THE TIMBERLAND COMPANY
2006 CORPORATE SOCIAL RESPONSIBILITY REPORT
What does it mean to “Make it better”?
At Timberland, we live by a simple challenge and
a common commitment—“Make it better.” Every
day, we apply skill and passion to finding new
ways to improve our products. Strengthening our
relationships with stakeholders. And enhancing
the communities where we live and work.
“Make it better” is straightforward, practical
and common sense. It is a journey and not a
destination. It can be found in small measures of
goodness and in revolutionary breakthroughs in
product technology. It’s the shoes we craft and
the green spaces we restore. And at the end of
the day, our hope is that, through the people and
places we touch, we do our share to create a
better world and a more beautiful planet.
Voices of Challenge 2.0
The Voices of Challenge sections throughout this report give you a flavor of the conversations
that are happening around the world in conferences, coffee shops, factories and boardrooms
about the material environmental and social issues of our industry.
Last year’s Corporate Social Responsibility (CSR) report included essays about these issues
from prominent leaders in other organizations. This year, instead of a series of monologues,
we are offering a dynamic dialogue among a variety of stakeholders. After all, we operate
in a global economy and must be responsive to stakeholders at all levels in order to remain
relevant and competitive in a changing landscape. As you read this report, you will see the
thoughts of a factory employee next to those of the Executive Director of a non-profit or a
senior executive of a large organization. Our hope is that, in this way, our Voices of Challenge
will provide a more nuanced picture of the environment companies operate in as they work
to become more responsible citizens.
The conversation doesn’t stop here. If you want to have your voice heard, tell us what you
think at csrinfo@timberland.com.
Table of Contents
From the CEO
4
The Timberland Footprint
6
Summary of CSR Indicators
8
The Organization
9
Global Human Rights
16
Environmental Stewardship
34
Community Involvement
52
Stakeholder Engagement
70
Report Scope
72
Standard Disclosures
78
2006 CSR report
1
➜ to
➜
Timberland employs 5,500 people worldwide in positions ranging from accounting to retail.
5500
from the CEO
The rhythm and din of shoe making is a sweet music to my ear—I grew up in our
factories. I learned to make shoes alongside real craftsmen, taught by my grandfather
and my dad. I inherited from them a love of the music of factories, and the
responsibility to make the music purposeful and valuable...
Those sounds—machines whirring, metal clanking, animated conversation of men
and women as they stitched and crafted the wonder of a shoe from the canvas
of leather. To some, a cacophony. To me, the daily symphony of progress. Sound,
conversation, connection defined our mission and inspired our community.
Today, that symphony of the factory floor remains a bold crescendo in my Timberland
iPod. The sounds of an engaged community aligned against a common vision. Press
“shuffle” and you’ll hear different rhythms, separate beats. Designers inventing
sustainable products. Employees and consumers reforesting the Horqin Desert in
Inner Mongolia, Marston Vale outside London, and the Bronx with Sustainable South
Bronx. Factory workers in classrooms learning HIV/AIDs education. And my current
favorite—the whoosh of the windmill and the chords of the solar panels as sun and
breeze power Timberland properties around the world.
So before you: a report. Non-toxic ink on recycled paper. Our annual presentation of
rigorous, objective and transparent measures of our performance against key social,
environmental and human rights initiatives. Adhering to the rigorous standards of Global
Reporting Initiative (GRI) and pushed further by our own insistence to define new
standards of excellence and collaboration. Where’s the beat? It’s in here. I respectfully
ask for you to listen to rather than read—the words before you. These are the voices of
suppliers, customers, consumers, employees, community leaders and activists. This is
the 21st century rendition of the rhythm of my grandfather’s factory floor.
Publishing a statement of accountability is necessary, but not sufficient. If we write a
report and fail to initiate a conversation, we have missed an opportunity. And if our
report represents our only venue for engagement, then we have failed. An engaged
community—a convening of stakeholders committed to environmental stewardship,
community strength, global human dignity, and the quality of life for our workers
and those citizens with whom we are privileged to serve—is my intent. Our process
of reporting is not “us” to “you”. This report is a forum for you. React, respond,
challenge, commit. I commit back to you that we will listen and act.
In 20 years we’ve learned that we innovate and drive progress only in collaboration
with others. That sustained change demands connection and commitment. Stepping
into the civic square gains grace and purpose alongside men and women from
industry, community, government and the non-profit field. This report is today’s
evidence of our commitment. But tomorrow—and the day after that—we will invest
equal energy and passion to gain wisdom and challenge from voices around the
world. I am my grandfather’s grandson and know of no other way.
I ask for you to add your voice to those who have so graciously contributed to our
report. And, I express my sincere gratitude for your interest and commitment to our
planet and our global community.
Jeffrey Swartz
President and CEO
The Timberland Company
2006 2006
CSR report
CSR report
The Timberland Footprint
Framework for Commerce and Justice
Corporate Mission: To equip people to make their difference in the world.
➜ ➜
Core Values: Humanity, Humility, Integrity and Excellence
Bold Goals:
•
Become the authentic outdoor brand of choice by providing inventive and practical products to our consumers
•
Be the business partner of choice by providing distinctive value to our customers
•
Be a top employer of choice globally
•
Be the reference for socially accountable business globally
•
Deliver exceptional financial performance for shareholders
Our Approach
For more than 30 years at Timberland, two things
But gear is not enough. Not when you pursue a global
have endured:
standard for both commerce and justice. As a community
1. Values that are absolute
of men and women, we aspire to stand firmly in the
civic square, committing passion, skill and resources to
2. An enterprise vision that is ambitious and
ideas—and people—that generate civic energy for the
defies expectations
common good. These relationships can be with any of our
As a business, we invent premium, pragmatic solutions
stakeholders, from employees, consumers and business
that challenge aspiration, test personal limits, deliver
and community partners to the media and Wall Street.
a brand truth and exceed expectations of performance,
It’s all part of Timberland’s commitment to sustained,
technology and quality. Timberland equips you—most
positive impact in three strategic areas:
literally—to make your difference in the world.
•
Environmental stewardship
•
Global human rights
•
Community involvement
The CSR Organization at Timberland
CSR Board Committee
CEO
Corporate Culture Officer
Vice president of CSR
external
relations
Transparency
and
accountability
Environmental
Stewardship
Global
Human Rights
Community
Involvement
Critical Issues
As a global brand of footwear, apparel and accessories,
we are held to the highest standards of responsible
corporate citizenship. Our industry is highly scrutinized,
are the important topics our stakeholders have asked for
more information about, through formal and informal
feedback. We’ve even reached out to our competitors,
and they agree on the importance of these issues.
and the recognition factor of our brand adds to this
Organization of the Report
responsibility. National standards and social contracts
While this report represents a comprehensive view of our
differ, which means that we face a highly complex
network of factories, distributors, customers and
consumers. To help make sense of it, we rely heavily on
our stakeholders—that is, consumers, non-governmental
organizations (NGOs), suppliers, shareholders and
our own employees—to help guide us to be a more
accountable corporate citizen.
In this report, we have focused on three critical issues
for our organization:
•
Working hours in factories
•
Global warming
•
Nonprofit partnerships
CSR work, we’ve tried to focus each section around one
of the critical issues bulleted to the left. Each section
opens with a case study that brings the critical issue to
life through a short story. Then, the body provides more
detail on the work Timberland is doing in this area. We
conclude with a collection of outside voices—our Voices
of Challenge—weighing in on the subject matter to
provide context and perspective. It is our hope that these
three issues create general motifs that flow throughout
the report.
Finally, if you still want more information, some of the
sections include a link we’ve provided to a “Make it
better” brief on the subject. There you’ll find a deep dive
These three issues also happen to correlate with three of
into our past, present and future work, as well as best
the pillars of our CSR organization: Global Human Rights,
practices from the industry. We hope it provides you with
Environmental Stewardship and Community Involvement.
a complete picture of how we are dealing with what we
We didn’t come up with these issues on our own. These
feel are the most important issues facing our industry.
2006 CSR report
summary of csr indicators
For the past two years, Timberland has published a set of Key Performance Indicators (KPIs) at the beginning of each
CSR report. While this list has included important metrics, we believe they were an inadequate gauge for overall CSR
success. Currently, Timberland is developing a robust “dashboard” of metrics that will give a better demonstration of
our overall progress on global human rights, environmental stewardship and community involvement. Until we land on
an official KPI list, we commit to including a summary of important indicators in our CSR report.
Indicator
Explanation
2004
2005
2006
2007
Target
Global Human Rights
Coverage
Percent of Factories Assessed94%94%99%
100%
Designation
Percent of “High Priority” Factories
DNT54%50%
45%
Percent of “Partner” Factories
DNT
Frequency of Working Hour Violations in Continued Factory Partners
DNT50%39%30%
Frequency of Ethics Violations in Continued Factory Partners
DNT
18%
12%
10%
Frequency of Wages Violations in Continued Factory Partners
DNT
17%
16%
12%
Percent of Continued Factory Partners with Improved Score
DNT
DNT55%
60%
8.4
12.2
Immediate Actions
1
Score Improvements
25%
29%30%
Environmental Stewardship
Millions of Footwear Pairs using Water-Based
Adhesives in Stockfitting7.0
8.4
Chemicals
Millions of Footwear Pairs using Water-Based
Adhesives in Assembly
Energy
Resources
Systems
1.43.4
4.65.8
Total Metric Tons of Carbon Emissions
25,084
26,854
29,071
NT2
Percent of Energy Purchased from a Renewable Source
4.3%
6%
6.6%
8%
Organic Cotton as a Percent of Total Cotton Purchases
2.1%
2.1%5.7%
Environmental Assessment Score for Tanneries
DNT
DNT
2.533
Environmental Assessment Score for Footwear
DNT
DNT
2.123
Benefit Utilization Rate (BUR): Percentage of
employees that use at least one hour of service
69.7%
Hours Utilization Rate (HUR): The percentage of hours
used for service compared to hours available
28.8%31.1%39%
6.5%
community Involvement
Path of Service™
68%71%75%
46%
Hours Employees Spent Serving in the Community55,008
65,139
80,63298,000
Charitable Giving
Charitable Giving as a Percent of Previous Year’s
Operating Income
2.10%
1.60%
1.68%
Service Impact
Number of Trees Planted
DNT
DNT
DNT = Did Not Track
NT = No Target
1
The 2005 metrics for frequency of Immediate Actions is reflective of all factories, not continued business partners only.
2
We will release a climate change strategy document with targets in Fall 2007.
NT
DNT50,000
The organization
profile
Financial Performance
Our principal strategic goal is to become the authentic
long-term goals, we are focused on driving progress
• Extending enterprise reach through development of
new brand platforms and brand building licensing
arrangements
on these key strategic fronts:
• Expanding geographically
outdoor brand of choice globally. To achieve our
•
Increasing our focus on segregating discrete and
distinct consumer categories
•
Enhancing our leadership position in our core
footwear business
•
Capturing the opportunity that we see for
outdoor-inspired apparel
• Driving operational and financial excellence while
setting the standard for commitment to the community
and striving to be a global employer of choice
Some high-level views of our financial performance in
2006 are included in the graphs below. Please see our
2006 Annual Report on Form 10-K/A for more details
on our financial performance.
REVENUE
DOLLARS IN MILLIONS
$2,000
$1,500
1,501
1,568
2006 Awards
•
Named one of Forbes magazine’s “Best Big Companies
in America” for the 8th year in a row
•
Ranked 6th on Business Ethics magazine’s list of
“100 Best Corporate Citizens”
•
Selected for Fortune magazine’s list of “America’s
Most Admired Companies”
•
9th consecutive year on Fortune magazine’s “100 Best
Companies to Work For”; also listed on Fortune’s Hall
of Fame
•
2006 Points of Light—“Award for Excellence in
Workplace Volunteer Programs”
•
Listed as one of Industry Week magazine’s
“50 Best-Managed Manufacturing Companies”
for the third consecutive year
•
Recognized as one of the “World’s Top Sustainable
Stocks” by SustainableBusiness.com for the third
year in a row.
•
3rd consecutive year on list of “100 Best Companies
$1,000
$500
$0
2004
2005
2006
NET INCOME3
$200,000
DOLLARS IN THOUSANDS
1,566
180,216
$150,000
145,114
$100,000
101,205
$50,000
0
2004
2006
DILUTED EPS3
$3.00
$2.50
$2.00
2005
$2.66
$2.03
$1.50
$1.59
$1.00
for Working Mothers” by Working Mother magazine
$0.50
$0.00
3
2004
2005
2006
As Restated. See our 2006 Annual Report on Form 10-K/A.
2006 CSR report
Economic Indicators
Our contribution to the economic systems in which we
chart attempts to illuminate the economic impact our
operate is fundamental to understanding the basis for
organization has on the local community at significant
sustainability. New in this year’s report, the following
locations of operation4.
Economic Impacts for 2006
Number of
Employees
in 2006
% of Total
TIMBERLAND
Employees
Local
Minimum
Wage (Hourly)5
Entry Wage
(Hourly)6
% of
Minimum
Wage Paid
14%
$5.15
$9.15
177.67%
1773%
$10.55
$10.84
102.75%
1%
N/A
$6.70
N/A
Headquarters
Stratham, New Hampshire
Wexham Springs, England
Singapore
780
52
Distribution Centers
Danville, Kentucky
125
2%
$5.15
$9.15
177.67%
Ontario, California
115
2%
$6.75
$9.45
140.00%
Enschede, Holland
130
2%
$8.67
$8.67
100.00%
1,84332%
$0.73
$0.96
131.51%
Factory
Santiago, Dominican Republic
4
5
6
Significant locations of operation include headquarters, distribution centers and manufacturing facilities.
Local Minimum Wage: Minimum wage refers to compensation per hour or other unit of time for employment allowed under law.
Entry Wage: Entry-level wages are defined by the full-time wage offered to an employee in the lowest employment category. Intern or apprentice wages
are not considered.
Number of
Employees Grade
77 and Above
Number of Employees
Grade 7 and Above
from Local Area
% of Managers
from Local
Community8
Stratham, New Hampshire
222
222
100%
Wexham Springs, England
26
21
81%
Singapore
119
82%
Headquarters
Distribution Centers
Danville, Kentucky
2
150%
Ontario, California
2
2
Enschede, Holland
2
150%
100%
Factory
Santiago, Dominican Republic
7
8
87
88%
Grade 7 employees are senior management and are generally defined as “leadership.”
If the location is in the US, then employees from that region (Northeast) are considered local. If the location is outside of the US, then local means any manager
from that country.
EXPANSION
New Brand: Say Hello to howies
A thoughtful, authentic brand. A carefully crafted blend of innovative products.
Provocative ideas. And a meaningful dialog with the consumer. That is the basic
philosophy of howies, an edgy line of men’s and women’s apparel emanating from a humble locale in Cardigan
Bay, Wales, UK. They are also maniacally concerned for the planet, the lives of their consumers and finding ways
to “ask a different question.” About the world we live in. The businesses we build. And the values we share. They
are not your typical company.
And they’re perfect for Timberland. In late 2006, we welcomed howies into the Timberland family. Immediately,
it was obvious that we’d found a great fit. We were drawn to howies because it’s a smart, fast-moving, lean,
consumer-centric enterprise that also happens to be values-driven. We also saw a unique opportunity to reach
new consumers and new markets from their youthful platform. The joining of our two organizations is a marriage
of boot, brand and belief. More importantly, it’s a true testament to our vision. Our passion. And the individuals
committed to making it better—and making a difference in the world.
To find out more about this exciting brand, please go to www.howies.co.uk.
New Brand: GoLite®
In June 2006, Timberland announced the introduction of a new line of
advanced footwear for trail-running enthusiasts under the GoLite® brand. The
GoLite® footwear line is inspired by the extreme challenges of sky runners and
their need for ultra-light, technically advanced footwear. According to GoLite co-founder and CEO Kim Coupounas,
“Our companies share many values, including our dedication to excellence, innovation and being good corporate
citizens. We are honored to be working with a company that is a global leader in premium-quality footwear and
corporate social and environmental responsibility.”
To find out more about this brand, please go to www.golite.com.
Integrating SmartWool into the Timberland Culture
Shoes and socks. What could be a more natural pairing? There was a lot more to our acquisition of SmartWool than the
natural match-up of our products, though. We wanted to grow with a company whose values fit with us, too.
Last year was the first time after the acquisition for SmartWool to be part of Timberland’s annual Serv-a-palooza—one of our
pillar service events. In September 2006, 5,500 Timberland employees around the world strapped on their boots and went
out into the community to “make it better.” More than 50 SmartWool employees in Steamboat Springs, Colorado, joined the
event with gusto, donating more than 300 hours—and braving the rain—to refurbish housing for the elderly. Plus, in Boulder,
Colorado, all eight SmartWool employees spent the day building a multi-use trail.
Their enthusiasm proved to us once and for all that we’d found a partner who could not
only help us sell great products, but also help to advance our CSR strategy, too.
2006 CSR report
11
Governance
A Culture of Responsibility from
Top to Bottom—and Vice Versa
Corporate Social Responsibility at Timberland. This
At Timberland, we think a top-down, bottom-up approach
Directors, who will meet regularly with the CSR leadership
is the best way to integrate social and environmental
team to help set the strategic agenda and hold the
awareness into all levels of the company. Let’s start at
team accountable for their actions. We believe this new
the top of our organization. We have a CEO who is deeply
structure will leverage additional resources and leadership
committed to the concept of “Commerce and Justice”—
toward achieving our CSR goals.
that is, a responsibility to generate revenue while at the
same time making positive changes in the communities
and environment where employees live and work. This
set of values naturally trickles down to influence all
company decisions—major and minor.
And from the bottom up? We do everything we can to
help employees make a difference in the world. We
start by doing our best to make sure that every new
hire is passionate about Corporate Social Responsibility
group is made up of four members of our Board of
To learn more about our corporate governance, including
the charter for the new CSR committee, please go to the
Corporate Governance section on our Web site.
Public Policy
Our passion for civic action inspires our approach to
building strong communities and a healthy planet. There
are a few fundamental tenets:
•
First and foremost—and always—our programs must
reflect our values of humanity, humility, integrity and
excellence. These words must be made real by our
actions and attitudes.
•
The “how to”—across environmental stewardship,
global human rights and worldwide community
involvement—is also constant. In other words, we
rely on a collaborative process based on a common
vision and multi-sector partnerships built on aligned
values to create enduring change.
•
Finally, results must be measurable and
transformative. And on occasion, we hope, visionary.
(CSR). Soon after they’re hired, all new employees at our
corporate headquarters perform a day of service. That
way, right away, they can understand how we partner
with local communities to “Make it better.” In addition,
they’re exposed to our values in a variety of activities.
Employee-initiated charity drives. Volunteer service fairs.
Environmental “lunch and learns.” And the Community
Impact Center in our headquarters cafeteria, which
highlights recent CSR activities.
Taking Responsibility
at the Very Top
The issues we embrace as an enterprise and as a
In the past, the influence of our Board of Directors has
community are complex and far reaching. Our passion for
guided the development of our CSR strategies. For global
the planet compels us to turn our attention and expertise
human rights. Community investments and engagement.
toward the area of global warming. Our desire to increase
And environmental stewardship. In addition, our Audit
civic participation requires us to ensure the strength and
Committee has received formal reports of our Code of
credibility of City Year9. Our belief that values are not
Conduct assessments of our contract factories—and the
local to our commercial markets, but rather are a global
remediation work that’s being done.
responsibility, engages our community in stopping the
What’s new for 2007 is that we’ve instituted a formal
CSR Committee that will provide guidance for all
genocide in Darfur and alleviating the pain and anguish
along the Gulf Coast.
We are not political or partisan. We do not financially
support candidates, political campaigns or Political Action
Our passion for the planet
compels us to turn our
attention and expertise toward
the area of global warming.
Committees. But we deeply honor public service—in fact,
we revere it. We know that sustained change requires
policy decisions and investments that support the will of
the people. Our approach to affecting policy is to raise
awareness, model innovation and compel action—always
through collaboration. We invite and encourage civic
discourse and engagement by politicians, policy experts,
industry partners, employees and consumers.
9
12
A non-profit organization dedicated to building a stronger democracy by engaging diverse groups of 17- to 24-year olds in National Service.
2006 CSR report
Global Warming
Global warming is one of the most critical issues our company faces. As such, Timberland has developed a
coordinated and comprehensive approach to policy around this issue. In New Hampshire, we screened An
Inconvenient Truth and hosted environmental experts and a “green” fair to raise visibility for both policy and
options for sustainable improvements. We partner with industry colleagues, including the Outdoor Industry
Association (OIA), to share our priorities and commitment with elected leaders. Our President and CEO
Jeff Swartz joined global business leaders convened by The Climate Group for a meeting with British Prime
Minister Tony Blair and California Governor Arnold Schwarzenegger to share best practices and to encourage
policy leadership. We joined The Climate Group in requesting that German Chancellor Andrea Merkel raise
global warming as a priority of the G-8 Summit in 2007. We actively share best practices and innovations
in environmental stewardship with industry partners and elected leaders. And we raise awareness for
consumers and encourage their action and activism through our retail stores from Regent Street in London
to Diamond City in Osaka. Our annual Earth Day, range of sustainable apparel and footwear, product
packaging and messaging, and in-store communication reflect the core of our belief—that informed citizens
are the greatest lever for change. Their voice, their actions and their leadership drive and inspire change
all over the world.
2006 CSR report
13
PEOPLE
Our Employees
Passion. Purpose. These are two characteristics that make Timberland unique. We invite and invest in people who
share our values and passion to make a difference by doing well as a business and doing good in the community.
Our people—and the ways we engage them on our journey—are of the utmost importance in our aspiration to be an
employer of choice. The task of balancing the capability of our organization to support dynamic business growth while
keeping our employees effectively engaged continued to be a key area of focus in 2006. Please see below for updated
global employee and safety statistics for 2006.
AVERAGE TENURE FOR FULL TIME EMPLOYEES10
8
35
7.2
6
38.1 39.0 39.1
5.1
3.9
5.2
32.8 32.1
28.7
25
5.4
5.1
AGE
4.8
4
37.8 37.5
34.8
30
5.5
YEARS
AVERAGE AGE OF FULL TIME EMPLOYEES10
40
4.2
27.7 27.8 27.5
20
15
2.4
2
2.4
2.5
10
5
0
Distribution
Center
Manufacturing
2005
2004
6000
5000
EMPLOYEES
EMPLOYEES
4000
5000
4000
3000
2000
2000
0
0
Retail Stores
1000
17821782
379 379
385 385
1531 1531
16291629
1642
0
2004
1642
2004
1655
2005
200511
100%
Manufacturing
Manufacturing
1610
1610
11
60%
Office
Office
Retail
Retail
1820
1820
Office
2005
GLOBAL COMPOSITION OF LEADERSHIP12
Male
67%
64%
64%
33%
36%
36%
2004
2005
2006
40%
1690
20%
2006
0%
1690
2006
0.4%
3.1%
GLOBAL 2006 DIVERSITY
11.9%
American Indian or Alaskan
Unknown
15.9%
Black (not of Hispanic origin)
Hispanic
Asian or Pacific Islander
0.1%
68.7%
Charts include full time and part time employees.
We closed our Puerto Rico factory in December of 2005.
12
Leaders are defined as senior managers (grade 7) and above.
10
11
14
2006 CSR report
Retail Stores
2006
80%
Distribution
Distribution
407407
1655
Manufacturing
2004
DISTRIBUTION OF TIMBERLAND EMPLOYEES
1611 1611
Distribution
Center
2006
DISTRIBUTION OF TIMBERLAND EMPLOYEES
6000
3000
1000
Office
White (not of Hispanic origin)
Female
As part of our annual Serv-a-palooza event, Timberland employees, in conjunction with Habitat for Humanity,
built homes for families displaced by Hurricane Katrina.
Health and Safety
The Lost Workday Injury and Illness (LWDII) rate averages the amount of lost-time incidents (i.e. time away from work
or a return to work with medical restrictions) for every 100 employees. In 2006, the rate of “lost work days due to
injury or illness” occurrences (LWDII) was 3.3. This statistic represents all U.S. operations (including retail, corporate
headquarters, Ontario and Danville distribution centers and SmartWool locations) and our Caribbean manufacturing
plant located in the Dominican Republic.
In 2006, we continued to invest in improving our health and safety efforts globally. Timberland makes every effort to
reduce and eliminate work-related incidents at all of its locations. This includes employing safety professionals at our
world headquarters and Caribbean operations. Corporate Health and Safety works with sites globally to identify the
causes of work-related incidents and develop measures to improve the overall safety of our work environments.
