES AND MANAGEMENT 2014 SUSTAINABLE DEVELOPMENT REPORT Internal Auditors: - In conjunction with tasked SD in Production Managers and SD Assessors, internal auditors audit the internal personal health and safety assessment conducted on our suppliers. Environment Project Managers: - Supporting a set of key themes, they define: strategy, training courses and assessment tools. - They coordinate a network of environment leaders in their specific area. SD in Production Managers: - Produce Human Responsibility in Production and Environmental assessments and help suppliers to improve their skills. Tasked SD Assessors: - Constitute a network of employees approved as Human Responsibility in Production or Environment assessors to carry out audits among our suppliers. Tasked Environment Leaders: - Within a defined scope, these coordinate the implementation of environmental actions, training, environmental assessments, communication, etc. N.B. The HR team is responsible for HR governance; product safety is assigned to the quality department. Site safety is maintained by the site operating departments. PROGRESS THROUGH DIALOGUE Because of the variety of our activities and our operations, we dialogue with organisations on several levels: regional, national, European and international. We’re working to try and identify all stakeholders as exhaustively as possible. Work is already under way with some of them. By way of example: ALLIANCES NETWORK Website http://www.reseau-alliances.org/ We are a partner of World Forum Lille, taking part at a regional level in a workshop dedicated to employee mobility/accessibility on their worksite, organised by the Alliances Network. Our projects http://www.worldforum-lille.org/fr/ http://declic-mobilites.org/ PERIFEM (Technical Association for the Commerce and Distribution sector) Website http://www.perifem.com/internet/presentation.asp In 2014, helped to compile a guide on how to conduct a Greenhouse Gas assessment, so as to employ a common methodology best suited to the needs of the distribution sector. Our projects http://www.bilans-ges.ademe.fr/fr/ressource/guide-sectoriel-list/index/ idElement/8 CHALLENGES AND MANAGEMENT / 9 2014 SUSTAINABLE DEVELOPMENT REPORT FCD (Federation of Commerce and Distribution) Website http://www.fcd.fr/ Sits on the FCD Environment Committee that works to promote Sustainable Development. Our projects http://www.fcd.fr/actualites/article/id/62 FPS (Professional Federation of Sports and Leisure businesses) Website http://www.entreprisesdusport.com/fr/ Has been part of the CSR Commission of the FPS since 2014 (working on the code of conduct for the FPS and on an event linking CSR and sport). Our projects http://www.entreprisesdusport.com/fr/infos-conso/developpement-durable/ conference-5-juin-2014/ EUROCOMMERCE Website http://www.eurocommerce.eu/ Member of the Environment Committee, with the aim of monitoring and anticipating any future strategic and legislative developments for the European Union in terms of the environment. ADEME (Environment Agency and Energy Control) Website http://www.ademe.fr/ Involved drawing up guidelines to help the various activity sectors write their greenhouse gas emissions accounting guide. Our projects http://www.ademe.fr/lignes-directrices-developpement-dun-guide-sectoriel-bilan-demission-gaz-a-effet-serre Afnor/ADEME Website http://affichage-environnemental.afnor.org/ Involved for several years in Afnor-Ademe (French environment and energy management agency) working on the environmental labelling of products, aiming to define common evaluation methods for use within France. ORSE (CSR observatory) Website http://www.orse.org/ A member of the ORSE for several years. This organisation provides continuous monitoring of CSR in businesses across France, Europe and the world. 10 / CHALLENGES AND MANAGEMENT 2014 SUSTAINABLE DEVELOPMENT REPORT PCN France (National Contact Point) Website http://www.tresor.economie.gouv.fr/pcn Meeting with the PCN members in September 2014, with the aim of presenting a responsible purchasing strategy and discussing potential areas for progress. This meeting forms part of the drive to disseminate and monitor the PCN report on the implementation of the OECD textile/clothing sector guiding principles dated 2 December 2013. IMPACTT Website http://www.impacttlimited.com/ Decision to join the Benefits for Business and Workers scheme (BBW) at the end of 2014 implemented by the consultancy firm Impactt Limited. Our projects http://www.impacttlimited.com/case-studies/benefits-for-business-and-workersbbw EUROPEAN COMMISSION OEF (Organisation Environmental Footprint) Website http://ec.europa.eu/environment/eussd/smgp/organisation_footprint. htm Participation in a European experiment to define a common method for calculating a multi-criteria environmental footprint for businesses. PEF (Product Environmental Footprint) Website http://ec.europa.eu/environment/eussd/smgp/product_foot print.htm Participation in a European experiment to define a common method for calculating a multi-criteria environmental footprint for products. OCDE (Organisation for Economic Cooperation and Development) Website http://www.oecd.org/fr/ Member of a consultative committee (with representatives from PCNs, businesses, the European Commission, multi-stakeholder initiatives, NGOs and unions) tasked with writing a guide on due diligence in the textile and footwear industries. CHALLENGES AND MANAGEMENT / 11 2014 SUSTAINABLE DEVELOPMENT REPORT Sustainable development issues Decathlon’s CSR approach involves defining and prioritising the company’s strategic issues relating to corporate and social responsibility. Dedicated teams coordinate a table of indicators in order to measure how effective efforts have proved for each issue. Decathlon’s results for 2014 were as follows: CROSS-CUTTING HUMAN ISSUES 86% 91% 91% 50% 17% WILLINGNESS TO GO TO WORK of employees are happy to go to work. RESPONSIBLE AND AUTONOMOUS EMPLOYEES of employees feel they are able to take on initiatives and make decisions to keep their customers happy, within their particular fields of responsibility. MONITORING EMPLOYEE HEALTH AND SAFETY of employees consider their physical safety in the workplace to be well protected. 81% 81% 56% SHARING THE VALUE CREATED BY EVERYONE of employees are Decathlon shareholders. 119,918 9,9918 ENCOURAGING EMPLOYEES AND CUSTOMERS TO USE SOFT TRANSPORT METHODS of Decathlon’s greenhouse gas emissions are generated by customer and employee travel. 622 622 A MOTIVATING BUSINESS PLAN of employees are motivated by their company’s business plan (their store, warehouse, production office, department, etc.). TRAINING IN ORDER TO DEVELOP TALENT of employees are satisfied with their professional development. ENSURING FAIR PAY of employees feel that their pay levels are consistent with their responsibilities and performance. HELPING PEOPLE TO PLAY SPORT AND TO INTEGRATE INTO SOCIETY THROUGH OUR FOUNDATION beneficiaries of Decathlon Foundation projects in 11 countries. ENCOURAGING OUR CUSTOMERS AND EMPLOYEES TO DO SPORT customer input events organised in France by Decathlon stores. ISSUES RELATING TO OUR PRODUCT AND SERVICE RANGES 11,206 206PPM PPM 97% DEVELOPING SAFE, DURABLE AND HIGH QUALITY PRODUCTS customer product returns (per million). GUARDING AGAINST CHEMICAL HAZARDS FOR CUSTOMERS, EMPLOYEES AND THE ENVIRONMENT of tests comply with our standards. 12 / CHALLENGES AND MANAGEMENT 10.3% 4.06/5 STANDARDISING ECO-DESIGN BY INCORPORATING SUSTAINABLE USE OF RESOURCES INTO THE EQUATION of products sold are eco-designed (in terms of quantity). ENCOURAGING THE SALE OF INNOVATIVE PRODUCTS THAT ARE AFFORDABLE BY AS MANY PEOPLE AS POSSIBLE is the average customer rating for our innovative products. 2014 SUSTAINABLE DEVELOPMENT REPORT ISSUES RELATING TO PRODUCTION FROM THE RAW MATERIALS STAGE THROUGH TO PRODUCT MANUFACTURE 65% 18.2% HELPING OUR SUPPLIERS TO IMPROVE WORKING CONDITIONS IN OUR SUPPLY CHAIN of tier 1 suppliers rated ABC. DEVELOPING RESPONSIBLE SOURCING FOR CERTAIN “SENSITIVE” RAW MATERIALS of cotton products are made using environmentally-friendly cotton. 85% 31% REDUCING POLLUTION EMITTED DURING PRODUCTION, AND PRIORITISING THE MONITORING OF WATER QUALITY of suppliers concerned comply with Decathlon’s standards. DEVELOPING LOCAL SOURCING OF COMPONENTS AND PRODUCTS of Decathlon brand products for each area are made with locally manufactured products (in terms of turnover). ISSUES RELATING TO THE TRANSPORTATION, STORING AND DISTRIBUTION OF OUR PRODUCTS 35 35 BUILDING OUR SITES FOR A SUSTAINABLE FUTURE (STORES) accredited stores. 145.5 14 45 5 REDUCING ENERGY CONSUMPTION AND IMPROVING THE ENERGY EFFICIENCY OF OUR SITES (STORES) is the average energy consumption of our stores. 3353 53 REDUCING GREENHOUSE GAS EMISSIONS RESULTING FROM PRODUCT TRANSPORTATION per item delivered in Europe (transportation from production country to store). KWH / M2 / YEAR G OF CO2 5 71.2 KWH / M2 / YEAR BUILDING OUR SITES FOR A SUSTAINABLE FUTURE (WAREHOUSES) accredited warehouses. REDUCING ENERGY CONSUMPTION AND IMPROVING THE ENERGY EFFICIENCY OF OUR SITES (WAREHOUSES) is the average energy consumption of our warehouses. ISSUES RELATING TO THE USAGE AND END-OF-LIFE OF OUR PRODUCTS 4.15/5 15/5 MAINTAINING LONG-TERM CUSTOMER SATISFACTION is the average customer rating for our products. 10.3% BUILDING IN PRODUCT RECOVERY RIGHT FROM THE DESIGN STAGE, TO ENCOURAGE RECYCLING of products sold are eco-designed (in terms of quantity). CHALLENGES AND MANAGEMENT / 13 2014 SUSTAINABLE DEVELOPMENT REPORT Liberating energy Decathlon is re-focusing on the basics by giving all of its employees both freedom and responsibility. Centred on their enjoyment and motivation at work, the idea is to develop their skills to help create value and improve satisfaction for the end client. BECOMING OURSELVES AGAIN Over the years, hierarchies have been set up, frustrations have sometimes rooted themselves and well-being in the workplace has sometimes suffered. Liberating Decathlon, a drive spearheaded by Michel Aballea and his team, enables each employee to take responsibility for their own area of activity. Each employee makes decisions whilst being finely attuned to the consequences of these. It is important that employees trust each other whilst acting within a global framework. In 2014, a large number of events and conferences were organised internally to enable each and every employee to understand and implement these managerial changes. “ I found the day both enriching and energising. This makes it all the more satisfying to work at Decathlon; I appreciate the ambitiousness of its project, the diversity of its employees, its ability to adapt and to put plans in motion. At first I found the analysis exercises a bit repetitive, but the diversity of the projects helped me to understand that there’s something for everyone there, and that it’s our job now to expand at our own pace, in line with our own needs and beliefs.” — Sébastien The company’s values are upheld by its employees. A DIFFERENT WAY OF WORKING Happiness at work, personal fulfilment and self-expression: these are just some of the alternative ways in which the business helps its employees to develop. We no longer organise our operations around a specific business department; instead we focus on developing our skills. Coaches support and train employees, helping them to boost their levels of competence. Well-being at work becomes the condition for developing ground ripe for innovation. Happiness is very much in the interests of performance. 14 / CHALLENGES AND MANAGEMENT 2014 SUSTAINABLE DEVELOPMENT REPORT Understanding climate issues Our greenhouse gas assessment is a snapshot at a given point in time of the GHG emissions generated by each of Decathlon’s activities. Updated and published every year, it is used to identify the main sources of GHG emissions, to measure the effectiveness of emission reduction programmes, and to raise awareness. BREAKDOWN : BREAKDOWN OF CO2 EMISSIONS IN 2014 Product production = 67% Customer travel = 17% Site construction and operation = 7% Product transportation = 6% Employee travel = 3% RÉSULT: 4,519,000 tonnes de CO2 were generated in 20142 . We use two indicators to manage our performance, in line with the peaks and troughs of Decathlon’s activity: • GHG emissions per products sold: + 0,3% compared with 2013. • GHG emissions by revenue: + 6% compared with 2013. Efforts by our teams on the ground have limited the extent of these falling standards: • Our sites have become more energy efficient. • The goods flow and use of air transport for products going to Europe have been optimised. However, it is vital we remain vigilant with regard to: • Waste recycling in stores. Overall, this has fallen, despite the efforts of certain countries. • Product eco-design. The rate is flattening out, as teams are currently working on environmental labelling. “ Our ambition is to set a common target by means of an improvement goal, shared with all teams within the business.” — Émilie Aubry, GHG assessment manager for Decathlon. 2. The scope of this survey extends to all Decathlon stores, warehouses, offices (international head office, brand sites, production offices, etc.), as well as product transportation from production countries to stores, and employee and customer travel. CHALLENGES AND MANAGEMENT / 15 2014 SUSTAINABLE DEVELOPMENT REPORT Interview with Émilie Aubry and Romain Poivet Interview with Emilie Aubry, manager of Decathlon’s GHG Emissions project, and Romain Poivet, an expert in GHG Emission Assessment methods for ADEME. Why produce a GHG emissions assessment? Romain: Human activity is largely responsible for climate change. Given this situation, businesses can conduct greenhouse gas emission assessments in order to gain an understanding of their impact on the climate, as well as to evaluate their dependence on fossil fuels (oil, natural gas, coal, etc.) with a view to reducing their emissions What are the key GHG issues for mass retail? Romain: The same as those highlighted by your GHG emissions assessment: products, with raw materials and manufacturing, logistics, and customer travel. These results should be viewed in the context of those for the food retail sector, which has more challenges in terms of keeping products chilled. How are teams involved? Emilie: Employees play a pivotal role! Firstly, a comprehensive network of leaders provides the data required for the calculations. Then, the overall Group assessment is broken down into individual assessments by activity or geographical area. This information is communicated to managers, who can then merge it with their own specific data in order to introduce appropriate action plans. We are currently working on an IT tool designed to make it easier to collect data and communicate results. And how do we get the customer interested in these results? Romain: We need to convert the information available at Group level into information that directly concerns the customer. For example, by giving them data about the product’s CO2 “cost”, Decathlon is enabling customers to decide between different products that can help them reduce their carbon footprint when playing sport. Emilie: This is what we hope to do with our environmental labelling efforts. The information on products’ environmental performances will be instantly visible to customers on signage both in store and online. What is Decathlon hoping to achieve in this area? Emilie: Statistics are not an end in themselves. For the time being, we use two indicators to measure our GHG emissions in line with our activity. Our ambition is to set a common target by means of an improvement goal, shared with all teams within the business. To eventually be able to create an overall environmental performance indicator, we will need to combine other criteria such as water and soil pollution, or resources depletion. We’re working on it! 16 / CHALLENGES AND MANAGEMENT 2014 SUSTAINABLE DEVELOPMENT REPORT ADAPTING TO CLIMATE CHANGE: We’re carefully monitoring the work of the GIEC3, and have communicated upwards our need for a methodology that can help research and innovation by the European Union so that we can better understand this issue. Decathlon is also a member of the working group OEF, which aims to define a methodology for calculating business’ overall environmental performance. OUR MAIN ACTION LEVERS • For our products: eco-design and suppliers’ environmental processes. • For our buildings: eco-designed buildings, improving energy efficiency, recycling and waste reclamation. • For transporting our products: optimising sourcing procedures, use of multimodal transport and maximisation of lorry loads. 