Our responsibility. About H&M and social responsibility

Transcription

1 Our responsibility About H&M and social responsibility

2 Our responsibility H&M s business concept is to offer our customers fashion and quality at the best price. At H&M, quality is about more than making sure that our products meet or exceed our customers expectations. It also means that they have to be manufactured under good conditions and that our customers must be satisfied with us as a company. Taking responsibility for how our operations affect people and the environment is also an essential prerequisite for H&M s continued profitability and growth. Here we explain how we do this.

3 Contents PAGE 6 Follow Tobias Fischer and Payal Jain, two of around 40 H&M auditors, during a typical working day in New Delhi. PAGE 8 The code of conduct is an agreement that all H&M s suppliers have to comply with. It sets out the company s requirements concerning aspects such as good working conditions. PAGE 12 MeeT MUHAMMED AKHTARUZZAMAN, factory manager in Dhaka, Bangladesh. He tells us all about working with H&M and what effect this has had on his factory. PAGE 14 Rokeya Rafique and Shirin Akter are two representatives of the Karmojibi Nari organisation in Bangladesh. Read about what they think of the co-operation with H&M. PAGE 16 H&M s world: this shows where our goods are produced and where they are sold, and what development projects we support. PAGE 20 H&M s code of conduct suppliers to comply with the environmental legislation applicable in their own country. We also encourage them to take more environmental responsibility than the law requires. A shared responsibility During a recent trip to Asia I had the opportunity to visit several of our suppliers, including some in China. I also met some of H&M s auditors, whose job it is to monitor compliance with our code of conduct, and gained an insight into the extensive work that goes into improving the working conditions in our suppliers factories. It was reassuring to see for myself how effectively this part of our organisation functions. I am in no doubt that long-term profitability and good relations with our customers and other stakeholders depends upon us taking responsibility for how people and the environment are affected by what we do. We are continually receiving input from the world around us, not least from customers and employees, indicating that the environment and social responsibility are issues that engage people. H&M has signed up to the UN s Global Compact and supports its ten principles. We want to send out the message that we are prepared to act in accordance with Kofi Annan s appeal to companies to respect human rights and to contribute to sustainable development within the areas we can affect. H&M also supports the OECD guidelines for multinational enterprises and is a member of the Amnesty Business Group. The CSR department* reports directly to me, so I have been able to follow this important work closely. This means I can assure H&M s customers, staff, shareholders and other stakeholders that we are devoting our expertise and our commitment to pressing ahead with this work. We have already made good progress, but to be successful in our quest for a better society we also have to continue working closely in partnership with others. Rolf Eriksen, CEO, H&M It is important for us to accept our responsibility and to press ahead with this work. ROLF ERIKSEN DANISH STOCKHOLM, SWEDEN WIFE AND TWO CHILDREN CEO, H&M * CSR stands for corporate social responsibility, and means that the company voluntarily takes account of social and environmental issues in the way it operates, to help contribute towards sustainable development. NAME NATIONALITY LIVES IN FAMILY PROFESSION