5
4
LWDII US AND CARIBBEAN
4.4
LDWII
3
3.2
3.3
2005
2006
2
1
0
2004
2006 CSR report
15
FOCUS ON
The Challenge of Working Hours
Just about everyone wants to do the right thing. The trouble is, sometimes people don’t agree on what the
right thing is. We discovered this firsthand as our sourcing needs took us to new corners of the globe where
working with migrant workers opened our eyes to this sometimes conflicting viewpoint.
When Pou Yen (PY) China began producing shoes for Timberland, they had already developed their own
strategy for corporate citizenship that focused on worker rights. As is our standard procedure, we asked
them to accept our Code of Conduct, as well. One component of the code is a restriction on total working
hours. No more than 60 hours a week. And no more than 12 hours a day.
That’s when something happened that defied expectations. Resistance. From some of the workers. They
wanted the extra overtime, so that they could earn more money. The factory actually had to teach workers
about the restrictions put forth by the Code and put policies and procedures in place to ensure compliance.
Pou Yen has learned from this experience. About the challenges that occur when brands have conflicting
codes of conduct. Or when production issues cause delays. The choice is often a costly one. Spend money
to air freight the shipment. Or allow excessive overtime.
One method PY employed to improve results was placing the power to approve overtime above the required
standard solely in the Operating Director’s hands. That way, even though excessive overtime isn’t entirely
eliminated, it is strictly controlled. Today, the workers at PY know their rights and more readily accept
the working hours restrictions. In addition, the corporate responsibility team offers personal development
courses to provide workers with more options for spending their free time.
Still, adhering to Timberland’s working hours requirement remains a challenge. 70% of our footwear
factories had violations of working hours standards that required immediate action in 2006, according to
our Code of Conduct. We see this as a persistent challenge in our supply chain and commit to working with
factories to improve the results.
Want to learn more about our working hours violations in the supply chain?
See our Make it better brief for a deeper dive on this issue.
GLOBAL HUMAN RIGHTS
progress report: Global human rights
Goals for 2006results
Rating
Expand Our Assessment Collaborations
We piloted joint assessments with another brand at three factories
in Turkey and two in India. Feedback from the factories was generally
positive and we learned ways to improve the process. In 2007, all
regions will be looking for opportunities to conduct joint assessments
with brands in shared factories.
Improve Workplace Conditions
We saw a 4% increase in the number of factories scoring Partner.
Likewise, the number of factories scoring High Priority decreased by
4%. 84 factories raised their scores from 2005, improving on average
by 34%. However, while improvements were seen, there were also 61
factories that scored lower in 2006 (an average decline of 23%).
Form Strategic Partner Relationships
A pilot with Verite to have workers take the lead in the assessment
process was deployed in two factories in China. We have not yet rolled
this out to other factories.
Focus Our Community Efforts
In 2006, community-based projects were ongoing in the following
countries: Dominican Republic (continuing education program, food
assistance program, physically challenged employment program);
Turkey (parenting skills development); Bangladesh (CEPZ project with
CARE for training on women’s rights and labor laws, health and hygiene
promotion, and micro-finance facilities); and China (Verite pilot of a
model for having workers conduct social compliance assessments).
Key:
no improvement
making progress
achieved objective
Taking Responsibility within Our Supply Chain
Fair. Safe. Non-discriminatory. We strongly believe
To accomplish these goals, we’re striving to make
people everywhere deserve those basic rights in the
changes that will create a workplace that embodies our
workplace. It’s not always easy to accomplish—
four corporate values. Humanity. Humility. Integrity.
especially when you’re dealing with more than 175,000
And Excellence. To support this effort, our assessors are
workers in 35 countries worldwide. Because we own only
focused on sustaining social and environmental changes
one of the approximately 300 factories that manufacture
through education and training. Finally, we recognize
Timberland® products, we don’t always have direct
that industry change cannot be made by Timberland
control over the practices of our vendors and suppliers.
alone. We want to share best practices with others in
But we do work hard to choose business partners who
our industry, to improve the quality of life for workers
share our beliefs, then work with them to operate under
throughout our supply chain.
the standards set forth by our Code of Conduct.
2006 CSR report
17
Timberland’s Influence in the Supply Chain
Since our last CSR report, stakeholders have asked us
(the majority of the steps and/or more capacity than the
to further clarify who we include in our assessment
prime supplier), we believe this subcontractor should
process. In summary, all suppliers (including “non-core”
be assessed. Sewing, knitting and certain assembly
product suppliers and indirect subcontractors)
operations are considered to be integral to product
are required to adhere to our Code of Conduct. We
manufacturing and so are included in the assessment
reserve the right to assess any supplier, but will initially
schedule. Among those who are not automatically
limit our assessment schedule to manufacturers of
included in our assessment schedule are subcontractors
“core products” (i.e., footwear, apparel, gear and
who do cutting only, wash houses and mills. Efforts to
key/long-term licensed goods such as belts, watches,
work with other brands to monitor further upstream in
product care and eyewear). Assessments of raw material
the supply chain are being considered.
and component suppliers are limited to tanneries and
footwear component suppliers that have global
sourcing contracts.
Our primary vendors are required by contract to ensure
that the Code of Conduct is applied by suppliers
and subcontractors we do not assess. Our assessors
Subcontractors to these primary vendors must be
do review the process through which these primary
approved by Timberland, but may or may not be
vendors communicate and monitor their suppliers’ and
included in our assessment schedule. For example,
subcontractors’ adherence to our Code.
if a subcontractor completes most of a Timberland order
timberland Factories Worldwide
country
number of factories
Argentina
8
Hong Kong
Austria
1
India
Bangladesh
1
Brazil
Bulgaria
number of factories
3
country
South Korea
number of factories
14
27
Sri Lanka
1
Indonesia
2
Swaziland
1
Italy
3
Taiwan
3
Japan
2
Thailand
2
15
7
17
Mexico
2
Tunisia
103
Morocco
7
Turkey
Dominican Republic
7
Pakistan
15
U.K.
2
Egypt
3
Peru
1
USA
16
El Salvador
1
Philippines
1
Venezuela
France
3
Portugal
2
Vietnam
Honduras
2
Romania
2
Canada
China
18
country
2006 CSR report
8
13
1
15
Factory Growth
In 2006, we finished our second full year of the new
100%
assessment process. In total, our assessors performed
311 assessments on 296 factories13. This represented
year, compared to 2005. Of these 311 assessments,
our external monitoring firm (Cal Safety Compliance
Corporation) conducted only 24% (or 75 assessments),
FACTORY COVERAGE
a 47% increase in assessments for the calendar
80%
as opposed to 38% in 2005. Coverage of our factory
ASSESSMENT COVERAGE
94%
94%
2004
2005
98.7%
60%
40%
20%
base increased in 2006 to approximately 99%, just
short of our goal of 100%. The factories that did not
receive an assessment are explained below.
0%
2006
factories missing assessment in 2006
countrybusiness unitexplanation
Vietnam
Licensee
This factory produced City Year backpacks in 2006—but we don’t plan further production.
Production proceeded without Code of Conduct authorization or a Code of Conduct
assessment. Facility then denied assessor access to conduct an assessment, citing no
future Timberland production planned at the facility.
Pakistan
Licensee
Timberland assessor had scheduled an assessment but became ill while in Pakistan, and the
assessment was canceled. External monitoring agency was contracted to conduct assessment.
Factory denied access, citing there was no current Timberland production occurring at the facility.
Licensee confirmed the factory would no longer be producing for Timberland in the future.
India
Licensee
Upon being hired in March 2006, the Timberland assessor for India attempted to schedule
an assessment. Factory denied access, citing no Timberland business was occurring there at
that time. Licensee confirmed that the factory was not going to be producing for Timberland
in the future.
Fiji
SmartWool
An assessment was scheduled in Fiji for December 4th and 5th by Timberland’s external
assessment agency. The week prior to the assessment, a travel advisory was issued, citing
all non-essential travel to the region was to be avoided due to the potential for a political
coup. The assessment was canceled and could not be rescheduled in 2006. Vendor will not
be producing for Timberland in 2007.
We want to share best practices with others in our industry,
to improve the quality of life for workers throughout our supply chain.
The only Timberland-owned factory is located in Santiago, Dominican Republic.
13
2006 CSR report
19
In 2006, our supply chain grew to 300 factories. As
recent contract with Phillips-Van Heusen (to produce
you can see in the chart below, growth was seen across
most of Timberland’s North American apparel) and the
all of our business units. Our 12 Licensees represented
addition of Timberland PRO® apparel to licensees. The
the greatest growth and now represent 38% of our
42 additional Licensee factories, along with the addition
supply chain, with 112 factories (up 5% from 2005).
of SmartWool’s supply chain, accounts for 75% of the
We see this trend continuing in 2007 in light of our
increase in factories.
300
112
100
60
40
23 24
18
23
21
21
25
0
r
Sm
ar
tW
oo
Su
pp
lie
en
se
e
Lic
ea
r
0
otw
2006
Di
2005
29
7 7
HQ
2004
23
l
Ta
nn
ery
20
50
2006
50 52
ibu
tor
100
2005
70
Fo
150
80
str
227
Ap
pa
rel
261
200
0
120
As
ia
NUMBER OF FACTORIES
250
SUPPLY CHAIN GROWTH (FACTORIES RECEIVING ASSESSMENT)
FACTORIES IN OUR SUPPLY CHAIN
NUMBER OF FACTORIES
300
An updated listing of the factories in our supply chain can be found at www.timberland.com/factorylist.
So what do all these numbers mean? The most important
The second theme shown by these numbers is that, as
trend we see is growth in our supply chain. Although
the number of assessments has grown, our assessors
we are working to develop longer business relationships
have had less time to spend on remediation. In 2007
within our supply chain, there has been a proliferation of
we will be looking to apply new models of collaboration
factories this year—especially in our Licensing and new
(with other brands and with staff from our supply chain
brands division (i.e. SmartWool). While new brands will
and human resource departments) to allow for increased
inevitably increase the size of our supply chain, we see
focus on remediation.
working with our Licensees to reduce factory churn as an
opportunity for improvement.
SmartWool Integration
New in 2006, all SmartWool factories were rolled into our Code of Conduct program.
21 of the 22 factories that made SmartWool® products in 2006 received assessments.
The one factory that did not get an assessment is explained in the chart on page 19.
Tip: Reducing your footprint
Carry your own refillable
water bottle instead of buying
single-use plastic bottles.
In 2003, only about 12% of water bottles were recycled. That
means 40 million bottles a day were simply thrown away.
The Code We Live By
At Timberland, we have been manufacturing in our own factories for three generations. When we
manufacture in other people’s factories, we live by the same beliefs we practice in our own. We know
that we can make high-quality products in a way that respects the basic human rights of the craftspeople
who work on the factory line. In fact, we insist on it—wherever anyone works on Timberland® products,
around the world.
Whenever we work with these third-party contract manufacturers, our Code of Conduct is just as
important as our purchase order. From the beginning of the process, we only work with factories that
commit to the standards our Code insists on—no matter how challenging those standards appear to be.
Of course, a Code of Conduct and good intentions alone do not ensure compliance. That’s why we have
a team of dedicated employees who regularly assess the performance of our supplier partners against
these requirements. When factory conditions don’t meet them, we ask the management of that supplier
to remedy the situation, offering assistance and guidance as needed. We work with the factory through a
remediation plan to make improvements. Progress is tracked and monitored by our assessors. Timeframes
are established that are reasonable and realistic, and we make working with factories to implement
change a priority, rather than leaving the factory. But if factory management is not willing to commit to
making improvements, we have no choice but to disengage from that supplier—after we consider how our
decision affects workers.
In early 2006, Timberland made the difficult decision to leave a Chinese factory that accounted for 17%
of our production14. It was a bitter pill to swallow—especially since our business relationship had lasted
ten years. The decision wasn’t difficult only for Timberland. The jobs of hundreds of workers in China
were put at risk when Timberland ceased production in the factory. And because we weren’t able to
“Make it better” for them, as an advocate for a workforce that too often lacks the ability to protect
itself, we failed.
Our leaving a factory in China is in no way an indication of a change in our business strategy or a shift
away from our values. This partnership failed, but we are not failing. If anything, we’re moving ahead with
a resolution to stand more firmly by our values, learn from our mistakes and look for new opportunities to
pursue our agenda of commerce and justice.
14
Production numbers based on 2005 data.
2006 CSR report
21
The assessment
assessment results
Definition of an Assessment
•
Remediation. Once the comprehensive, systemic
In 2005, we moved from an audit to an assessment.
action plan is developed, additional, ongoing support
The assessment process consists of these basic phases:
and assistance are provided to the factories as they
implement their remediation action plans. Assessors
•
•
Assessment. Assessments look at root causes and
partner with the factory throughout the remediation
systemic gaps in addition to individual findings, and
process, right through to completion. Sharing best
workers are afforded more opportunities to share their
practices. Analyzing management knowledge and
thoughts by participating in information-gathering
skill levels. Helping to build capacity. And ensuring
sessions.
adequate awareness, desire and knowledge at the
Action Planning. During this process, assessors help
factory managers analyze the root causes of issues.
factory to self-manage Code of Conduct matters
effectively.
Identify gaps in management systems. And develop
With each assessment, and receipt of an agreeable action
action plans that not only address what our assessors
plan, Timberland business units may begin or continue
have discovered, but also aim to prevent problems
from occurring again. This comprehensive process
includes considering the impact of any proposed
changes, deciding how to overcome obstacles or
production for the next 12 months. After 12 months, the
Code of Conduct approval expires, and an assessment
is required to continue production. As described above,
throughout those 12 months, remediation assistance and
potential resistance, communicating changes to
support are provided by our assessment team, as needed,
everyone affected by them and measuring—and
to encourage improvements.
celebrating—success along the way.
Factory Designations
The performance, skills and competencies of our factories
In 2006, we saw marginal improvement in our designation
are scored against a set of standards. When the assessment
scores. The number of Partner factories increased by
is completed, factories are given one of three designations,
4 percentage points, while our High Priority factories
based on their score:
decreased by 4 percentage points. In addition, we were
•
Partner: No Immediate Actions found and
encouraged to see that more than 50% of our supplier
infrastructure for continuous and sustainable
factories in the U.S. and Canada region reached Partner
workplace improvements exists.
status—something that did not happen in 2005.
Acceptable: No high risk findings, but improvements
•
are needed.
•
High Priority: High risk violation(s) found in
the factory.
ASSESSMENT
SCORES
ASSESSMENT SCORES
60%
50%
54%
2006
highLEVEL
level ASSESSMENT
assessment results
2006
HIGH
RESULTS
51%
High Priority
2005
40%
2006
28%
30%
20%
21%
21%
25%
0%
22
High Priority
2006 CSR report
Acceptable
51%
28%
21%
10%
Partner
Acceptable
Partner
assessment
(number OF
of FACTORIES)
Factories)
ASSESSMENT designation
DESIGNATION by
BY business
BUSINESS unit
UNIT (NUMBER
100%
80%
44%
37%
18%
9%
40%
43%
20%
79%
58%
47%
Apparel
(55)
29%
Partner
32%
56%
Acceptable
High Priority
38%
38%
25%
Asia HQ
(7)
12%
24%
43%
60%
0%
7%
14%
14%
22%
56%
33%
22%
Distributor
(24)
Footwear
(29)
Licensee
(112)
Supplier
(23)
SmartWool
(21)
Tannery
(25)
assessment
designation
(number
factories)
ASSESSMENT
DESIGNATION by
BY region
REGION (NUMBER
OFof
FACTORIES)
100%
15%
17%
17%
80%
26%
13%
22%
20%
40%
39%
45%
44%
55%
Partner
60%
20%
0%
59%
70%
61%
Acceptable
100%
30%
40%
61%
80%
55%
30%
Greater
China (99)
East Asia
(23)
Southeast
Asia (30)
Indian SubContinent
(43)
20%
17%
North Africa
& Middle
East (18)
SubSaharan
Africa (1)
Europe
(29)
High Priority
36%
28%
US &
Mexico,
Canada (18) C. America,
Caribbean (10)
South
America
(25)
Real and sustainable change in the factories takes time. We
on remediation should help to improve human rights in our
are encouraged by the incremental change—but the sheer
supply chain, and we hope to show that improvement in our
number of factories in the High Priority category reminds us
2007 results.
that there is much work left to be done. Our increased focus
Scoring
Distribution. One explanation is that Timberland is one step
Factory designations serve as a broad categorization of
removed from these factories. In Footwear, for example,
our factories. For us, improvement can only be gauged
our supply chain has direct contractual relationships with
by annual improvements in assessment scores among the
the factories that are making our products. For Licensees,
factories with whom we have had continued business.
we have a contract with the Licensee who, in turn, has
In 2006, these “continued business” factories represented
52% of our supply chain. In other words, almost half of
our supply chain
2006 FACTORY BASE
consisted of
chain does limit some of our influence. This being said, the
moment our assessor enters the factory—it doesn’t matter
if it is footwear, apparel or a Licensee—the assessment and
remediation processes are the same.
factories that were
New Factories
new to us. We can’t
show progress
the contract with their factory base. This extra link in the
Continued Business
52%
48%
In 2007, we will be trying new models of communication,
to facilitate direct interaction between the Code of Conduct
in a factory with
department and the Licensee partners. Our hope is that this
whom we have no
increased interaction will enable stronger improvements with
history. Nothing
these partners.
changes by conducting an assessment—change happens with
progress
byCONTINUED
continued
business
PROGRESSseen
SEEN BY
BUSINESS
30
time, patience and persistence and is strengthened when a
25
relationship develops between the assessor and the factory.
20
In general, we have seen improvements in factories where
FACTORIES
remediation. Our experience has shown that remediation takes
we’ve done business for longer than a year. The following
chart shows that, for the most part, Timberland business
5
units have seen a majority of their factories improving
0
19
18
15
10
their scores. That has not been the case for Licensing and
26
13
8
2
10
12
4
3
1
Asia HQ
Apparel
Distributor
Improved Score
13
12
Footwear
Licensee
Supplier
5
Tannery
Worse Score
2006 CSR report
23
Immediate Actions
To be treated humanely. To be treated equally. And
to be treated with respect and honesty. Basic human
rights—one of the cornerstones of our assessment
process. In our assessment process we call human
rights violations “Immediate Actions” (IAs) to call
attention to the severity of the situation. Immediate
Action violations require an immediate commitment
4%
3%
2%
1%
from factory management to cease/desist such practices.
If an assessor finds one of these violations, the factory
receives an automatic “High Priority” designation—
alerting Timberland management to the severity of
the violation(s). In 2006, there were a total of 221
Immediate Actions found in our supply chain. The chart
below15 shows the distribution:
IMMEDIATE ACTIONS IN OUR SUPPLY CHAIN
4%
2%
1%
3%Hours
18%
18%
52%
IMMEDIATE ACTIONS IN OUR SUPPLY CHAIN
Forced Labor
Wages
Discrimination (0%)
Ethics
Free Association
(0%)
Wages
Discrimination (0%)
Harrassment
Pregnancy Test
(0%)
Ethics
Free Association (0%)
Hours
Refuse Assess
Child Labor
Harrassment
52%
20%
Forced Labor
Pregnancy Test (0%)
Refuse Assess
Child Labor
20%
Immediate Action
Description
Working HoursTotal hours exceed 60 hours per week, 12 hours per day or more than 6 days consecutively
Ethics
Falsification of documents, willful violation of law, unethical business or financial practices
Minimum Wage
Legal minimum wage not being paid
Harassment
Verbal, physical or psychological
Discrimination
Based on race, religion, gender, color, age or other personal characteristics
Minimum Age
Under the country minimum age or 16, whichever is higher
Forced LaborPrison or debt-bonded labor
Refuse Assessment (0%)
Factories refuse an assessment
Pregnancy Testing (0%)Performed and/or results used in workplace for employment applications, promotions or other work-related decisions
Freedom of Association (0%)
Deny the right to freely associate and bargain collectively
As was the case in 2005, the top three IAs were working
hours, wages and ethics. Anyone can see by looking at
this chart where we need to focus our efforts. Working
hours infractions are the most frequently found IAs in
our supply chain—and they are growing (up from 48%
last year). Our code puts a restriction on total working
hours to 60 hours in a given week or 12 hours in a given
day and no more than 6 days consecutively. To date, we
have found that this is a difficult rule to enforce in our
supply chain 100% of the time. But it also represents a
critical issue that our team must grapple with.
15
As a company, we are working hard to reduce all IAs.
To learn more specifically about working hours, please
download our “Make it better” brief on Working Hours,
which provides a deep analysis of what we are doing to
rectify this issue. Also, see our “Voices of Challenge”
section to hear what voices outside of Timberland have
to say about it. After all, we don’t claim to have all the
answers—we invite comments and challenges. To raise
your voice, email us at csrinfo@timberland.com.
If you have any additional questions about the findings in this chart, please email us at csrinfo@timberland.com
The Evolution of our factory
monitoring process
What’s the difference between an audit and an
we expanded this monitoring of environmental
assessment? To us, an audit is an impartial observation,
compliance to all footwear and apparel suppliers. We
while an assessment is an effort to understand the root
wanted to measure how our factories were managing
cause of a problem and then work in partnership to seek
chemicals, water, waste and energy efficiency. The
improvements.
result is a scorecard that allows assessors to monitor
Assessments
In 2005, a new monitoring process was unveiled that
and encourage improvement in environmental practices
throughout our supply chain.
focused on assessment. Under this new process, our
assessors are no longer seen as “compliance police”—
instead, they are recognized as partners in identifying
and resolving issues and addressing worker needs.
Through this collaborative process, our assessors have
forged positive and powerful relationships with both
factory management and workers—a partnership that
continues after the assessment is completed.
One ongoing challenge with this new approach is getting
factory management to look at issues systemically. For
“The [Timberland Code of Conduct] program approach
focuses on the lives of the workers and on the impact
of the employer on the local community, which is
reflected in a deep assessment approach, a focus on
root cause issues, and in an ongoing, collaborative
effort to drive continuous improvement.”
Ryan Lynch
Eastern Regional Manager
Cal Safety Compliance Corporation
more than a decade, they have been exposed to multiple
brands’ compliance audits, creating corrective action
plans to fix individual findings. What they haven’t been
asked to do in the past is to develop systemic action
plans—in other words, identifying root causes to issues
and developing systems that not only correct individual
findings, they also ensure that similar issues are caught
and/or prevented in the future. This kind of analysis
takes time—time to teach and time to conduct. In
fact, it can take so much time, it can seem as though
we’re willing to wait for issues to be corrected—and
that can send the wrong message to factory managers.
Some issues require immediate action, with a systemic
prevention plan to follow. The challenge then becomes
getting factory management to develop a systemic
prevention plan after the issue has already been fixed.
How We Measure Environmental Performance
Environmental responsibility was written into our Code
of Conduct in 2002. In 2003, we began environmental
compliance audits of our tanneries. In 2005, at the
Our Newest Initiative: Addressing Civic Engagement
In the third year of the assessment program, we’ve
decided to evolve the process even further. We’re now
ready to address the last piece of our CSR mission:
civic engagement. Beginning in 2007, questions are
being added to our assessment questionnaire regarding
suppliers’ community investment and service activities.
Through these questions, we believe we’re creating
an opportunity to inform, inspire and engage each
other. Recognizing and acknowledging factory partners
who share our passion to make a difference in their
communities. And identifying opportunities to further
the ripples of civic engagement worldwide.
With this final addition to our assessment questionnaire,
our process has evolved to an overall CSR assessment,
encouraging factories to “Make it better”—both inside
their factory and out.
same time that we switched from audits to assessments,
2006 CSR report
25
Why We’re Collaborating
with Other Brands
Imagine for a moment that you’re a manager for a factory
that produces footwear or apparel for multiple brands.
Throughout the year, you are visited by each of these
brands multiple times to review over and over again
the factory’s policies, procedures and documentation.
Industry surveys indicate that factories on average
undergo 25 audits a year. With an audit every other
week—who has time to focus on remediation? In 2006,
at the invitation and facilitation of Levi Strauss &
Co., a group of brands joined together to discuss this
issue. Though we may be competitors, all brands and
buyers share a common goal of setting a basic level of
The Goals of Collaboration
Here, more specifically, is what we hope to achieve
through brand collaboration during the assessment
process:
1. Improve factory performance on Code-of-Conduct
standards through consistent communication from
all brands served by the factory;
2. Create a more sustainable process by reducing
duplication in a number of areas, including
monitoring, follow up, factory training and capacity
building programs; and
3. Reduce the resource load on factory management
by eliminating duplication in all of these
same areas.
compliance in our factories—and, ideally, motivating
How well has collaboration worked so far? Through
continuous improvement beyond it. So why not join
a global initiative prompted by Levi Strauss & Co.,
resources and work together rather than duplicate
Timberland piloted the idea in three shared factories—
efforts? Why not visit factories together rather than
two in Turkey and one in India.
subjecting them to multiple audits? Why not pool
resources and work together to assist with remediation?