3. Intergovernmental group of climate change experts. More information: https://www.ipcc.ch/ CHALLENGES AND MANAGEMENT / 17 2014 SUSTAINABLE DEVELOPMENT REPORT Decathlon Foundation The Foundation shares the values of Decathlon’s purpose. Since 2005, it has been helping employees who want to get involved in sport-based social inclusion projects. For 10 years, the Foundation has helped 435 employees get involved in 257 projects designed to benefit more than 130,000 people in 21 countries4. THE FOUNDATION IS CHANGING! The Decathlon Foundation currently operates with a board of directors and a team in France that works in tandem with several country-based representatives. Decathlon is keen for countries to be autonomous and to select and approve their own projects. Local Foundation Teams are being formed so as to facilitate employee initiatives and project monitoring. In 2015, China, India, Brazil, Spain and Italy will be in a position to function autonomously. SPORT AND INCLUSION The ultimate aim of the Foundation’s work is to enable disadvantaged people to access education, training and employment. Former beneficiaries of projects supported by the Foundation have had the opportunity to do work experience placements, with some going on to become Decathlon employees. The Sport in the City project: Lyon and Paris. The Decathlon Foundation has been supporting the Sport in the City association for a number of years in Lyon and more recently in the Paris region. By building new football grounds in the inner Parisian suburbs, Decathlon is hoping to create solid links between its stores and Sport in the City centres. The Sport in the City project dovetails perfectly with the aim currently supported by the Foundation, namely to use sport as a vector for educational and professional integration by involving our stores, our warehouses and our services to offer professional opportunities to young people who are passionate about and motivated by sport. The project approved in October 2014 has already given two youngsters the chance to work in regional stores. 4. i.e. 38 projects were approved in 2014, supporting 19,918 beneficiaries in 11 countries. 18 / CHALLENGES AND MANAGEMENT 2014 SUSTAINABLE DEVELOPMENT REPORT In Lyon, the project implemented 10 years ago enabled three youngsters to obtain an employment contract in the Part-Dieu and Bron stores. Numerous tours of the business are held with the aim of introducing youngsters to the world of professional employment. NUMBER OF PROJECTS CARRIED OUT OVER THE LAST 10 YEARS Europe Zone = 208 Africa Zone = 15 Asia Zone = 15 India Zone = 11 America Zone = 7 Russia Zone = 1 The French project “More for roms”, approved in 2012, has seen various beneficiaries hired on fixed term contracts. The Chinese project “Another possibility of life”, approved in 2014, helps those disadvantaged in society. The first British project approved in 2014, “Street league” focuses on introducing British youngsters to the world of employment. The 2012 Indian Project “Reality gives football programme” has enabled young Indian children to break down social barriers. CHALLENGES AND MANAGEMENT / 19 PRODUCTS AND SERVICES 20 / PRODUCTS AND SERVICES 2014 SUSTAINABLE DEVELOPMENT REPORT Innovation Lovers Innovation is clearly stated in Decathlon’s purpose: “Innovation lovers, for the happiness of people”. We innovate in order to make sport more accessible to as many people as possible, by means of ingenious, attractive products sold at a competitive price. From the product design stage through to visiting our stores and websites, all employees share one common objective: to offer our sports customers a different experience “ The principle idea is to innovate in a sustainable and systematic manner.” — Vincent Ventenat - Director of innovation THE ADVENTURE STARTS WITH UNIVERSAL EMPLOYEE COMMITMENT: Decathlon maintains a culture of innovation, a fertile ground for encouraging people to take risks, even if it means making mistakes. The teams responsible for product design are primarily the ones benefitting from this mind-set, but it involves all other departments within the business too. As innovation is more than just a process, we give our employees the freedom to be bold and creative, in order to find solutions that will become the services and products of the future. The way in which teams are organised into project mode is reviewed to enable a more cross-disciplinary approach and encourage dialogue between departments. Project coordination and management methods are also reviewed in order to develop team's autonomy in decision-making, with a more collaborative working model. For example, Actireo shoes by the Newfeel brand were developed in 9.5 months compared with the 18 needed for the standard model. This efficiency is largely due to the greater flexibility of teams when it comes to finding solutions. More autonomous, employees discover a sense of responsibility and develop their skills, thereby increasing value added in their day-to-day work. To derive maximum benefit from the numerous workshops5 organised, an internal tool (Keep It) has been developed to store areas for discussion and their outcomes, year after year. This enables us to capitalise on ideas and share them among our teams. 5. Brainstorming workshops designed to bring forth ideas about new products/services or developments. PRODUCTS AND SERVICES / 21 2014 SUSTAINABLE DEVELOPMENT REPORT Brand Innovation Managers for some of our Passion brands are working hard to breathe life into this environmental project. “ Every day is a new chapter in a unique adventure” — Sylvain Venant. We chat to Sylvain Venant, Brand Innovation Manager at B’TWIN. What is the role of the Brand Innovation Manager? The BIM instils, supports and cultivates a culture of innovation. A visionary, the BIM poses questions, provides explanations and leads their brand’s differentiation strategies. The BIM is also a manager "on the ground", who helps teams to adopt the necessary methods, skills and collaborative practices to improve and ensure that projects succeed. How do you see innovation at B’Twin in 10 years’ time? It's important to take a big step backwards in order to identify the downward price levers right across the value chain: how we design, produce, source, communicate, sell and purchase... right through to after-sales service and recycling. Innovation will be even more collaborative in nature (both internally, and with the external environment), designed and fine-tuned with a 360° approach, placing the customer-user at the heart of the process. We must now step up our efforts to ensure that all employees can be creative and innovate within the business, regardless of the department they work in. This ambitious objective is our way of promoting the optimum well-being of all our teams worldwide and ensuring that they take pride in their work. The Decathlon Innovation Awards Every year since 2005, Decathlon has showcased its expertise at its own Innovation Awards. This event is as much an opportunity to introduce ground-breaking new products and services to our customers and partners as an in-house competition that brings our teams closer together. It's an evening when the most innovative products - whether by their usage, technology or spin-off usage – are introduced, with the winning entries voted for by customers and employees. Don’t miss this year’s event on 8 October 2015! 22 / PRODUCTS AND SERVICES 2014 SUSTAINABLE DEVELOPMENT REPORT INNOVATION: A RESPONSE TO SOCIETY’S CHALLENGES Our management methods are geared towards the assumption of responsibility. Such employee autonomy has seen the birth of new brands and product modifications inspired by sustainable development issues. Each brand is free to choose its own projects depending on its policy, its market, the economic context and whether it's the right time to be doing it. 4,06/5 is the average6 rating awarded by our customers for our innovative products. GALLERY OF INNOVATIVE PRODUCTS ARPENAZ 10 BACKPACK: AN ENVIRONMENTALLY-FRIENDLY INNOVATION Following a workshop, the manufacturing process for the Arpenaz 10 backpack was revamped to comprise one single seam, thereby reducing the amount of material used, decreasing production time, increasing the number of backpacks that could be transported in the lorries, and making the end product cheaper. ▶ Video with the designer of the Arpenaz 10 backpack: https://www.youtube.com/watch?v=ZJPIm6I9wug&feature=youtu.be THE MYBIKE: DESIGNED AND MANUFACTURED IN INDIA FOR INDIAN PEOPLE The teams in India have developed (with basic technical support from B’Twin’s teams) bikes suited to the needs and means of the Indian population. These bikes are 40% cheaper than the models sold previously. THE CAPERLAN SINKER: LEAD-FREE FISHING FOR THE ENVIRONMENT This ground-breaking, lead-free-certified product reached the finals at the 2014 Innovation Awards. ▶ Video Lead-free fishing: a new strategy from Caperlan https://www.youtube.com/watch?v=JkFPBoC2Q8k T H E S P O R T I D E A B O X And what if we turned your ideas into reality? Who better than a sportsperson to know what they need to improve their performance? We know that anyone who loves sport has opinions and ideas to share. That's why we've invited to them to help us design the sports products of tomorrow on decathloncreation.com. The aim of this platform is to convert ingenious ideas and suggestions submitted by community members into actual sports products that are both innovative and affordable. 6. Out of 13 970 ratings collected in 2014 on these products. PRODUCTS AND SERVICES / 23 2014 SUSTAINABLE DEVELOPMENT REPORT Eco-design PRODUCT LIFECYCLES AND IMPACT REDUCTION Efforts to reduce environmental impact starts as soon as we begin the product design stage. Analysing lifecycle enables us to assess the product’s environmental impact. We can use it to identify the challenges facing us as well as levers to achieve these and to reduce product-related impacts. CLIMATE CHANGE Long-term changes in the global climate caused by rising greenhouse gas levels. WATER CONSUMPTION The various product-related impacts. Total water consumption contributing to the depletion of water resources. WATER POLLUTION Physical, chemical and biological deterioration of water quality. CLIMATE CHANGE Depletion of both renewable and non-renewable natural resources. 24 / PRODUCTS AND SERVICES 2014 SUSTAINABLE DEVELOPMENT REPORT UNDERSTANDING THE IMPACTS ASSOCIATED WITH OUR PRODUCT, USING THE EXAMPLE OF A T-SHIRT: The lifecycle provides a good overall way of looking at a product's various impacts on the environment. Applying more in-depth analysis, conduct a stage-by-stage review of the environmental consequences for a product like a T-shirt7. LIFECYCLE IMPACTS OF A T-SHIRT Production = 33% Raw materials = 27% Usage = 19% Distribution (customer travel) = 12% Transport = 7% End of life = 2% The biggest impacts are generated by raw materials and production. In the case of a T-shirt, such impacts are linked to water consumption and pollution occurring during these stages. This is why teams use recycled materials as well as new dyeing processes. Furthermore, a T shirt's recycling potential and second life possibilities reduce the impacts associated with this product’s end-of-life. On average, one T-shirt produces 7.2 kg CO2, the equivalent impact of a light bulb burning for 150 hours8. OTHER EXAMPLES OF ECO-DESIGNED PRODUCTS ATHLETEE T-SHIRT REF : 8297656 Made from 100% organic cotton. MC ELIOFEEL T-SHIRT REF : 8240455 The main component is made from 80% recycled fibres. BIDARTE PALM REF : 8333507 Available in various colours. Its main component is made entirely from recycled materials GROWTH CURVE FOR ECO-DESIGNED PASSION PRODUCT SALES (IN QUANTITIES SOLD) The level of eco-designed products is flattening out, as teams are currently working on environmental labelling. 7.2% 2010 9.4% 10% 10.5% 10.3% 2011 2012 2013 2014 7. Survey carried out by our research department as part of our environmental labelling project for a cotton T-shirt. 8 . ADEME, 2011. PRODUCTS AND SERVICES / 25 2014 SUSTAINABLE DEVELOPMENT REPORT “ Eco-design is part of Quechua’s DNA, and it’s important to maintain this identity” — Benjamin Lafoux. Profile for Benjamin Lafoux Product engineer at Quechua since 2004 and environment manager since 2012 In practical terms, what are your missions as environment manager? Basically to give value to the environmental dimension, to reverse the trend of recent years in which the environment has been seen solely as an expense. Eco-design is part of Quechua’s DNA, and it’s important to maintain this identity. The manager is involved in the writing of all joint projects. A huge strategic coordination effort between the various departments is required in order to ensure that the environment is properly taken into account, as each person has their own responsibility at their own level. I am there to pass on good practices, introduce new components and relay the group's key projects such as the carbon balance assessment or environmental labelling. When I conduct our environmental review at the end of the year, we'll be able to determine action levers and understand which products we need to concentrate on in order to reduce our impact. How is your network organised? There are more than thirty environment managers across the design and production departments. The sustainable development department organises meetings between all the managers. It’s an opportunity for us to discuss ecocomponents, eco-design and project progress, and to focus on other initiatives. We are all interconnected so that we have a solid network stretching from production through to our stores. 55% A flagship product: the Quickhiker tent The materials used in the Quickhiker Ultralight have been reviewed so as to reduce their environmental impact and increase their durability. The use of a 65% recycled polyester fabric, a lightweight component made from recycled plastic bottles (see choosing the right product components section), has enabled us to improve both our technical and environmental performance. Our tents are sold with a kit that means anyone can repair a broken pole. The entire product is also repairable in store. 9. Out of a total of 294 engineers. 26 / PRODUCTS AND SERVICES of product engineers at Decathlon have been trained to use our tool so that they can conduct an environmental assessment9. 2014 SUSTAINABLE DEVELOPMENT REPORT SUSTAINABLE DEVELOPMENT: RAISING AWARENESS AND MOBILISING EMPLOYEES Passion magazine, our in-house publication available in all countries, devotes one of its chapters to our efforts in sustainable development. 2014 was also the first year that the group compiled its first report for employees. The Green Awards are an important occasion in the sustainable development calendar, rewarding the best sustainable development initiatives. This year’s event saw two packaging projects, a logistics and property project in Russia and a customer input event dedicated exclusively to sustainable development: the Gr’In Day. GREEN AWARDS CEREMONY First place: a project to reduce boxes used for B’Twin bikes. Smaller boxes for lorries, meaning warehouses can store more. Third place: development work on clothes hangers, pre-hanging garments in production and recycling to generate less CO2. Award winners with their trophies. Second place: the joint property and logistics project in Russia. Jury’s special prize: the customer input event by Aulnoy les Valenciennes dedicated to sustainable development. Employees attending the event, applauding the winners. PRODUCTS AND SERVICES / 27 2014 SUSTAINABLE DEVELOPMENT REPORT Environmental labelling Environmental labelling is a large-scale project that our teams have been working on since 2009. Its aim is to give customers the keys enabling them to apply an environmental criterion when making a purchase. The rating on a particular product (going from A to E) is designed to inform our customers about its environmental performance, making it possible to compare products sharing the same typology. Our aim is to ensure From 2014, pictograms in store will be used to distinguish products designed with environmental concerns in mind. In December 2014, environmental impacts were calculated for 49% of Decathlon's Passion products; in other words, over 1,900 products10. Their rating is yet to be determined. 