Monitoring Compliance

Sourcing decisions

Alignment with Sourcing management and tracking tools

The Global Apparel Strategic Alliance (GASA) is an ongoing programme aimed at building a world-class sports apparel supply base that is capable of meeting our business needs. GASA has been built on the principle of continuous improvement and rewards suppliers for their performance and fit with Global Apparel Sourcing's needs.

Embedded within GASA is a core requirement for qualifying Tier 1 suppliers to meet a minimum SEA Compliance KPI score of 60%. This is only one of a number of basic expectations established by GASA for qualifying suppliers; others include product availability, price and quality. GASA has also incorporated forward-looking strategic targets for the sustainability performance of our suppliers.

First milestones

It began in 2006 by communicating to the supply base a set of milestone targets, with an emphasis on operational results such as delivery performance and production capacity. Since then the milestones have evolved to cover more process excellence criteria and capabilities which are deemed to be essential to support speed, agility and connectivity with our brands and subsidiaries.

Involving suppliers

To engage all key stakeholders in the setting of milestones, GASA established an Advisory Board which has met regularly since 2009 to formulate the blueprints for future milestones. The Board is made up of senior sourcing managers, brand representatives and other internal departments who work closely with the apparel supply chain, such as Continuous Improvement and Social and Environmental Affairs (SEA). In an effort to foster a genuine partnership with the supply base, the Board also comprises senior executives from our Tier 1 garment manufacturers and Tier 2 material suppliers.

From apparel to footwear

Building on the approach first adopted by the Apparel Sourcing team, in late 2009 the Global Footwear division launched its strategic initiative - the Footwear Advanced Capability Track Program, or FACT. As with GASA, FACT is a vehicle for establishing and communicating future capability needs to our Tier 1 and Tier 2 suppliers through the setting of milestones and mid- and long-term goals. It drives the development of a supply base with innovative and industry-leading capabilities to deliver adidas Group requirements now and for the future.

FACT is also seen as a transparent tool to qualify and segment the footwear supply chain. It aims to develop future potential with respect to such aspects as competitiveness, continuous improvement, speed/agility, connectivity, and sustainability to shape the future of the footwear supply chain as well as continue to deliver basic supplier performance around four core supply chain capabilities: quality, delivery, costs and SEA compliance.

Similarly to its apparel counterpart, the Global Footwear team formed an Advisory Board to help setting the vision for the future, develop a strategic roadmap and regularly review and update FACT milestones. The Board includes Footwear Sourcing management, key internal stakeholders such as brand representatives, Continuous Improvement, Social and Environmental Affairs (SEA) as well as senior executives from selected Tier 1 footwear manufacturers and Tier 2 material suppliers. The Board meets bi-annually.

To ensure consistency across the sourcing business, the sustainability milestones adopted for GASA and FACT are closely aligned and linked with the Group's 2015 Environmental Sourcing Strategy, which has identified specific energy saving, water and waste reduction targets, as well as SEA's strategic compliance model which promotes the development of internal systems and management capacity to achieve supplier self-governance. See Managing our suppliers for more information.

2010 outcomes

In 2010, the selected milestones for delivering sustainability under GASA and FACT included:

  • The suppliers' acceptance and review of environmental best practice guidelines
  • Progress against implementing ISO 14001 and OSHAS 18000 management systems
  • Preparation of environmental metrics to create a baseline of environmental performance data
  • The completion of effective internal compliance audits.

By integrating basic compliance and long-term sustainability into the sourcing management tools and performance measurement systems, our key business partners are able to understand how their social compliance score is one factor in determining our ongoing business relationship together. They can see how they rate against each other, and this transparency and integration with sourcing decisions is fundamental to the success of our efforts to drive improvements in workplace conditions.

Reading this report

Performance counts and reporting is about making performance clear to readers.

So in this year's report each page identifies which Global Reporting Initiative (GRI) indicators it addresses, complementing the GRI Index.