Fewer assessments, allowing for increased time
and focus on making change. That is the idea
behind sharing in the assessment process with
competitive brands.
In all cases, the idea and the process received
overwhelming support from factory management. They
appreciated the prospect of fewer assessments, as well
as consistent expectations and requirements from both
brands. They also saw the presence of two assessors
from different brands as an opportunity to brainstorm
While the intent of our actions is altruistic, joint
about new ideas and solutions to complex issues. And
assessments and remediation efforts do have possible
extra ears and eyes during assessments made factory
legal implications. We are mindful of the importance of
management more responsive to issues and reinforced
safeguarding each brand’s relationship with its supplier
remediation activities.
and ensuring that our combined actions don’t create
legal liabilities. Our sole purpose in collaborating with
brands in shared factories is to enable the factory and
the brands to work together. To improve workplace
conditions. And achieve mutual standards of ethics in
an efficient, effective and sustainable manner. You may
be sure, however, that each brand continues to make
independent business judgments and sourcing decisions.
In other words, the results were positive. And we aim
to do more collaboration with more brands in the years
to come.
Positive results aside, there is much work left to be
done. The success of the experience depended heavily
on the two brands’ assessors spending time together in
advance of their joint assessments to compare Codes
of Conduct. Assessment techniques. Action planning
methodologies. And remediation processes. It was
important that these guidelines be agreed upon early
on. Otherwise, collaboration runs the risk of confusing
the factory and/or making one brand’s requirements or
expectations more important than the other’s.
The success of the experience depended heavily on the two brands’ assessors spending
time together in advance of their joint assessments to compare Codes of Conduct.
Assessment techniques. Action planning methodologies. And remediation processes.
26
2006 CSR report
Voices: Levi Strauss & Co. on Brand Collaboration
Brand collaboration has been a goal for the apparel and footwear industry since the early 1990s, when
companies began to implement their supplier codes of labor practice. Over the years, various “top-down”
approaches have been implemented, but none realized the full promise of a truly collaborative approach to
factory monitoring.
In late 2005, Levi Strauss & Co. (LS&CO.) published our supplier list, believing that greater transparency
in the supply chain could lead to improved working conditions in apparel factories worldwide. One
very specific goal of that effort was to encourage collaboration among buyers in shared factories. Upon
publication, we reached out to a number of brands, including Timberland, asking them to review our list
and consider how we might work together in shared factories.
In 2006, we began to work with 15 companies, including Timberland, in 70 suppliers. Through exchange
of monitoring reports, joint monitoring visits, remediation discussions, and joint training programs, we have
already seen positive results. By working with other committed brands, we were able to reduce monitoring
in shared suppliers by 25 percent in 2006. This allowed us to direct resources that would otherwise have
been spent on monitoring toward working with suppliers on training, development of management systems,
and other sustainable solutions to labor issues.
While this work is still in its infancy, we are extremely encouraged by the results thus far, and the
committed engagement of other leading and highly respected brands such as Timberland. We continue to
learn from our brand colleagues and suppliers in this work.
Going forward, we invite other brands, monitoring initiatives, and civil society organizations to join
this work. Together, we hope we can more effectively use our collective resources to drive positive and
sustainable change for the benefit of workers in our suppliers.
Michael Kobori
Vice President, Global Code of Conduct
Levi Strauss & Co
2006 CSR report
27
Empowering Workers in the
Assessment Process
In July 2006, a new project was launched in
collaboration with Verite, an independent non-profit
organization monitoring international labor rights, in
two large factories in China. Called the Participatory
Social Compliance Assessment (PSCA), the project was
designed to create a mechanism for factory workers
themselves to conduct ongoing Code of Conduct
assessments of their factories. The idea behind the
project was that getting workers more involved in
identifying and solving Code of Conduct issues would
ultimately improve workplace labor conditions. The
initiative involves three phases:
Phase I: Surveys. Three surveys were distributed to
factory management and supervisors, enabling them
to ascertain perceptions regarding the factory in three
areas: Organizational Culture, CSR Management System
and Communication Practices. Factory workers were also
given the opportunity to participate in a base-line survey
to collect information regarding their awareness of CSR
issues and their views on key issues. Factory working
conditions. Labor issues. And industrial relationships.
Phase II: Training. Factory managers, supervisors and
representatives selected by the workers next took part in
a series of training sessions. Totaling approximately 35
hours and customized according to survey results, these
courses were aimed at equipping participants with an
understanding of CSR. They also taught the leadership
and interpersonal skills necessary for participants to
conduct social compliance assessments effectively.
Feedback from managers indicated that most of them
thought the training was very helpful in learning how to
integrate CSR into the factory’s operations—and support
a successful PSCA project into the future.
development of these tools commencing in early 2007,
the initial PSCAs are expected to be completed by the
worker groups in the summer.
Environment, Health & Safety
in the Assessment Process
Last year, many stakeholders asked us why
Environmental, Health & Safety (EH&S) issues weren’t
included in our list of “Immediate Actions”—our list
of issues that require an immediate response and
commitment from the factory as they represent the most
severe violations of basic human rights. In response,
here’s how EH&S fits in our assessment process.
Health and safety have been included in Timberland’s
Code of Conduct (and related monitoring program)
from the start. We require that workplaces be safe
and healthy, based on the recognized standards of the
International Labour Organization (ILO) and national
laws. We don’t just mean work environments. We also
mean residential facilities provided to workers. In 2002,
we expanded our Code to address the environmental
impact of manufacturing, requiring suppliers to
be responsible in that regard. In 2005, we began
monitoring—and scoring—environmental compliance.
Although environmental, health and safety matters
are not included in our list of “Immediate Actions,”
EH&S matters do represent a significant portion of our
assessment process and are captured in our scoring
system as either “High Priority” or “Continuous
Improvement.” We simply don’t authorize production
with suppliers who have unaddressed High Priority
issues. And in order to allow production to commence or
continue, a written remediation plan that addresses all
High Priority violations must be approved by our Code of
Conduct department. The action plan for High Priority
matters can’t exceed 6 months—and some issues must
Phase III: Keeping the Process Going. The final phase
be resolved within 2 months or less, or even immediately
of the project is to create a process and set of tools
stopped. And suppliers who have medium- to high-risk
for worker representatives to use in conducting social
EH&S findings cannot score Partner, just like suppliers
compliance assessments. This includes incorporating a
with Immediate Action violations.
mechanism for adding workers to the process. With the
“My hope is for PSCAs to help in enhancing mutual trust between
management and workers, changing workers’ behavior, and
increasing their sense of responsibility.”
COO of Chinese Factory participating in pilot phase of PSCA project
28
2006 CSR report
Statistics Tell the Story
In every assessment, the findings surrounding each
Of the 269 questions reviewed during an assessment,
Root Subject are analyzed, and their overall risk is
60% involve EH&S (87 questions pertain to health and
calculated16. Of the 223 factories cited for Emergency
safety matters, 76 to the environment). The chart below
Planning & Fire Safety, less than 5% were found to be
provides a snapshot of how the factories we use stacked
high risk and 36% were found to be the lowest risk.
up with regard to EH&S.
Number of
factories cited
root subject
percentage of
factories assessed
Emergency Planning & Fire Safety
22375%
Physical Agent Exposure/Hazard Mitigation
17459%
Chemical Agent Exposure/Hazard Mitigation
132
45%
Environmental Management
85
29%
Sanitation/Hygiene
78
26%
Medical Service
74
25%
Structural Integrity
37
13%
Beyond Monitoring
Our ultimate goal: improve the lives of workers. We know
safety of the workplace. This microfinance operation has
there are limitations to how assessments can impact
a number of important benefits:
workers’ lives. Sometimes their lives outside the factory
are a part of the issues they face while at work. Knowing
this, we turn to local organizations who are experts in
the needs of worker communities.
Certain countries are strategic sources for the
manufacture of Timberland® footwear and apparel. It is
in these countries that we look to assess workers’ needs
outside the factory. Once we analyze the needs of the
larger communities, we implement initiatives designed
to make improvements in a number of areas that involve
•
Preventing robberies on paydays
•
Offering savings accounts
•
Providing flexible credit services
To date, more than 13,000 employees have taken
advantage of these onsite services, taking out loans
totaling over $1.7 million. Roughly 95% of the
borrowers have been migrant women. To help you
visualize the impact this program has had on their lives,
we’d like to tell you the story of one of them:
their social infrastructure and/or economic health.
A migrant garment worker from rural Bangladesh,
Matters such as education. Physical infrastructure. Child
Golenur joined The YoungOne Company seven years ago.
care. Health services. Finance and credit availability.
But, as an unskilled worker, her wages were so low; she
Food. Secondary markets for waste goods. And creating
and her family could barely meet their basic needs.
demand for renewable energy.
Through the CEPZ micro-credit activities, Golenur began
Small Loans Making a Big Impact
to put money from her paycheck into savings. She then
saw an opportunity to create a small cloth shop, but her
For several years, CARE and Timberland have partnered
to improve the quality of life—and livelihoods—of factory
workers in the Chittagong Export Processing Zone (CEPZ)
of Bangladesh. Within that zone, a long-term supplier of
Timberland® apparel, The YoungOne Company, has 14
factories employing roughly 23,000 workers.
Among the projects CARE and Timberland have
established at The YoungOne Company is a savings
booth inside the factories, which allows workers to make
deposits and withdraw cash during their breaks in the
To arrive at this calculation, we use the formula: Hazard x Probability x Impact.
16
With credit and savings opportunities through the CEPZ project,
women like Golenur have the opportunity to create a better life for
themselves and their families.
savings were not enough to cover the start-up expenses.
outlook on life. In order to improve these women’s
With the help of the CEPZ micro-credit facilities, she
self-image and give them a sense of achievement, it
borrowed $180 to start her business. As the business
is vital to support their primary roles as mother and
became more successful, Golenur began to realize a
caregiver. Otherwise, it’s difficult to demand that they
profit. Not only did she repay her original loan, she
be motivated or high-performing employees.
even took out a new credit line to grow her business. No
wonder Golenur has become an advocate for microcredit, encouraging friends and family members to start
savings accounts of their own.
An Education Program Grows
in the Dominican Republic17
Roughly 1/3 of all Timberland employees worldwide work
SORFOS (Social Responsibility Forum for Sustainability)
is a multi-brand forum in Turkey with three goals:
•
Sharing social compliance practices among brands
•
Discussing national and regional issues in the field
of social responsibility
•
Implementing joint local and regional projects
at the Recreational Footwear Company (RFC), our factory
Timberland is a member of SORFOS, which identified
in the Dominican Republic. Our efforts to provide access
the needs of women within the region and approached
to education for these employees and their families
ACEV (Mother Child Education Foundation), a local
began in 1999, when the factory office staff introduced
Non-governmental Organization active in supportive
a literacy program for 45 employees. That initial effort
education programs, to assist with developing a solution.
has since developed into a program of basic education
courses for which employees can receive government
certification in grades 1–12. With RFC funding, teachers
from local schools provide classes to employees onsite at
the factory after work.
ACEV’s Mother/Father Support programs cover
fundamental areas of human interaction such as
effective communication. Positive attitudes. Making
the most of time at home. And conflict resolution.
These programs turned out to be an ideal match for
the needs of Turkish women. The Turkish Garment
Sector Association, an independent Non-governmental
Organization formed by the Textile Enterprises, was also
engaged to provide additional support and serve as a
stakeholder to the project.
Together, ACEV, the SORFOS brands and the Turkish
Garment Sector Association encouraged 80 area garment
employers to take an active role in the long-term
development of workers and the immediate development
of their communities. To accomplish these tasks, they
As a natural evolution of our literacy program, the RFC
funded the creation of a high school equivalency course
in 2005. This program enables employees to form study
groups after work to prepare for their General Education
Diploma (GED). In 2006, the RFC increased the number
are investing in early childhood and adult/family training
programs in their communities. They are also helping
develop workers’ parenting and communication skills in
an effort to increase employee motivation and attitude at
work—as well as peace of mind at home.
of employees participating in this program to 116.
Buoyed by overwhelming support from the factories, a
Currently, 18 of these students are on track to graduate
series of ten “Communicating with Your Child” seminars
with their high school degree in June 200718.
is being scheduled in Istanbul and outlying Turkish
Improving Women’s Lives in Turkey
Family ties are a top priority in Turkey—especially for
women, who can face dire socio-economic conditions
and limited access to education. Without the skills
necessary to improve their situation, these women
often end up plagued by low self-esteem and a negative
17
18
provinces, such as Adana and Bursa. It is expected
that 700 parents and their children will benefit from
the series, which will be followed by questionnaires,
interviews, observations and performance reviews
designed to measure the impact of the training
on workers’ everyday lives. This impact analysis is
scheduled for June 2007.
To learn more about our work in the Dominican Republic, please see a detailed analysis of our environmental and social impact there at www.timberland.com/csrreport.
To date, seven employees have completed their studies and received their GED. One employee graduated with honors.
Looking Forward: 2007 Goals
Encourage Community Engagement: To further our goal of unleashing civic
potential, we will add community engagement questions to the assessment process in
2007. Our purpose is to engage factory partners in a dialogue about their investment
in or support of their communities. We will encourage factory partners to invest in their
communities through financial contributions and/or service hours, and we will offer
additional resources to assist factories in initiating community service activities.
Working Hours Remediation: Working Hours violations represent the #1
Immediate Action in our supply chain—and will be an area of increased remediation
focus in 2007. Our goal is to see a 30% improvement this year, so we will dedicate
additional time and resources to assisting factories. In implementing management
systems that address production capacity issues. And/or analyzing the root causes
of violations. Both internal and external resources will be used, as needed, in the
remediation process.
EH&S Remediation: Health and safety matters represent the most significantly cited
subject in our assessments. In 2007, additional time and resources will be dedicated
to assisting factories in implementing EH&S Management Systems. Our goal is to see
a 30% improvement in 2007, by addressing not only health and safety matters, but
also environmental compliance and bottom line incentives to reduce the environmental
footprint of manufacturing.
Empower Workers: We intend to make workers full partners in assessing,
maintaining, and improving the working conditions of the factories. In 2007, following
the results of the Verite pilot in China, select factories will be provided the opportunity,
tools and training to self-assess. Our ultimate intention is to allow all Partner factories
to self-assess in 2008.
Reduce Audit Fatigue: A survey conducted by another brand in 2006 revealed
that their factories undergo an average of 25 different brand assessments a year. Our
goal in 2007 is to help reduce the number of assessments a factory must undergo by
partnering with other brands in shared factories. Joint assessments. Shared remediation
efforts. One voice, one assessment, one set of expectations. More time to remediate.
➜
➜
➜
VOICES OF CHALLENGE
question: how should a company deal
with the issue of excessive working
hours in its contract factories?
➜
➜
➜
Dr. Ruth Rosenbaum
Executive Director,
Center for Reflection,
Education and Action, Inc.
It’s Thursday afternoon before the weekend your family has been planning for months. You
finished your work so you could have Friday free. You are preparing to leave when the boss walks
in and informs you that she/he has a report you need to do by Monday morning. With those words,
your weekend is gone. That’s excessive overtime.
Excessive overtime continues to plague supply chains regardless of industry, country or time of
year. Responsible brands monitor instances of it, and know they must address root causes. This
means dealing with two key realities.
One: Turn-around time in placing orders. As everyone seeks to lessen exposure to risk, the turnaround time imposed on producers and suppliers is continually shortened. Last-minute order
changes also shorten production time. Poor planning can cause the problem. Maybe the overtime
can’t be avoided, but we ask how many times that’s true, and how often better planning would
make it unnecessary.
Two: Why workers are willing to put in excessive overtime. Obviously they don’t want to jeopardize
their jobs. But, also, for hourly workers excessive overtime means more income to provide
necessities for themselves and their families. Until the issue of sustainable living wages can be
addressed across an industry, workers will work excessive overtime. None of us can meet the
challenges alone. We must address these issues collaboratively.
➜
➜
Peter Tsai
CSR Department Manager,
Pou Yen Vietnam
I believe that the factory and brand are partners
Dan Henkle,
Senior Vice President
of Social Responsibility,
Gap Inc.
in the supply chain and should deal with all the
Excessive working hours in contract apparel
issues together. Per Timberland’s request, Pou
and footwear factories can have a wide variety
Yen has summarized the following issues as
of root causes. Sometimes, factory managers
they pertain to working hour violations at
may not build enough flexibility into their
our factory.
production plans to allow for unanticipated
In my opinion, there are many stages in the
manufacturing process that can influence
working hours infractions at a factory—
business, purchasing, planning, production
control, quality control and human resources.
If there are any delays in manufacturing, there
is a high probability the factory will exceed the
working hours requirement of the brand or law
of the country.
Working hours violations are also influenced
by external factors such as brand and material
suppliers. When our business department
receives highly complicated orders from the
brand (e.g. too many SKUs or small order
quantity) or orders that fluctuate wildly, this
makes it difficult to set up a production plan
and schedule appropriate manpower. The
orders vary significantly between high and low
changes in product design or volume. Factories
may also take on more business than they can
reasonably handle because they don’t want to
disappoint brand customers. In either case,
workers may put in long hours to make up for
the limited production time. Our experience
suggests that specialized training programs on
production planning can help factory managers
learn how to run more efficient operations
without the need for excessive working hours.
As our social responsibility efforts have
evolved, we’ve also come to realize that some
of the everyday business practices of brands
and retailers—from excessive or last-minute
changes to production orders to onerous
testing requirements—can have a significant
impact on labor standards in factories,
especially working hours.
seasons, so the factory has to recruit additional
Over the past three years, we’ve been closely
workers to complete orders during the busy
examining our own business practices to
season. During the off season, the factory
understand how we can make better decisions
has to pay high labor costs due to increased
as a company. We’re working with external
headcount without brand support. In addition,
partners to detect inefficiencies in our internal
the factory usually does not have the power to
decision-making and buying practices—and
refuse and bargain over orders.
identify ways in which we can improve. The
Finally, when brands designate material
suppliers, the factory loses control over leadtime for materials (e.g. leather). This creates
a situation where we have to track material
more we learn, the more we believe that good
business and good working conditions are
linked—and we’re constantly looking for new
and innovative ways to improve in both areas.
shipments to coordinate with the sample and
mass productions schedules. Because the
relationship is owned by the brand, material
suppliers do not work closely with the factory
and this has a negative effect on preproduction.
for a deeper dive into the “working hours” issue, please see our “Make it Better” Brief at www.timberland.com/csRreport.
Marcela Manubens
Senior Vice President, Global Human Rights
Program
Phillips-Van Heusen Corporation
The issue of working hours is not only about the rampant, endemic
excessive overtime and no rest day per week prevalent in many contract
factories in developing countries, but it is also about the payment of
mandatory premiums. We have observed a shift in conditions, from a
scenario where workers were subject to excessive overtime and no rest
day per week a decade ago to the current scenario where in addition, no
proper wages and premiums are paid.
The traditional compliance approach solely based on policing factories
has failed its basic goal of ensuring the implementation of legal and code
requirements. I propose a rethinking of the industry’s approach in order
to lead to a more inclusive, comprehensive analysis of the overall concept
of working hours, its impact on the workforce and in stakeholders such
as the factory and the brands who engage in a commercial transaction.
But let me be clear, the focus must be on the factory and its key
stakeholders—labor and management.
At a minimum, we need to address the following factors:
a) Standards applicability and sustainability
b) Viable solutions and comprehensive remediation approaches to the
multiple factors impacting the implementation of hours of work
c) Incentives and mechanisms to sustain enforcement
Brands and retailers must address their internal inconsistencies. Often
they deliver a conflicting message to the factories. On one hand, they
demand no excessive overtime, on the other, delivery on time. While the
latter can be achieved, many factors play a role and are interrelated. Any
one element can bring imbalance to this delicate equation. Moreover,
industry-wide dialogue is necessary to establish a consistent approach as
any company’s efforts will be curtailed by the lack of critical mass in any
given contract factory.
Alice Tepper Marlin
President,
Social Accountability International
Let’s address excessive overtime from two perspectives: in the factory and
throughout the supply chain.
Implementation and corrective action are just as important as a code that
allows for no more than 12 hours overtime/week, makes overtime voluntary
and permits workers to collectively bargain and communicate their
concerns to management. The elements in a credible code are mutually
reinforcing—ensuring reasonable overtime depends on whether workers
receive a decent living wage.
Leading brands partner with suppliers to communicate the importance of
compliance, assure relevant training of both managers and workers and
assist factories to institute an effective management system. The factory
deserves clear incentives for progress, such as preference in future orders
and/or better prices, especially for independently verified compliance (e.g.
SA8000 certification).
Brands need to look inward to identify and address root causes. For
example, are lead times adequate? Have stable, long-term relationships
been built with suppliers? Have we minimized design changes, avoided
sample delays, put good faith efforts towards an even flow of orders (to
minimize peak production time pressures), and charged fair prices with full
cost models? In this environment, brands are under increasing pressure
from retailers to reduce inventory in the supply chain. So retailers need to
be enrolled in the effort to assure decent and safe working hours.
2006 CSR report
35
FOCUS ON
Plant One on Us
London’s Regent Street Reforestation Campaign
At Timberland, we’re outdoor people. So we have an active interest in preserving the places where
we love to recreate.
Our Regent Street retail store in London turned this concept into reality. With the “Plant One on Us”
campaign. A guarantee to plant one tree for every pair of boots sold at the store. Even customers who
didn’t buy a pair of boots could contribute. For just $2.50 we offered to plant a tree on their behalf.
(Throughout the store, you could hear staff asking customers, “Would you like a tree with that?”) We liked
the idea and decided to spread the campaign to the rest of our UK retail stores.
We’re making good on our guarantee by partnering with The Marston Vale Trust (www.marstonvale.org)—
a charity that is converting 61 square miles of former industrial land north of London into woodlands
for people and wildlife to enjoy. It is part of their 40-year vision to repair decades of industrial use by
improving the landscape and environment.
What was the result of the initial campaign? In 2006, our UK customers helped Timberland and the
organization plant 20,000 trees. With results like this, you can bet that, in 2007, we’ll roll this initiative
out globally. We believe it’s one way to allow our consumers to make purchase decisions that create
positive environmental transformation.
Environmental Stewardship
progress report: environmental stewardship
Goals for 2006resultsscore
Carbon Neutral by 2010
We expanded the scope of our 2006 greenhouse gas inventory, but failed
to have a third party verify it. Our 400kW solar array went into operation,
reducing our California carbon emissions by approximately 40%. A
carbon-neutral strategy was developed that outlines the company’s plan
for reducing and offsetting its emissions for all its facilities and owned
operations by 2010.
Environmental Assessments
Our environmental code was expanded to measure resource
consumption and waste water recycling this year. Code of Conduct
Specialists received in-depth training in all areas of environmental
assessment, with a high level of concentration in waste water
treatment systems. Timberland was also able to engage in a more
in-depth evaluation at leather tanneries with a new, cross-brand
assessment launched by the Leather Working Group.
Improve Environmental Performance
of Products
After a 2005 program interruption, our water-based adhesive program
rebounded with the creation of a standard for adhesive application.
At the same time, we grew the use of recycled content in our product
line by almost 80% and increased our consumption of organic cotton
by 366,000 pounds. Our new Green Index™ rating system was
launched to guide material and process selections towards
earth-conscious choices.
Develop Systems Procurement
and Waste Management
Our forest product procurement working group worked with Forest
Ethics to establish a Forest Product Procurement policy and baseline.
Our finance and procurement teams led early efforts to reduce paper
and virgin pulp consumption through wireless billing and by switching
to a higher recycled-content paper stock. Our corporate collateral,
annual reports and packaging are now all made from 100% postconsumer recycled fiber. Environmental criteria are now specified in all
of our procurement RFPs.
Key:
no improvement
making progress
achieved objective
Confirming Our Commitment to the Outdoors
We’re outdoor people. We make boots and gear and
our environmental stewardship program, we’re committed
clothes for your journey. We equip you to make your
to doing our part to address these challenges.
difference. So, we had better make sure the trail is there
to hike. The river to traverse. The landscape to inspire.