100% that all our Passion brand products have an environmental rating in 2016. ECO-DESIGN ONLINE! Some Passion brands offer an “eco-design” sorting filter on their online retail website, to help customers find the products with the smallest environmental impact. http://www.domyos.fr/ http://www.quechua.fr/ Example of Quechua’s online rating system. 10. Passion products are assessed and then awarded an environmental rating. 28 / PRODUCTS AND SERVICES 2014 SUSTAINABLE DEVELOPMENT REPORT CREATING A POSITIVE DYNAMIC WITH OUR STAKEHOLDERS Decathlon collaborates with a large number of stakeholders. We place our customers at the very heart of our focus. We take their expectations and opinions into account. We have conducted three surveys amongst our customers, which have enabled us to fine-tune our labelling. Pioneers in this subject, we have implemented11 a discussion platform on environmental labelling for consumer products (ADEME/Afnor)12. We are working on defining methods for assessing the environmental impact of products, and on creating labelling formats. Devising an accounting method is a complex issue, as is fixing a scoring framework, which is why Decathlon is also working with the European Commission on the textile PEF platform13. Generally speaking, we adopt an open-minded approach with public authorities, associations and other businesses when it comes to sharing information, and standardising and converging our methods. Choosing the right product components When Decathlon designs products, choosing which components to use is a key stage. The teams are committed to designing reliable products that incorporate innovative materials that reduce the impact on the environment. REDUCE THE ENVIRONMENTAL IMPACT OF PRODUCTS ORGANIC COTTON In 2014, Decathlon excelled itself by becoming one of the top 5 businesses in the world using organic cotton. Domyos and Quechua are the leading consumer brands at Decathlon, a company that uses 4,271 tonnes of organic cotton were used last year, 613 tonnes more than in 201314. Using organic cotton helps to preserve the soil and water resources and encourages biodiversity, as it is grown without using either chemical fertilisers or pesticides. 11. In France. 12. ADEME coordinates a methodological platform operated by AFRNOR, which is compiling a “Good practices Guide” as well as ratings for different product categories. 13. Decathlon is taking part in the European environmental labelling experiment PEF (Product Environmental Footprint), to define a common method of calculating multicriteria environmental footprints for products. Decathlon is a member of the technical secretariat for textiles, the aim of which is to define assessments methods, test environmental labelling visuals and define rating classifications for this product category. 14. For 2014: the indicator is calculated by taking the tonnage of organic cotton, BCI cotton and recycled cotton. The proportion of BCI cotton and recycled cotton are currently still fairly insignificant. PRODUCTS AND SERVICES / 29 2014 SUSTAINABLE DEVELOPMENT REPORT RECYCLED POLYESTER Our flagship product made from recycled polyester, Quechua’s Forclaz 50 fleece, continues to be popular among customers (men, women and children). We’re looking to adopt an even more innovative stance towards this mass-produced product by switching from a recycled fibre with a 65% recycled bottle content to a fibre made entirely from recycled bottles by 2016. COLOURING WITHOUT DYEING Colouring without resorting to the use of dyes is nothing new. At Decathlon we're innovating - by mixing a coloured fibre with a neutral fibre. With no need for water, production times are shorter, the fabric is stronger and the cost is cheaper. These textiles will be in store from the 2016 Spring/Summer season onwards, used in our Quechua tents. One square metre of fabric uses 75% less water. This will save 130 million tonnes of water, equivalent to 44 Olympic swimming pools! That’s a lot of water that's not going to be polluted or wasted. The spool of thread is solution-dyed without using water. ENSURING USER HEALTH AND SAFETY Our suppliers agree to respect our list of prohibited substances15. We don’t just take into account country-regulated substances but also impose thresholds for substances that we consider to be hazardous to our customers. EXAMPLES OF SUBSTANCES THAT WE HAVE PROHIBITED: Residual isocyanates that can cause allergies. Also, since 2008, we have prohibited the use of phthalates16 in all our products, not just in toys as stipulated by pre-2015 regulations. To ensure that all our products comply with our standards, all products from all of our suppliers are subjected to tests17 at various points during their lifecycle: during the design phase or production stage, and even in store. 6,717 products tested in 2014, i.e. 26% more than in 2013. 15. Substances regulated in all distribution countries, as well as the substances that we have prohibited. 16. 10 phtalates. 17. As well as tests conducted by our suppliers, tests are also carried out by Decathlon on these products. 30 / PRODUCTS AND SERVICES 2014 SUSTAINABLE DEVELOPMENT REPORT Since 2010, Decathlon has been giving its suppliers pre-implementation training in chemical risk management in order to safeguard employee health. The aim is to enable them to act autonomously in terms of chemical risk management. The dedicated team remains on hand to assist with any needs and to help ensure compliance with standards; we are creating tools specific to their requirements. Stricter controls are carried out on products considered to be more sensitive (those aimed at children under 3, toys and products that come into contact with food, etc)18. We’re working impartially, objectively and honestly. Besa Environmental health engineer, answers questions on chemicals asked by customers. What do your missions involve? My job was created to respond effectively and quickly to customer queries about our products. Customers contact us in store, via our Customer Relations Centre, by telephone, by email19 or by comments made online on the Decathlon website. I respond to all of their questions about how our products are made and how they comply with the various regulations. I also deal with any adverse skin reactions associated with product use. My job is also to satisfy the requirements of governmental bodies20 and consumer associations. What sort of relationship do you have with our customers? Our priority is to be able to guarantee their safety; we take any feedback extremely seriously. We analyse all elements of information that we have in order to establish whether there is any link between the product and the reaction. I make every effort to contact the customer within 3 days21. Similarly, we are committed to providing the customer with a final response within 45 days22, now we’ve reduced this to within 40 days, which includes the following stages: - receiving the customer’s product, - conducting tests, - producing analysis results, - communicating our conclusions to the customer. If necessary, we contact the customer’s doctor or we may suggest they visit a specialist. It is rare for a product to be in dispute, but should there be a risk for our customers, production is halted and the products destroyed. 18. In 2014: over 97% of products tested complied with our standards. 19. [email protected]. 20. DGCCRF: commission for consumption, competition and fraud control. 21. Indicator implemented during the period from June to December 2014. 22. This time limit was calculated by using that determined by REACH regulation (CE) N° 1907/2006 of 18 December 2006 concerning the recording, assessment and authorisation of chemicals. PRODUCTS AND SERVICES / 31 2014 SUSTAINABLE DEVELOPMENT REPORT CUSTOMER SATISFACTION AND CONTINUOUS IMPROVEMENT From designing our products through to selling them, Decathlon focuses on delivering long-term customer satisfaction. The quality of our products and services is an on-going requirement, with user safety a prerequisite. QUALITY: A CROSS-FUNCTIONAL PROCESS As we are the product designer, and because of our regular visits to our subcontractors, we are in a position to continuously improve the quality of our brands’ products. It is an essential requirement, and one that we try to foster at various stages of the product lifecycle: DURING THE DESIGN PROCESS At each of our Passion brands, one or more quality managers are entrusted with monitoring the products. Their primary aim is to supervise user safety. They help to develop the product, determine the use that the product is designed to fulfil (depending on, for example, playing conditions and frequency, ability level, etc.). Once at this stage, they analyse the product to detect potential weaknesses and resolve them. Tests are then carried out in the field or in the lab in order to check durability, and the degree to which the product's technical performance corresponds with its intended usage. “ Our role is to support teams through collaborative working. We work together: quality managers, product engineers, method engineers, product managers, etc., to develop a product in line with our customers’ usage requirements and any manufacturing constraints. The most important consideration is our customers' safety and long-term satisfaction.» — Nicolas Lenglet, Domyos quality manager. ▶ Video Decathlon // Hi-tech at low prices: product tested, quality guaranteed. https://www.youtube.com/watch?v=akvSaCtUfVs DURING PRODUCTION Once the product specifications have been drawn up, it’s necessary to make sure that the manufacturing process does not compromise on quality in any way. Our production teams control the quality of items across the factory chains, and conduct tests to check whether objectives have been achieved. Subcontractors are assisted and regularly assessed in these areas. IN STORE AND ONLINE Should a product on sale in store be faulty, there are several possible solutions designed to protect the customer and ensure that fully compliant product replacements are available as quickly as possible: withdrawal from sale, repair products returned to suppliers, products destroyed, recall campaign for products sold. Decathlon implements the necessary teams and resources to ensure that the right corrective action is taken. Quality representatives are appointed in each country and IT tools shared in order to speed up response times and improve efficiency. 32 / PRODUCTS AND SERVICES 2014 SUSTAINABLE DEVELOPMENT REPORT CORRECTIVE ACTION PROCESSES IN 201423 80% items returned to warehouses 10% items repaired in store 5% items destroyed in store 5% customer recall campaign in store IN TERMS OF ITEMS SENT BACK TO WAREHOUSES 50% were destroyed 25% items were repaired 25% were sent back to suppliers It is important that our customers bring back or return their faulty products in order to help us make quality improvements. Some will be sent straight to our design teams for analysis and correction! 1,204 PPM Passion Brand products Returns rate (per million) for Passion brand products returned by customers because they were faulty or because the customer was dissatisfied 24. CUSTOMER SATISFACTION IS AT THE HEART OF WHAT WE DO Among the main sources of information that helps us understand how our customers perceive our product quality are the ratings and comments they post on our retail websites. This source has been extremely valuable to us since 2008, enabling us to measure their enthusiasm for our products. By analysing them in more detail27, we were able to determine their definition of what quality was, and identify the link that exists between opinions and satisfaction. For our customers, a quality product is a product that caters effectively for its usage and is durable over time. 4.14 /5 25 The average product rating for our Passion brand products. This marks an improvement on 2013’s figure (4,07/526) as our brands have made this subject their central priority, in a bid to improve customer satisfaction. This definition confirms and strengthens our own convictions about creating ingenious, long-lasting products. 23. Out of 180 corrective quality actions, i.e. 3 million items concerned (Decathlon brands and other international brands included) with regard to over 800 million items sold in 2014. 24. Compared with 1,196 passion brand products in 2013, this increase can be explained by an increase in the number of certain products returned by our customers. 25. Out of 229,290 ratings collected in 2014.. 26. Out of 119,904 ratings collected in 2013. 27. Internal survey conducted from 2013 to 2014 involving 204 products (involving all Passion brands and manufacturing processes) 29,800 respondents, scope: France. We are working to extend this survey to a global audience. PRODUCTS AND SERVICES / 33 2014 SUSTAINABLE DEVELOPMENT REPORT Whatever the rating or comment, we use them to identify usage needs upstream, and to continually develop our product range downstream, by discontinuing ranges that have left customers disappointed, or by simply not renewing them. By leaving ratings and comments on our websites, our customers are actively helping to improve the quality of our products! Comments are used to amplify ratings, to enable us to delve further into what makes customers satisfied or disappointed with our products. “ As a strong advocate of customer satisfaction, I use the comments left by customers to continually improve the quality of our products. Once the average score dips below 3, we draw up stricter action plans to bring the rating back up quickly.” — Germain Provot, B’Twin’s quality manager. ADVANCING THROUGH CAPITALISATION For each problem encountered, teams note down the root causes (poor usage classification, component-related issues, design rules poorly applied, etc.). This process of understanding is designed to improve our standards so that we can capitalise on the causes of non-quality and improve the quality of our products on an on-going basis. Repairing your products Decathlon enables its customers to use the product for as long as they possibly can. The Passion brands operate dedicated services designed to help everyone repair their product themselves, or have their product repaired. DOING IT YOURSELF Repairing products rather than discarding or exchanging them helps us to reduce our environmental impact. Geonaute has embarked on a big project with its customers to try and increase their post-purchase satisfaction. Faults on electronic items are often complex issues to pinpoint, so the Passion brand has introduced a web site (http://support.geonaute.com/en-GB) designed to help customers use their products. This after-sales service initiative has seen a fall in the number of products thrown away, and with improved product understanding, fewer product returns have been recorded. Folding your scooter, fitting a brake and changing a tyre: get some help with the basics with these videos produced by Oxelo! See you on Oxelo's YouTube channel! 34 / PRODUCTS AND SERVICES ▶ Video https://www.youtube.com/user/oxelo 2014 SUSTAINABLE DEVELOPMENT REPORT Domyos has also developed a tool to help customers solve their problems remotely. The after-sales service website (http://sav.domyos.co.uk/) is there for customers to use autonomously. Should they fail to solve their problem, they can opt to be called by a technician. The technician can resolve faults remotely, send spare parts and even organise a replacement to be shipped to the customer’s home address. In France 54% of solutions are found remotely. The Domyos website is available in 18 languages, with remote problem solving available – with support from a technician possible in 6 countries28. Domyos is currently working with the Workshop to roll out technical support to even more countries. GETTING YOUR PRODUCTS REPAIRED IN THE WORKSHOP Located in our Decathlon stores, Workshops can repair products, maintain and service them, and even customise them. How repairable an item is depends on three elements: • component availability, • the machines and tools required to carry out the necessary work, • the technicians’ methods and expertise In 2014, 88% of customers recommended the Workshop. ▶ Video https://youtu.be/UtBLstpKYds “ In 2014, 3 million customers worldwide used our Workshops to have their equipment serviced or repaired. They awarded them an average score of 4.27/5”. Our Workshop technicians place customers at the very heart of their strategy, responding to 100% of all comments posted. — Axel Amblard - Workshop services manager The Workshops are committed to our sustainable development drive: • by supplying our second-hand items sector: trocathlon.fr • by recycling used components. Our repair and maintenance work means that our customers don't have to stop practicing sport. 