4 6 Did you know that... Around 750 people work at H&M s offices in the manufacturing countries. Most of them are locals. A day in the life of an auditor Payal Jain and Tobias Fischer are two of around 40 auditors working for H&M. Their job is to inspect working conditions at H&M s suppliers and to check that the ILO core conventions and H&M s Code of Conduct are being respected. Payal and Tobias work together, visiting suppliers in and around New Delhi. Outside New Delhi. It is early in the morning when Tobias Fischer and Payal Jain arrive at the factory gates in their car. No one knows they are coming today. Tobias and Payal wear H&M ID badges so that the guards and the factory staff know who they are. Six months ago, auditors carried out a comprehensive inspection of the working conditions at the factory and Payal and Tobias are here today to find out whether the supplier has achieved the short-term goals set during that visit. We want the suppliers to strive for lasting improvements because they can see the benefits for themselves. Code of conduct is the starting point Like all of H&M s suppliers, the factory has signed up to a cooperation agreement H&M s Code of Conduct promising to comply with local legislation and H&M s requirements regarding the working environment. The agreement also contains a provision stipulating that H&M s auditors can make unannounced visits. We carry out an extensive audit whenever we start working with a new supplier. This takes between two and seven days. We work with the factory managers to identify key areas for improvement, and decide on a plan of action. The plan contains both long-term and short-term goals and sets out how the goals should be achieved, who will be responsible and when the work should be completed, explains Tobias. Unannounced visits Payal and Tobias enter the factory and ask for the manager. He greets them and accompanies them on a tour of the factory. Since H&M first introduced the code of conduct in India in 1998, the auditors have made repeated visits to the factories. To begin with the factory owners were a little unused to the idea of being inspected like this. Now they understand that unannounced visits are part and parcel of the way we work, and few are surprised when we turn up out of the blue, says Payal. Improvements implemented The auditors check the fire escapes and discuss safety routines with a factory representative. These include the provision of fire alarms, emergency exits and fire extinguishers, but also cover aspects such as making sure the factory is always clean and tidy and that there are a sufficient number of good, clean toilets. The working environment is important, both for the workers wellbeing and for the quality of the clothing produced. Payal notes that the working environment has improved considerably since the last visit. In the past there had been problems with material remnants from the cutting machines and thread from the production area being left lying around. Now the factory has employed more cleaners, supplied suitable tools and equipment and introduced better routines. The factory is clean and is now a safer and more pleasant place for the employees to work. Overtime a problem When Payal and Tobias have finished the factory inspection they go to the supplier s office to examine the paperwork relating to the employees. They check payroll information and employee records, and see how much overtime has been worked. Recently, some departments at the factory were understaffed. This hampered production and led to excessive amounts of overtime being worked. Having inspected the time cards, payroll information and production records, Tobias and Payal can confirm that the overtime has been reduced, but it is still above the legal limit. The supplier will have to continue following the action plan. Then it s time to drive back to H&M s offices in New Delhi to document the visit and to report back to the CSR department at head office in Sweden. Influencing attitudes The auditor s job is far from simple because it involves influencing other people s attitudes and behaviour. Payal explains: It can be quite a tough challenge to persuade suppliers that they have a lot to gain from H&M s Code of Conduct and the cooperation with us. I try and get them to see that it can make their employees more motivated and may well even increase productivity. We want the suppliers to strive for lasting improvements because they can see the benefits for themselves, not just because the buyer says they have to. Their task, as I see it, is to put us out of a job. Tobias Fischer and Payal Jain are two of around 40 employees who check that suppliers are complying with H&M s Code of Conduct.

5 8 Did you know that... H&M signed up to the UN Global Compact in Our code of conduct a long-term commitment We are all dependent upon sustainable development. Polluting water and spoiling other natural resources is not sustainable, nor is violating human rights. That s why more and more companies are drawing up special regulations, so-called codes of conduct, for their suppliers. H&M s code of conduct was drawn up in 1997 and is based on the UN Convention on the Rights of the Child and the ILO s conventions on working conditions and employment rights. It exists because we want our products to be manufactured under good working conditions. A code of conduct must be more than just fine words; it has to be rooted in reality. Factories that don t meet the requirements of H&M s Code of Conduct receive assistance to help them improve and to develop. That s why we have around 40 auditors working full time, checking that suppliers comply with our code and giving the factories advice and assistance. The aim is to get them to see for themselves the long-term benefits that improved conditions can bring. H&M also has a 150-strong team of inspectors whose job is to control the quality of the clothes. They can also report any breach of the code of conduct they may spot during their factory visits. Read more about the background to H&M s Code of Conduct on page 10 or at H&M s Code of Conduct exists because we want our products to be manufactured under good conditions. H&M s code of conduct includes the following stipulations: Ban on child labour Fortunately, child labour is not a common occurrence at the factories that manufacture H&M products. If H&M were to find a child who was below the statutory minimum age working at one of our suppliers, we would work to find a solution that was in that individual s best interests. Co-operation would end if the supplier repeatedly breached H&M s ban on child labour. Good working environment and fire safety The factories where H&M s clothes are made have to provide a clean and safe working environment. There must be a high level of fire safety, and regular fire drills must be held. Emergency exits must be clearly marked and must not be blocked. The lighting must work properly and all areas must be kept clean. Reasonable working hours and wages Wages must be paid regularly and should be in proportion to the work carried out. Overtime must be voluntary and properly compensated. Female employees must have a right to maternity leave. Right to organise and ban on discrimination All employees have a right to an employment contract and the right to organise. There must not be any discrimination on the grounds of gender, religion or ethnic background. ILO conventions The International Labour Organisation (ILO) is a UN body consisting of representatives of government, employer organisations and trade unions. It works to improve working and living conditions by drawing up conventions and recommendations concerning wages, working hours, employment conditions and social systems. Read more at UN Convention on the Rights of the Child The UN Convention on the Rights of the Child applies to children and young people throughout the world. Most countries have signed up to the Convention, whose principles state that all children are of equal worth, that all children have the right to an education, care and security and that persons or bodies who make decisions that affect children must do so based on the child s best interests. Read more at Environmental and chemical restrictions H&M requires its suppliers to take responsibility for the impact they have on the environment. This means that in addition to complying with the legislation applicable in their own country, they also have to sign an agreement promising to comply with H&M s chemical restrictions. These safeguard our customers health and safety, as well as the environment. The full text of the code of conduct can be found at Talking to factory employees provides an insight into the situation at their workplaces.