Because of this passion for the outdoors, we believe that
doing our best to “Make it better” for our planet is at
the core of our business. Unfortunately, some of today’s
biggest ecological challenges have been linked to our
Fortunately, we are not in it alone. We’re leveraging our
partnerships with NGOs, other brands and professional
service companies. And we’re working with our supply
chain to demonstrate environmental leadership and
reduce our impact as a global brand.
industry—from global warming to deforestation. Through
2006 CSR report
35
Our Efforts to Cool the Rate of Global Warming
Global warming is impacting the health of our ecosystems. We contribute to the problem by using energy that produces
carbon emissions. To be a part of the solution, we pledge to be carbon neutral in Timberland-owned and operated
facilities by 2010.
Our Plan
How are we going to achieve this in such a short time frame? Here’s our plan . . .
our plan
processexplanation
STEP 1
Verify our greenhouse gas inventory with a credible third party.
STEP 2
Reduce our energy demand through energy-efficiency improvements at our facilities around the world.
STEP 3
Purchase clean, renewable energy from electric utilities.
STEP 4
Generate our own renewable energy on-site where we can’t purchase clean energy from the electric grid.
STEP 5
Purchase renewable energy credits to offset emissions and help develop local renewable energy projects.
STEP 6
Use service and retail store promotional opportunities to plant trees that sequester (or absorb) carbon
emissions beyond what we’ve reduced or offset as a company.
While becoming carbon neutral is an important
that has already planted 20,000 new saplings. The
and challenging goal for us, we realize that the real
expansion of earth-conscious product lines in footwear
opportunity for reducing global warming is using
and apparel. And promotional activities that support
the marketplace to inspire consumers to make their
regional conservation partners. For Earth Day 2007,
difference. In Europe, Asia and the US, in-store and
consumers had the option to forgo a paper shopping
online programs build awareness and enable action.
bag to make a donation to a local environmental
A cornerstone of our commitment to accountability is an
industry-first nutritional label on every one of our 100%
recyclable shoe boxes. The label provides consumers
organization. They could also purchase 100% recycled
tote bags that featured a one-time discount for a return
visit to Timberland.
with detailed measures of our impact on the planet to
Our love for the outdoors is matched by our passion
invite their analysis and inform their choice. We also
for confronting global warming with focus and a fully
offer a series of service events and promotions that
integrated strategy—from the source all the way to the
engage consumers in environmental action.
floors of Timberland® stores worldwide.
Program highlights include a commitment to plant a
million trees in the Horqin Desert in China through a
strategic partnership with Marston Vale Park in London
36
2006 CSR report
The Evolution of our
Product Labeling
More and more, today’s consumers want to know
what kind of environmental footprint is being left by
the products they buy. In 2006, Timberland began
putting that information on 30 million footwear
boxes: by placing a “nutritional label” on every box to
educate consumers about the product. Where it was
manufactured. How it was produced. And its effect on
the environment.
Green index
MGI-4
A Nutritional Label—for Shoes
Factors
4
™
lower
impact
0
Climate Impact:
higher
impact
4
10
Greenhouse gas emissions through production.
00
Chemicals Used:
10
Presence of hazardous substances
(PVC, Chrome leather* and Solvent Adhesives).
9 10
0
Resource Consumption:
Reduced by the use of recycled, organic and renewable materials.
*Chrome leather present in leather based shoes
For more information about the Green Index™ rating, see inside the
shoe box or visit www.timberland.com/outdoorperformance
green index
™
To create the label, three critical areas are highlighted.
Information about the manufacturing plant. The impact
of manufacturing on the climate. And the impact on
the community, including such factors as the number
of hours of volunteer service performed by Timberland
employees to “Make it better” in the community. We’re
also putting a message inside the box asking consumers
to consider what kind of footprint they themselves are
leaving and encouraging them to become proactive in
Introducing the Next Step: The Green Index™ Rating
the effort to protect our planet.
The next step in this initiative is the Green Index™
Under this initiative, footwear boxes are also crafted
from 100% post-consumer recycled waste fiber, using
no chemical glues. Only soy-based inks are used to
print the labels, which are the first of their kind
in the industry.
rating, which will go beyond printing corporate CSR
information on a nutritional label on the shoebox
to provide product-specific environmental impact
information on the actual shoe. Using a scale of 0 (best)
to 10 (worst), the Green Index™ rating will rate the shoe
on three key environmental factors: climate impact,
The First Step
chemical use and resource consumption. By putting this
So far, public reaction has been positive. But, as the
information—good and bad—at your fingertips, we hope
Chinese proverb states, “A journey of a thousand
you’ll know exactly what you’re putting on your feet. The
miles begins with a single step.” Well-informed CSR
Green Index™ rating will be carried on a select line of
pundit Joel Makeower agreed in his blog. Evaluating
Greenscape shoes in 2007. Our goal is to have it on all
Timberland’s nutritional label, he says, “It’s a step in the
of our shoes by 2010.
right direction” and “a laudable first effort,” but adds
that it left him “hungry for more.”
What to Expect Going Forward
Unveiled in January 2007 at the Outdoor Retailer
We couldn’t agree more. In fact, we see our new
trade show in Utah, the Green Index™ rating helped
nutritional label as just the first step. Of a conversation.
Timberland win the Backpacker Editor’s Choice Green
A promise of our commitment to transparency and
Award for innovation in green product development.
sustainability. And a challenge to our entire supply chain
And industry-wide interest seems to be developing for
and to other companies to “Make it better” for the world
creating a common “eco label” for products. We’re
we share.
excited about this development and look forward to
seeing where this journey leads.
Let your own voice be heard! What do you think? Does this initiative affect your
purchasing decisions or your understanding of Timberland’s footprint? How
can it be improved? Let us know by writing to us at csrinfo@timberland.com.
2006 CSR report
37
Energy
Greenhouse Gas Inventory
Timberland-Owned Facilities
As accountable corporate citizens with a genuine
Timberland uses The World Resources Institute (WRI)
commitment to environmental stewardship, we
protocol for measuring greenhouse gas emissions. It’s a
focus almost obsessively on our energy use and the
widely accepted and utilized methodology for businesses
contribution we make to greenhouse gases. Our
like ours that voluntarily choose to report emissions.
comprehensive approach encompasses a broad array
WRI’s tools allow us to take electricity, gas, and oil
of rigorous corporate policies. The development of
bills as well as airline, car and public transit mileage,
new green technologies and innovations. And most
and calculate our contribution to climate change.
importantly, engagement with citizens and partners
Specifically, the model tells us our direct emissions
all over the world. With their wisdom and collaboration,
(the emissions from fossil fuels burned for power or
we seek to achieve carbon neutrality by 2010.
transportation) and our indirect emissions (emissions
from purchased electricity.) Our inventory reports the
The first step to carbon neutrality is to understand
emissions from the facilities and vehicles we own and
your baseline carbon emissions, or in other words,
operate, as well as the emissions from air mileage.
your greenhouse gas inventory. This year, Timberland
worked to expand the scope of our 2006 greenhouse
As you can see in the graph, our carbon emissions
gas inventory by adding information about product
increased across a majority of our business divisions. A
transportation. The results are included in this section.
deeper dive reveals that most of these increases can be
attributed to improved proficiency with data collection.
These results mask what otherwise would be considered
significant emissions reductions. Nobody said this was
going to be easy. In the Fall of 2007, we will release
a report that will include third-party verification of our
greenhouse gas inventory and a detailed brief on our
climate change strategy.
Direct and Indirect Emissions by Division19
8,341
7,328
7,052
Headquarters
5,507
2006
International
Retail
International
Showrooms
Direct Emissions
Indirect Emissions
Direct Emissions
Indirect Emissions
Direct Emissions
930
1,822
Indirect Emissions
46
1,889
211
936
97 112
16
12
123
122
363
Manufacturing
2,708
3,884
US
Showrooms
151
84
91
58
89
269
US Retail
2,483
4,989
2005
2,322
Distribution
Centers
91
2,271
314
2,158
360
291
586
0
353
2,000
303
4,000
2004
4,548
5,263
6,000
6,223
8,000
6,212
METRIC TONS OF CARBON
10,000
International
Offices
The system isn’t perfect. We still haven’t yet found an
We’ve also been working to calculate the emissions
adequate way to estimate the direct emissions from
produced by the third parties that ship our product in
leased spaces where heat is included in our lease
the US and in Asia. That’s why we’ve partnered with
agreements. Sometimes, we don’t have enough stores
Businesses for Social Responsibility’s Clean Cargo
in a single climate regime to make good assumptions.
Working Group to build our 2006 inventory.
19
38
We have restated 2004 and 2005 data to include employee air travel in “indirect emissions” as opposed to “direct emissions.”
2006 CSR report
Transportation Emissions: Ocean Freight
who all are members of Business for Social
The calculation of CO2 emissions is based on a model
Responsibility (BSR). The calculation follows the
developed by the Clean Cargo Working Group
guidelines set forth by CCWG and is our best current
(CCWG)—a group of Carrier and Shipper companies
estimation of our transportation footprint.
tons of carbon emissions related to product transportation20
2005
2006
Asia ➜ North America
10,3069,431
Asia ➜ Europe
6,047
6,448
202
483
522
412
Asia ➜ Rest of the World
Other Lanes (excluding Dominican Republic origin)
17,077
Total
16,774
Engagement: BSR Clean Cargo Working Group
Timberland’s Global Transportation group has engaged with other members of Business for Social
Responsibility (BSR) in a forum known as Clean Cargo Working Group (CCWG), in an effort to understand
the greenhouse gas impact of our product transportation. CCWG promotes the use of industry-wide tools
and methodologies to address the environmental and social impacts of transporting products. This group
is working to capture information about CO2 emissions from vessels and intermodal transportation so that
Shippers (i.e. brands) can understand their share. Once we have a base line understanding of our CO2
emissions, we plan to work with Carriers (i.e. transportation companies) engaged in the CCWG to reduce
our overall greenhouse gas impact.
Summary of Greenhouse Gas Inventory
2006 GREENHOUSE GAS INVENTORY: METRIC TONS OF CARBON21
30,000
Timberland-Owned Facilities
16,774
22,557
Employee Travel
Product Transport:
Inbound Ocean Freight
6,514
METRIC TONS OF CARBON
25,000
EMISSION TREND DATA22
25,084
26,854
29,071
20,000
15,000
10,000
5,000
0
2004
2005
2006
We made several assumptions for this calculation. It’s assumed that the CO2 emission factors calculated by the carrier apply to all the Carrier’s vessels—regardless
of whether the Carrier owns the vessel or charters it. The Carrier CO2 emission factors also assume a fully utilized vessel, which rarely is achieved. We assume that the
distance reported by distances.com (+2%) accurately reflects the true distance between ports.
21
This chart does not include outbound and intermodal product transport. It also does not include greenhouse gases associated with our contract factories.
22
Represents carbon emissions from Timberland-owned facilities and employee travel.
20
2006 CSR report
39
Efficiency Measures
employees to drive hybrid cars. And Timberland plans
In 2006, Timberland continued to work to reduce the
to roll out a comprehensive program in 2007 to reward
amount of energy we require to operate as a company.
employees who have the smallest carbon footprint by
Having installed renewable energy systems at almost all
breaking their dependence on “dirty energy”.
of our largest facilities, we began adding more focus to
our retail stores. With more than 300 stores around the
world, 20 renovations and 30 build-outs per year, stores
represent one of our greatest opportunities for reducing
our corporate energy demand. After incorporating green
building principles and energy-efficient lighting in our
design for years, last year we committed to exploring
a more holistic approach to retail store constructions.
We did that by using the US Green Building Council’s
LEED (Leadership in Energy and Environmental Design)
certification system as the basis for our new global
standards for retail store design and construction. LEED
buildings on average consume 30% less energy, use
30–50% less water and reduce waste costs by as much
as 50–97%23. Our new store designs, which began
construction in spring 2007, are intended to meet, at a
minimum, the silver certification for LEED’s new pilot
program for retail store construction.
In addition, we continue to encourage our employees
Renewable Energy Credits and
Carbon Offsets
In 2006, Timberland purchased Renewable Energy
Credits (RECs) to power key community service projects
and events. We also offset the emissions associated with
mailing our 2005 Corporate Social Responsibility report
to our partners. In this same spirit, all recipients of our
2006 Holiday card received a tree planted on their behalf
by The Conservation Fund at the Illinois Wildlife Refuge.
Reforestation
In 2006, we began to focus on reforestation as a way to
leverage consumer interest in global warming. This plan
involved two major initiatives. In Marston Vale in the
UK, an innovative consumer engagement strategy led
to the planting of 20,000 trees in the first year alone.
And in China, our Timberland Asia team has made a
commitment to plant more than 1 million trees over a
five-year period (2006–2011) in the Horqin Desert.
to live these values. A $3,000 bonus encourages
Renewable Energy
In the last three years, four renewable energy systems (three solar arrays in New Hampshire, California and the
Dominican Republic and a wind turbine in the Dominican Republic) have contributed to our current electricity
utilization rate of 6.6% from clean, renewable sources. The most recent effort was the installation of a 400kW solar
array at our Ontario, CA distribution center. The array provides 60% of the power for our facility—enough electricity to
power 50 homes. In addition, our distribution center in Holland is powered by 100% renewable energy that is bought
from the grid. And we use biodiesel fuel in a service vehicle at our corporate headquarters.
In preparation for meeting our carbon neutral goal for 2010, we spent most of 2006 exploring renewable energy
opportunities for our facilities—in particular, our manufacturing facility and our retail stores. Our goal for 2007 is to
use this information to convert our manufacturing operations in the Dominican Republic to 100% renewable energy,
and to purchase as much renewable energy off the grid as we can to power our retail stores.
Renewable Energy Breakdown (in kWh)
Total Timberland Energy Use
23
40
2005
2006
37,089,047
42,540,928
Wind Power
637,317
727,429
Solar Power
3,000
518,518
Hydro Power
910,975
1,017,149
Renewable Energy From Grid
692,173
540,078
Total Renewable Energy Used
2,243,465
2,803,174
Renewable Energy as Percent of Total Energy Used
6.0%
6.6%
Source: http://www.usgbc.org/ShowFile.aspx?DocumentID=1892
2006 CSR report
Chemical Management
Chemicals are used in material and footwear production
testing of a thermoplastic rubber substitute in 2006 is
paving the way for the launch of PVC-free boots in 2008.
to improve the performance and aesthetics of our product.
Finding substitutes that meet the molding and physical
Timberland is committed to eliminating the use of
requirements for our industrial and full-shot boots remain
chemicals linked to human or environmental harm. To that
the two outstanding PVC-related issues in our footwear.
end, the company is working to identify and adopt safer,
In 2007, we will enlist the University of Massachusetts
more environmentally conscious substitutes for common
at Lowell Green Chemistry Program to develop solutions
footwear components. These components include polyvinyl
to complete our phase-out of PVC across the Timberland®
chloride (PVC), solvent-based adhesives and chrome
footwear line.
leather. In addition, we want to stay informed of the latest
developments regarding restricted substance lists. This
Apparel
desire informs our active participation in AFIRM.
Analysis has revealed that only a few items in our
apparel line contain enough PVC to require material
PVC
substitutions. Changes like the switchover of logos or
Polyvinyl chloride (PVC) has long been linked to human
the use of different trims were easy to make. Finding
health issues. In our last CSR report, we discussed our
substitutes for the inks used in our high-density (puffy)
commitment to phasing PVC out of our products. Used
printed graphics, however, proved to be an issue. Working
in everything from drainage pipes to shopping bags, this
with our regional suppliers around the globe did not
plastic is also found in the inks applied to our t-shirts,
identify a comprehensive solution last year, so in 2007
the linings of our luggage and the midsoles of our boots.
we seek to work with a multi-brand group to stimulate the
Footwear
development of PVC-free ink alternatives.
We voluntarily started removing PVC from our product
Licensed Product
several years ago. In 2006, we made significant strides
For licensed product such as luggage, watches, belts and
with our footwear by implementing a hard-and-fast rule
hats, PVC again showed up in small areas. It was fairly
that all new products developed by Timberland would
simple to find alternatives for watch cases, for example.
be PVC-free. While this initiative didn’t immediately
Working with our luggage supplier to find alternative
eliminate PVC in our carry-over product, such as the
fabric backings is our largest ongoing project in 2007.
midsoles in our classic boot models, the successful
The reward of these efforts? In 2008, Timberland’s
licensed accessories will be PVC-free.
2006 CSR report
41
Solvent-based adhesives
Chrome III
Solvent-based adhesives are used to glue footwear
Chrome III is a mineral agent used in the processing
components. They can emit volatile organic compounds
of leather to impart key performance characteristics
(VOCs), which, if not treated, can produce indoor and
and long-term preservation. Due to the excellent
outdoor air pollution. In addition, the extra adhesive
performance properties given by chrome salts, chrome
is considered hazardous waste and requires careful
remains the most common means of tanning leather.
disposal. Timberland began promoting the use of
Although Chrome III does not pose a direct human
safer, water-based alternatives in 2000. By the end
or environmental threat in the processing of leather,
of 2006, we had converted about 10 million pairs
it can convert to a carcinogenic form known as
of shoes—or about 1/3 of our product line—to
Chrome VI under very specific circumstances, such as
water-based adhesives (WBAs).
incineration. Given the small but serious potential for
We did not achieve our 2006 WBA targets of 14.4
million pairs, however, due to sourcing changes and
costing pressures. To reinvigorate our approach, we
began focusing our efforts on aggressive training
internally and in our factories. Through this
pollution, Timberland has been working with leather
industry representatives to improve the environmental
performance of tanneries that use chrome. As an
organization, we are also working on initiatives to
develop alternative tannages for footwear leather.
comprehensive approach, we began to see immediate
AFIRM
improvements in WBA use. We have forecast this growth
As the global apparel supply chain continues to grow
to continue in 2007 and have projected increases of
and reach many places in the world, it is important for
45% in stockfitting and 25% in assembly over 2006.
brands to stay current on latest developments regarding
We also intend to identify further areas where we can
restricted substances lists. Based on this need, the
reduce overall VOC (e.g., primers and cleaners) this
Apparel and Footwear International RSL Management
year. And we will problem solve other issues relating
Working Group (AFIRM) was formed in July, 2004 with
to materials that typically don’t bond with water-based
the goal of bringing together product chemistry, safety,
adhesives, such as oily leather.
regulatory and other experts within the apparel industry
to discuss emerging restricted substance topics, share
10
WATER-BASED ADHESIVES USED IN FOOTWEAR PRODUCTION24
MILLIONS OF PAIRS
8
6
8.40
are currently ten companies in AFIRM: adidas Group,
C & A Buying, Gap, Inc., Hennes & Mauritz, Levi Strauss
8.42
& Co., Marks & Spencer, Nike, Nordstrom, PUMA
7.00
and Timberland. The guiding principles of AFIRM are
4
4.64
as follows:
3.40
2
0
information and experiences, and benchmark. There
1.40
2004
2005
WBA - Stockfit
•
Chemical product safety must be understood in the
global supply chain as an integrated whole, from
workplace to consumer.
•
Chemical product safety can only be achieved
through partnership among retailers, suppliers and
manufacturers.
•
Retailers must encourage suppliers’ and
manufacturers’ self-governance of chemical
product safety within their spheres.
2006
WBA - Assembly
In 2006, AFIRM conducted a joint Vendor Event to train
nearly 1,000 suppliers about RSL and created a joint
RSL for vendors.
24
42
“Assembly” is the production of the upper portion of the shoe. “Stockfit” is the production of the midsole to the outsole.
2006 CSR report
Resources
Reducing the harmful impacts of manufacturing. And
reducing our overall environmental footprint. These
actions are high on the agenda at Timberland. Over
the past few years, we have pledged to closely review
how we design our products, our stores and even our
packaging. We’re also being much more careful about
how we select our resources and raw materials.
Leather
The durability of our footwear is due in large part to the
quality leather we source for it. Leather is a byproduct
from the meat-packing industry. Even so, it is a resourceintensive material to produce, so, unfortunately, leather
contributes more to our environmental footprint than
any other material we use in our footwear. Even more
unfortunately, there is no winning technology that
In 2007, Timberland will require all of its tanneries to
switch over to this cross-brand assessment process.
Assessments will be performed once per year by
a third-party auditor who is qualified under LWG’s
auditing criteria. The protocol will continue to be a
dynamic one, updated by LWG members as needs and
technology change. Scoring will also evolve over time
as environmental technologies become increasingly
available to tanners. We hope that, as the top level
“bronze, silver and gold” scores become increasingly
challenging to obtain, tanneries will be spurred toward
better management techniques and new technologies.
In the meantime, the bulk of the group’s efforts will be
devoted to making tanners better aware of best practices
and resources, empowering them to “Make it better” in
their operations and their products.
can produce leather in a way that can be considered
Organic Cotton
“earth-conscious.”
In 2006, we grew our consumption of organic cotton
Our opportunity with tanneries is to encourage sound
management and year-over-year improvement in
environmental performance. Having audited factories
and suppliers for nearly 10 years now, we know that this
is easier said than done. Tanneries undergo rigorous
auditing by multiple brands, which creates audit fatigue
and confusion over standards. Often, the by-products are
reports, with little remediation and long-term planning.
to 593,000 pounds (or 5.7% of our overall cotton
purchase) through the sale of 100% organic cotton and
organic cotton blended t-shirts, as well as specialty
woven organic products including shirts, pants and some
women’s wear lines. We also introduced a color palette
specifically designed for organic cotton merchandise.
This new palette was formulated with the help of dye
suppliers (such as Clariant, Dystar and Huntsman)
to use fewer chemicals, less water and less energy—
Many Brands Work toward a Common Goal
ultimately leading to less carbon dioxide emissions in
What’s needed, obviously, is agreement on a common
dyeing. The palette will also help Timberland comply
set of rules. Recognizing this, in 2005 Timberland, Nike
with the new organic certification standard, GOTS
and UK-based BLC Leather Tech convened a cross-
(Global Organic Textile Standard).
brand, cross-tanner working group, called the Leather
Working Group (LWG). This group now also includes
top brands such as Clarks, Marks and Spencer, New
Balance, adidas, Ikea and The Pentland Group.
The first priority that LWG identified was to ensure that
8%
PERCENTAGE OF ORGANIC COTTON PURCHASED
7%
6%
5.7%
5%
4%
valuable brand and tanner resources benefited from a
3%
streamlined assessment process. In 2006, the group
2%
completed a final, peer-reviewed draft of a detailed
1%
auditing process and launched it with tanners who had
0%
2.11%
2.11%
2004
2005
2006
participated in the working group. Tanners are scored on
their environmental performance in over 300 areas, so
Processing our organic cotton with the new eco dyestuffs
the assessment is rigorous. Still, the promise of having a
and using a scouring (vs. bleaching) process to remove
single, comprehensive audit conducted each year, with
knitting oils eliminates approximately 2 hours from the
one standard performance grading system, has proven
total dye processing time. We’re also seeking to save
to be a real incentive for tannery participation. Other
resources by encouraging new developments from textile
incentives provided by the LWG include benchmarking
machine builders, such as Thies, to increases our dye
data, guidance documents and a forum for sharing
houses’ ability to dye at lower liquor ratios. For a typical
best practices.
t-shirt that uses approximately 200 grams of fabric, the
2006 CSR report
43
carbon emission savings from these improvements is
roughly 10gm per t-shirt (an average 15% reduction).
In 2007, we have a new opportunity ahead of us:
howies—a small but growing activewear brand based
in Wales that Timberland acquired at the end of last
year. Howies was founded on strong environmental
Carden Welsh Award for
Environmental Excellence
2006 Winner: Larry Klane
principles and is incorporating renewable materials in
Timberland has long struggled with what to do with
Organic Exchange, we seek to grow our consumption of
unmatched footwear samples used by our sales
organic cotton to 6.5% in 2007.
its product line at every opportunity. For example, their
organic denim is dyed using natural indigo grown in the
Tokushima Prefecture of Shikoku Island in Japan. With
their brain trust and our continued partnership in the
staff. Our distribution centers were never organized
to collect and match these samples. We couldn’t
even find a nonprofit organization willing to accept
so many shoes of the same size. Sadly, in the past,
we ended up having to dispose of well over 15,000
pairs of shoes a year in the United States alone.
Wool
The SmartWool® brand is the U.S. pioneer of woolbased socks, apparel and accessories. SmartWool works
to establish good business practices that focus on
environmental sustainability. Economic sustainability.
That’s where Larry Klane comes in. Through
Improvement in animal welfare. And social change.
research and persistence, Larry developed a
Environmental Sustainability
partnership with several nonprofit organizations that
SmartWool is the largest natural fiber-based brand in the
allows our U.S. sales staff to mail unmatched shoes
outdoor industry—roughly 90 percent of its raw materials
to a central collection site. There, they are matched
are natural and biodegradable. It is also the largest single
by non-Timberland volunteers.
branded purchaser in the world of wool from New Zealand,
The main nonprofit
where sustainable farming helps to maintain undeveloped
involved was Soles4Souls.