28. France, Spain, Italy, Belgium, Portugal and China PRODUCTS AND SERVICES / 35 2014 SUSTAINABLE DEVELOPMENT REPORT Customer input events Decathlon doesn’t just sell sports items. We also organise regular customer input events in our stores. These events invite our customers to come and join in or discover various sporting activities. They’re fun, friendly occasions for all ages. Two new events made an appearance in 2014: team sports day and combat sports day. 622 customer input events were organised in 2014, i.e. 108 fewer than in 2013. More stores took part but they organised fewer events. 190 French stores took part in 2014, compared with 205 in 2013. INTERNATIONAL EVENTS Decathlon Neelambur in India organised its first ever Vital Sport event. This day saw employees, customers and sporting associations get together to discover a range of new sports. It was also an opportunity to strengthen ties between Decathlon and local sporting associations. “ We would like to thank you for organising this Vital Sport event in Coimbatore. It’s given us a chance to run some introductory boxing sessions. Children and adults were all very interested in our sport. We also enjoyed being able to learn about other sports. We hope that Decathlon organises this type of event again.” — Kovai Boxing Academy (India). Photos of the Vital Sport day in India 36 / PRODUCTS AND SERVICES 2014 SUSTAINABLE DEVELOPMENT REPORT CHANGES AT TROCATHLON The Trocathlon, an event that our stores have run for 29 years, is implementing some developments in response to the changing needs of our customers. After surveying its customers, Decathlon France is now hoping to meet their expectations by offering a new service: trocathlon.fr (https://www.trocathlon.fr/). Now, customers in France can buy and sell second hand sports items online whilst benefitting from Decathlon’s guarantees: Decathlon teams are on hand to advise customers in stores across France, and to help them post their adverts online. This new service from Decathlon is expected to be rolled out in other countries from 2015 onwards. The Trocathlon event takes place twice a year in Spain, Italy, Portugal, Germany, Belgium, Hungary, Romania and Poland. The products collected are checked over before being sold. We're there to help buyers and sellers throughout the process. PRODUCTS AND SERVICES / 37 ENJEUX ET TRANSPORT MANAGEMENT AND STORES 38 / TRANSPOAND ENJEUX ET MANAGEMENT AND STORES 2014 SUSTAINABLE DEVELOPMENT REPORT Managing our sites IMPROVING OUR ENERGY CONSUMPTION MANAGEMENT. Decathlon is implementing an international strategy to manage energy in its stores. This global strategy operates at local level to ensure optimum effectiveness. This means that the involvement of all our teams worldwide is enabling us to improve the energy efficiency of our stores. A strategy split into three phases: - Promotion and communication. To get teams involved in managing energy on their site, there’s the inspiring example of a Decathlon UK employee, who set up a «Green Keepers» network. She rounded up teams from the various UK stores and explained the benefits of managing energy consumption properly. Making teams autonomous is the first, essential step before moving on to the next phase. 9.21% of our company-owned retail space is certified, i.e. 35 sites. This is more than in 2013, with figures of 6.47% and 24 sites respectively29. - Managing energy consumption in real time. Knowing your consumption in real time can help you better manage performance. Decathlon Italy is gradually installing this new technology in all of its stores. Employees will be warned when consumption hits peak levels and will be able to respond accordingly. - Modernising our sites. When building new stores, we try – as far as possible – to do it with environmental certification in mind. In the remainder of cases, we make technical improvements, such as in Germany, where we swap to LEDs whenever we change our lighting. MOUNTAIN STORE, AN HQE-CERTIFIED BUILDING In November 2014, Quechua, Wed’ze and Simond, Decathlon’s mountain brands, inaugurated their new international base camp in Passy, in the heart of the Mont Blanc lowlands. The HQE label 30 was primarily concerned with the issue of landscape integration (66% green spaces, green cycling and pedestrian link, etc.). The project had minimal environmental impact too (noise levels, water management, 100% recycled site waste). The building is extremely efficient from an energy point of view, with large triple-glazed doors and windows, insulation and natural light. Recycling and construction material selection were also key issues. 29. Figure revised at the end of the year. 30.HQE certification for stores means we can also reduce noise pollution during construction work. TRANSPORT AND STORES / 39 2014 SUSTAINABLE DEVELOPMENT REPORT RENEWABLE ENERGIES Decathlon Belgium continues to fit out its stores with photovoltaic panels. Five stores have installed this technology, with the panels generating between 20 and 25% of a store’s energy requirements. Stores’ electricity consumption fell by 6%, i.e. 145.5 kWh/m² in 2014, and 157 kWh/m² in 2013. The figure for warehouses also dropped, with consumption totalling 71.2 kWh/m² in 2014 and 80 kWh/m² in 2013.. The figures are confirmation of the initiatives implemented in stores and warehouses. Decathlon is maintaining its goal of reducing energy consumption by 20% between 2012 and 2015 Decathlon teams are working to minimise and recycle waste generated by commercial activities. Boxes, hangers and packaging are all types of waste processed by our stores and warehouses day in, day out. Decathlon Belgium is working with the Walloon government to create spaces reserved for car-sharing schemes in its car parks: there were 100 spaces in 2014. These spaces are a way to encourage the use of «soft» methods of transport. 40 / TRANSPORT AND STORES 2014 SUSTAINABLE DEVELOPMENT REPORT WASTE MANAGEMENT Sorting waste in order to recycle it enables Decathlon to recover raw materials or give certain items a new life. It’s an important stage in terms of reducing our environmental impact. TYPES OF WASTE GENERATED BY OUR SITES DECATHLON STORES, BRAND SITES, COMPANY-OWNED WAREHOUSES. Recycled paper and cardboard = 48% Mixed waste = 46 % Recycled plastic = 3 % Other (wood, metals, textiles, etc.) = 3 % DECATHLON SPAIN SHOW THE WAY In our Spanish stores, customers have to pay for their shopping bags. It’s one of the country’s main strategy thrusts in its bid to reduce the number distributed. In 2014, this scheme helped to finance Decathlon Spain’s sustainable development initiatives. A huge beach clean-up campaign was organised in October, to raise awareness amongst customers and employees alike. It was an opportunity to forge partnerships with Spanish institutions such as the Ministry of Sustainable Development. Furthermore, Decathlon Spain has also developed a global waste recycling strategy. Employees in store are made aware of the approach, with all recycling costs and methods explained. Solutions are put forward for recycling hangers, which are collected before being re-used. Decathlon Spain gets its employees on board. Everyone is able to share his or her good practices on a dedicated intranet site. TRANSPORT AND STORES / 41 2014 SUSTAINABLE DEVELOPMENT REPORT SPECIAL MENTION FOR DECATHLON BELGIUM Decathlon Belgium has an effective waste recycling programme, collecting 75% of its in-store waste. Whilst the legislation governing these areas is stricter in Belgium, our Belgian stores have performed extremely well. As well as recycling plastics and cardboard, stores also collect aerosols, inner tubes and metals. WASTE RECYCLING RATES Stores Warehouses 46% 2014 56% 2013 88% 86% 2014 2013 Thanks to renewed efforts by teams, recycling rates in warehouses are extremely satisfactory. However, recycling rates in stores fell last year. There was a drop in overall figures due to a sharp decline in recycling rates in French stores Our certified warehouse in Betonka (Russia) tops the rankings, recycling 98% of its waste. ENABLING OUR CUSTOMERS TO RECYCLE At the entrance to our stores are several containers for collecting used batteries and electric and electronic waste. Decathlon then makes sure they are sent to the right processing site so that they can be recycled correctly. In France, the Triman signage system is a visual reference point notifying consumers that a particular product (including the packaging) contains specific instructions as regards its recycling. 42 / TRANSPORT AND STORES 2014 SUSTAINABLE DEVELOPMENT REPORT Storage and transportation Storing and transporting our products are important aspects of our business growth. 2013 saw three key strategies designed to bring down CO2 emissions resulting from this activity. A year on, we can see that these efforts have been sustained, adapting in line with the latest standards, needs and ambitions. DEVELOPING OUR NETWORK OF WAREHOUSES Our warehouses are located at strategic points so that deliveries can be made to our stores within optimum timeframes. Our teams work tirelessly to reduce the distance our products have to travel. RUSSIA ADAPTS ITS LOGISTICS NETWORK TO ITS GEOGRAPHY Russia: 7 time zones and nearly 1,000km between its Moscow distribution platform and its Decathlon stores. A collaborative project involving distribution, logistics and property has made it possible to implement a country-specific strategy. Regional platforms have been opened close to the most far-flung stores. Lorries travelling to regional platforms are loaded to capacity, which means that our products are covering less distance. In Russia in 2014, lorries travelled 1,000,000 fewer kilometres, saving 1,500 tonnes of CO2. 2 new warehouses certified in 2014: Rouvignies (France)31 and Betonka (Russia)32, making 5 certifications in total. 31. High Quality Environmental standard. 32. BREEAM. TRANSPORT AND STORES / 43 2014 SUSTAINABLE DEVELOPMENT REPORT OPTIMISED BOXES; FULLER LORRIES AND WAREHOUSES We’re working on different areas: • optimising boxes: an initiative undertaken by our design teams. • filling lorries to capacity: aiming to ship full boxes as well as improving lorry loading. 1,259 items shipped per m² in 2014, that’s an improvement on 2013 (1,165 items/m²)33. • number of items in warehouses: we’re working on the number of items shipped per m² with a view to boosting the number of items per m³, particularly through optimising height wise storage. OPTIMISING BOXES FOR OUR B’TWIN BIKES How can we reduce the size of our bike boxes? That’s the question that Decathlon teams are asking themselves. So they’ve been working on a new way to assemble bikes, which means using smaller, shorter boxes that are therefore easier to handle. This can only be positive for the environment, with boxes that enable us to transport 50% more bikes in our lorries. Locally, the Bouc Bel Air warehouse and the stores within its distribution zone have introduced innovative developments in terms of lorry-loading height, with 40% more boxes per lorry now being shipped. Stores have invested in lift trucks that can hold more boxes, and the logistics organisation has been redesigned. This has enabled them to reduce the number of lorries on the roads. + 7.6% The Saragossa warehouse has increased its average per lorry load factor from 49 to 52m3, a rise of 7.6%34. Employees working in the Lompret warehouse. 33. At global level. 34. In average in 2014, the rate was 49.05m3 between key import warehouses and distribution warehouses, i.e. 12,504 items per lorry. 44 / TRANSPORT AND STORES 2014 SUSTAINABLE DEVELOPMENT REPORT ALTERNATIVES TO ROAD TRANSPORT Where infrastructure permits, major import warehouses are located on multi-modal platforms. In Europe, 11.5% of products are transported via train or barge35 . For flows leaving Asia, we’ve been working with a sea transportation company committed to an on-going programme of environmental improvements. One of its key moves was to invest in a fleet of boats to reduce its fuel consumption; every year the company issues us with its environmental performance results. QUECHUA PRODUCTS TAKE THE TRANS-SIBERIAN It’s not enough to eco-design a product. You also have to be mindful of the means used to transport your items from their manufacturing location to the distribution zone. Quechua is keen to remain consistent with its aim to reduce its environmental impacts. The brand has therefore decided to use the Trans-Siberian linking Asia with Russia for some of its Passion products: this option is 7 times less impactful than air travel and twice as fast as sea transport. CHANGES IN THE ENVIRONMENTAL IMPACT OF OUR PRODUCTS DELIVERED TO STORES IN EUROPE (in grams of CO2/item.)) 323 232 Production countries to Europe. Major import warehouses36 to distribution platforms. Distribution platforms to stores37. 49 2014: TOTAL = 353 84 72 2013: TOTAL = 508 35. Post-shipment transport from the port to the key import warehouse, 3 out of 7 warehouses are located close to ports. 36. At European level. 37. At European level. TRANSPORT AND STORES / 45 2014 SUSTAINABLE DEVELOPMENT REPORT Stores and their community involvement A Decathlon store acts as a continuous interface with its environment. A living space for employees and customers, it plays a role in developing the local community in many ways. We invite you to explore the various interactions between a store and its stakeholders, within the local direct impact area. A pilot project is currently underway to identify and strengthen stores’ positive action levers across their communities, for benefits that are shared by all those within them. The store works in partnership with sports clubs (special rates), helping them to improve their facilities, thereby playing a part in extending sport to more people. It doesn’t engage in any direct sponsorship or make donations. It can help people back into community life through sport, forging a close relationship with local public bodies. Waste recycling and reclamation is also managed at store level, depending on the existing recycling facilities in the area. The store must now develop its remit to raise customers’ awareness of the impact their purchases and sports have on the environment. Employees are recruited locally and paid according to a salary package defined by each country. Decathlon enhances the employability of its employees, largely through its culture of accountability that sees them gain in autonomy. Training is intrinsically linked to the responsibilities allocated early on in the role. 46 / TRANSPORT AND STORES 2014 SUSTAINABLE DEVELOPMENT REPORT The store contributes to local government and council revenue (in the form of tax revenue, apprenticeship tax, local and property taxes, etc.) and uses investment to play a key role in the economic growth of its local area. Located on the outskirts of towns and cities, the store should ideally be situated close to public transport links so as to make it easy to get to. The store can help people back into community life through sport, forging a close relationship with local public bodies. The store organises events such as Vitalsport, as well as occasions like Foundation Day. The store is keen to instil good, fair consumer practices and the lowest possible prices, and encourages store loyalty (promotional offers, loyalty schemes, personalised advice, etc.). The store offers its customers a range of affordable, high quality products and services (hi-tech/price ratio). Employee health and safety are important issues for the business. Store employees are in charge of managing energy consumption. TRANSPORT AND STORES / 47 2014 SUSTAINABLE DEVELOPMENT REPORT Guaranteeing safety Decathlon considers personal safety as its primary responsibility, and one that can actually help enhance the well being of our teams, as well as bring about business growth. STORE AND WAREHOUSE SAFETY Various tools (promotion, training, prevention, risk management, etc.) exist to ensure everyone’s safety. Each country gives its employees health and safety training as soon as they join (via an e-learning platform or other medium specially adapted by the country and its various sectors). An end-of-training questionnaire is also used to check that each new arrival has gained the required understanding and skills. WORKSTATIONS IN PRODUCTION FACILITIES Working and discussion groups are held to enable employees to help build their own workstations. Our production facilities have invested in special machines (such as ski maintenance equipment, etc.) that fulfil the need to enhance the safety of employees operating cutting and mechanical tools. In addition, movement and posture training enables all employees to feel more comfortable in the workplace and reduce the risk of accidents. There is a health and safety representative in each store and warehouse at all times. The role of this representative is to take safety-related decisions: secure building entries and exits, evacuation, customer and employee assistance in the event of an incident, etc. Employees in this role receive prior training (evacuation, first aid, first responders, etc.) studying both the theory and the required practical skills. In April 2014, a customer from the Baden-Baden Decathlon store in Germany suffered a cardiac arrest. 