6 10 Did you know that... H&M has carried out more than 15,000 factory inspections since Active co-operation H&M does not accept child labour H&M does not own or operate any factories of its own. Our clothes and other products are manufactured at around 700 supplier factories, with most of the production taking place in Asia and Europe. Stipulating standards of production, both in terms of the quality of the clothes and the working environment in the factories, is nothing new for H&M. We have long held the view that as a company, we have a responsibility for everyone who contributes to H&M s success. We have learned to take one small step at a time, always making sure we re moving in the right direction. H&M drew up its own code of conduct in 1997 to combat substandard working conditions. Child labour was very much in the news at the time, and was a pressing issue, so we also got the Save the Children organisation involved in the drafting of the code of conduct. H&M s own experience was also an important influence on the final shape of the document. Ingrid Schullström, who is responsible for the environment and social responsibility at H&M, was one of those who helped get the project off the ground. More concrete effort and pro-active work was needed from H&M, says Ingrid Schullström. These are important issues and we want to take our responsibility. We have already come an unbelievably long way, and work is still ongoing. We re now at the stage where we re focusing on more specific and complicated issues such as trade union rights. We have learned to take one small step at a time, always making sure we re moving in the right direction. Textile worker in Cambodia, where H&M works with ILO s Better Factories Cambodia. H&M takes the issue of child labour extremely seriously. The code of conduct states very clearly that child labour is not permitted in the suppliers factories. If any of H&M s auditors discovers a person who is still below the statutory minimum age for work, we try and find the best possible solution in consultation with the supplier and the child s family. We take account of the child s age, level of education and conditions at home. The solution often involves some form of education. It is very important that any change leads to an improvement in the situation of the individual person. If the child is just forced out of the factory without any follow-up, there is unfortunately a risk that he or she may end up doing other, heavier work. But if H&M discovers repeated breaches of its ban on child labour at the same supplier or one of its subsuppliers, the cooperation will be ended for good. How do we make sure there is no child labour? When inspecting the factories, H&M s auditors keep an eye out for any workers who look too Training is an effective way of preventing child labour. young. It is also the job of the auditors to check employment papers and other documentation concerning the employees. Any gaps in the paperwork might indicate there is a problem. The auditors can then provide advice on how the employer can organise the hiring of new staff to make sure no underage employees are taken on, such as requiring a birth certificate. What is the age limit? H&M s child labour policy is based on the UN Convention on the Rights of the Child and ILO convention 138, but also on the national legislation of the country concerned. The basic rule is that no one under the age of 15 should be employed at the suppliers factories. A better situation for children We are aware of the vulnerable situation of children in many parts of the world. That s why we work actively both with our suppliers and with local organisations to improve children s future prospects. We support UNICEF s work with girls education. Read more about UNICEF on page 19.