Soles4Souls is a relatively
new organization, formally
established post-Hurricane
Katrina. They have
since raised almost 1
lands. SmartWool’s fiber production uses 3 to 5 times
less energy than synthetic fiber production. Plus, recent
research supports chlorine use and chlorine-Hercosett
wool processing, which SmartWool utilizes, as the most
commercially viable and environmentally sensitive wool
processing available.
million pairs of shoes for
Economic Sustainability
displaced people along
Everybody wants job security, and SmartWool helps to
the Gulf Coast. For 2006,
provide that for wool growers, as the world’s first wool
Timberland committed to
product manufacturer to develop seven-year sourcing
donating 30,000 pieces
contracts with them. Also, SmartWool has developed
(15,000 pairs) of footwear
accreditation certification standards for livestock
samples to Soles4Souls.
stewardship, environmental responsibility, and economic
This project is a win, win, win.
Win #1: We reduce our solid waste.
Win #2: We outfit people who cannot
afford footwear.
Win #3: Instead of paying to dispose of the shoes,
we receive a tax deduction that will more
than offset the cost of shipping shoes to
the nonprofit site.
and social values for our growers.
Animal Welfare
SmartWool, along with its New Zealand partners, developed
the first accreditation in the wool industry that ensures animal,
environmental and social values. Their sheep are free-range and
hormone free. They provide safe, effective and responsible use
of medicines and supplements to ensure animal health. And
SmartWool is the world’s first wool-product manufacturer to
mandate that wool growers end
Congratulations to Larry for truly embodying the
the controversial practice of
spirit of “Make it better” at Timberland.
“mulesing” sheep.
Eco-Effective Design
“greening” practices for footwear (e.g. adding recycled or
It makes sense to make something right from the start
organic content) didn’t deliver the greatest environmental
rather than less bad at the back-end. So why don’t
returns. Fewer materials, lighter materials and a reduction
corporate sustainability initiatives incorporate this thinking?
in volatile organic compounds (VOCs) had a far greater
Taking something that’s commercially successful and
impact. Combining material reduction and cement-free side
reinventing it to be environmentally responsible requires an
stitch construction, without compromising performance
entire mindset shift in the people who shape the business
or aesthetics, proved to be tremendously difficult. Few
and design the product. It’s hard. We are starting down
materials were available that combined lightweight
that path, where, instead of becoming waste, products and
renewable or recycled materials while meeting our tough
services become the raw materials for new products and
durability requirements for abrasion, tensile strength, stitch
services. That is the principle behind eco-effectiveness.
tear and crocking. Most required heavy synthetic backers.
Despite pioneering the use of water-based adhesives (WBAs)
Product
more than six years ago, our factories still struggle to keep
The biggest and most important step in the direction of
WBA chemistry at a development pace that matches our
creating eco-effective product is to introduce a tool that
rapid increase in new material use. Working with these
allows our design and development teams to understand
obstacles, we stripped as many parts from the shoe as we
the environmental impact associated with their choice
could (this reduced the shoe’s weight by between 10-15%),
of materials. This tool, the Green Index™ rating, was
employed a hand-stitch construction around the outsole
tested by the Outdoor Group in 2006 as we developed
(saving 50g of VOCs per pair) and used WBAs to construct
the Greenscapes Collection of footwear. The objective
the rest of the shoe (saving an additional 48 grams per pair).
of the collection was to meet the technical performance
and aesthetic requirements of the outdoor enthusiast,
Our greatest challenges were ensuring that our Green
while delivering a more earth-conscious product.
Index™ rating was accurate and our design optimized
sustainability. To do this, we had to obtain detailed
Our challenge was to use this new, objective rating
material content from our factory and from our suppliers.
system to influence product design and development. We
It turned out to be easier to get performance data than
also had to do it within a typical six-month design cycle,
chemical component descriptions of our materials.
using only commercially available materials. The design
In an effort to streamline this data collection (which,
team hoped to achieve a rating that was at least 50%
interestingly, is the biggest obstacle for other brands
better than the rating for our typical product.
as well), we spent six months developing an improved
Application of the Green Index™ rating system taught
us something we didn’t expect—namely that common
factory communication process plan that we’re now
applying across all new Green Index™ rated lines.
Materials Used in our Product Line
The following chart shows the percentage of Timberland® products25 that use one or more of the following types of materials:
25
Category
Explanationpercentage
Natural / Renewable Materials
Harvested materials that are readily available, grow rapidly and
don’t require lots of chemicals to produce.
3.76%
Recycled Content
Materials that contain ingredients from other products. Postindustrial material uses scrap from the manufacturing process.
Post-consumer material is recovered after use by consumers.
79.50%
Recyclable Materials
These materials can be recycled through municipal or private
programs.
75.64%
Reduced Impact Materials
Versions of materials that use less energy, resources and chemicals,
thus saving natural resources.
6.53%
Recycled Packing Materials
This includes shoe stuffers, box stuffers, box tissue and separators
made from recycled materials.
77.46%
There were a total of 6,322 products in the survey that covered Fall 07, Fall Holiday 07 and Spring 08 product lines.
2006 CSR report
45
SmartWool® fabric lining made from
sustainable, biodegradable merino wool
Organically tanned,
premium full-grain leather
and fast-growing hemp.
Vibram® EcoStep® outsole made
with 30% recycled rubber
Mountain Sneaker Low Hemp
The Mountain sneaker is part of our Greenscapes Collection—a technical, casual footwear and apparel
collection which utilizes earth-conscious materials and construction methods without sacrificing the style
and function demanded by the outdoor consumer.
These shoes contain:
• Green Index™ Rating of 3.5: The sneaker features a Green Index™ (GI) rating for the climate,
chemical and resource impact created from raw material extraction through finished
product production.
•
Recycled PET materials: Used for more than 10 years in fleece, recycled PET is a new fiber to
footwear. This fiber comes from post-consumer plastic bottles and is incorporated in the linings
and laces of the sneaker.
•
Rapidly renewable fibers: Hemp is an extremely desirable fiber from an environmental standpoint
because it grows rapidly while requiring minimal input of chemicals and water. Durability and
aesthetics have always plagued the use of hemp in footwear. We found a 25% hemp/75% polyester
blend that allows us to gain some of the environmental benefits of hemp without sacrificing our
performance or aesthetic requirements.
•
Reduced VOCs: Water-based adhesives and hand stitching replaces traditional solvent adhesives,
thus reducing the release of harmful volatile organic compounds.
Store
•
Where we locate our buildings is another area where
we can model eco-effectiveness. Our focus now is to
consider walking and biking distance, and public transit
availability, so that it’s not necessary to generate extra
greenhouse gas emissions by getting in a personal vehicle
to visit Timberland. We’re also looking at how we can
Keeping or simply cleaning exposed brickwork
and raw tongue-and-groove wall claddings, to
support the statement the brand wanted to make.
Refinishing remnants of the banana warehouse,
including steel box rolling-racks, tables and
assorted metal work, then returning them to the
site as display equipment
repurpose the resources in the buildings we occupy to
Resources and Materials
meet Timberland’s fixture requirements. Plus, we’re asking
Designed elements met a set of strict constraints:
if everything in the building design is necessary. Sourced
•
locally. Made entirely out of reused or recycled materials.
Energy efficient. And most importantly, recyclable into
new products after Timberland has moved on.
Build as little as possible: Develop methods of
achieving the desired design goals with a minimum
of materials. These materials were also assessed
for their embodied energy values (e.g., we used a
significant amount of timber as opposed to metal).
In 2006, we launched Timberland Boot Company (TBC),
a premium footwear and clothing brand that combines
•
Use certified products: Use products such as FSCapproved softwood and sheet material in furniture
and framework. These materials were finished using
natural waxes and oils.
•
Design for disassembly: All the designed elements
were designed to be simply unbolted into their
basic raw-material components to either recycle or
biodegrade naturally. Similarly, on a large scale, all
fittings can be removed from the building, leaving
minimal trace on this Grade II-listed Georgian
building. In other words, if Timberland Boot
Company chose to leave the site, they would leave
it in a significantly restored and more usable state.
•
Celebrate Context: Requirements for accessibility
demanded the inclusion of a DDA (Disability
Discrimination Act) toilet facility and a ramped
floor to the centre of the store. In order to integrate
the new seamlessly with the old, reclaimed London
stock bricks were sourced to create the toilet
enclosure and reclaimed warehouse flooring defined
the ramp.
the best of modern-day innovation with earlier ideals of
craftsmanship. The idea is to blend the best of the old
and new, wrapping it all up in a culture of community
responsibility.
It was decided early on that the commercial activities
of the new brand would be guided by our company’s
environmental ethic. We wanted to make sure that
its retail spaces would use resources effectively, by
physically consuming as few of them as possible. In
addition, we sought a site where Timberland Boot
Company could create a “home” for itself within an
established community and make a positive contribution
to it—for example, by using the retail space to hold
community-based events and artistic displays.
Our decision to choose a historic site steered the type of
environmental approach we used in the design. The key
emphasis became the restoration of period features using
traditional craft-based methods. All materials used were
either recycled/repurposed or new materials that were from
certified sustainable sources or that could be recycled
without downgrading their quality. Examples include:
•
•
Applying lime paste and wax finish to
existing flooring
Replacing timber cladding with sourced
like-for-like material
David Kira, once a banana and tomato wholesaler, is now the
Timberland Boot Company.
As a result of these approaches, almost no building
waste was generated during the project.
Energy
Energy use has been kept to a minimum throughout the
project by following a number of different strategies:
•
Transport of materials to and from site was strictly
controlled, and whenever possible all fixtures and
fittings were pre-fabricated and shipped in parts for
efficiency.
•
Day lighting was enhanced significantly to the rear
of the store space, through the inclusion of (new)
skylight to reduce artificial lighting loads.
•
The artificial lighting system installed can be
upgraded to significantly more energy-efficient
lamps in the future.
2006 CSR report
47
we will build the culture
with a global program that
encourages a wide variety of
green office behaviors.
Environmental Stewardship
in our Value Chain
Our assessment process has evolved to include scoring
for the environmental attributes of our factories. While we
have been doing this in our tanneries for several years, in
2005 we began to roll it out to other business units.
What happens is this: The Timberland Code of
Conduct team, trained in our environmental standards,
•
Flexible sun shading to the south-facing shop front
reduces glare and minimizes heat gain during the
summer but, once retracted, allows for heat gain
during the winter months.
•
The heating system is basic but utilizes a boiler
chosen to match the heating requirements of
the store volume. It is also mated to reclaimed
cast-iron radiators.
Looking Forward
Modeling eco-effectiveness is admittedly an unreachable
goal for our company. Every time we will think we’re
closer, new information, technologies and ideas will
show us that there’s more work to be done. This is a
good thing. An infinite goal will keep us hungry for
what’s new and better—and keep us innovating—in the
environmental arena.
In 2006, our goal was to begin delivering the tools
that will empower our product design and development
teams to make product better from the start from a
sustainability standpoint. The Green Index™ rating
was a powerful start. Developing design criteria for
our premium earth-conscious product, Earthkeepers™
collection, provided another important set of guardrails.
In 2007, we will continue down the path of automating
and launching the Green Index™ rating across our line.
In the near future every designer and developer will be
able to get environmental statistics on their product
while they are developing it. In addition, we plan to
publish our internal “Green Guide,” which outlines
Best, Better and Good material choices and services for
everyone from product designers, to printers and facility
managers, so that our entire staff will be empowered
to make more informed procurement decisions. Finally,
we will build the culture with a global program that
encourages a wide variety of green office behaviors. This
expands our existing hybrid-car incentive program to
acknowledge other resource conservation and community
service initiatives spearheaded by employees.
48
2006 CSR report
interviews factory management to make sure that
human and environmental health is protected and
that environmental and management best practices
are encouraged. During the assessment, we search for
environmental hazards such as asbestos and PCBs,
look at chemical, water, waste and energy management
systems, and score factories based on how far above
and beyond compliance they go with their
environmental measures.
With each assessment, suppliers are rated on five
criteria to establish an overall score reflecting their
commitment to minimize their environmental footprint.
For each criterion, a factory is given a score from 1-5,
with one representing no accountability or tracking and
five representing factories that have exceeded stated
targets. Among the areas assessed are:
1. Systems: Making sure that accountability has
been formalized, with effective monitoring and
procedures worthy of independent certification and
a proven history of effectiveness.
2. Compliance: Ensuring full awareness of all
applicable regulatory requirements, with no current
instances of non-compliance in all regulated areas.
3. Chemicals (footwear only): Verifying that waterbased or hot-melt adhesives are utilized in the
manufacture of Timberland® footwear, as well as up
to 100% use of solvent-free cleaners, primers and
adhesives.
4. Energy: Establishing and tracking energy reduction
goals and checking that aggressive efficiency
measures are in place, with up to 100% renewable
energy.
5. Waste: Implementing waste-minimization efforts
that result in up to zero-waste operations (in other
words, all waste streams are either recycled or
re-used).
Environmental Assessment Results
As a footwear-first company, we focused our environmental assessment training and tracking on our tanneries and
footwear factories in 2005 and 2006. The results for 2006 are shown below for these two business units.
ASSESSMENT SCORE
2.5
2006 ENVIRONMENTAL ASSESSMENT (AVERAGE)
Target
2.12
Actual
1.5
1.0
2.0
2.59
2.45
2.21
2.55
2.06
2.00
1.91
1.5
2.55
2.44
Footwear
Tanneries
1.0
0.5
0.5
0.0
2.5
2.53
2.0
2006 ENVIRONMENTAL ASSESSMENT (BY CATEGORY)
3.0
3
3
ASSESSMENT SCORE
3.0
Footwear
Tanneries
BUSINESS UNITS
0.0
Systems
Compliance
Energy
Chemicals
Resources
SCORING CATEGORIES
While neither business unit has achieved the target goal of three, it is clear that our tanneries have outperformed our
finished-goods footwear facilities. We believe these results are consistent with the on-site visits and environmental
guidance that tanneries have received from Timberland personnel for several years. Training and tracking for environmental
performance was expanded to the entire supply chain in 2006, and we plan to share results in our 2007 report.
Looking Forward: 2007 Goals
Climate change: Address our contribution to the most pressing environmental
issue of our time by implementing a strategy that will reduce our energy demand and
emissions. Support the development of clean, renewable energy. And grow carbonabsorbing forests for generations to enjoy. Timberland commits to the goal of carbon
neutrality by 2010.
Product: Continue to implement the Green Index™ rating across our product line
and our industry. This will provide our product development teams with tools to design
product better from the start, and it will inform consumers’ purchasing decisions
around sustainability.
Employees: Launch a comprehensive program, the “Make It better” initiative, which
will inform and inspire our team with opportunities to reduce corporate and personal
environmental footprints. Apply the lessons learned to the development of consumer-facing
initiatives that encourage Timberland consumers to make it better in their communities.
➜
➜
➜
VOICES OF CHALLENGE
question: how far should a company
go to stabilize the climate?
➜
➜
➜
➜
Jonathan Dorn
Editor-in-Chief,
Backpacker
➜
Mindy Lubber
President,
Ceres
As far as it can go. And then a bit farther—
Climate change will have huge financial implications
especially if the company is rooted in the outdoor
in the years to come. How businesses and investors
industry. As users and protectors and beneficiaries
respond to the risks and opportunities from this issue
of wilderness, we bear a unique responsibility to
will have an enormous rippling effect on the global
do more than the other guy, to set an example for
economy. For this reason, Ceres challenges companies,
our culture’s interaction with nature.
like Timberland, to tackle climate change head-on.
Is there any other answer that is acceptable? Not
Adaptive companies know that times have changed,
really. But few businesses can remake themselves
that the 21st century presents unparalleled challenges
overnight. Backpacker faces that predicament
with sustainability at their core. Companies leading
right now. Mea culpa! This magazine is a carbon-
in the climate arena are formulating comprehensive
intensive operation. We know we must eliminate
strategies that involve the measurement and reduction
all those subscription cards. We must use higher
of emissions causing global warming, as well as
grades of recycled paper—and less paper overall.
engagement of key stakeholders. Timberland is on
We know we must reinvent our business to be both
the right track. The company’s 2010 goal to become
profitable and carbon-neutral. And we will.
carbon-neutral includes critical steps to reduce energy
The outdoor industry, led by companies like Keen,
Teko, Patagonia and Timberland, has turned a very
use, pursue efficiency gains, purchase renewables, and,
when necessary, offset emissions.
important corner—the corner of intentionality. We
Stabilizing the climate requires board members and
know what we have to do and how far we need to
senior management to focus on long-term planning.
go. And most of us are on board. The important
We are pleased that Timberland recently added a
thing now is to instill in our companies, and in
sustainability committee to its Board of Directors,
each other, the kind of urgency that leads to some
and expect this Committee will be involved in refining
measurable progress every day, every issue, every
Timberland’s future climate strategy.
show, every year.
However, we also need companies to show strong
leadership in developing meaningful climate policy
solutions in Washington. Investors are calling for
analysis and disclosure of the business and competitive
implications of this issue—including members of Ceres
and the Investor Network on Climate Risk, an alliance
of investors with nearly $4 trillion of assets. This is a
necessary step to move corporate America full throttle
into the clean energy economy.
Chris Walker
US Director,
The Climate Group
Tim Smith
Senior Vice President,
Walden Asset Management
Meredith Benton
Associate Director
of Social Research,
Walden Asset Management
From the leather in its boots and the wool in its socks,
to the transport of its merchandise, to the clothing its
customers wear, climate change has the potential to
change every aspect of Timberland’s business. Given
a complex, interconnected economy and a complex,
interconnected natural world, all companies will be
The climate impact of the retail sector and of many
consumer-facing brands may not be as obvious as
that of a steel mill or power station. But retailers
account for a rising percentage of overall energy
consumption and CO2 emissions. And as the
“hidden” footprint of retailers and brands is also
significant, exciting opportunities for emission
reductions exist not only at the operational level
but also in the supply chain and in the products
and services provided.
affected by climate change. And all companies will need
Exploiting these opportunities will be increasingly
to make changes in order to reduce their greenhouse gas
important as climate change moves up the agenda
emissions and address the difficulties presented.
for consumers and investors. The latest research26
A leader in socially responsive investing, Walden Asset
Management manages clients’ assets to achieve specific
financial and social objectives. With a focus on attractive
investment returns, we seek to identify, and encourage,
sustainable business models. To be sustainable, a
company must approach environmental, social and
governance issues in a holistic manner that incorporates
long-term strategic thinking. We have found that
shows that climate change is likely to be “a
mainstream consumer issue” by 2010. When this
happens, there will be “reputational implications
for many sectors not seen to be addressing the
issue appropriately.” In order to prevent putting
brand value at risk consumer facing retailers and
leading brands will increasingly need to take a
proactive stance on climate change.
operating within a sustainability framework contributes to
Forward-thinking companies are already taking
long-term business success. Addressing climate change
significant action to reduce site-based emissions.
is one key example of sustainability planning.
As a boot-making family business, Timberland does
However, sustainability reaches beyond a company’s
not seem the most likely candidate for leading
direct operations, employees, and consumers, to include
the corporate world in taking action on climate
its entire sphere of influence. Hence, we encourage
change. With a carbon footprint equal to less than
Timberland and all companies to actively work toward
1% of BP’s, Timberland’s definitive contribution to
sustainability wherever they have the ability to do so
emission reduction may seem inconsequential—
effectively. For example, we expect them to address
until the company’s supply chain and consumer
topics such as greenhouse gas emissions and human
outreach are considered.
rights when structuring supplier relationships. We expect
companies to ask hard questions, listen to hard answers
and have the courage to make the necessary changes.
As investors, we believe taking these steps, as daunting
as they may be, is essential for sustaining the long-term
health of a company—and the planet.
With 120,000 factory workers worldwide and
distribution vehicles traveling over 25 million miles
annually, Timberland’s scope for positive change
is obvious. It is our belief that, regardless of a
company’s size, its capacity to make a difference
is infinite.
We commend Timberland for its willingness to
approach sustainability issues thoughtfully, to look
for opportunities for constructive change, and to test
innovative solutions. We encourage Timberland’s
leadership, and to go even further in prioritizing
sustainability goals: in its work with its supply chain,
in its sourcing of leather and other materials, and in its
structuring of stakeholder relationships.
The question before us was: how far should a company
go to stabilize the climate? The answer is simple: as far
as it reasonably can.
26
The Carbon Trust: http://www.carbontrust.co.uk/Publications/publicationdetail.htm?productid=CT-2004-10
2006 CSR report
51
FOCUS ON
“Boundarylessness”
When a small, unknown youth leadership corps asked The Timberland Company for 50 pairs of boots in
1989, no one knew that the course of both organizations would be forever changed.
The organization was City Year, and from this simple transaction, a company’s culture and mission was
transformed. City Year inspired Timberland’s Path of Service™ employee volunteer benefit program and
helped inform our approach to building strong communities through stakeholder engagement. Through
the Timberland uniformed corps, City Year has served as the embodiment of the company’s mission
to “equip people to make their difference in the world” across the United States and in South Africa.
Shoulder to shoulder, we have mobilized hundreds of thousands of citizens to perform close to 20 million
hours of global service. And as we serve, City Year shares wisdom and insight about their generation, the
communities in which we live and work, and important lessons of culture and diversity.
And as City Year has developed a new generation of young leaders through citizen service, civic leadership
and social entrepreneurship, Timberland has provided strategic advice, access to new markets, connections
to new investors and editorial and brand exposure. As a National Leadership Sponsor, Timberland is more
than an investor—we strive to be City Year’s leading strategic partner. Closest ally. And toughest critic.
Today, Timberland and City Year share what some regard as a “model private-public partnership.” Yet, in
18 years, a great deal has changed. Both organizations have expanded globally. Missions have been honed.
Weaknesses have been identified. Social and environmental challenges have grown increasingly complex—
requiring more innovation and sustainability. Yet, at the foundation of our partnership is an alignment of
values and strategic intent. And, of equal importance, we share a passion for service. A belief in young
people. And a deep resolve for a more inclusive, united community.
As we plan for our third decade of partnership, we must adapt—together—to the changing dynamics of the
marketplace, emerging trends in the non-profit sector and greater collaboration among consumers, financial
investors and civic leaders. In 1989, Jeff Swartz envisioned a “boundarylessness” partnership—true
integration and strategic alignment to affect profound change locally and globally. Values defined and
measured. And new models of leadership and innovation. We continue to drive this vision to strengthen
both organizations and the communities and markets we serve.
Community Involvement
progress report: community involvement
Goals for 2006resultsscore
Leverage service events
We increased participation in our pillar service events and surpassed
our goal of a 20% increase in employee service hours across the globe.
The Global Stewards contributed to ensure that service increased in
most constituencies.
Optimize Path of Service™ Program
While we continued to make progress on the service-event experience,
we also developed a standardized set of measures used by Global
Stewards to evaluate their respective volunteer programs. Additionally,
we launched our enhanced sabbatical program in 2006 to allow
employees to work with a nonprofit organization for two weeks to six
months on capacity-building projects—either full-time or part-time.
Lastly, we have decided to report US valuation of volunteer hours
according to the Independent Sector’s annual rate.
Strategically allocate corporate
investments
No progress was made against this goal. A high degree of due diligence
is needed to manage a robust global investment program, and we
are currently unable to manage such a program due to decreased
investment staffing.
Key:
no improvement
making progress
achieved objective
Engaging in Community Service
Making communities strong. Healthy. Environmentally
bold goals. First is defining a global standard for
sustainable. At Timberland, we are committed to
volunteerism through innovation, regional relevance and
improving the quality of life of our employees by serving
employee engagement. Secondly, we want to create an
their communities, around the world. We are passionate
impact in the community that can be sustained beyond
about this connection between commerce and social
the short term. Third, we are striving to strengthen
justice, because we believe that living our values—and
the relationship between our consumers and our
engaging stakeholders in service—creates sustainable
stakeholders through outreach and service. And finally,
change in the communities where we live and work. We
in line with our greater vision for Corporate Social
want Timberland® products to stand for much more than
Responsibility, we want to develop and leverage our
just quality craftsmanship. Our end goal, always, is to
strategic partnerships to drive corporate and
“Make it better” throughout the world.
business goals.
To accomplish this, we need to engage our stakeholders
in our vision of community. Our agenda involves four
2006 CSR report
53
Global Stewards: Ambassadors
of the CSR Platform
For close to 20 years, Timberland’s Path of Service™
program has provided an annual benefit of 40 hours for
employees to invest in strengthening their communities.