5 sales assistants administered first aid. According to the emergency services, this customer’s chance of survival would have been very small had they not intervened in this way. 48 / TRANSPORT AND STORES 2014 SUSTAINABLE DEVELOPMENT REPORT KEY FOCUS FOR LOGISTICS SAFETY Logistics teams work constantly to ensure the safety of employees, their work equipment and assets across all of their warehouses from the day they open. Safety is the focus of continuous improvement programmes, by means of exchanging good practices, monitoring risk, controls and inspections (both internal and external), drills (evacuation, etc.), surveillance and action plan monitoring. Internal controls are organised prior to the opening of any new operational site and each time a new warehouse director is appointed. Coordinating the logistics network relies on “black belts” working at country level39 or area level40 with safety leaders in each warehouse, depending on their scope. “ In the light of my career, my current experience as safety leader for the Caen warehouse, and my natural interest in this field, I was given the role of “black belt” for the France logistics network. This mission involves passing on the basics for running a warehouse so as to control risk, communicating changes to local regulations, coordinating priorities and sharing good practices.” — Xavier Malandain - safety leader for the Caen warehouse and “black belt” for France. “ Supporting our safety leaders in warehouses is an important role and we have to show a keen interest in raising the skills of these leaders in warehouses, enabling them to operate fully autonomously.” — Cristina Gaitan Perez - safety leader for the El Prat (Barcelona) warehouse and “black belt” for Spain. Safety training sessions as well as on-site signage have been implemented worldwide (left: Dourges, France / right: India) Flows safety is a priority for warehouses; pedestrian protection, natural lighting, training in handling equipment and storage quality, etc. (Caen, France). 38. Where we are owners. 39. France, Spain, China, Italy. 40. Portugal/UK/Germany, Poland/Hungary/Belgium, Brazil/Russia/India/Turkey/Singapore. TRANSPORT AND STORES / 49 2014 SUSTAINABLE DEVELOPMENT REPORT Promoting employee development Innovation lovers, for the happiness of people: such is Decathlon’s purpose, a guiding light that inspires our employees every day. At Decathlon, our employees are the first of our key success factors. ATTRACTING SPORTS FANS AND TALENT! Decathlon is growing and expanding internationally. To support this growth, we aim primarily to hire strong personalities who channel our sporting values: team spirit, competitiveness, endurance and energy. These criteria should enable us to inspire future employees to join Decathlon for the long haul. We’re not looking for a typical profile; rather the ability to be autonomous and responsible, to predict and plan ahead, to be open to people and to have natural leadership skills. Store managers mainly recruit locally, thereby boosting employment within their area. RECRUITMENT EXPERIENCE: WECHAT IN CHINA WeChat is an extremely popular social network in China. Decathlon China has therefore decided to use it as a recruitment platform, by creating a public account. Applicants can use it to find information about the company and vacant positions. They can apply directly to the one that appeals to them. It’s a great media concept for both PC and smartphone, and one that has sparked a certain amount of interest among the younger generations. 50 / TRANSPORT AND STORES 2014 SUSTAINABLE DEVELOPMENT REPORT INDIA GIVES A WARM WELCOME TO ITS NEW EMPLOYEES: WELCOME! The Welcome project helps to make employee integration that bit easier, with friendly training videos that instantly convey the atmosphere at Decathlon. Steve Dykes, CEO of Decathlon India, welcomes new employees through the use of visuals. WINNING TEAM MEMBERS: A KEY ELEMENT OF OUR PEOPLE STRATEGY. Since 2002, all employees in the company who have held an employment contract for more than 3 months41 take part in the Winning Team Member survey. This anonymous survey assesses employees’ well-being by looking at various themes such as commitment to the business plan, the quality of management among their superiors, and their own career development. Once the results have been analysed, Decathlon then knows which areas its employees are happy with, as well as those where action plans can potentially be implemented on a local scale. All teams in stores, warehouses and services receive a detailed set of results of the responses from their field of activity, enabling them to then measure how far they have progressed and to set new priorities for action. 2014 saw the best Winning Employee survey participation rates ever recorded, with 83% of forms completed and returned by employees. Whilst these results are clearly encouraging, we will continue to promote this survey in order to boost participant numbers to maximum levels. GIRL POWER! Women account for 41% 41 % of personnel at Decathlon42, and 30%43 of managers44 are women. 41. Regardless of their contract, except for temporary or external employees. 42. As of 31/12/14, overall business level. 43. i.e. 3,209 women out of around 10,000 managers. 44. Person responsible for at least one employee in the hierarchy. TRANSPORT AND STORES / 51 2014 SUSTAINABLE DEVELOPMENT REPORT FORMATION In France, 30% of department managers are women, but only 17% are store managers. It is this disappointing statistic that has led Decathlon France to create the “Leadership au féminin” training initiative. This approach fulfils two key objectives: - efforts to improve work/life balance - supporting women in terms of career development, enabling them to flourish in their professional life. Since 2013, hundreds of female employees have taken this training course, after which they have the opportunity to be supported by a dedicated HR manager.. Alongside this training scheme, Decathlon is also working hard to recruit female employees, and to ensure that their salaries are fair. ▶ Video Female leadership training https://www.youtube.com/watch?v=_7dzBIddPZY FINDING THE RIGHT WORK/LIFE BALANCE: For several years now, a key part of Decathlon France’s efforts to manage working hours has been a focus on work/life balance. Firstly, the business has encouraged all employees to share their thoughts via a “satisfied employees” table. This information is then analysed by the line manager, who may or may not issue a favourable response depending on their business activity. Employees can also share their feelings about the way in which their work was scheduled over the past year. At the same time, a specific mechanism known as “part-time balance” has been introduced for part-time working mothers and fathers, designed to limit the range of working hours every week. Lastly, managers whose hours are calculated on a day basis rather than hourly one can express their views during personal reviews, commenting on the organisation, their workload and work/life balance. An annual planning tool enables each employee to plan their coming year, so as to schedule in some holiday and rest time. The business agreement also reiterates the importance of playing sport regularly, for greater employee well-being. Furthermore, a large number of stores regularly organise sports activities after meetings. Our diversity agreements also contain provision for other arrangements (for senior employees, pregnant women, etc.). We are keen to do more so that all of our employees are happy with their hours they work and with the activities that make up their day. Our primary aim is for all employees to be happy to come to work. 45. Compared with 64% in 2013, source: Winning Team Members survey, international level. 52 / TRANSPORT AND STORES 69% of part-time employees are “happy with the number of hours they are contracted to work”45. 2014 SUSTAINABLE DEVELOPMENT REPORT HIRING DISABLED EMPLOYEES In 2014, France’s disability mission celebrated its 15 year anniversary. 15 years of working with our dedicated teams, in a network with external partners to help people with disabilities get back into work. ▶ Video 15 years of disability initiatives at Decathlon France https://www.youtube.com/watch?v=0YAh4QyxfD0 A PARTNERSHIP EFFORT TO COMBAT DISCRIMINATION IN ITALY Every Decathlon store in Italy has an agreement with local disabled sports organisations to encourage the recruitment of people with disabilities. Working in conjunction with town councils, some stores take on people in vulnerable situations, such as orphans and refugees, as team members, as experience, to help them ease into the world of employment. PAY: PAYING A FAIR WAGE BY SHARING THE VALUE CREATED BY EACH INDIVIDUAL. Decathlon awards employees pay levels that are commensurate with their performance. Wages are pegged in line with the local market, comprising a personal, fixed amount relating to individual responsibilities and a group-based amount linked to team performance. 11.32% of the business’ capital is owned by Decathlon employees. Over and above salaries, Decathlon is keen to encourage all its employees to adopt a healthy lifestyle and play sport. For example, in most countries we operate in, we’re giving our employees a discount card valid on all items sold in store, so as to help them purchase the equipment they need for their chosen sport. We’re also thinking of our employees’ health, taking the necessary measures to ensure that health insurance is specifically tailored to the country in question. DECATHLON’S EMPLOYEE SHAREHOLDER SCHEME HAS ONE AIM: TO ENABLE ALL EMPLOYEES TO BECOME SHAREHOLDERS. Since 1988, we have been committed to ensuring that every employee is able to invest in the company through an employee savings scheme. 83.50% of those eligible are Decathlon shareholders46. This scheme was operating in 20 countries in 2014, following its successful introduction to employees in India in November, 99% of whom wanted to become shareholders as soon as it launched. 46. i.e. 32,860 employees worldwide. TRANSPORT AND STORES / 53 RESPONSIBILITY IN PRODUCTION 54 / RESPONSIBILITY IN PRODUCTION 2014 SUSTAINABLE DEVELOPMENT REPORT Working sustainably with our subcontractors Together with our sub-contractors, we share a desire to make our Passion Brand products the best possible value for money. Our mutual working environment is based on: • a relationship based on mutual respect. • compliance with our current standards and legislation, for the safety of all concerned. • attaining the highest possible quality standards. • improving price competitiveness. • building a reliable, high-powered supply chain. • sharing and using mutual information systems. • preserving the environment. Our teams work tirelessly to ensure that our partners all make progress in these areas. Traditionally, strategies designed to improve working conditions are the ones where our teams make most headway. We are continuing such efforts whilst also making progress in terms of reducing pollution generated by the manufacture of our Passion brand products. 1,338 905 employees mpl plloy p loy oyee ee es responsible resp re spon sp onsi on ssiibl ble e forr maintaining maiintain in nin ing and ing and coordinating oordinating relations with ith subcontractors. subcontractors 22 producti production tiion tion n countries. subcontractors ctors 43 production oduction n off ffices ices 9 Decathlo Decathlon lo on production facilities. RESPONSIBILITY IN PRODUCTION / 55 2014 SUSTAINABLE DEVELOPMENT REPORT OUR PRODUCTION AREAS Our production areas bring together the countries where Decathlon teams have a physical presence and organise product manufacturing with subcontractors. Africa production area: Morocco, Tunisia, Egypt, Madagascar. America production area: Brazil. North Asia production area: China, Taiwan, South Korea. South-east Asia production area: Cambodia, Indonesia, Singapore, Thailand, Vietnam. South-west Asia production area: Bangladesh, India, Sri Lanka. Europe production area: France, Portugal, Italy, Turkey, Romania. CEI47 production area: Russia. BREAKDOWN OF VOLUMES PURCHASED BY DECATHLON (BY PRODUCTION AREA) North Asia = 50.5 % Europe = 18.6 % South-east Asia = 14.2 % South-west Asia = 11.4 % Africa = 4.8 % America = 0.5 % CEI = 0.1 % 47. Commonwealth of Independent States. 56 / RESPONSABILITY IN PRODUCTION 2014 SUSTAINABLE DEVELOPMENT REPORT AVERAGE LENGTH OF SERVICE FOR SUPPLIERS 60% (TOP 100 SUPPLIERS IN TERMS OF VOLUMES PURCHASED BY DECATHLON) 14% Average: 8.5 years 16% 10% 0% < 1 year 0% 1-3 years 3-5 years 5-10 years 10-20 years > 20 years INNOVATING BY INTRODUCING SUSTAINABLE PARTNERSHIPS We’re keen to create an exclusive relationship with certain subcontractors, based on a strongly shared mind-set that shares our vision and our values. We make progress by working together, helping us to surmount the day-to-day challenges inherent in what we do. By sharing common objectives, interests and standards with them, our partners become important players committed to our business plan. It helps us to view our subcontractor relations in a new way; a change of mentality that’s good for everyone involved. 9 partner suppliers pliers in 2014. 201 014. 01 4 With this strategy we’re hoping to manufacture 80% of our products with 100 partner suppliers. THE IMPORTANCE OF PROXIMITY We are keen to increase our instore product availability by reducing the distance between our clients and our production sites. Heightened responsiveness to local markets and the demands of our customers will enable us to reduce our packing, packaging and transportation costs, among other elements. This strategy helps to minimise our environmental impacts and can generate indirect employment in countries we operate in. PROPORTION OF PRODUCTS MANUFACTURED AND SOLD LOCALLY 89.6% 29.8% 28% 21.3% 2.2% Brazil China Europe Russia India RESPONSABILITY IN PRODUCTION / 57 2014 SUSTAINABLE DEVELOPMENT REPORT ON-GOING IMPROVEMENT OF OUR MANUFACTURING PERFORMANCE So that we can offer our customers the most value added, the lowest prices, the highest quality and optimum timeframes, we have adopted a continuous improvement approach with both our teams and our manufacturing partners. The idea is to develop of culture of minimising wastage and optimising resources in a sustainable manner. By creating conditions whereby the subcontractors’ employees are involved in optimising their own performance on an on-going basis, resources are naturally allocated to the value added tasks. Since 2011, a dedicated team has been working to train all employees in this process and provide on-the-ground support. It also helps manufacturing partners with their continuous improvement drive. The majority of its efforts take the form of workshops, in real-life factory conditions. Teams from Decathlon and the subcontractor analyse factory flows together and identify possible areas for improvement (China). In addition, our design teams apply good design-to-cost practices in order to fine-tune products that dovetail perfectly with the required usage, whilst optimising the use of raw materials. COMBATTING CORRUPTION Due to its numerous sites worldwide and its wide variety of business activities (product manufacturing, transportation, trade, and building construction), Decathlon needs to remain vigilant in order to sidestep any risk of corruption. Over the last few years, we’ve introduced contractual documents designed to ensure that our employees, together with their suppliers and service providers, apply and adhere to good business practices. Decathlon’s various operational units all have their own management systems specific to their area of activity, in order to sidestep this risk. In 2014, a survey was carried out to identify existing tools, and 2015 will see various shared tools put forward and distributed. 