At Carter’s we are committed to ensuring that the manufacture of all of our products is performed in compliance with the highest legal and ethical standards of social responsibility. More than 10 years ago, as part of this commitment, we launched our social responsibility program. Since then, our program has been effective and efficient in addressing the Company’s business needs. Recently, however, the social responsibility landscape and our business needs have changed, and our social responsibility program is evolving to keep pace.
At the heart of our factory monitoring program is our corporate social responsibility policy, which Suppliers contractually agree to follow. The policy is the foundation for our commitment to, and ongoing evaluation of, social responsibility compliance by our Suppliers. While we recognize and respect all the cultural and legal environments in which our Suppliers operate, our policy sets forth minimum social responsibility requirements that Suppliers must satisfy in order to do business with us. The policy outlines standards in the following areas:
If the requirements and standards in our policy exceed applicable laws, Suppliers must still comply with our policy.
Factory audits are a central pillar of our monitoring program. Since we do not own any of the factories that produce merchandize for our stores, regular audits are conducted to verify that a Supplier is complying with our policy as well as to strengthen working conditions and labor practices in factories. We contract with an accredited and internationally recognized audit provider to execute these audits.
Once a factory is audited an assessment rating is assigned. The assessment rating is based on a number of factors including the frequency, severity and probability of the finding. We have a total of four types of ratings. The rating assigned determines the timeframe for remediation. In general, we prefer to work with Suppliers to address concerns rather than terminating the relationship as such action is unlikely to correct the underlying issue and may cause further hardship on those who depend upon the employment. However, if the Supplier fails to demonstrate improvement, we reserve the right to terminate the business relationship with that Supplier.
We recognized that monitoring alone is not enough. To enhance these efforts and support long term solutions we developed a Supplier training program, which is updated and communicated annually during our global Supplier summit. The training program outlines our expectations and provides specific guidelines on how to best address concerns in the following areas:
Additionally, Merchandising, Sourcing and Supply Chain teams are trained on our social responsibility program to enhance program awareness and foster more active engagement.
While we worked hard individually to improve our social compliance program and the workplace conditions of factories we source. We recognized that we alone cannot solve many of the pressing issues facing the industry. To effectively address these issues we believe that multi-stakeholder engagement and dialogue are the most productive approaches. To this end, we partner and participate in industry wide initiatives and organizations such as:
To collectively address industry challenges we collaborate with other brands and retailers who share our social responsibility approach and whose products are produced in the same factories as ours. Suppliers regularly manufacturer goods for multiple brands simultaneously, each of which seeks to enforce standards through periodic inspections and audits. By sharing and comparing our audit results with other brands, we reduce redundant auditing, allowing us to focus our resources and those of the Suppliers on making continuous and long term improvement.
Our common purpose is to move swiftly and work in collaboration with all interested parties to raise standards across the board. Together we can significantly improve workplace conditions and contribute to the long term viability of the industry.
Uzbek Cotton – Due to the systemic, government-sanctioned use of forced child labor in the harvesting of cotton in Uzbekistan, we prohibit the use of any cotton from Uzbekistan in our products. Historically, we advised our vendors of our prohibition against the use of Uzbek cotton. Additionally, in an effort to persuade the government of Uzbekistan to end the practice of forced child labor, we have partnered with other international stakeholders and signed the Uzbekistan Cotton Pledge created by the Responsible Sourcing Network. We are hopeful this broad coalition can help end the use of forced child labor in Uzbekistan.
CA Supply Chains Act
Conflict Minerals Policy – In 2010, Congress passed the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (“Dodd-Frank Act”), which requires publicly traded companies to file a report with the U.S. Securities and Exchange Commission disclosing whether their products contain gold, tantalum, tin, and tungsten (“3TG”) sourced from the Democratic Republic of the Congo, Angola, Burundi, Central African Republic, the Republic of the Congo, Rwanda, South Sudan, Tanzania, Uganda, or Zambia (“Covered Countries”). By enacting the relevant provisions of the Dodd-Frank Act, Congress is seeking to eliminate the market for 3TG minerals from the Covered Countries, which have been used to fund armed conflict and human rights abuses in the Covered Countries
This Policy applies to all Carter’s products, purchased from its agents and suppliers, which contain 3TG minerals that are integral to the functionality or production of those products.
Carter’s is committed to ensuring that metals and other minerals contained in its branded products are obtained, produced, and used in an environmentally and socially responsible manner. The Company strives to source in ways that do not contribute to human rights abuses and will work with its agents and suppliers to achieve the goal of not sourcing 3TG from the Covered Countries. Carter’s expects its agents and suppliers to ensure that none of its products include 3TG from the Covered Countries.
To meet its obligations under the Dodd-Frank Act, Carter’s will conduct an annual inquiry into the origin of 3TG minerals that are necessary to the functionality or production of its products. The inquiry will be reasonably designed to determine whether any 3TG minerals originated in the Covered Countries or came from recycled or scrap sources. Carter’s expects its agents and suppliers to participate fully in this inquiry, including providing complete and timely responses to surveys and other inquiries.
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