As Timberland grew from New England to regions
around the globe, our service mission expanded with
equal intensity. Genuine community-led transformation
required a broader understanding of local needs
and priorities, as well as a structure for accountable
leadership. In 2006, the Global Stewards program was
founded to meet this goal and to serve as a vehicle to
develop the professional and civic skills of committed
President and CEO, Jeff Swartz, poses with the founding
members of the Global Stewards in Santiago, Dominican
Republic.
team members.
We found that no matter how committed everyone is
in Europe, one in the Caribbean and five in Asia—to
to a goal, there still needs to be someone in charge
assume these responsibilities. Under this program, our
of making sure the job gets done. That’s the idea
Global Stewards:
behind Timberland’s new Global Stewards program. We
•
Help employees in their region gain a more
immediate, in-depth appreciation of CSR
•
Cultivate leadership skills
•
Help build necessary relationships with local
stakeholders to help assess and define local needs,
resources and opportunities for impact
•
Inspire and enable regional service activities driven
and informed by community assessment and
stakeholder engagement
recognized that many of our offices and facilities around
the world lacked a point person. To inspire engagement
in the community. Communicate Timberland’s commerce
and justice agenda. And extend the reach of our
Corporate Social Responsibility (CSR) team.
In other words, we needed on-the-spot leadership. What
we did was launch the Global Stewards program, which
identified 23 emerging leaders from among our existing
employees around the world—seven in the U.S., ten
Highlights of the Pilot Year
During the program’s pilot year last year, our Stewards
“The Global Stewards program
creates a powerful worldwide
network of passionate leaders,
committed to advancing our social
justice agenda. For individuals,
it’s a unique opportunity to
pursue their passion while at the
same time developing as leaders
at Timberland.”
Mike Harrison
Casual Gear Brand President
The Timberland Company
were charged with two objectives:
1. Increase service hours in their region by 20%
2. Educate people in their region about our CSR
agenda
How have they fared? Here’s just a sampling of projects
that would not have occurred without them:
US: Summer of Service. Over a series of Fridays last
summer, corporate-based Stewards organized outdoor
service events, providing employees with easy ways to
serve their communities. Generating nearly 800 hours of
volunteer service, this model will be replicated by Global
Stewards in other markets.
Caribbean: Merengue Competition. Local culture played
a role in an awareness-raising event in the Dominican
Republic. Our Steward there highlighted Timberland’s
commitment to CSR by creating an internal Merengue
songwriting competition, with lyrics expressing the
company’s commitment to the community. The winning
song is now regularly played over the PA system.
Europe: Serv-a-palooza. Timberland’s annual Serv-a-
assistance. In the summer, employees in Taiwan also
palooza event is the company’s premier showcase of
helped clean up a local river. And Taiwan associates
employee leadership and civic entrepreneurship around
serve The Chinese Children Home and Shelter
the world. Thanks to the Stewards’ ability to rally
Association throughout the year. Efforts such as these
employees in their regions, Europe delivered the highest
accrued employee service hours of 1,658 in 2006—an
employee participation rates in the world last year, with
increase of 321% over the previous year’s total of 516.
567 employees taking part—up from 370 volunteers
in 2005.
In all, our Stewards have created service committees in
half of our offices. Dedicated a space for posting CSR
Asia: Regular Service Opportunities. Our Steward in
messages. Raised the profile of Timberland’s values. And
Taiwan recruited employees to participate in monthly
“Made it better” for their regions in a number of ways.
service events with community partners in need of
Tip: Reducing your footprint
Lowering your thermostat just 2 degrees in winter
can save about 2000 pounds of carbon dioxide a year.
Moving it up 2 degrees in summer does the same thing.
Source: www.stopglobalwarming.org
2006 CSR report
55
Community Service
Timberland’s Path of Service™ program provides an annual benefit of 40 hours for employees to invest in strengthening
their communities. A company-wide passion for service has led to innovative programs and events, including our global
Serv-a-palooza, service sabbaticals and recognition programs, such as the John Lewis Fellowship, which honors the life
and legacy of the courageous Civil Rights leader.
hours served
employee hoursnon-timberland hours
HUR
BUR
2006
2006
2006
2005
Yr/Yr Comp
2006
2005
Yr/Yr Comp
North America
45,16835,699
26.52%
64,07839,605
61.79%
61%93%
Dominican Republic
11,016
11,516*
-4.34%
4,5443,40833.33%
16%51%
Europe
15,484
12,516
23.71%
16,804
11,13650.90%
43%
Asia
8,9645,408
65.75%
6,544
4,585
42.73%
27%75%
Global Total
80,632
23.78%
91,970
58,734
56.59%
39%
65,139
85%
71%
* Includes 4,096 service hours from our Puerto Rico factory, which closed at the end of 2005.
All regions posted strong growth in 2006. If you adjust
worked closely with the CSR team to measure their
the numbers for the Dominican Republic factory (by
respective constituencies against annual targets and
subtracting 4,096 of Puerto Rico’s service hours from
successfully implemented monthly service plans that
2005), then you see an approximate 48% year-over-year
offered a broader menu of service opportunities all
increase of service at our factory. The Global Stewards
year long.
What is the economic value of service? Right now, we can only calculate for the US.
According to the Points of Light Foundation, the Independent Sector hourly rate for
volunteering is $18.05. Therefore, Timberland enabled nearly $2M worth (109,246
of total hours of service in US, both Timberland and non-Timberland employees) of
volunteering in 2006.
56
2006 CSR report
Evaluating Employee Participation
At Timberland, we’re committed to community service. And we wanted to understand our volunteer efforts in a
corporate context. That’s why, two years ago, we developed the Hours Utilization Rate (HUR)27 and Benefit Utilization
Rate (BUR)28 metrics. Here’s how our US numbers stacked up against the Points of Light Foundation’s 36 Best
Employee Volunteer Programs29 in 2006:
industry Comparison
Timberland
Average Involvement of Employees (BUR)
Best Practices
Benchmark
71%32%
50% or 20 hours
Volunteer Average Hours Served (HUR)
16 hours
According to these statistics, Timberland’s employee
We further expect that our pillar service events, Earth
participation rates compare very favorably against the
Day and Serv-a-palooza, will engage around 45% of our
benchmarked programs. Although our total paid-time
workforce in 2007. They remain critical culture-building
volunteer hours pale in comparison to the much larger
tools and serve to spread the ethic of service across
numbers registered by larger companies such as IBM or
the company.
Home Depot, these statistics show that we do more with
less than a lot of larger companies. When comparing our
rates of participation (BUR and HUR) to others in the
industry it becomes evident just how unique the service
culture is at Timberland.
Although this progress is good, we see lots of room for
improvement in corporate volunteering. For us, we need
to continue to measure the impact of our service. How
is this work actually helping the communities where we
volunteer our time? In 2007, we will continue to pursue
this goal.
27
28
29
HUR = Percent of total hours offered to employees that are utilized.
BUR = Percent of employees that use at least one hour of service.
2007 Points of Light Foundation Benchmarks of Excellence Magnitude and Nature of Volunteering at Best Employee Volunteer Programs (EVPs).
2006 CSR report
57
After visiting a shelter in
New Orleans where most of the
residents were without shoes,
Timberland employees were
inspired to donate the ones off
their feet.
Service Highlight: Our Commitment
to the Gulf Coast
When devastating hurricanes hit Louisiana in August
2005, Timberland forged a connection with the children
and families of New Orleans and throughout the region.
Throughout 2006, that connection has continued to
deepen. Together with our partners City Year and Share
Our Strength, we’ve dedicated resources—and passion—
toward addressing critical long-term issues facing the
community, as well as providing compassion, friendship
and support.
In 2006, we invested in nutrition and education programs
and job training. We also funded the full-time service
of 60 City Year corps members, who provided tutoring
and mentoring for hundreds of displaced children in
decor. The Authentic Youth team partnered with local
musicians and artists to generate revenue to restore the
arts and music community and school-based programs.
And in October, Timberland and City Year galvanized
hundreds of Share Our Strength supporters to renovate
two public schools in New Orleans 7th Ward.
From the Annual Sales Meeting to an Exercise in
Community Involvement
With each visit, the need for our work continued, and
our passion for this special community grew. That’s
why, at the end of 2006, Timberland’s North American
organization, senior leadership and Board of Directors
chose New Orleans for our annual sales meeting. Our
commitment was twofold:
•
To contribute to the region’s economic rebirth
through the support of tourism, hospitality and
local businesses
•
And to leverage relationships and resources to
make an impact in the community
after school programs and onsite at FEMA villages. They
also mobilized thousands in large-scale physical service
projects aimed at furthering the region’s renewal.
At Timberland, employees created innovative ways
to generate immediate and long-term disaster relief
efforts and provide product for those most vulnerable.
Timberland PRO team members and partners at Skills
USA and FFA constructed twelve Habitat for Humanity
homes during the summer. By winter, they had worked
with three local families to install their new homes
in the community—and provided furniture and home
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2006 CSR report
Throughout the week’s visit, commerce and justice
ran in tandem, with each day featuring education,
engagement and partnership with the community. The
highlight was four days of service led by employees
and City Year. More than 800 volunteers transformed
ten blocks of Oretha Castle Haley (OCH) Boulevard—a
historic and important center of culture, commerce
and community in the Central City neighborhood. More
than 5,000 hours were invested to advance the vision of
the Ashe Community Cultural Center, Hands On NOLA,
Groundwork, City Year and local business and community
leaders. Projects included:
•
Renovating Café Reconcile
•
“Greening OCH” by planting thousands of trees and
equal numbers of plants, flowers and shrubbery
•
Gutting elderly housing in preparation for
renovation
•
Landscaping a number of major landmarks
•
Installing local artist-designed murals
•
Rehabilitating a civil rights museum
•
And creating playing fields for youth recreation
A special highlight of our week was our partnership with
A historic intersection in need of restoration.
keynoting our sales meeting, Miss Leah helped direct
scores of volunteers in early-stage renovation of her
restaurant.
the inspirational and legendary Miss Leah Chase, an
We are pleased that our work in New Orleans continues
84-year-old restaurateur whose local landmark, Dooky
through strategic grants and the daily service of City
Chase’s, was devastated in the storm. Dooky’s played
Year and Share Our Strength. Highlights include the
a critical and irreplaceable role in the city’s history
soon-to-be-complete renovation of Dooky’s, continued
and in the culture of the historic Treme community.
landscaping—including the planting of 1,000
For decades, the restaurant was the gathering place
sunflowers, ongoing restoration and renovation of
for the African-American community’s leading artists,
storefronts on the Boulevard to recruit businesses, and
musicians, politicians and Civil Rights leaders. Martin
simple but meaningful symbols of renewal—such as the
Luther King, Jr., and Count Basie were among the many
installation of flowerboxes and blooms at the home of
historic figures who convened at Dooky’s. In addition to
Fred Wilson, one of the elderly citizens whose home we
helped stage for rebuilding.
Our Plans for 2007
One of the highlights for 2007 is the funding and
leadership of a major Earth Day project in New Orleans.
The Hands On Network and Earth Day Network will
lead more than 200 volunteers in renovating the James
Singleton Charter School. One of the few schools to
reopen in Central City, the Singleton School has grown
from 350 students to more than 750. A greenhouse,
an outdoor classroom and learning gardens will be
among a number of projects that promote education and
sustainability. Funds will also support an energy audit of
the school, new energy-efficient lighting and the hiring of
a teacher to implement an environmental curriculum for
the school and the broader community.
Two years after the tides have receded, the strength and
profound courage of this community continue to inspire.
It is our sincere hope that, through our ongoing presence
and the friendships we have developed, we have
Concrete columns became
canvases for our service
team to create art.
contributed to this special city’s rebirth and renewal—
and that we will continue to do so in the year ahead.
2006 CSR report
59
Pillar Service Events
Scale and impact. Depth and breadth. These are the
•
Maximizing internal involvement throughout retail
units in the US and Europe and leveraging “store
as community hub” for consumer engagement
strategies (i.e. each store recruits consumer
volunteers); and
•
Engaging our business partners, distributors and
franchisees in Europe and across the world.
hallmarks of Timberland’s Global Pillar events, Earth
Day and Serv-a-palooza. Both events will celebrate
10th annual benchmarks in 2007. We anticipate that
somewhere in the world, across one of our more than
150 Serv-a-palooza projects this fall, we will serve
our 500,000th volunteer hour as a company. Initiated
back in 1992, the Path of Service™ program sought to
model behavior by devoting employee paid time to serve
Serv-a-palooza
pressing community needs.
In September 2006, almost 6,000 volunteers on five
continents pulled on their boots to make a difference
Earth Day
in their communities around the world. Their efforts
Over the past four years volunteer engagement at
were part of Serv-a-palooza, our ninth annual global
Timberland Earth Day has grown over 800% from
celebration of service. What was the result? 1,252
980 volunteers in 2002 to more than 9,000 in 2006.
people will directly benefit from new or improved
This increase has largely been driven by the following
housing. And 3,151 children will benefit from five new
strategies:
•
outdoor classrooms and 23 playgrounds.
Converting a largely US-based event into companywide event involving employees from all Timberland
offices and manufacturing floors around the globe;
2006 Global Impact
Reforestation
Global Impact of Pillar Events
Want more? This chart aggregates the collective impact
of our two annual pillar service events around the globe:
Serv-a-palooza
Earth Day
Totals
n/a
13,501 trees planted30
13,501 trees
Land Conserved or Beautified
5 acres
612 acres
617 acres
Length of Cleaned Waterways
2 miles
47 miles
49 miles
n/a
5 miles
Length of Recreational Trail Installed/Refurbished
5 miles
Interior or Exterior Walls Painted
90,775 sq feet
n/a
90,775 sq feet
11,271 sq feet
n/a
11,271 sq feet
23
n/a
23
5
n/a
5
Area Painted with New Murals
Playgrounds Built / Refurbished
Outdoor Classrooms Built
31
“Serv-a-palooza was a wonderful opportunity for SmartWool employees to learn firsthand how committed
Timberland is to helping others. I believe the overwhelming feeling from those who participated was how
much a day of service could impact the community. It was a rich day of new friendships, team-building, and
helping to improve a very deserving organization in Steamboat Springs.”
Gardner Flanigan, SmartWool, Steamboat Springs, Colorado
17,511 tons of carbon saved. Each tree planted saves 1.4 metric tons of carbon over its lifetime (source: http://www.usctcgateway.net/tool/)
Equivalent of 1.3 city blocks in the Northeast of the US
30
31
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2006 CSR report
Timberland PRO sponsored the WLC service day. The experience provides members a hands on opportunity to put their leadership
and service learning to practice not only in Washington, D.C., but also in their local communties.
A New Partnership Model: FFA
Shared values. Those are the pillars of the relationship
Answering that call, more than 53,000 FFA members
Timberland PRO and The National FFA Organization
descended on the Indianapolis community to celebrate
have been building since 2004. FFA’s mission is to
their mission. It was our honor to serve with more than
promote premier leadership, growth and career success
600 students who fought gray skies and chilly rain to
through agricultural education. Working with the FFA
improve their communities and aid those in need. More
allows Timberland PRO to inspire young adults to “Make
than 2,000 hours of service were donated that day,
it better” in their local communities across the US
bringing the overall total for Timberland PRO and The
through our platform of community service. And at the
National FFA Organization to 28,000 hours of service.
same time, we’re gaining access to a valuable future
consumer.
Among the service learning experiences Timberland PRO
has created for FFA students are the Washington
Accomplishments of the first annual FFA National Day
of Service:
•
Gleaners Food Bank: Assembling of 2,918 boxes
of food, totaling 116,720 lbs., for elderly whose
income is less than $1,000 per month.
•
Habitat for Humanity: Improvements to 5 houses,
including full framing of one of them.
•
Keep Indy Beautiful: Building of a large outdoor
classroom, through clearing, planting and
establishing a healthy native environment.
•
Indy Parks: Refurbishment of local parks, including
reseeding 14 acres of land, removing 4 tons of
trash and replanting 4 acres of land. As a result,
the Indy Parks Department now reports that the
project is 6 months ahead of schedule.
Leadership Conference (WLC) and National FFA
Convention. Both events strive to teach young adults
how to lead through service—and how the power
of one can lead to great impact on many.
It was the 79th annual National FFA Convention that
launched a brand-new event in October last year—the
first annual FFA National Day of Service. This event,
co-sponsored by Timberland PRO and the National
FFA Organization, focused on leadership and service
learning—values our two organizations passionately share.
It was also a historic year for Timberland PRO, as Jeff
Swartz became the first-ever corporate sponsor to address
the general assembly of 17,000 students. Appropriately,
To hear outside opinions on how to leverage the
his speech was entitled “A Call to Service.”
relationship between a corporation and a nonprofit, please
see the Voices of Challenge at the end of this section.
2006 CSR report
61
Investing in the Community
City Year. Share Our Strength. Earthwatch. These were among our major community partners last year. There
were other community-based organizations we supported, too. We don’t give to our local partners because
we want applause from the community. We give because we’re part of the community. The examples below
highlight a few of the 40-plus organizations to whom we distributed donations to in 2006, through our
Community Investment Competitive Grants Program.
Groundwork New Orleans
We provided both grant money and service hours to
complete an eco-friendly landscaping project along Oretha
Castle Haley Boulevard, a major thoroughfare in New
Orleans that desperately needed rehabilitation in the wake
of Hurricane Katrina.
Volunteers clean up after Hurricane Katrina.
Unis Cité
Supported by Timberland since 2001, Unis-Cité engages
young people aged 18 to 25 in an innovative program
of youth service in France. Young men and women of all
cultural and social backgrounds and education levels
come together in teams, for a full-time commitment of six
or nine months. Find out more at www.unis-cite.org.
Unis Cité volunteers in their trademark orange T-shirts.
Bay Area Wilderness Training
Bay Area Wilderness Training’s mission is to create
opportunities for at-risk youth to experience the wilderness
first hand. They exist as a vital, comprehensive and
ongoing source of support to agencies that lead youth
wilderness trips.
The Wilderness Leadership Training (WLT) course is Bay
Area Wilderness’s experiential-learning based, five-day
backpacking course that comprehensively covers all aspects
Several youth enjoy a break after a snow hike
in the Bay area.
of leading youth in the outdoors. A Timberland grant helped
to fund the training of 60 teachers/youth development
professionals in the WLT course, as well as 200 participants
in the supplementary workshops. It serves 800 youth. Find out
more at www.bawt.org.
Bay Area Wilderness Training provides opportunities for youth to enjoy wilderness.
Community Investments
At Timberland, we believe in strengthening communities
While we are challenged to place a monetary value on
through service and through the actions and beliefs
this comprehensive commitment, we are mindful that
of individuals committed to the common good. We
a corporate donation—both cash and in-kind—is one
also know that sustained change is advanced through
indicator with precise measures. Each year, we track
strategic investments in partnerships, innovative
donations as a percentage of income and as one of
nonprofits and high-impact programs. To meet critical
the inputs against our holistic approach to community
needs with local solutions, we assess our portfolio
involvement.
of options—service events, financial resources, inkind donations, loaned executives through Service
Sabbaticals, capital investments, strategic partnerships
and board leadership. Working collaboratively with
stakeholders and across our company, we make informed
decisions for powerful change.
CONTRIBUTIONS AS PERCENTAGE OF OPERATING INCOME
2.5
2.0
2.13%
1.5
1.55%
1.72%
1.0
0.5
0.0
2004
2005
2006
2006 Charitable Contributions32
Type of Donation
AMOUNT
Cash
$2,178,748
In Kind (e.g. tools for service events)
$79,787
Product (e.g. Timberland® product)
$1,859,908
Total
$4,118,443
2005 Operating Income
$240,101,000
Percent of Operating Income
1.72%
33
32
33
Company-wide contributions figures consistent with figures reported to IRS
Operating income figures derived from Annual Report 10-K/A
2006 CSR report
63
The Boroughs Project engaged five
artists from the New York area to
design shoes and support local
nonprofit organizations.
Community Engagement
around the World
A Fusion of Art, Community
and Commerce
Creativity. Passion. Energy. We want to capture all three
of them through design and art—as well as authentic
and ongoing dialogue. To help accomplish these goals,
Timberland launched www.10061.com—a Web site that
seeks to inspire and connect with the loyal consumers
who have honored us with their passion for our boots and
brand. One of its initiatives is designed to share pride
in the local community through creative self-expression.
“The Boroughs Project” engages five talented artists—
one from each New York City borough—to come up
A Promise in Asia
Why are trees being planted in a desert? Desertification
is becoming a pressing problem throughout the world—
particularly in northern China, where overuse of land has
led to a decline in vegetation and a deterioration of the
ground water. Air quality is also being affected. As the
Horqin desert expands, it generates massive migrating
dust clouds, which pollute the air not only in China,
but even in Japan and other Asian countries. Since
2001, Timberland Asia has been helping to address this
issue by working with an organization called Green Net.
This Japan-based nonprofit organization is committed
to reforestation and prevention of desertification and
drought.
with an innovative boot design and also support a
The Timberland Asia team has made a commitment to
nonprofit organization in their community that reflects
plant more than 1 million trees over a five-year period
their passion.
(2006-2011). In 2006, approximately 70 members
Conversation and connection are facilitated even further
through the site’s Gallery, which offers a forum for
consumers from every zip code. We invite you to view
the beautiful mosaic of photography, art and design that
has been created just in the first nine months. We also
encourage you to participate and add your own artistic
expression vision. Visit www.10061.com to find
out more.
Employees take a rest after
a long day planting trees in
the Horqin Desert.
64
2006 CSR report
of the Timberland Asia team and Green Net met in the
desert to begin honoring this commitment. The team is
planning to extend its support even further in the future.
By helping to develop school exchanges. And by helping
to create a multi-language Website to support Green
Net’s efforts to reforest the Horqin Desert.
Virtual Retail Academy
Joining with the Education Business Partnership,
Timberland Boot Company launched the Virtual Retail
Academy at the Morpeth School in London in late 2005.
This three-year program aims to provide a group of 24
thirteen-year olds with the soft skills necessary to enter
the job market. This program was the result of several
months of research into the social issues in the area
surrounding our flagship store on Fournier St. in
East London.
During the first year, the children at the Morpeth
School worked with a local artist to create a mural at
the Timberland Boot Company flagship store, visited
the Marketing and Sales teams at our European
headquarters in Wexham and took part in a creative
course to produce their own T-shirts. To help create
the T-shirts, local graphic designers brought in their
portfolios, talked about career opportunities in the
field and asked the children to come up with their
Julie Adams, a Timberland employee, meets school children
near the Rift Valley in Kenya.
own designs. The students then learned how to
use computers to facilitate the design process and
visited the printer, where they learned screen-printing
techniques. The resulting T-shirts were displayed in
the school reception area and in an exhibition in our
Fournier St. retail store in London.
Field Assignment in Kenya
Led by our partner Earthwatch Institute and a team of
their scientists, a Timberland delegation representing
Asia, Europe and the US traveled to Kenya in 2006
to assess Lake Naivasha’s ecosystem and the effects
of human use on this critical source of water. Their
two-week service in Africa marked the first Timberland/
Earthwatch Expedition—which will become an annual
community service event. Challenging skills. Deepening
environmental awareness and knowledge. And honing
leadership tools.
Working on open water, in wetlands, and on land, the
combined team supported research projects in the areas
of botany, coleoptera, ornithology and chronomid larvea.
As founders of this program, these individuals stepped
forward to help to fulfill our mission of building and
fostering a global ethic of service. Their efforts have
demonstrated the sustainable impact that volunteer
leadership can have on our environment—and in our
global village.
Top left: The design process.
Bottom left: Children at the Morpeth
School show off their T-shirt creations.
2006 CSR report
65
Tip: Reducing your footprint
How many lightbulbs does it
take to change the world?
replacing just one regular
lightbulb with a compact
fluorescent lightbulb will
save 100 pounds of Carbon
dioxide a year.
Source: www.stopglobalwarming.org
66 2006 CSR report
Looking Forward: 2007 Goals
Global Stewards: Optimize the Global Stewards Program to provide a regular
menu of compelling local volunteer opportunities resulting in increased employee and
business partner engagement in service.
Path of Service™: Increase the measurable impact of the Path of Service™ program by
• Increasing employee access to skills-based volunteer opportunities
• Leveraging networks of community partners and business partners
•Developing Earth Day and Serv-a-palooza as premier leadership development
opportunities
Volunteer Management System: Pilot automated online volunteer management
system in North America to track, manage, evaluate and promote volunteer activity.