7 Did you know that... H&M is the largest European buyer of clothes from Bangladesh. 13 A factory manager reports A large number of H&M garments are produced at the factory FCI (Fashion Club International) in Dhaka, one of the better factories in terms of compliance with H&M s Code of Conduct. Chief operating officer Muhammed Akhtaruzzaman s philosophy is to maintain a family atmosphere in the factory and involve the workers in the company and its development. When the workers are part of the result and get something out of it, they are motivated and feel a sense of responsibility, Muhammed Akhtaruzzaman explains. According to his philosophy, the workers at FCI take part of the profit through additional performance bonuses and attendance bonuses. There is a policy for equal opportunity and equal treatment and all sewing operators have a chance to advance. We have 60 to 70 supervisors who were all promoted from the floor. 90 per cent of the office staff also started their career on the factory floor. Human resources play a vital role in building up a successful industry. Focus on the working environment Almost 1,400 people work in the one-storey building where FCI operates. A great deal of effort has gone into creating the interior environment. The sewing area is light and clean, and an air-conditioning system keeps the air cool. FCI provides the employees with free transportation, group and life insurance, 75 per cent subsidized lunches and free snacks. There are two separate praying areas in the factory, as well as medical and childcare facilities. And, in addition, a welfare fund has been formed in order to support workers financially when there is a special need. I believe the fund is quite unique, says Muhammed Akhtaruzzaman, who used to be a legal advisor before he became garment factory manager. He explains that generally in Bangladesh, garment workers are not organised, or they do not benefit much from the trade unions. At FCI, the workers representation welfare committee (WRWC) is the workers voice. Once a month the WRWC meets with the management to exchange views and bring up issues. Workers committees Our workers welfare committee was initially formed at the request of H&M. They gave us ideas about how to act and how to identify code of conduct issues, says Muhammed Akhtaruzzaman. I believe that everyone should have a code of conduct and follow it rigorously. It benefits not only the workers but the production and the quality as well. Human resources play a vital role in building up a successful industry. Despite numerous good practices, FCI still has a few issues to sort out. Excessive overtime is one of them. H&M s audits have shown that some of the workers have worked long hours and for too long without days off. The factory is to address these issues, and the progress will be followed up by H&M. Muhammed Akhtaruzzaman runs FCI in Dhaka in Bangladesh.

8 14 Did you know that... H&M has been dealing with Bangladeshi suppliers for more than 20 years. The most important thing is the change of attitudes The garment sector has brought a silent revolution for women in our society, claims Shirin Akter, a labour rights activist since 1970 in Bangladesh. She is a strong and well-known voice for garment workers and president of the women s rights organisation Karmojibi Nari (KN), meaning working woman. In August 2004, H&M and KN started a project with the objective of increasing awareness among garment workers of their rights. A training programme was developed primarily for female workers, focusing on gender equality and workers relations with management in factories producing for H&M. Our society is a patriarchy and the trade unions are male dominated. Women have always believed that it is a man s job to speak out. The female workers have little knowledge of labour laws, Shirin Akter explains. Seeing things in a new light Rokeya Rafique, a famous actress in Bangladesh, is doing the training. Each and every session is an eye-opener for the participants, Rokeya says. The most important thing is the change of attitudes. After the training, women know there are laws for maternity leave, equal pay for equal work and overtime. They become brave. They feel equal, they can talk to the management or a colleague about their problems. The training groups consist of randomly selected participants at a number of factories. The groups are 20 per cent male and 80 per cent female workers the same proportions as in the garment sector in Bangladesh. Leaflets are circulated at the factories and each participant has the task of sharing the new knowledge with five colleagues. Welfare officers have also been trained by KN. Their task is to educate employees and middle management in workers rights, with the aim of improving relations between workers and management. Our society is a patriarchy and the trade unions are male dominated. Still plenty to do The contradiction of manufacturing companies which operate in poor, developing countries implementing codes of conduct but squeezing costs at the same time is not lost on Shirin Akter. But she is convinced this kind of cooperation will benefit both sides. If it is not only cosmetic but really for the benefit of the workers and business, then we have many things to do. H&M s programme is integrated and long term. We are very pleased and proud of our co-operation and of the fact that H&M is concerned about workers rights, concludes Shirin Akter. Rokeya Rafique and Shirin Akter campaign for workers rights in Bangladesh.