58 / RESPONSABILITY IN PRODUCTION 2014 SUSTAINABLE DEVELOPMENT REPORT Adopting a progressive HR stance Working to create better employment conditions in our supply chain and reinforcing health and safety for those manufacturing our Passion brand products are both priorities here at Decathlon. Our aim is to go beyond inspection remits in order to develop relationships with our subcontractors that are based on trust and mutual respect. This is what we called human responsibility in production. OUR TEAMS ON THE GROUND Several teams are typically involved on a daily basis: 1- Sustainable development in production managers, in-house specialists in this area: 14 people48 are based in production areas and conduct the majority of assessments. They also co-devise corrective action plans in conjunction with suppliers. Recruited locally, their command of the language and knowledge of the country’s culture make them more effective in their work. They provide production teams with on-going training so that they understand our expectations in this field. 2- Production teams: working with suppliers on a daily basis, they help conduct assessments and take over from sustainable development managers in monitoring the implementation of corrective actions. Aside from assessments, they are also responsible for identifying situations of non-compliance and finding a solution in conjunction with suppliers. In 2014, 72% of production teams received training in our human responsibility in production policy. 3- Those assigned to this task: certain employees with production skills (buyers, quality managers, etc.) can become assessors. They are given internal training in both theory and practical skills49 internally, which qualifies them to perform these assessments. 26 people have voluntarily put themselves forward to work in these areas50. 66% of the 1,019 assessments conducted in 2014 were carried out by our internal teams51 (sustainable development in production managers or those assigned to the task). Several times a year, all internal assessors get together to standardise and improve their practices. In 2014 72% of production teams52 were trained in this approach. The team of sustainable development in production managers in China. 48. As of 31/12/14. 49. Internal HRP trainers have successfully taken the theory course in the SA8000 standard and the associated assessment techniques. 50. As of 31/12/14. 51. The remaining assessments are conducted by external firms, selected for their global presence and service quality. 52. i.e. 442 people (this training does not involve all production departments) RESPONSABILITY IN PRODUCTION / 59 2014 SUSTAINABLE DEVELOPMENT REPORT THE BASIC PRINCIPLES OF OUR APPROACH Since 2003, our social charter53 has set out our 8 requirements governing working conditions at subcontractors responsible for manufacturing our brands’ products. Assessments are carried out onsite to evaluate how well they are being applied: • no children on site. • no forced labour. • a safe and healthy working environment. • no discrimination. • no abusive disciplinary practices. • respect for working hours. • respect for employees. • internal HR management key in terms of compliance with our charter. An auditor interviewing an employee The charter is signed and the subcontractor assessed before any commercial relations are agreed54. The frequency of these assessments depends on: • the standards required by local legislation. • resources implemented by countries to ensure that they are being applied. • subcontractors’ performance levels (the less satisfactory the working conditions, the more often assessments are required). At the end of the assessment, the subcontractor’s rating is calculated on a 5-grade scale, from A-E. A Exemplary The sub-contractor exceeds the requirements of the charter. B Objective achieved The sub-contractor complies with all requirements laid down by the charter. C Consolidation D Basic E Unacceptable The sub-contractor must implement a corrective action plan, with the help of Decathlon teams if necessary The sub-contractor has one year to improve the situation with the help of Decathlon teams. Decathlon suspends production and helps subcontractors to find a solution to their problems. A repeat assessment will take place before production is resumed. 53. Our charter is based on the fundamental principles of the universal human rights convention, the fundamental principles of the ILO, and the CSR standard SA 8000. It is a legally valid document, and also applies to our own production facilities. 54. If the assessment results are unsatisfactory with regard to our standards, no business relations will be initiated. 60 / RESPONSABILITY IN PRODUCTION 2014 SUSTAINABLE DEVELOPMENT REPORT CREATING A COLLABORATIVE ETHOS WITH OUR SUBCONTRACTORS 2014 saw us get together with our subcontractors for the first time ever, to organise themed meetings where we could discuss the purpose of our approach, and make joint progress in resolving key issues. “ This was an opportunity to share information with and among suppliers, in order to address our common issues” — Candice Lee: sustainable development in production manager Candice Lee Sustainable development in production manager Why organise meetings with our subcontractors on this subject? We still have several key omissions from our charter. We therefore wanted to change the image that our suppliers have of our standards, by helping them to fully understand the issues involved. What were the subjects you talked about? We explained the general purpose of our approach, and our motivations following the additions of new standards, in the field of fire safety, for example. We identified which improvements they could introduce in order to comply with these standards. It was a time for sharing information with and between suppliers, in order to make headway on shared issues. What were the stages that followed this meeting? We were pleased with the results. For example, 27 out of the 42 people attending the Taiwan production facility felt that they had improved because of the assessments we are conducting on site. We also did work in other areas to help us achieve our objectives, like distributing educational booklets. Other events were also organised with the same aim: • In Bangladesh, we teamed up with our suppliers at a series of conferences and panel discussions in order to present our strategies for sustainable development in production, and train them up in our new fire safety standards • In China, subcontractors were also invited to take part in a fire safety training course. • Our teams also went out to train production teams and subcontractors in chemicals managements55. INVOLVING INCREASING NUMBERS OF SUPPLIERS As always, we involve our tier 1 suppliers56 in our working conditions assessment and improvement process. In 2014, we were keen to go even further back along the supply chain and gradually start to add in our tier 2 suppliers57: This has seen 210 tier 2 suppliers receive support from Decathlon in these areas, along with the 1,065 tier 1 suppliers. 55. 15 sessions were organised by teams dedicated to chemicals management. 75 people from production teams and 12 subcontractors were then given training in these areas. 56. Suppliers that we have a direct contractual relationship with. 57. Suppliers of our tier 1 subcontractors, with no contractual relations with Decathlon. RESPONSABILITY IN PRODUCTION / 61 2014 SUSTAINABLE DEVELOPMENT REPORT Our reasons for spearheading such a development lie in our understanding that some of our tier 2 suppliers make a considerable contribution to the value of our products, or use manufacturing processes that we are keen to investigate further. For example, screenprinting suppliers that we’ve identified have been subject to inspections, as this process involves the use of many chemicals, thereby posing a potential risk to employee health and safety. UNDECLARED OUTSOURCING BY OUR SUPPLIERS: DIFFICULT TO DETECT AND RESOLVE. Despite our official opposition58 to undeclared outsourcing, some of our suppliers may be using external service providers to help them manufacture our products without our prior knowledge. Having our teams working on the ground is not enough to avoid such situations. Aware of this shortcoming, we’re keen to make this issue a priority for 2016. TOWARDS A MINIMUM LIVING WAGE? Minimum wage59 Fixed in line with national legislation for each country, according to the economic situation and competitiveness of its industries (specifically those using a labour force). Living wage60 Covers the essential needs of workers and their families (food, housing, transport, clothing, education, health care and savings). In some countries, the minimum wage does not enable employees and their families to enjoy a decent quality of life. We hope to work with our subcontractors located in these particular countries to ensure that their employees are paid a wage commensurate with their needs. In 2014 we joined the “Benefits for Business and Workers” scheme run by Impactt, an organisation specialising human rights in the workplace61. The scheme’s multiple goals, which it aims to achieve by means of training courses in management, up skilling and production organisation, include: • increasing employee well-being at work. • bring employees in line with a national minimum living wage. • enable employees to see where they fit in to the company’s future. Impactt supported us in our first pilot project to be launched in Bangladesh, involving three subcontractors. In the light of the lessons we have learned from this project, we’re planning to roll out this method at other suppliers and in other countries. 58. Signalled by a contractual clause signed by the subcontractors. 59. Definition largely based on the ILO conventions and the universal declaration of human rights. 60. Definition largely based on the ILO conventions and the universal declaration of human rights. 61. Impactt is a specialist consultancy firm working to improve working conditions and the means to live via world supply chains, with the aim of delivering clear commercial benefits to both ends of the chain. More information: http://www.impacttlimited.com/ 62 / RESPONSABILITY IN PRODUCTION 2014 SUSTAINABLE DEVELOPMENT REPORT HOW OUR PANEL PERFORMEDL In 2014, 65% of our tier 1 suppliers62 (74% in 2013) and 53% of tier 2 suppliers involved in our scheme scored performance levels of A, B or C63. There are several reasons to explain this development: Garment factory in Bangladesh. • the addition of extra fire safety requirements could result in a D score (specifically the need for fire doors separating factory floors from fire escapes). • greater transparency on the part of certain subcontractors regarding the hours worked by employees. As a result, more transparent relations should enable us to improve these situations. • stricter standards required by internal assessors regarding issue resolution. We require proof that our corrective actions have been effective in the long-term before raising a subcontractor’s score. CAUSES OF NON-COMPLIANCE OBSERVED AMONG OUR SUBCONTRACTORS. 100 % % A-B-C % D-E 90 80 70 60 50 40 30 20 10 Re Ch gu Pr ild ot la la to ec bo ry tio Fo ur ap n r ce of pr d ov vu la al ln bo sa er ur ab nd l ew pe Ri rio or sk ke di an cm rs d on sa ito fe ty rin m Ch g a em na ge ica m ls Fi en m re t an sa a fe ge ty m an en d t ev W ac or ki u at ng io en n Su v iro pp nm lie rm en an t Di a ge sc ip m lin en ar t yp ra ct ice W or s ki ng ho ur W ag s ec on tro ls HR pr ac tic M es an ag em en t 0 62. during a review of the voluntary process for the 2014 financial year was carried out on this indicator, a discrepancy was noted at 28 tier 1 supplier sites (out of the 1,065 involved) with no audit report in the supplier database tool. 63. Photo dated 5/01/2015. RESPONSABILITY IN PRODUCTION / 63 2014 SUSTAINABLE DEVELOPMENT REPORT Waste water treatment: a global approach to supplier support Since 2009, Decathlon has been supporting a panel of suppliers with the aim of minimising the pollution they generate by manufacturing their items. By pooling social and environmental assessments gradually over time, we hope to work together with these suppliers to implement a global CSR approach. WATER POLLUTION: A MUST-HAVE Practically all manufacturing processes require water, which – once used – is generally discharged into the natural environment. Water is now a precious resource that is unevenly protected throughout the world. Decathlon has been working on this priority issue since 2014, with the aim of reducing contamination risks for local residents. Used for fishing, food and transport, water is the central focus of multiple issues for Bangladeshis (photo taken near the waste water treatment plant of one of our key local suppliers). ASSESSING HIGH IMPACT SITES As a key player in the textile and footwear industry, Decathlon’s initial targets are subcontractors that use dyeing and tanning manufacturing processes. This decision was based on the fact that among the processes used to manufacture Decathlon brand products, these are the ones that could pose the greatest immediate pollution risks. Sites using paints and surface treatments will be included in this process from 2015 onwards. For tanning and dyeing, we require suppliers to fulfil the quality criteria governing waste water as stipulated in our specifications. 64 / RESPONSABILITY IN PRODUCTION 2014 SUSTAINABLE DEVELOPMENT REPORT CONTROLLING THE QUALITY OF MANUFACTURING WATER Our specifications define the quality thresholds to be complied with64. To ensure compliance with these specifications, the auditor takes various treated water samples and sends them to an external laboratory. The results are then sent to the supplier within a fortnight. To simplify the process, the waste water quality and working conditions are assessed at the same time and by the same assessor, who has received prior training. 41 suppliers ers assessed ed in 20 2 2014 014 1 . 35 suppliers complied with Decathlon’s specifications A technician from the waste water treatment plan taking a water sample prior to discharge. SUPPORTING PROGRESS If results do not meet the required standards, the supplier has 6 months to correct the problem, with the help of our on-site teams. The effectiveness of waste water treatment is now a criteria that relevant suppliers must satisfy before embarking on a business relationship with Decathlon. Decathlon will gradually develop solutions it can use in conjunction with its suppliers to handle issues such as hazardous waste treatment, energy efficiency and air quality. As from 2015, test audits will be carried out on water treatment management (human organisation, reporting and maintenance, etc.) before eventually being rolled out in 2016. Production teams and subcontractors have been supplied with educational booklets specific to industrial water management in order to help them progress in these areas. 64. Decathlon’s specifications include 15 parameters for testing, covering the key risks for local populations. Each parameter test must satisfy the strictest limit, either that set by local legislation or that set by Decathlon. RESPONSABILITY IN PRODUCTION / 65 METHODOLOGY 66 / METHODOLOGY 2014 SUSTAINABLE DEVELOPMENT REPORT OUR SOCIAL PERFORMANCE INDICATORS INDICATORS % of employees by gender and geographical zone. (From 1/01/2014 to 31/12/2014) Employees hired on permanent contracts. (From 1/01/2014 to 31/12/2014) Employees hired on temporary contracts. (From 1/01/2014 to 31/12/2014) Number of employees recruited overall. (From 1/01/2014 to 31/12/2014) Number of departures (permanent contracts). (From 1/01/2014 to 31/12/2014) Number of resignations (permanent contracts). (From 1/01/2014 to 31/12/2014) Number of redundancies (permanent contracts). (From 1/01/2014 to 31/12/2014) Number of retirements (permanent contracts). (From 1/01/2014 to 31/12/2014) Rate of turnover for permanent personnel. (From 1/01/2014 to 31/12/2014) 65. Employees hired in France in 2013 on a permanent contract: 3,310. 66. Employees hired in France in 2013 on a temporary contract: 21,349. 67. Number of resignations in France in 2013: 3,048. 68. Number of redundancies in France in 2013: 362. 69. Number of employees retiring in France in 2013: 11. 