2006 CSR report
67
➜
➜
➜
VOICES OF CHALLENGE
question: how can a relationship between
a company and a nonprofit be leveraged
to drive value for each organization, while
increasing social or environmental impact?
➜
➜
➜
➜
Mitch Landrieu
Lieutenant Governor
State of Louisiana
This is a message from Louisiana. In the wake of
the worst natural disaster to face our nation, we
have seen and experienced unimaginable loss, up
close and personal. Families displaced and broken,
homes, schools and businesses destroyed, lives lost.
The course of our history has been changed forever.
Since those dark days in 2005, more than 500,000
people have come in to help gut, clean and restore
our homes and our spirits. We have experienced first
hand the generosity of American and international
citizens who have shown us that we are not alone
in our recovery. We will survive, and, in the
future, thrive.
What’s next for us? Louisiana will attract the
smartest individuals, non-profits, companies and
government entities, who will coalesce around
common goals. They will address social problems
facing our state such as housing, education, health
care and public safety. They will participate in
an unprecedented exchange of bold ideas among
people who have never worked together before.
They will learn to understand each other’s language
and find higher common ground. They will discover
solutions that are measurable and sustainable. And,
because of its willingness to serve as the world’s
laboratory for change, Louisiana will be known as a
place of “opportunity found.” There’s one question
remaining: “are you in?”
➜
Brad Googins
Executive Director,
Boston College Center for
Corporate Citizenship
Comfort. It’s something to look for in a good pair
of boots, but similar attributes can diminish the
impact of a company’s partnership with a nonprofit.
Durability, on the other hand, is something you want
in a boot—and in a partnership.
Finding common interest is a critical component to a
partnership, but to really leverage impact, each party
must challenge the other to go beyond conventional
thinking, current operating models and their comfort
zone. To tackle today’s troublesome issues that
almost defy solutions, companies must cooperate
with business competitors and government agencies.
From my perspective, companies and nonprofits
committed to making a positive change spend far too
much time with each other.
It’s time to move beyond the feel-good zone created
by community service days and conventional
partnerships. It’s time to project that strong corporate
voice and move beyond the like-minded. Only then
will social change be brought to scale.
I challenge Timberland to find some unlikely partners—
especially in the business community—and work on
a critical issue such as restoring our public education
system. After two decades of targeted corporate grants
and numerous executives chairing innocuous blue ribbon
commissions, there has been little improvement in this
area. If executives really turn up the heat and demand
the kind of results they know how to deliver, I believe we
will see real change. It’ll be hard work, but the return on
investment—for all parts of society—will be great.
Evan Hochberg
National Director, Community
Involvement, Deloitte Services
LLP
Majora Carter
Executive Director/Founder,
Sustainable South Bronx
A few ideas for building stronger relationships
with nonprofits:
Move beyond cash and traditional volunteerism
• As businesses, we need to put our core
competencies at the heart of our community
involvement. What differentiates your
organization’s success? Sharing this intellectual
capital with nonprofits can offer far greater longterm value than cash or traditional volunteerism.
Environmental justice is the civil rights
movement of the 21st century. For those
unfamiliar with that term, it is a response to
the disproportionate amount of environmental
burdens placed within close proximity to
poor communities and communities of color
across the US. Emissions from power plants,
truck traffic and the like are point sources of
the greenhouse gases that everyone is trying
to curb these days. Although decades of
localized public health burdens are easy to
see in asthma rates alone, that’s only the tip
of the iceberg—and this one isn’t melting.
Entire communities, some only minutes away
from very wealthy areas, are suffering severe
health, economic and other quality of life
traumas because of global warming and other
environmental abuses.
Embrace the business case
• Compelling community involvement initiatives
start with an authentic commitment to making a
difference. But, with the competitive pressures
facing business, they must also deliver business
value in order to sustain themselves.
Just like industrial and consumer practices
have societal costs from the inner city to
Antarctica, economic developments that
fail to grow WITH environmentally and
economically impoverished citizens are
equally noxious in their own ways.
•H
ow many companies truly integrate their
community efforts with their people and client
strategies? Companies that are progressive
about making this connection often worry about
appearing too self-serving.
We need to tap that latent economic
energy towards clean-tech goals with local
community development on a grand scale.
Billions of dollars spent on water treatment,
power generation, war, emergency-room
visits for asthma attacks, and jails can
be directed towards water management,
energy efficiency, peace, health and most
importantly—hope. It means a realistic
assessment of environmental costs across the
board that includes “green” in the economic
sense as will as the ecological sense. It
means striving for equality, and a chance at
achieving an America as good as its promise.
“Do you want what’s behind door number one,
two, or three?” This guessing, based on very
limited knowledge, makes for an entertaining game
show, but not for successful business-nonprofit
relationships. Successful relationships require a
greater transparency and exploration of each other’s
goals, strengths, and needs.
•T
his thinking needs to change. Achieving social
impact and business value are completely interrelated. It is the deeply authentic efforts that
resonate with stakeholders and trigger business
value. And those that deliver business value are
more likely to secure resources, thus enabling a
deeper social impact.
Measure outcomes
• Business initiatives are shaped by disciplined
thinking that projects expected outcomes.
Moving forward, actions are fine-tuned based
on performance against these outcomes. For
nonprofit relationships to generate the same
investment and involvement of business
leadership as other top business initiatives, we
must work together to demonstrate progress
against real social and business performance
metrics.
2006 CSR report
69
Stakeholder Engagement
Stakeholder Theory
Our company is built on four values—humanity, humility, integrity and excellence.
These values are steadfast and remind us that our responsibility extends to all of our
stakeholders. We are a publicly traded enterprise and a corporate citizen. As such,
our constituency is broad and diverse. Timberland’s stakeholders include groups or
individuals who can affect—or are affected by—the achievement of the company’s
objectives. In both commerce and justice. Our stakeholders include employees,
customers, communities, shareholders, suppliers, factory workers, nonprofit
organizations, media, the civic and political sectors, and business colleagues34.
Stakeholders give voice to challenge. Provide vision for
that direct and personal engagement with stakeholders
change. Lend an objective eye to our activities. Improve
is the most effective process to create sustained
decision making. And inspire conversation, collaboration
impact. In late 2006, an industry-first Facility Report
and change. Our approach to stakeholder engagement
on our factory in the Dominican Republic served as the
focuses on two central tenets—transparency and
foundation for an 80-person stakeholder dialogue in
accountability.
Santiago. Facilitated by a local NGO, the forum focused
Transparency enables us to engage in candid dialogue
with stakeholders, to challenge assumptions and
encourage innovation. It also helps us build trust with
these partners, to deepen our understanding of our
impact on the world and advance our approach to
on our factory’s role in the community and identified
critical issues and opportunities for collaboration and
impact. This effort will progress in 2007 to include a
defined set of strategies for change.
environmental stewardship and social justice. Whether
The Reporting Process
we’re working with a diverse group of stakeholders on
By engaging our stakeholders, we’re seeking to move
the creation of the industry-leading Green Index™ rating
from understanding to action and from action to positive
or on determining the critical issues to include in our
economic, environmental and social impact. Our CSR
Corporate Social Responsibility Report, stakeholders
reporting process provides a good example of how we
help us remain open and transparent and help us build
engage stakeholders in this process of understanding.
authenticity.
Timberland’s CSR Report
A similar commitment to accountability drives our efforts
Comparable, consistent and credible reporting on CSR
to seek public and stakeholder input as we pursue our
strategy. A platform for a continuous discussion. We
“commerce and justice” objectives. We believe that, as
believe that providing this kind of strong foundation for
a public entity, we must adhere to a set of standards in
discourse can create sustained and positive economic,
order to receive our license to operate. We also believe
environmental and social impact.
Please go to www.timberland.com/csrreport to get a better understanding of how we engage these stakeholders.
34
70
2006 CSR report
One way that Timberland seeks to stimulate this debate
has provided input on the development of our Green
is through our annual Corporate Social Responsibility
Index™ rating system. It has also helped us select the
report, which summarizes our work in sustainability for
content and review the strategies for both our CSR report
the previous calendar year. This document details and
and RFC Facility Report.
assesses our environmental and social footprint in the
communities where our company operates. It also strives
to be transparent and unflinching in its assessment
of our work.
Timberland engaged with Ceres and a team of external
stakeholders to review this year’s (2006) sustainability
report. The Ceres stakeholder team is an independent
group of individuals drawn primarily from the Ceres
By openly sharing both information and intent on issues
coalition and represents a range of constituencies that
material to our industry, we seek to encourage questions
have expertise in environmental, social and governance
and challenges from people and organizations on all
issues. In reviewing this report, the team considered
sides of the issues we address—and ultimately find
whether the company adequately reported on its
innovative solutions. One prominent example of how
sustainability performance and key impacts, including
our stakeholders are challenging Timberland and the
goals, targets, systems, data and initiatives.
industry on important issues can be found in the
“Voices of Challenge” (VOC) sections in our 2005
and 2006 reports.
Through the review process, the Ceres stakeholder team
provided extensive feedback to the company, which was
considered in the preparation of the final version of this
Ceres Stakeholder Reviews
report. Examples include helping us define “critical
Through our relationship with Ceres, we regularly
issues” for the VOC 2.0 section, focusing our discussion
convene a diverse set of stakeholders to review our work
of assessment results and presenting a balanced view of
in sustainability—and provide guidance on how we
our work. We look forward to continuing our relationship
can improve. This stakeholder team currently includes
with this group as we work to be more responsible and
investors, labor rights activists, supply chain experts,
accountable corporate citizens.
environmental NGOs, consumer advocates, community
partners and a member of our supply chain. This group
2006 CSR report
71
REPORT SCOPE
Our last report was published in July 2006 and covered Timberland’s global Corporate Social
Responsibility (CSR) activities in 2005. This annual report covers these actions for the calendar year
2006. Most of the data included is from that year, with the notable exception of our factory list, which
catalogs our active factories as of May 1, 2007. Instances when we report only on US-based activities are
clearly indicated.
The Basis of this Report
This report was developed based on the G3 and Apparel and Footwear Sector Supplement (AFSS). While
we attempted to create a comprehensive report, there are some G3 and AWSS indicators not included
in this report. There are several reasons for these omissions. Our impact may have been immaterial, or
we might have lacked enough internal data to provide a report. In the future, our goal is to narrow that
gap as we continue to report on social and environmental impacts that are both relevant and strategically
important.
How this Report Was Verified
Every data point in this report was verified internally, as was the way it was characterized. We are
continuing to explore the viability of an external verification program. After all, such programs enhance the
credibility of our CSR reports and make them easier to audit. We hope to receive guidance on this issue
during conversations with our stakeholders.
If you have any questions about this report, please direct them to:
Alex Hausman
CSR Reporting Manager
ahausman@timberland.com
(603) 772-9500 ext. 2281
A collection of images from our 2006 sales meeting in New Orleans
Appendix: Recreational
Footwear Company Facility Report Update
Local Accountability: Reporting, Engagement and Action
Recreational Footwear Company
Facility Report 2006 Update
In 2006, Timberland published our first “facility-level”
In the 2005 report, we indicated that the RFC was
CSR report. The facility involved was the Recreational
found to have an Immediate Action violation for
Footwear Company (RFC), a Timberland-owned factory
surpassing the limits regarding working hours. What
in Santiago, Dominican Republic. Using a framework
have we done to counteract this problem since then?
piloted by Ceres and the Facility Reporting Project,
this report provides a baseline for the facility’s
performance in our core CSR target areas. Global human
rights. Environmental stewardship. And community
involvement.
Our goal for this report is to build on our commitment
to local accountability, by measuring community
engagement and ongoing performance improvements at
this facility. It is also intended to facilitate analysis and
collaboration among Timberland, its Dominican factory
and the factory’s stakeholders. This report will serve as
a model for future reporting projects with other facilities
and contractors.
Engagement
What was the response to the report? The report became
an invitation for action. The RFC joined forces with a
Working closely with the Timberland assessor, the
Santo Domingo-based nonprofit organization, CIPAF, to
RFC prepares a report on Thursday of each week that
host a stakeholder dialogue in downtown Santiago. For
outlines the hours worked by employees in each of
this event, the factory opened its doors to roughly 80
the departments. This report provides the information
community stakeholders, including employees, local
needed to plan for overtime without exceeding the 60
and global nonprofits, government officials, universities,
hour maximum limit. Plant managers and supervisors
community-based organizations and other businesses.
must provide an explanation for any overtime worked in
The conversation that followed openly discussed issues
excess of 60 hours and may be subject to disciplinary
presented in the report, ranging from wages and longer
actions if the violations continue. In addition, the HR
break times for workers to the improvement of local
Manager personally follows up with the Plant Manager to
green spaces.
ensure they are aware of any employees in the “danger
To hear directly from two of the stakeholders at the
event, see the “Voices of Challenge” (VOC) at the end
of this section.
area” of at least 59 hours. This process drastically
reduced the number of overtime incidents to only
two cases over a five-month period. And even those
instances had an average of 60.3 hours. That’s two
violations of approximately 20 minutes over the allowed
hours with over 1,600 employees. We are encouraged
by this progress.
2006 CSR report
73
The charts below provide some additional updates to the data in the 2005 Facility Report.
WATER-BASED ADHESIVE
1,500,000
1,463,742
PAIRS OF SHOES
1,200,000
using WBAs.
491,876
300,000
117,376
2004
2005
2006
CHARITABLE DONATIONS
$40,000
donations based on the starting and finishing
$33,869
of projects. In 2006, donations were down
DOLLARS
$25,000
$20,000
$21,234
$15,000
$5,000
2005
2006
HOURS SERVED IN THE COMMUNITY
HOURS
events are in addition to our traditional Earth
Day and Serv-a-palooza activities.) As a result
we saw a 48% year-over-year increase in
2004
2005
KWH PER PAIR
2006
In 2005, over 60% of our production at the
2.63
produced there. With the closing of our
1.85
1.55
factory in Puerto Rico, the RFC has had to
1.0
2006 CSR report
RFC was “uppers” which were then sent to
Puerto Rico to be attached to the “bottoms”
2.0
take on the entire bottoming process, which
0.5
74
hours served last year.
Energy Use Changes
ENERGY USE PER PAIR
2.5
0.0
2006 by organizing monthly departmental
production work was slow. (These service
7,420
2000
1.5
Increased Community service
activities and conducting service when
7,744
4000
3.0
this budget.
The RFC increased community service in
11,016
8000
0
and we were looking for new opportunities
community service investments do not hit
2004
10000
6000
because several school projects finished
to invest. It is important to note that our
$10,000
12000
Lower Donations
We see year-over-year variation in charitable
$39,039
$35,000
$0
pairs using water-based adhesives (WBAs) by
ultimate goal of 100% of our footwear line
600,000
$30,000
In 2006, we exceeded our goal of 843,000
74%. The RFC continues to push toward the
900,000
0
Exceeded our goal
significantly increases energy use per pair.
2004
2005
2006
Emissions
pounds of CO2
2004
2005
2006
Transportation
282,962
282,962317,551
Generation
689,832
265,320363,736
Purchased
2,485,928
2,975,4033,409,061
Total
3,458,722
3,523,685
4,090,348
pounds of air pollutants
2004
2005
2006
NOx
19,1087,3497,349
SOx
1,257
483
1,257
CO
4,116
1,583
4,111
PM-10
1,343517
1,343
MEK
–
12,400
19,400
Toluene
– 5,600
6,600
VOC
– 32,090
65,800
With the addition of more bottoming processes in the RFC, our emissions have significantly increased at the factory.
The main reason is that bottoming requires many processes that are hot, including injection, back pack molding and
trim spew. These processes tend to emit more pollutants than those used in the uppering processes.
The Path Ahead
The facility-level CSR report and stakeholder dialogue have deepened our roots as a partner, employer and community
member. The information we’ve gained will guide a newly formed coalition of stakeholders as they address the priorities
of the Santiago community and create strategies to decrease our environmental footprint. The continuous process of
evaluation, dialogue, engagement, action and measurement will serve as a model in communities worldwide.
2006 CSR report
75
➜
➜
➜
VOICES OF CHALLENGE
question: what was your general impression
of the stakeholder engagement hosted
by Timberland in the Dominican Republic?
➜
➜
➜
➜
Luis Felipe Rodríguez
Centro Cultural
Eduardo León Jimenes
➜
Luis Felipe Rodríguez
Eduardo León Jimenes
Cultural Center
El encuentro me sorprendió gratamente por
At the meeting I was greatly surprised by its
el carácter abierto y participativo que tuvo.
open and participatory character. The presence
Fue importante la presencia de diversos
of diverse actors from the social arena and the
actores sociales y la manera integradora que la
integrative strategy that the proposal offers to
propuesta ofrece para involucrarlos.
get us involved were important.
Lo más importante es que el evento sirvió,
The most important thing is that apart from
más allá de dar a conocer la experiencia, para
sharing experiences, the event served to
demostrar lo mucho que puede aportar el
demonstrate how much the private business
sector privado y empresarial en el mejoramiento
sector can contribute toward improving the
de los sectores poblacionales con los que
segments of the population with which it
interactúa. Obviamente, Timberland reivindica
interacts. Obviously, Timberland is helping
la responsabilidad social que tiene el sector
to restore the social responsibility that the
privado en la generación de procesos de cambio
private sector has when it comes to generating
en nuestras sociedades.
processes of change in our societies.
Es importante significar, que esos proyectos
It is important to note that these projects will
tendrán mayores y mejores resultados y se
have bigger and better results and will be made
harán sostenibles en la medida en que sean
more sustainable as long as they are more
más participativos, involucrando directamente
participatory, directly involving communities.
a las comunidades. Por otra parte, debe
One must also remember that improving the
entenderse que el mejoramiento de las
living conditions of communities also depends
condiciones de vida de las comunidades
on the generation of cultural processes that
depende también de la generación de procesos
help transform and improve the spiritual life of
culturales que ayuden a transformar y mejorar
individuals and social groups.
la vida espiritual de las personas y los grupos
sociales.
One must consider the importance of narrowing
the gap between culture and day-to-day reality
Hay que considerar la importancia del
in the community such as, for example,
acercamiento de la cultura a la realidad
[providing] the opportunity to attend during
cotidiana de la comunidad como, ejemplo, la
one’s free time, from the socio-educational
posibilidad de atender el tiempo libre, desde
point of view and giving creative content to
el punto de vista socio-pedagógico y darle
people’s free time.
contenido creativo al tiempo libre.
Amarilis Morel
Acción callejera
Amarilis Morel
Action in the Street
La actividad fue muy participativa
The activity was very participatory,
con un ambiente abierto y sin
with an open environment and no
rigidez. La presentación del informe
rigidity. The report presentation
mostró que Timberland es una
showed that Timberland is a
empresa con una visión clara de
company with a clear vision of
responsabilidad social empresarial
corporate social responsibility that
que involucra todos los actores y de
involves all actors in the sector,
manera especial a sus empleados/as
especially its employees, with ideas
con propuestas que procuran elevar
that seek to elevate quality of life
su calidad de vida y que repercuten
and have direct repercussions in the
de manera directa en su entorno
local community environment.
comunitario.
The work being done to empower
Debe fortalecerse el trabajo para
communities to handle the
empoderar a las comunidades en
processes that affect them for good
los procesos que la afectan positiva
or ill should be reinforced, not only
o negativamente y para lograr no
to increase the volunteer corps but
solo crecer el voluntariado sino
also to ensure the continuity and
también para asegurar la continuidad
sustainability of the changes being
y sostenibilidad de los cambios
proposed.
promovidos.
One important aspect to take into
Un aspecto importante a tomar en
consideration in community work is
consideración es el trabajo en las
the process of awareness-building
comunidades son los procesos de
in issues with a social impact like
sensibilización en temáticas de
violence and crime, violence against
impacto social como la violencia y la
women and children, physical and
delincuencia, la violencia contra las
mental health, recreation, and safety
mujeres y los/as niñas/os, la salud
for the elderly. Participating in
física y mental, la recreación y la
this activity was a highly gratifying
seguridad para la vejez. Participar en
experience.
esta actividad fue una experiencia
bastante gratificante.
2006 CSR report
77
Standard Disclosures
G3 Index
GRI
Indicator
Indicator Description
Sectionpageexplanation
1. Strategy and Analysis
1.1
Statement from the most senior decision-maker of the organization
(e.g., CEO, chair, or equivalent senior position) about the relevance of
sustainability to the organization and its strategy.
CEO Letter
5
1.2
Description of key impacts, risks, and opportunities.
The Timberland Footprint, Summary of
CSR Indicators
6-8
2. Organizational Profile
2.1
Name of the organization.
Front Cover
1
2.2
Primary brands, products, and/or services.
10-K/A
–
http://www.timberland.com/investorRelations/index.jsp
2.3
Operational structure of the organization, including main divisions,
operating companies, subsidiaries, and joint ventures.
10-K/A
–
http://www.timberland.com/investorRelations/index.jsp
2.4
Location of organization’s headquarters.
Last page
2.5
Number of countries where the organization operates, and names of
countries with either major operations or that are specifically relevant to the
sustainability issues covered in the report.
Economic Indicator, Timberland’s Influence
in the Supply Chain
10,
18-21
2.6
Nature of ownership and legal form.
10-K/A
–
http://www.timberland.com/investorRelations/index.jsp
2.7
Markets served (including geographic breakdown, sectors served, and types
of customers/beneficiaries).
10-K/A
–
http://www.timberland.com/investorRelations/index.jsp
2.8
Scale of the reporting organization.
The Organization, 10-k
9-15
http://www.timberland.com/investorRelations/index.jsp
2.9
Significant changes during the reporting period regarding size, structure,
or ownership.
Expansion, Factory Growth, 10-k
11,
19-20
http://www.timberland.com/investorRelations/index.jsp
2.10
Awards received in the reporting period.
2006 Awards
9
3. Report Parameters
Report Profile
3.1
Reporting period (e.g., fiscal/calendar year) for information provided.
Report Scope
72
3.2
Date of most recent previous report (if any).
Report Scope
72
3.3
Reporting cycle (annual, biennial, etc.)
Report Scope
72
3.4
Contact point for questions regarding the report or its contents.
Report Scope
72
Report Scope and Boundary
3.5
Process for defining report content.
Critical Issues, Stakeholder Engagement
7,
70-71
3.6
Boundary of the report
Report Scope, Timberland’s Influence in
the Supply Chain
72,
18-21
3.7
State any specific limitations on the scope or boundary of the report.
Timberland’s Influence in the Supply Chain
18-21
3.8
Basis for reporting on joint ventures, subsidiaries, leased facilities,
outsourced operations, and other entities that can significantly affect
comparability from period to period and/or between organizations.
Timberland’s Influence in the Supply Chain
18-21
3.9
Data measurement techniques and the bases of calculations, including
assumptions and techniques underlying estimations applied to the
compilation of the Indicators and other information in the report.
Throughout the report
–
3.10
Explanation of the effect of any re-statements of information provided
in earlier reports, and the reasons for such re-statement (e.g.,
mergers/acquisitions, change of base years/periods, nature of business,
measurement methods).
Financial Performance, Energy,
Community Investments
9, 39,
63
3.11
Significant changes from previous reporting periods in the scope, boundary,
or measurement methods applied in the report.
Not material
–
Table identifying the location of the Standard Disclosures in the report.
Standard Disclosures
78
Policy and current practice with regard to seeking external assurance for
the report.
Report Scope
72
Our intent is to provide global information. We specifically
notate instances in which the scope is altered.
We did our best to explain the data measurement
techniques and bases of calculations for the indicators
found throughout the report.
We added Smartwool facilities and employees when
reporting on global statistics.
GRI Content Index
3.12
Assurance
3.13
4. Governance, Commitments and Engagement
Governance
78
4.1
Governance structure of the organization, including committees under the
highest governance body responsible for specific tasks, such as setting
strategy or organizational oversight.
Our Approach, Governance
6,
12-13
4.2
Indicate whether the Chair of the highest governance body is also an
executive officer
Timberland Web site
–
2006 CSR report
http://phx.corporate-ir.net/phoenix.
zhtml?c=105954&p=irol-govhighlights
GRI
Indicator
Indicator Description
Sectionpageexplanation
4.3
For organizations that have a unitary board structure, state the number
of members of the highest governance body that are independent and/or
non-executive members.
Timberland Web site
–
http://phx.corporate-ir.net/phoenix.
zhtml?c=105954&p=irol-govhighlights
4.4
Mechanisms for shareholders and employees to provide recommendations or
direction to the highest governance body.
10-k
–
http://www.timberland.com/investorRelations/index.jsp
4.5
Linkage between compensation for members of the highest governance
body, senior managers, and executives (including departure arrangements),
and the organization’s performance (including social and environmental
performance).