9 16 17 Global responsibility H&M s world is growing year by year. As we expand, our area of responsibility also grows wider. The map shows where we sell our products and where our products are made. Cooperation and partnership UN Global Compact H&M supports the ten principles of the Global Compact on human rights, working conditions, environment and anti-corruption. Global Compact is a co-operation between the UN and industry. H&M also supports the OECD s guidelines for multinational enterprises. Read more about Global Compact at and about the OECD guidelines at The UN s Millennium Development Goals H&M contributes to the Millennium Development Goals through its active environmental work with suppliers, including key measures such as chemicals restrictions and water treatment. The Millennium Goals are eight clear goals for global development, all with target dates. They are described in the UN Millennium Declaration which was signed by the world s leaders during the so-called Millennium Summit in New York in Today the Millennium Development Goals are at the heart of most of the development work around the world. The goals cover areas such as fighting poverty and hunger, reducing child mortality, improving maternal health, environmental sustainability, ending gender discrimination and eradicating HIV/AIDS, malaria and other diseases. We also contribute to charity projects such as those aimed at giving people access to clean water, and giving children access to education in various parts of the world. But as a buyer of clothes in many developing countries, possibly the greatest contribution we make towards fightin g poverty is creating employment for hundreds of thousands of factory workers. Read more about the Millennium Development Goals at Amnesty Business Group H&M is a member of the Business Forum, part of the Amnesty Business Group. This is a group of Swedish companies which operate internationally and which are active in the area of promoting human rights. ABG is part of the Swedish section of Amnesty International, and its mission is to teach Swedish companies to respect, defend and promote human rights wherever they operate. As a member of the Business Forum, H&M has access to Amnesty s knowledge network and can share experience with other international member companies on a range of issues, from a country risk analysis to human rights training. Read more about ABG at WaterAid H&M supports the work of the British aid organisation WaterAid, to improve access to and quality of water for people in Asia and Africa. For more than a billion people, getting water is a daily struggle. Women in these parts of the world can walk up to six hours a day to fetch water. H&M has been contributing to WaterAid s work since 2002, by donating part of the revenue from selected swimwear. Read more about WaterAid at H&M keeps its prices competitive by: having few middlemen buying large volumes having an efficient distribution system being cost-conscious at every stage Fair Labor Association H&M has been involved in the Fair Labor Association (FLA) since FLA is an organisation that safeguards workers rights and seeks to improve their working conditions. FLA carries out independent checks on member companies suppliers and publishes the results annually on its website. For H&M, this means another layer of quality assurance in our own system for monitoring our suppliers factories. Read more about FLA at sales market production offices Clothes for charity Disasters such as war and earthquake affect people all over the world. Victims need aid, including clothing. H&M works with recognised aid organisations in every one of our sales countries. We donate clothes which, for various reasons, have failed to meet H&M s quality standards and have therefore been rejected. Obviously we do not donate clothes that fail to meet our safety standards.