2014 Men Women Europe Zone 59% 41% Russia Zone 41% 59% Asia Zone 55% 45% India Zone 81% 19% Africa Zone 71% 29% America Zone 72% 28% World 59% 41% France 3,30665 China 2,114 Russia 1,682 Spain 284 Italy 504 World 13,641 France 26,79866 Spain 11,960 France 30,104 Spain 12,244 France 3,504 Spain 1,094 France 2,81767 Spain 964 France 45168 Spain 70 France 869 Spain 0 France 21.6% Spain 18.6% METHODOLOGY / 67 2014 SUSTAINABLE DEVELOPMENT REPORT INDICATORS World payroll. (From 1/01/2014 to 31/12/2014) % of world payroll/turnover. (From 1/01/2014 to 31/12/2014) % of capital owned by shareholding employees. (as of 01/07/2014) Number of shareholders. (Situation as of 31/12/2014) % of shareholding employees. (compared with rights holders) 2014 €1,572,850 K World (1,418,800 K€ en 2013) World 19% (idem 2013) World 11.32%70 World 32,86071 sur 20 pays ayant accès à l’actionnariat et 39,354 ayants droits World 83.5%72 World 83%73 (Situation as of 31/12/2014) % of people who responded to the annual Winning Team Members survey. (Survey conducted in September 2014 at international level) % of people who responded “yes, very” or “yes, quite” to the question “On their satisfaction with their department's and the company's business plan.” in the Winning Team Members survey. World (Survey conducted in September 2014 at international level) % of people who responded “yes, very” or “yes, quite” to the question “I am happy to go to work.”, in the Winning Team Members survey. World (Survey conducted in September 2014 at international level) % of people who responded “yes, very” or “yes, quite” to the question “In my area of responsibility I can take the initiative and make decisions in order to keep my customer happy.”, in the Winning Team Members survey. World (Survey conducted in September 2014 at international level) % of people who responded “yes, very” or “yes, quite” to the question “My overall pay is consistent with my performance and responsibilities.”, in the Winning Team Members survey. (Survey conducted in September 2014 at international level) World Yes, very 39% Yes, quite 39% Total who said Yes 81%74 Yes, very 43% Yes, quite 43% Total who said Yes 86%75 Yes, very 54% Yes, quite 37% Total who said Yes 91%76 Yes, very 16% Yes, quite 40% Total who said Yes 56%77 70.% of capital owned by shareholders in 2013: 11.085%. 71. Number of shareholders in 2013: 31,887 out of 19 countries with access to share ownership and 38,084 eligible persons. 72. Objective for this indicator: 100% of eligible persons and 80% of personnel worldwide . 73. 40,295 employees responded to the survey, compared with 34,056 in 2013. 74. 79% in 2013. 75. 85% in 2013. 76. 85% in 2013. 77. 56% in 2013. 68 / METHODOLOGY 2014 SUSTAINABLE DEVELOPMENT REPORT INDICATORS Permanent personnel working full time. (Situation as of 31/12/2014) Permanent personnel working part time. (Situation as of 31/12/2014) % of part time personnel / Total Permanent Personnel. (Situation as of 31/12/2014) % of people who responded “yes, very” or “yes, quite” to the question “I am happy with the number of hours I am contracted to work.”, in the Winning Team Members survey. 2014 France 9,699 Spain 1,337 France 6,557 Spain 5,333 France 40%78 Spain 20% World 69%79 France 3.29% Spain 3.79% (Temporary contracts only - Survey conducted in September 2014 at international level) Absenteeism rate for employees on permanent contracts. (number of hours not worked because of absenteeism/ number of hours worked in theory) (From 1/01/2014 to 31/12/2014) % of people who responded “yes, very” or “yes, quite” to the question “My physical safety at work is protected.”, in the Winning Team Members survey. World (Survey conducted in September 2014 at international level) Number of accidents at work leading to a stoppage. (From 1/01/2014 to 31/12/2014) % of people who responded “yes, very” or “yes, quite” to questions “about personnel development” in the Winning Team Members survey. Yes, very 54% Yes, quite 37% Total who said Yes 91%80 France 976 Spain 926 81 World 81%82 (Survey conducted in September 2014 at international level) ) 78.% of part-time employees out of all permanent personnel in France in 2013: 41.05%. 79. 64% in 2013. 80. 90% in 2013. 81. 1,902 accidents travelling to work, 126 of which were in France and 88 in Spain, during journeys to or from work. 82. 79% in 2013. METHODOLOGY / 69 2014 SUSTAINABLE DEVELOPMENT REPORT INDICATORS Number of trainers who have delivered at least one training course during 2014. 2014 World 14,65483 World 27,684 World 1,973,46584 World 5,62 hours85 World 45,402 (Situation as of 31/12/2014) Number of employees who have taken at least 1 e-learning course. (From 1/01/2014 to 31/12/2014) Total number of training hours. (From 1/01/2014 to 31/12/2014) Average amount of training delivered per employee. (From 1/01/2014 to 31/12/2014) Number of employees who took at least 1 training course in 2014. (From 1/01/2014 to 31/12/2014) Training courses leading to a qualification (UP and HOPE programmes). World (From 1/01/2014 to 31/12/2014) Number of women Managers88. (Situation as of 31/12/2014) Number of people with recognised disabilities. (Situation as of 31/12/2014) Number of Mission Handicap accredited "advisor” employees. UP programme86: 188 qualified and 177 in process of qualifying HOPE programme87: 40 employees and 15 different nationalities World 3,209 women managers France 3.47%, i.e. 631 people89 Spain 2.1% France 15090 World 0.5% World 99 (Situation as of 31/12/2014) Seniors rate (people aged 55 and over / total personnel). (Situation as of 31/12/2014) Number of nationalities working within the business. (Situation as of 31/12/2014) 83. 12,817 trainers in 2013. 84. 1,710,858 training hours in 2013. 85. Average number of hours’ training delivered per employee in 2013 : 5.59. 86. UP programme: certification course offered by Decathlon and its partners, which accredits employees’ professional working experience. 87. Hope programme: an internal corporate MBA-type course run in partnership with the IESEG. 88. Person managing at least one other person below them – Managers accounted for 17% of all personnel in 2014. 89. Rate of people with a recognised disability in 2013: 3.13%. 90. Number of “mission handicap-accredited” advisors in 2013 in France: 126. 70 / METHODOLOGY 2014 SUSTAINABLE DEVELOPMENT REPORT COLLECTIVE AGREEMENTS SIGNED IN 2014 IN FRANCE AND SPAIN Collective agreements signed in 2014 France Retail (Decathlon SA) Pay Pay Services (Decatlhon SA + promiles) Incentive Incentive Incentive Pay Mandatory annual negotiations Mandatory annual negotiations Mandatory annual negotiations Health insurance agreement (medical expenses) Health Pay Bonus dividend Bonus dividend Bonus dividend Diversity Gender equality agreement Gender equality agreement Gender equality agreement Group committee renewal Group committee agreement Employment Working conditions Misc Decathlon Spain S.A. Employee profit-sharing (group agreement) Pay MAN Logistics Spain Equality of opportunity and treatment plan Creation of a France health and safety committee Travel time compensation Collective agreement METHODOLOGY / 71 2014 SUSTAINABLE DEVELOPMENT REPORT OUR ENVIRONMENTAL PERFORMANCE INDICATORS INDICATORS GHG emissions in tonnes of CO2 equivalent generated by Decathlon’s activities 2014 World (From 1/01/2014 to 31/12/2014) Average water consumption on our sites (Decathlon stores and company-owned warehouses) in litres per m2. (From 1/01/2014 to 31/12/2014) Quantity of waste generated by our sites (Decathlon stores, Brand sites and company-owned warehouses) in tonnes. World World (From 1/01/2014 to 31/12/2014) Overall consumption by energy type on our sites (Decathlon stores, Brand sites and company-owned warehouses) in MWh. (From 1/01/2014 to 31/12/2014) World Renewable energy production in kWh for each of our stores. (From 1/01/2014 to 31/12/2014) World Scope 191 22,500.C02e Scope 2 149,600.C02e Scope 3 4,347,000.C02e Total 4,519,000.C02e Stores 119 litres/m2 92 Warehouses 51 litres/m2 Paper and cardboard separated 31,398 tonnes Plastic separated 1,701 tonnes “Other” materials (wood, scrap metal, textiles, etc.) 2,224 tonnes Mixed waste 30,090 tonnes Total93 65,413 tonnes Electricity 428,708,560 MWh Gas 23,813,657 MWh 23,813,657 kWh94 OUR SOCIETAL PERFORMANCE INDICATORS INDICATORS 2014 % of employees having received chemical risk prevention training95. World 80% % of suppliers having signed the latest version of Decathlon’s toxicology specifications. World 83%96 91. These limits correspond to scopes 1, 2 and 3 of the GHG protocol method. Data for 2013 is as follows: Scope 1: 23,500 C02e - Scope 2: 130,600 C02e - Scope 3: 3,604,400 C02e, i.e. a total of 3,604,400 C02e. 92. The average consumption for a store and a warehouse was calculated for 2014 using a database of actual data obtained from a sample of 7 stores and 14 warehouses. The 2014 average confirms that reporting is not exhaustive, given the low consumption. 93. Waste quantities generated in 2013= 49,384 tonnes in total . 94. Renewable energy production by Decathlon stores in 2013: 204,819 kWh. 95. Out of 788 people involved in this training on design and production skills. 96. New version of Decathlon’s toxicology specifications dated January 2014. 72 / METHODOLOGY 2014 SUSTAINABLE DEVELOPMENT REPORT Regulatory cross- reference table Chapter Page 1) Category: Company information a) Employment Total personnel and breakdown of employees by gender, age and geographical area. Decathlon in figures. 3 Recruitment and redundancy. Our performance indicators. 67 Pay and pay trends. Promoting employee development. 53 Organising working time. Promoting employee development. 52 Absenteeism. Our performance indicators. 69 Organising employee dialogue, including procedures for informing, consulting with and negotiating with personnel. Our performance indicators. 71 Overview of collective agreements. Our performance indicators. 71 b) Organisation of work c) Employee relations METHODOLOGY / 73 2014 SUSTAINABLE DEVELOPMENT REPORT Chapter Page d) Health and safety Guaranteeing safety. 48 Our performance indicators. 69 Overview of agreements signed with unions and employee representatives as regards occupational health and safety. Our performance indicators. 71 Accidents at work, including their frequency and severity, as well as occupational illnesses. Our performance indicators. 69 Guaranteeing safety. 48 Human responsibility in production. 58 Adopting a progressive HR stance. 59 Our performance indicators. 70 Measures implemented to promote gender equality. Promoting employee development. 52 Measures implemented to promote the employment and integration of those with disabilities. Promoting employee development. 53 Anti-discrimination policy. Promoting employee development. 53 Occupational health and safety conditions. e) Training Training-related policies implemented. Total number of training hours. f) Equality of treatment g) Promoting and respecting the fundamental conventions of the ILO with regard to Respect for the freedom of association and collective bargaining rights. Adopting a progressive HR stance. 59 Eliminating occupational and employment discrimination. Adopting a progressive HR stance. 59 Eliminating forced or compulsory labour. Adopting a progressive HR stance. 59 Abolishing child labour. Adopting a progressive HR stance. 59 74 / METHODOLOGY 2014 SUSTAINABLE DEVELOPMENT REPORT Chapter Page 2) Category: Environmental information a) General environmental policy Interview. 6 Sustainable development governance. 8 Understanding climate issues. 15 Employee training and awareness-raising initiatives undertaken in the field of environmental protection. Eco-design. 27 Resources allocated to the prevention of environmental risks and pollution. Sustainable development issues. 12 Total provisions and guarantees for environmental risks, provided that this information is not likely to cause serious damage to the company in any ongoing disputes. No provisions or guarantees were made in 2014. Company organisation for handling environmental issues, and - if required - any environmental assessment or certification procedures. b) Pollution and waste management Measures to prevent, reduce or rectify emissions to air, water and land causing serious environmental damage. Measures for preventing, recycling and eliminating waste. Addressing noise pollution and all other forms of pollution specific to a particular activity. Eco-design. 24 Environmental labelling. 28 Managing our sites. 39 Storage and transportation. 43 Wastewater treatment. 64 Eco-design. 24 Repairing your products. 34 Customer input events. 36 Managing our sites. 39 Managing our sites. 39 METHODOLOGY / 75 2014 SUSTAINABLE DEVELOPMENT REPORT Chapter Page c) Sustainable use of resources Focus on product composition. 29 Wastewater treatment. 64 Focus on product composition. 29 Wastewater treatment. 64 Managing our sites. 39 Storage and transportation. 43 Our performance indicators. 72 Managing our sites. 39 Storage and transportation. 43 Greenhouse gas emissions. Understanding climate issues. 15 Adapting to the consequences of climate change. Understanding climate issues. 15 Eco-design. 24 Focus on product composition. 29 Water consumption and supplies to reflect local conditions97. Consumption of raw materials and measures undertaken to improve their efficiency of use. Energy consumption, measures undertaken to improve energy efficiency and the use of renewable energy. Land use. d) Climate change e) Protecting biodiversity Measures taken to preserve and develop biodiversity. 97. Our main water consumption categories relate to raw materials, an area we are targeting with reduction strategies (link to Focus on product composition). 76 / METHODOLOGY 2014 SUSTAINABLE DEVELOPMENT REPORT Chapter Page 3) Information relating to corporate commitments in the field of sustainable development a) The geographical, financial and social impact of the company’s business activity In terms of employment and regional development. From local or neighbouring populations. Stores and their community involvement. 46 Promoting employee development. 50 Working sustainably with our subcontractors. 55 Stores and their community involvement. 46 Promoting employee development. 50 Working sustainably with our subcontractors. 55 b) Relations maintained with people or organisations involved in the company's activity, particularly social and employment support services, educational establishments, environmental protection associations, consumer associations and neighbouring communities Conditions governing dialogue with these people or organisations. Partnerships and sponsorships. Sustainable development governance. 8 Environmental labelling. 28 Decathlon Foundation. 18 METHODOLOGY / 77 2014 SUSTAINABLE DEVELOPMENT REPORT Chapter Page Working sustainably with our subcontractors. 55 Adopting a progressive HR stance. 59 Wastewater treatment. 64 Working sustainably with our subcontractors. 55 Adopting a progressive HR stance. 59 Wastewater treatment. 64 Working sustainably with our subcontractors. 58 Focus on product composition. 29 Continuously improving customer satisfaction. 32 Adopting a progressive HR stance. 59 c) Subcontractors and suppliers An awareness of social and environmental issues when devising purchasing policies. The importance of sub-contracting and being aware of suppliers’ and subcontractors’ CSR as part of the relations management process. d) Fair practices Actions undertaken to prevent corruption. Measures taken to enhance consumer health and safety. e) Human rights Other actions carried out to promote human rights. 