10 18 Did you know that... More than 500 young people have received training since 19 H&M opened its sewing school in Bangladesh in Our contribution to social development An important part of H&M s responsibility is to contribute to local development in countries where our projects are manufactured or sold. It is also important that we can be involved in the various projects and make sure that they are developing in the right direction, and are sustainable in the long term. H&M invests in young people in Bangladesh Many young people in Bangladesh dream about getting a job in a garment factory. But many of them lack vocational education and can only perform simple and monotonous tasks at the factories. In 1999, H&M started a training course in sewing for young people in Dhaka, the capital. This has now grown into two training centres where a total of 100 young people a year receive vocational training in sewing after finishing their basic education. H&M pays wages during the training period, and once students have completed their training they are guaranteed a job as a machinist at one of H&M s suppliers. I have had opportunities that otherwise might not be possible. Mohammad Ashraful is 20 years old and comes from Kushtia in western Bangladesh. He lives in Dhaka with his parents and four brothers and sisters. Mohammad came to H&M s training centre via the organisation BRAC. He says he enjoyed the training: instead of just learning about an individual aspect of the job, he now understands the whole manufacturing process. He has also learned about issues such as health and safety in the workplace. Mohammed believes that the training has given him opportunities he would not otherwise have had. After completing the course he got a job at one of the factories H&M buys from. He is currently undergoing in-house training at the factory to become a supervisor, and dreams of being a factory manager one day. H&M trains young people in sewing in Dhaka. H&M helps to raise factory workers awareness of HIV/Aids and health. UNICEF s education for girls More than 120 million children all over the world are denied the opportunity to go to school, and the majority of them are girls. This violates the convention on the rights of the child, which states that all children have the same human rights including the right to a free basic education. The international 25 by 2005 campaign, which is supported by H&M, aims to accelerate the development of girls education. One aspect of the work is aimed at changing attitudes among authorities and parents, to show them the benefits of allowing girls to go to school. Another is to make education more practically accessible. The mobile school is one concept being pursued by UNICEF, bringing classrooms to places which traditional education cannot normally reach. UNICEF also trains female teachers and provides special grants for girls. Read more on page 22. Preventing the spread of HIV/Aids in Cambodia Cambodia has the fastest-growing rate of HIV/ Aids in south-east Asia. It is also a country where H&M s clothes are made, so it seems only right that we should help to try and prevent the spread of HIV/Aids there. This is another project where H&M works in partnership with UNICEF. Around 290,000 people work in some 200 garment factories in Cambodia. The majority of them are young women, a risk group that UNICEF is making special efforts to reach. H&M plays a key role here by encouraging the factories to allow their employees to take part in the preventative activities organised by UNICEF during working hours. The aim is to increase female factory workers awareness of HIV/Aids and knowledge of other health issues, to help them improve their healthcare and to make it easier for them to make informed choices. Other resources have also been devoted to the project. For example, a helpline has been set up where anyone can ring and ask questions about HIV/Aids. H&M is one of the companies providing the funding for this. The number of enquiries has risen recently, and the line is now open six days a week.

11 Did you know that... H&M s chemicals requirements are based on the sales country which has the strictest standards. 21 Environmental responsibility Just as H&M takes responsibility for the working conditions in the suppliers factories, we also accept responsibility for how our products affect the local environment in the manufacturing countries. Clean air, fresh water and unspoiled nature can no longer be taken for granted anywhere in the world. People and companies have to shoulder responsibility for ensuring that development is sustainable. For H&M, this means minimising our impact on the environment. It also means that anyone who comes into contact with H&M s products should be able to do so without fear of dangerous chemicals. That s why H&M pursues an active environmental policy in countries where our products are manufactured and sold. Our code of conduct includes environmental requirements H&M s environmental standards are described in our code of conduct. One of the stipulations is that all suppliers have to comply with their own national legislation. Our auditors check that the factories have all the approvals required from the relevant authorities. They also check that factories with processes such as dyeing or washing are treating the waste water. They check how the chemicals are handled and make sure that hazardous waste is dealt with responsibly. Reduced environmental impact in production Across the whole finishing chain from fibre to finished garment, the dyeing and washing of fabric are two of the processes that have the greatest environmental impact. That s why H&M has extended its environmental work in recent years to include production stages that take place before the sewing of our garments even begins, namely the production of the fabrics. We have launched a programme, Cleaner Production, which aims to make textile production cleaner. By drawing attention to the economic advantages of reducing energy, water and chemicals in fabric production, we have tried to encourage suppliers outside our direct supply chain to make environmental improvements. In countries where water and energy are in short supply it is important for the environment that all industry is operated as efficiently as possible, using the fewest possible resources. Reduced Respect for nature is one of H&M s environmental goals. volumes of input chemicals, including dyes, lessen the strain on the environment by lowering emissions. In an initial step, Cleaner Production has been introduced at a number of textile suppliers in India, China and Bangladesh, but the aim is to extend the programme to as many countries as possible. H&M uses organic cotton To further reduce the impact on the environment, H&M has started using small quantities of organically grown cotton from Turkey. The annual global production of organic cotton is still too small to be used for large volumes of garments. Thanks to H&M and other companies demanding greater quantities of organic cotton, the amount of cotton grown without artificial fertilisers and pesticides is increasing. H&M s chemicals restrictions apply to all suppliers Another important part of our environmental work involves monitoring and limiting the use of chemicals which are potentially harmful to people and the environment. We have therefore prohibited or limited the use of a number of chemicals in production. All prohibitions and limit values are set out in H&M s Chemicals Restrictions, which all our suppliers have to sign and comply with. Examples of substances on the restrictions list include lead, phthalates and brominated flame retardants. Since 2002 H&M s products have also been completely PVC-free. Eco-labelled clothes the Flower Since autumn 2005 H&M has been selling basic babywear marked with EU s eco-label, the Flower. The Flower certifies that harmful substances have been limited and water pollution reduced across the whole production chain, from the raw cotton to the final product. The label s quality criteria also guarantee the garment s ability to keep its shape and colour. Babywear bearing the Flower label also complies with H&M s own chemicals restrictions. Read more about our environmental work at

12 22 23 Children are our shared responsibility The workers must be given the opportunity to influence their own situation Children at a nursery school in Prey Prang in Cambodia. The nursery is run by UNICEF, with help from H&M. We are proud of the progress already achieved through the implementation of our code of conduct, but we are also humbled by the challenge still facing us, which is to bring about a long-term improvement in the situation of everyone involved in the manufacture of our products. There have been immense improvements in the factories since we introduced our code of conduct in But our work over the past few years has also taught us how hard it is to make the changes permanent. We want to help and motivate our suppliers to take on the responsibility for respecting human rights and offering their employees good working conditions. So our focus now is on encouraging our suppliers to introduce better management systems at the factories and improve the dialogue between employers and employees. Training is important Training for both management and workforce is important to achieve long-term, sustainable change. Cooperation with other companies, voluntary organisations and trade unions is also necessary if we are to achieve lasting results. I am fortunate to be part of a fantastic team. We have built up the broad expertise that is required to be able to form a true picture of the working conditions at a factory. We are able to see through the attempts that sadly are sometimes made to deceive our auditors. In addition, our membership of the Fair Labor Association allows independent experts to assess the quality of our work. We believe that working conditions at our suppliers factories should not be dependent upon us as buyers. Our aim is therefore to ensure that workers are informed about their rights and thus get the opportunity to influence their own situation. Ingrid Schullström, CSR Manager, H&M Almost 400,000 children are born each day around the world. No matter where they are born, they have the same right to survive and to grow into healthy and independent individuals. But many of them will need help along the way. Otherwise almost 30,000 of them will die before they reach the age of five. That s where UNICEF comes in. Our work is very much about changing attitudes. We work with governments and local organisations in an attempt to establish contacts everywhere, down to the smallest village. We also try and get the business community to take on a greater share of the responsibility - both here at home and in the countries where we work. Our collaboration with H&M is an excellent example of this broad cooperation. One of the areas H&M has chosen to focus on is the right of girls to an education. This is one of UNICEF s top priorities. We know from experience that investment in girls education is critical, not just for the girls themselves and their families but also for the country as a whole. We also know that programmes that help girls also help boys who don t go to school. Thanks to H&M s contribution, thousands of children s lives will be changed for the better. This benefit will be passed on to the families and will start a positive spiral that benefits the whole of society and future generations. Lotta Linden, Corporate Project Manager at the Swedish branch of UNICEF NAME NATIONALITY LIVES IN PROFESSION INGRID SCHULLSTRÖM Swedish STOCKHOLM, Sweden CSR manager, H&M

13 Read more about how H&M works with environmental and social responsibility Read more about corporate responsibility UN Global Compact OECD guidelines for multinational enterprises Fair Labor Association Amnesty Business Group Read more about human rights and working conditions Universal declaration of human rights Convention on the rights of the child ILO conventions and recommendations Read more about environmental issues United Nations Environment Programme European Environment Agency U.S. Environmental Protection Agency Greenpeace If you have any questions, please contact us via our website at AUGUST 2006 Printed on chlorine-free paper in a printing process with reduced environmental impact.