78 / METHODOLOGY 2014 SUSTAINABLE DEVELOPMENT REPORT Methodological note GENERAL ORGANISATION OF REPORTS Decathlon is bound by the extra-financial reports obligation via the Decathlon SA company following the publication of article 225 of the Grenelle II law98 and the order of 24 April 201299. By virtue of its personnel numbers100, Decathlon SA is required to submit reports on the financial year commencing after 31 December 2012. Decathlon SA is not listed on the stock exchange. For this report, we took into account the following criteria, which listed companies are obliged to fulfil: company information (fundamental/basic conventions of the ILO), environmental information (total provisions and guarantees for environmental risks, land use, adapting to climate change) and CSR information (sub-contractors and suppliers, fair practices, human rights, etc.). In terms of the fundamental conventions of the ILO, we apply the same standards across all of our 9 factories as those required of our suppliers. Decathlon is not listed on the stock exchange. For the 2014 financial year report, we took into account the criteria that listed companies are obliged to fulfil. This extra-financial report is the second of its kind for Decathlon. We’re therefore on a learning curve, adopting a continuous improvement approach over several years in order to reinforce the reporting process internally and enhance data reliability. This report illustrates Decathlon’s commitments, achievements and projects in terms of CSR for the 2014 financial year. To expand this area, we have implemented the following organisation: • two report project leaders (communications and technical) and a project officer responsible for internal reporting, • a network of contributors covering the various activities within the business (design, production, distribution, logistics, property, legal, etc.), • a management committee at strategy level (manufacturing dept. director and advocate of sustainable development within the business, communications director, sustainable development manager). Indicators are supplied by the contributors from the relevant operational activity, before being consolidated by the report project leaders. Some of the extra-financial indicators are drawn from information that has already been coordinated internally by the business’s employees. Indicators have been reviewed and organised every year since 2013 in order to align them with the legislative requirements and observations of the independent third party body. A voluntary mock audit based on three indicators was conducted in April 2014 by PwC101 in order to review processes and identify priority areas for improvement. 98. Law governing national environmental commitment n°2010-788 of 12 July 2010, article 225. 99. Decree n°2012-557 of 24 April 2012. 100. Higher than 2000 but less than 5000. 101. PricewaterhouseCooper: Independent Third Party Body for our sustainable development report 2014. METHODOLOGY / 79 2014 SUSTAINABLE DEVELOPMENT REPORT PRINCIPLES GOVERNING THE PRODUCTION OF THE SUSTAINABLE DEVELOPMENT REPORT: In line with GRI G4 sustainable development reporting guidelines, Decathlon applies the following principles when writing its Sustainable Development report: • Completeness: to be as exhaustive as possible on relevant topics, in order to enable readers of the report to assess the business’ CSR performance. • Relevance: topics considered to be relevant are those that we feel are most important for our own activities. • Clarity: to be universally understood. • Punctuality: to deliver the report on the same dates every year. • Balance: to be able to have a fair idea of the business’ overall performance by reflecting both positive and negative aspects. • Accuracy: to give precise, detailed information to enable readers to gain a better understanding. REPORT SCOPE: Decathlon has a presence in 21 distribution countries, with over 64,934 employees and a turnover of €8.2 billion excl. VAT in 2014. As of 31/12/2014, there were 909 points of sale in the Decathlon SA Group, 884 of which fall under the scope of Decathlon102, as well as 40 warehouses and 4 logistics platforms and 4 cross-docking distribution hubs. Within the context of extra-financial reporting, the scope excludes from the Group any companies not controlled by at least a 50% share in 2014, and companies contributing an insignificant turnover amount. Regarding the latter, we consider that the cost of obtaining environmental, social and societal data is disproportionate to the importance they represent. Excluding these companies has no significant effect on the representativeness of our data. As a result, Decathlon’s extra-financial data consolidation scope comprises: • companies controlled by at least a 50% share as of 30 September 2014. • companies contributing 98.3% to Decathlon’s turnover. METHODOLOGICAL CLARIFICATIONS: 1- Suppliers and sub-contractors mentioned in these reports are those with whom we have direct or indirect commercial relations, within the context of manufacturing our Passion Brand products and their components. The product development strategy (eco-design, quality, human responsibility in production, etc.) presented concerns solely those products manufactured for our Passion Brands. 2- In terms of our employees, it should be noted that: • Most of the qualitative and quantitative is produced within France and Spain using the SAP tool, as opposed to on a global basis, due to the non-availability of global data. France and Spain accounted for 57.7% of turnover and 52% of personnel worldwide in 2014. • The majority of personnel data is drawn from the MyIdentity tool, except for our distribution activities in India and for Decathlon Easy, the data for which was obtained in Excel format. Personnel data for Decathlon Easy will be incorporated into the MyIdentity tool in 2015, which will facilitate consolidation at group level for our third sustainable development report. 102. Other points of sale are our Passion Brand stores and the “other sales forms” stores (e.g. Terres & Eaux, Cabesto, Chullanka, etc.) 80 / METHODOLOGY 2014 SUSTAINABLE DEVELOPMENT REPORT • Work is currently underway to implement an internal global group report system for a selection of HR indicators, led by senior management and relevant at international level in terms of consolidation. These social indicators will, as far as possible, focus on: – our existing information systems, to avoid multiple data entries and to facilitate implementation at international level. – indicators from the winning team member survey carried out annually. In addition, given the diversity of local legislation and organisations, and available tools, each country will define and develop its own HR indicators - in line with their organisation and growth – which will enable them to coordinate their own activity. The extra-financial report should enable us to carry out one or more detailed studies on certain countries every year, such as France and Spain in 2014, so as to communicate good HR practices and encourage other countries to improve their HR statistics. To this end, work will begin in 2015 with the aim of conducting a more in-depth examination of social data in Italy and China in the third sustainable development report to be published in 2016. 3- For figures relating to logistics, the majority of data is drawn from within Europe, due to the non-availability of global data. Europe accounted for 83% of item quantities shipped during 2014. Logistics data gathering for 2015 will concentrate on the Europe zone, as other zones are only gradually emerging, transferring responsibilities and skills. From 2016 onwards, logistics data in the Asia and Russia zones will be gathered and added into the existing database. The same will happen in 2017 for the America and India zones, and in 2018 for the Africa zone. 4- As regards the greenhouse gas (GHG) emissions report, carbon footprint calculations were carried out using the GHG protocol103 method, which splits emissions into three areas (scopes 1, 2 and 3). Calculation GHG emissions involves multiplying activity data by an emission factor. Activity data was gathered from within the pre-defined scope area. Data that proves unavailable or contains errors is then the subject of assumptions, which have been extrapolated using real data. Apart from calculations of our product impacts, most emission factors come from the Carbon database managed by ADEME104. Product impact modelling is done using simplified lifecycle assessments. Calculations are carried out using an in-house tool along, assisted by several specialist research firms, who contribute their expertise and widely recognised databases (e.g. EcoInvent, Gabi, Buwal and Wisard). The scope used involves non-subcontracted Decathlon sites that opened before 1 January 2014, i.e. 736 Decathlon stores and 35 warehouses. In order to optimise our data gathering system, we have been working to computerise our collection and consolidation processes using a software solution that we hope to roll out in 2015. We calculated our sites’ energy data using actual energy consumption for 88% of Decathlon stores (i.e. 644 stores) and for 51% of warehouses (i.e. 18 warehouses). Calculations for the kWh/m2 ratio were updated to ensure that monthly management control remained relevant. Calculating the 2013 ratio involved dividing kWh consumption for stores operational since 1 January 2013 by the sum of the square metre area of these stores. The new ratio takes into account the concept of comparability over a 12 month period. This new ratio, calculated by month, includes sites that have been open for 12 months as of the reporting month. The annual indicator is equal to the sum of monthly ratios. 103. http://www.ghgprotocol.org/standards/corporate-standard 104. http://www.bilans-ges.ademe.fr/ METHODOLOGY / 81 2014 SUSTAINABLE DEVELOPMENT REPORT This means that in 2013, the kWh/m2 ratio included all sites open before 1 January 2013, whilst the new ratio only includes sites that have been open a year since the reporting month. For example, consumption for a site that opened in May 2013 would not be taken into account when calculating the kWh/m2 ratio for the month of January 2014. The kWh/m2 ratio for 2013 has therefore been updated in this current report, so as to enable comparison between 2013 and 2014. For waste tonnage and reclamation and recycling indicators, we used actual data for 47% of stores 23 (i.e. 349 stores) and for 46% of warehouses (i.e. 16 warehouses). All other data was extrapolated or estimated using actual consumption data gathered. 5- Restatement of 2013 SD report data and error correction: • There is a small chance that some data from 2013’s records may differ from that published in our first extra-financial report after calculation errors were detected. These modifications are not significant in any way. • Regarding the ABC % indicator for human responsibility in production: once the voluntary process review had been carried out for the 2014 financial year as regards this indicator, a discrepancy was noted across 28 tier 1 supplier sites (out of the 1,065 assessed) with no audit report in the supplier database. This discrepancy will need to be followed up by a corrective action plan that aims to guarantee that all social audit reports for any suppliers concerned are correctly uploaded and available in the supplier database tool, so as to eradicate any risk of error in the published data. REPORT PERIOD The report period for extra-financial data is based on the calendar year (1 January to 31 December 2014), so as to ensure consistency with the trading year of Decathlon’s companies as well as the business's existing reports. In cases where data refers to a reporting period different to the calendar year, this must be specified in the body of the report. METHODOLOGICAL LIMITS OF THE INDICATORS: Being Decathlon’s second extra-financial report, this report forms part of an improvement drive implemented over several years, with the aim of structuring and reinforcing the process internally. Environmental, social and societal indicators can present methodological limits caused by: • non-harmonised definitions, national/international legislation and local practices. • problems in retrieving certain data without data gathering software solutions. • manual data entry: reliability depends on the quality of the information gathering carried out by teams, • the availability of certain data within a limited field of study, • extrapolating and estimating certain data in cases where actual data is not available. • gradual implementation of our internal reporting protocol to cover the gathering, consolidation and management of indicators. 82 / METHODOLOGY 2014 SUSTAINABLE DEVELOPMENT REPORT Statement made in the presence of one of the statutory auditors, appointed as an independent third party body, relating to the social, environmental and societal information contained in the management report. FINANCIAL YEAR ENDED 31 DECEMBER 2014 TO OUR SHAREHOLDERS, In our capacity as auditor for Decathlon SA, and as a designated independent third party body, accredited by COFRAC (n°3-1060), we have drawn up this statement of consolidated social, environmental and societal information relating to the financial year ended on 31 December 2014, presented in the management report, (hereafter referred to as "CSR Information") in accordance with the provisions of article L.225-102-1 of the Commercial Code. CORPORATE RESPONSIBILITY The Supervisory Board is responsible for drawing up a management report containing CSR Information stipulated under article R.225-105-1 of the Commercial Code, prepared in accordance with the guidelines used by the company, (hereafter referred to as the “Reporting Protocol”) and available on request from head office, a summary of which appears in the appendices of the management report. INDEPENDENCE AND QUALITY CONTROL Our independence is defined by regulatory frameworks, the professional code of conduct and the provisions laid down in article L.822-11 of the Commercial Code. Furthermore, we have implemented a quality control system that includes documented policies and procedures aiming to ensure compliance with this code of conduct, our professional standards and the applicable legal and regulatory frameworks. NATURE AND SCOPE OF THE WORK We performed our work in accordance with the French professional auditing standards related to labour and environmental information falling within the scope of procedures directly related to the statutory audit engagement (NEP 9090), with the decree of May 13, 2013 setting out the ways in which an independent third party body should conduct its mission: - By conducting interviews with managers of the departments concerned, we were informed about various sustainable development directions, in line with the social and environmental consequences of the company's activity, its commitments to society and the wider community and, where necessary, actions and programmes resulting from these. - We compared the CSR data presented in the management report with the list stipulated by article R.225-105-1 of the Commercial Code. - In the absence of certain data, we checked that the explanations were supplied in accordance with the provisions of article R.225-105 paragraph 3 of the Commercial Code. - We checked that the CSR data covered the scope, with the scope limits outlined in the methodological note presented on page 79 of this report. Based on this work and given the limitations mentioned above, we confirm that the management report contains the required CSR information. RESPONSIBILITY OF THE AUDITOR It is our responsibility, on the basis of our work, to certify that the CSR Information required is present in the management report, or, if not, that it is fully explained in accordance with the third paragraph of article R.225-105 of the Commercial Code. We are not responsible for verifying the relevance and accuracy of CSR Information. Our work was carried out by a team of six people between December 2014 and May 2015, for a total duration of around three weeks. To assist us in these efforts, we called on experts in CSR. Neuilly-sur-Seine, 22 may 2015 Auditor at PricewaterhouseCoopers OLIVIER AUBERTY Partner SYLVAIN LAMBERT Sustainable Development Departement Partner AUDITOR'S STATEMENT / 83 2014 SUSTAINABLE DEVELOPMENT REPORT THANKS Decathlon would like to thank everyone who has helped to produce this report: • members of the dedicated management committee (Isabelle Guyader, Charlotte Mory, Nicolas Roucou and Philippe Dourcy), • internal contributors, for providing information about their activities and strategies, their monitoring and performance indicators, images, photos and videos, • Romain Poivet, GHG assessment specialist at ADEME (French environment and energy management agency), for his kind contribution, • those interviewed for the writing of this report (Mélanie Czepik and Lydie Recorbet from ORSE [French study centre for CSR], and Marie-Madeleine Carpentier from Le Réseau Alliance), • Philippe Cornet, CSR reporting expert for AFNOR, • and many others. THOSE RESPONSIBLE FOR THIS PUBLICATION: Corporate communication director: Philippe Dourcy Sustainable development communication manager: Claire Fouillé Sustainable development reporting manager: Rahel Damamme Graphic design: NTMY Lille Production: StudioPrint Photo credits: Decathlon communication department, Sebastien Sindeu, Jean-Michel André and Samuel Dhote. 84 / THANKS 4, boulevard de Mons - 59650 Villeneuve d’Ascq www.corporate.decathlon.com