10-k
–
http://www.timberland.com/investorRelations/index.jsp
4.6
Processes in place for the highest governance body to ensure conflicts of
interest are avoided.
Timberland Web site
–
http://phx.corporate-ir.net/phoenix.
zhtml?c=105954&p=irol-govhighlights
4.7
Process for determining the qualifications and expertise of the members
of the highest governance body for guiding the organization’s strategy on
economic, environmental, and social topics.
Timberland Web site
–
http://phx.corporate-ir.net/phoenix.
zhtml?c=105954&p=irol-govhighlights
4.8
Internally developed statements of mission or values, codes of conduct, and
principles relevant to economic, environmental, and social performance and
the status of their implementation.
Framework for Commerce and Justice
6
Our Code of Ethics and Code of Conduct can be found
at www.timberland.com/csrreport
4.9
Procedures of the highest governance body for overseeing the organization’s
identification and management of economic, environmental, and social
performance, including relevant risks and opportunities, and adherence or
compliance with internationally agreed standards, codes of conduct, and
principles.
Governance
12-13
Also see: http://phx.corporate-ir.net/phoenix.
zhtml?c=105954&p=irol-govhighlights
4.10
Processes for evaluating the highest governance body’s own performance,
particularly with respect to economic, environmental, and social
performance.
Timberland Web site
–
http://phx.corporate-ir.net/phoenix.
zhtml?c=105954&p=irol-govhighlights
Commitments to External Initiatives
4.11
Explanation of whether and how the precautionary approach or principle is
addressed by the organization.
Throughout the report
–
Our approach to risk management as it relates to
economic, social and environmental issues is woven
throughout this report.
4.12
Externally developed economic, environmental, and social charters,
principles, or other initiatives to which the organization subscribes or
endorses.
Timberland Web site
–
Our updated Web site will include information about the
external charters/principles we endorse. More at www.
timberland.com.
4.13
Memberships in associations (such as industry associations) and/or
national/international advocacy organizations in which the organization:
Public Policy
12-13
The section on Public Policy includes an incomplete list of
our industry association partnerships. We aim to include
a more comprehensive list in next year’s CSR report.
Stakeholder Engagement
4.14
List of stakeholder groups engaged by the organization.
Stakeholder Engagement
70-71
4.15
Basis for identification and selection of stakeholders with whom to engage.
Stakeholder Engagement
70-71
4.16
Approaches to stakeholder engagement, including frequency of engagement
by type and by stakeholder group.
Stakeholder Engagement
70-71
4.17
Key topics and concerns that have been raised through stakeholder
engagement, and how the organization has responded to those key topics
and concerns, including through its reporting.
Stakeholder Engagement
70-71
5. Economic Performance Indicators
Economic Performance
EC1
Direct economic value generated and distributed
Not reported
–
EC2
Financial implications and other risks and opportunities for the
organization’s activities due to climate change
Confirming Our Committment to the
Outdoors, Energy
35-37,
38-40
EC3
Coverage of the organization’s defined benefit plan obligations
Timberland Web site
–
http://www.timberland.com/corp/index.
jsp?page=working Here
EC4
Significant financial assistance received from the government
Not Material
–
http://www.timberland.com/investorRelations/index.jsp
We have not publicly disclosed employee wage
information in this manner. We hope this is something
we can report on in the 2007 report.
Market Presence
EC5
Range of ratios of standard entry level wage compared to local minimum
wage at significant locations of operation
Economic Indicators
10
EC6
Policy, practice and proportion of spending on locally-based suppliers at
significant locations of operation
Not reported
–
We have implemented SAP for our accounting services.
This will help us gather this information for future
reports.
EC7
Procedures for local hiring and proportion of senior management hired from
the local community at significant locations of operation
Economic Indicators
10
Timberland is always looking to hire from the local
community. In the report, we provide a ratio of senior
management that is from the local area.
Facility Report
–
Information about infrastructure investments for our
Dominican Republic factory can be found at www.
timberland.com/csrreport.
Indirect Economic Impacts
EC8
Development and impact of infrastructure investments and services
provided primarily for public benefit through commercial, in-kind
or pro-bono engagement
2006 CSR report
79
GRI
Indicator
EC9
Indicator Description
Understanding and describing significant indirect economic impacts,
including the extent of impacts
Sectionpageexplanation
Not reported
–
We have not tracked our indirect economic impacts in a
comprehensive manner. We are working to gain a better
understanding of these types of impacts.
6. Environmental Performance Indicators
Materials
EN1
Materials used by weight or volume.
Not reported
–
We are not tracking this information at the aggregate
level. We are working on a reporting infrastructure that
will help us gather this type of information. No date is
yet set to report publicly on this.
EN2
Percentage of materials used that are recycled input materials.
Eco-Effective Design
45
This chart provides are incomplete view of recycled
input material. We plan to expand this reporting
next year.
EN3
Direct energy consumption by primary energy source.
Greenhouse Gas Inventory
38-39
EN4
Indirect energy consumption by primary source.
Greenhouse Gas Inventory
38-39
EN5
Energy saved due to conservation and efficiency improvements.
Efficiency Measures
40
EN6
Initiatives to provide energy-efficient or renewable energy-based products
and services, and reductions in energy requirements as a result of these
initiatives.
Efficiency Measures
40
EN7
Initiatives to reduce indirect energy consumption and reductions achieved.
Efficiency Measures
40
EN8
Total water withdrawal by source.
Facility Report
–
EN9
Water sources significantly affected by withdrawal of water.
Not material
–
EN10
Percentage and total volume of water recycled and reused.
Facility Report
–
EN11
Location and size of land owned, leased, managed in, or adjacent to,
protected areas and areas of high biodiversity value outside protected areas.
Not material
–
EN12
Description of significant impacts of activities, products, and services on
biodiversity in protected areas and areas of high biodiversity value outside
protected areas.
Not material
–
EN13
Habitats protected or restored.
Not material
–
EN14
Strategies, current actions, and future plans for managing impacts on
biodiversity.
Not material
–
EN15
Number of IUCN Red List species and national conservation list species with
habitats in areas affected by operations, by level of extinction risk.
Not material
–
Energy
Water
Go to www.timberland.com/csrreport to find
information about water withdrawal by the Recreational
Footwear Company
Go to www.timberland.com/csrreport to find
information about water withdrawal by the Recreational
Footwear Company
Biodiversity
Emissions, Effluents and Waste
EN16
Total direct and indirect greenhouse gas emissions by weight.
Greenhouse Gas Inventory
38-39
EN17
Other relevant indirect greenhouse gas emissions by weight.
Greenhouse Gas Inventory
38-39
EN18
Initiatives to reduce greenhouse gas emissions and reductions achieved.
Energy
40
EN19
Emissions of ozone-depleting substances by weight.
Not material
–
We are not tracking this information at the aggregate
level. We are working on a reporting infrastructure that
will help us gather this type of information. No date is
yet set to report publicly on this.
EN20
NOx, SOx, and other significant air emissions by type and weight.
Appendix
73-77
We report on this data for the Recreational Footwear
Company
EN21
Total water discharge by quality and destination.
Not material
–
We are not tracking this information at the aggregate
level. We are working on a reporting infrastructure that
will help us gather this type of information. No date is
yet set to report publicly on this.
7. Labor Practices and Decent Work
Employment
LA1
Total workforce by employment type, employment contract, and region.
People
14-15
This section provides much of the required information.
LA2
Total number and rate of employee turnover by age group, gender, and
region.
People
14-15
This section provides much of the required information.
LA3
Benefits provided to full-time employees that are not provided to temporary
or part-time employees, by major operations.
Timberland Web site
–
Benefits can be found at http://www.timberland.
com/corp/index.jsp?page=workingHere_benefits
Not material
–
No Timberland employees are covered by collective
bargaining agreements.
Labor/Management Relations
LA4
80
Percentage of employees covered by collective bargaining agreements.
2006 CSR report
GRI
Indicator
LA5
Indicator Description
Minimum notice period(s) regarding significant operational changes,
including whether it is specified in collective agreements.
Sectionpageexplanation
Not material
–
No Timberland employees are covered by collective
bargaining agreements.
Our Health and Safety section discusses our work in
this area. Our safety committees are very small but
their work affects the broad employee population.
Occupational Health and Safety
LA6
Percentage of total workforce represented in formal joint managementworker health and safety committees that help monitor and advise on
occupational health and safety programs.
Not material
–
LA7
Rates of injury, occupational diseases, lost days, and absenteeism, and
total number of work-related fatalities by region.
Health and Safety
15
LA8
Education, training, counseling, prevention, and risk-control programs in
place to assist workforce members, their families, or community members
regarding serious diseases.
Not reported
–
While we include disease awareness into our worker
training, we do not track them formally.
LA9
Health and safety topics covered in formal agreements with trade unions.
Not material
–
No Timberland employees are covered by collective
bargaining agreements.
Training and Education
–
LA10
Average hours of training per year per employee by employee category.
Not reported
LA11
Programs for skills management and lifelong learning that support the
continued employability of employees and assist them in managing career
endings.
An Education Program Grows in the
Dominican Republic, Field Assignment
in Kenya
30, 65
LA12
Percentage of employees receiving regular performance and career
development reviews.
Not reported
–
We plan to report on this data in the 2007 report.
We plan to report on this data in the 2007 report.
Diversity and Equal Opportunity
Additional information can be found at http://phx.
corporate-ir.net/phoenix.zhtml?c=105954&p=irolgovhighlights
LA13
Composition of governance bodies and breakdown of employees per category
according to gender, age group, minority group membership, and other
indicators of diversity.
People
14-15
LA14
Ratio of basic salary of men to women by employee category.
Not reported
–
We have not tracked this information in the past. This is
something we would like to include in next year’s report.
The Global Human Rights section of the report
discusses how many factories have received a human
rights screening.
8. Human Rights
Investment and Procurement Practices
HR1
Percentage and total number of significant investment agreements that
include human rights clauses or that have undergone human rights
screening.
Global Human Rights
16-31
HR2
Percentage of significant suppliers and contractors that have undergone
screening on human rights and actions taken.
Factory Growth, The Code We Live By
19-20,
21
HR3
Total hours of employee training on policies and procedures concerning
aspects of human rights that are relevant to operations, including the
percentage of employees trained.
Not reported
–
While we train our employees on human rights, we do
not track this indicator in the aggregate.
Non-discrimination
HR4
Total number of incidents of discrimination and actions taken.
Not reported
–
We plan to report on this data in the 2007 report.
Freedom of Association and Collective Bargaining
HR5
Operations identified in which the right to exercise freedom of association
and collective bargaining may be at significant risk, and actions taken to
support these rights.
Global Human Rights
16-31
Operations identified as having significant risk for incidents of child labor,
and measures taken to contribute to the elimination of child labor.
Global Human Rights
16-31
Global Human Rights
16-31
Child Labor
HR6
Forced and Compulsory Labor
HR7
Operations identified as having significant risk for incidents of forced or
compulsory labor, and measures taken to contribute to the elimination of
forced or compulsory labor.
Security Practices
HR8
Percentage of security personnel trained in the organization’s policies
or procedures concerning aspects of human rights that are relevant to
operations.
Not material
–
Indigenous Rights
HR9
Total number of incidents of violations involving rights of indigenous people
and actions taken.
Not material
–
9. Product Responsibility
Customer Health and Safety
PR1
Life cycle stages in which health and safety impacts of products and
services are assessed for improvement, and percentage of significant
products and services categories subject to such procedures.
Green Index, Eco-Effective Product
Design
37,
45-48
PR2
Total number of incidents of non-compliance with regulations and voluntary
codes concerning health and safety impacts of products and services, by
type of outcomes.
Not material
–
We have not identified any non-compliance with
regulations and voluntary codes
2006 CSR report
81
GRI
Indicator
Indicator Description
Sectionpageexplanation
Product and Service Labeling
PR3
Type of product and service information required by procedures, and
percentage of significant products and services subject to such information
requirements.
Green Index, Eco-Effective Product
Design
37,
45-48
PR4
Total number of incidents of non-compliance with regulations and voluntary
codes concerning product and service information and labeling, by type
of outcomes.
Not material
–
We have not identified any non-compliance with
regulations and voluntary codes
PR5
Practices related to customer satisfaction, including results of surveys
measuring customer satisfaction.
Not reported
–
We have not reported on our customer satisfaction
research in past CSR reports. We are not sure if we will
include this data in future CSR reports.
Marketing Communications
–
PR6
Programs for adherence to laws, standards, and voluntary codes related
to marketing communications, including advertising, promotion, and
sponsorship.
Not material
PR7
Total number of incidents of non-compliance with regulations and voluntary
codes concerning marketing communications, including advertising,
promotion, and sponsorship, by type of outcomes.
Not material
–
Total number of substantiated complaints regarding breaches of customer
privacy and losses of customer data.
Not material
–
Monetary value of significant fines for non-compliance with laws and
regulations concerning the provision and use of products and services
Not material
–
Nature, scope, and effectiveness of any programs and practices that assess
and manage the impacts of operations on communities, including entering,
operating, and exiting.
A Promise in Asia, Appendix
64,
73-74
SO2
Percentage and total number of business units analyzed for risks related
to corruption.
Not material
–
More information can be found in our Code of
Ethics: http://www.corporate-ir.net/ireye/ir_site.
zhtml?ticker=TBL&script=2250
SO3
Percentage of employees trained in organization’s anti-corruption policies
and procedures.
Not material
–
More information can be found in our Code of
Ethics: http://www.corporate-ir.net/ireye/ir_site.
zhtml?ticker=TBL&script=2251
SO4
Actions taken in response to incidents of corruption.
Not material
–
More information can be found in our Code of
Ethics: http://www.corporate-ir.net/ireye/ir_site.
zhtml?ticker=TBL&script=2252
SO5
Public policy positions and participation in public policy development and
lobbying.
Public Policy
12-13
SO6
Total value of financial and in-kind contributions to political parties,
politicians, and related institutions by country.
Public Policy
12-13
Total number of legal actions for anti-competitive behavior, anti-trust, and
monopoly practices and their outcomes.
Not material
–
More information can be found in our Code of
Ethics: http://www.corporate-ir.net/ireye/ir_site.
zhtml?ticker=TBL&script=2250
Monetary value of significant fines and total number of non-monetary
sanctions for non-compliance with laws and regulations.
Not material
–
More information can be found in our Code of
Ethics: http://www.corporate-ir.net/ireye/ir_site.
zhtml?ticker=TBL&script=2250
We have not identified incidents of non-compliance
with regulations.
Customer Privacy
PR8
We have not identified any substantiated complaints.
Compliance
PR9
We did not have significant fines for non-compliance.
10. Society
Community
SO1
Corruption
Public Policy
Anti-Competitive Behavior
SO7
Compliance
SO8
82
2006 CSR report
Apparel and Footwear Sector Supplement (Draft version)
AF
Indicator
Indicator Description
Sectionpageexplanation
Commentary
on 1.2
Where applicable, this should include an assessment of supply
chain performance.
Global Human Rights
16-31
We describe our key impacts, risks and opportunities
throughout the Global Human Rights section.
AF1
Code of conduct content and coverage.
Timberland’s Influence in the Supply Chain
18
For more information, our Code of Conduct can be found
at http://www.timberland.com/corp/english_feb02.pdf
AF2
Parties and personnel engaged in code of conduct compliance function.
Our Approach, Factory Growth
6, 19
AF3
Compliance audit process.
The Assessment
22-29
More information about our assessment process can be
found at www.timberland.com/csrreport.
AF4
Policy and procedures for receiving, investigating, and responding to
grievances and complaints.
Timberland Web Site
–
Information about policy and procedures relating to
grievances and complaints can be found in our Code
of Ethics online: http://phx.corporate-ir.net/phoenix.
zhtml?c=105954&p=irol-govConduct
AF5
Strategy and scope of efforts to strengthen capacity of management,
workers and other staff to improve in social and environmental performance.
The Assessment, Beyond Monitoring
22-29,
29-30
AF6
Policies for supplier selection, management, and termination.
Taking Responsibility Within Our
Supply Chain
17-21
AF7
Number and location of workplaces covered by code of conduct.
Taking Responsibility Within Our
Supply Chain
17-21
AF8
Number of audits conducted and percentage of workplaces audited.
Taking Responsibility Within Our
Supply Chain
17-21
AF9
Incidents of non-compliance with legal requirements or collective
bargaining agreements on wages.
We will report on this information as part of our
disclosure under indicator AF14.
AF10
Incidents of non-compliance with overtime standards.
We will report on this information as part of our
disclosure under indicator AF14.
AF11
Incidents of non-compliance with standards on pregnancy
and maternity rights.
We will report on this information as part of our
disclosure under indicator AF14.
AF12
Incidents of the use of child labor.
We will report on this information as part of our
disclosure under indicator AF14.
AF13
Incidents of noncompliance with standards on gender discrimination.
We will report on this information as part of our
disclosure under indicator AF14.
AF14
Incidents of non-compliance with code of conduct.
Assessment Results
22-24
AF15
Analysis of data from code compliance audits.
Assessment Results
22-24
AF16
Remediation practices to address non-compliance findings.
Assessment Results
22-24
AF17
Actions to identify and mitigate business practices that affect code
compliance.
Taking Responsibility Within Our
Supply Chain
17-21
AF18
Programs to replace organic-based adhesives and primers with water-based
adhesives and primers.
Chemical Management
41-42
AF19
Practices to source safer alternative substances to those on the restricted
substances list, including description of associated management systems.
Chemical Management
41-42
Commentary
on EN1
Include use of pumice, stones and sand under Compilation 2.1 on
“Associated process materials.” Report on pumice, stones, and sand by
weight under Compilation 2.3
Not reported
–
AF20
List of environmentally preferable materials used in apparel and footwear
products.
Resources
43-48
AF21
Amount of energy consumed and percentage of the energy that is from
renewable sources.
Energy
38-40
Commentary
on EN21
For Footwear: Report on total chromium discharges under Compilation
2.3. For Apparel: Report on the discharge of antimony, arsenic, cadmium,
chromium, cobalt, copper, cyanide, lead, mercury, nickel, and zinc under
Compilation 2.3.
Not reported
–
We do not yet have the systems in place to track this
data. We are working within our supply chain to gain a
better understanding of these discharges.
Commentary
on EN22
Report on pumice, stones and sand under Compilation 2.1.
Not reported
–
We do not yet have the systems in place to track this
data. We are working within our supply chain to gain a
better understanding of these resources.
Commentary
on EN26
In addition to Compilation 2.2, report on specific programs to reduce
environmental impact of products, including but not limited to
manufacturing, product use, and packaging use at the design and
conceptualization stages.
Eco-Effective Design
45-48
AF22
Policy and practices regarding the use of employees with nonpermanent and
non-fulltime status.
Not reported
–
This issue is covered in Timberland’s Workplace Quality
Standards Guide. To request a copy of this document,
please email csrinfo@timberland.com.
AF23
Policy regarding the use of home working.
Not reported
–
This issue is covered in Timberland’s Workplace Quality
Standards Guide. To request a copy of this document,
please email csrinfo@timberland.com.
For more information, our Code of Conduct can be found
at http://www.timberland.com/corp/english_feb02.pdf
More information can be found in the Make it Better
Brief on Working Hours
We do not yet have the systems in place to track this
data. We are working within our supply chain to gain a
better understanding of these discharges.
2006 CSR report
83
AF
Indicator
84
Indicator Description
Sectionpageexplanation
AF24
Policy on the use and selection of labor brokers, including adherence to
relevant ILO Conventions.
Not reported
–
This issue is covered in Timberland’s Workplace Quality
Standards Guide. To request a copy of this document,
please email csrinfo@timberland.com.
AF25
Policy and practices on wage deductions that are not mandated by law.
The Assessment
22-29
For more information, our Code of Conduct can be found
at http://www.timberland.com/corp/english_feb02.pdf
AF26
Policy on working hours, including definition of overtime, and actions to
prevent excessive and forced overtime.
The Assessment
22-29
For more information, our Code of Conduct can be found
at http://www.timberland.com/corp/english_feb02.pdf
AF27
Policy and actions to protect the pregnancy and maternity rights
of women workers.
The Assessment
22-29
For more information, our Code of Conduct can be found
at http://www.timberland.com/corp/english_feb02.pdf
AF28
Percentage of foreign migrant workers as a portion of total workforce, broken
down by region.
Not reported
–
We do not currently track this indicator. We are working
to gain deeper transparency into our supply chain. We
hope to report on this indicator in future reports.
AF29
Percentage of workplaces where there is one or more independent
trade union(s).
Not material
–
Timberland does not have independent trade unions.
AF30
Percentage of workplaces where, in the absence of a trade union, there are
worker-management committees, broken down by country.
Not reported
–
We do not currently track this indicator. We are working
to gain deeper transparency into our supply chain. We
hope to report on this indicator in future reports.
Commentary
on LA7
Include health issues associated with reduced lung function due to dust
in “Occupational disease rate” under Compilation 2.4. Include risk
assessments and preventative measures for accidents and injuries under
Compilation 2.7.
Not reported
–
We do not currently track this indicator. We are working
to gain deeper transparency into our supply chain. We
hope to report on this indicator in future reports.
AF31
Initiatives and programs to respond to, reduce, and prevent the occurrence
of musculoskeletal disorders.
Not reported
–
We do many trainings for our employees and factory
workers. At this point we do not have trainings
specifically on musculoskeletal disorders.
AF32
Actions to address gender discrimination and to provide opportunities for
the advancement of women workers.
Beyond Monitoring
29-30
More information can be found in the Global Human
Rights section of the 2005 CSR report.
AF33
Priorities in community investment strategy.
Beyond Monitoring, Investing in the
Community
29-30,
62-63
AF34
Amount of investment in worker communities broken down by location.
Appendix
73-75
Commentary
on SO5
Report public policy position on the inclusion of labor and environmental
protections in trade agreements and the degree to which lobbying
positions integrate considerations about the potential effects on workers,
communities, and organizations in the supply chain under Compilation 2.3
Public Policy
12-13
2006 CSR report
We provide data for our workforce in the Dominican
Republic. We do not have data for other locations in
our supply chain.
GRI Application Level
Not Required
Report on a minimum
of 10 Performance
Indicators, including at
least one from each of:
Economic, Social and
Environmental.
Output
Report on all criteria
listed for Level C plus:
1.2
3.9, 3.13
4.5-4.13, 4.16-4.17
Management Approach
Disclosures for each
Indicator Category
Report on a minimum
of 20 Performance
Indicators, at least one
from each of Economic,
Environmental, Human
rights, Labor, Society,
Product Responsibility.
B+
A
A+
Same as requirement
for Level B
Management Approach
Disclosures for each
Indicator Category
Report on each core G3
and Sector Supplement®
Indicator with due regard
to the Materiality Principle
by either: a) reporting
on the Indicator or b)
explaining the reason for
its omission.
Report Externally Assured
➜
Report on:
1.1
2.1-2.10
3.1-3.8, 3.10-3.12
4.1-4.4, 4.14-4.15
B
Report Externally Assured
G3 Performance
Indicators &
Sector Supplement
Performance
Indicators
➜
Output
G3 Management
Approach Disclosures
➜
Output
Standard Disclosures
G3 Profile Disclosures
C+
Report Externally Assured
C
Report Application Level
➜
The GRI Application
Level of Timberland’s
2006 CSR Report
➜
For more information the GRI and its reporting principles, please visit www.globalreporting.org.
➜ Want to learn more about Timberland’s activities in the area of corporate social responsibility?
Please log on to www.timberland.com.
➜
or information about this report, please contact Alex Hausman in Corporate Social Responsibility
F
at: ahausman@timberland.com.
➜ The Timberland Company
200 Domain Drive, Stratham, NH 03885
603-772-9500
csrinfo@timberland.com
Timberland, , Make it Better, Timberland Boot Company, Timberland PRO, Earthkeepers and Path of Service are trademarks of The Timberland
Company. GoLite, the GoLite logo and Green Index are trademarks of Timberland Switzerland GMBH. Howies and the Howies logo are trademarks
of Howies Limited. SmartWool and the SmartWool logo are trademarks of SmartWool Corporation. Vibram and EcoStep are trademarks of Vibram
S.p.A. All other trademarks or logos used in this copy are the property of their respective owners. ©2007 The Timberland Company.
All rights reserved. COR35133
2006 CSR report
85
What does it mean to “Make it better”?
Everyday we are inspired by the actions of other
organizations. Here are examples of how our
“Voices of Challenge” participants made a
difference in 2006.
State of Louisiana
Changing Louisiana through Volunteerism and
Social Entrepreneurship is an initiative that
promotes social entrepreneurship and citizen
service throughout Louisiana. The full-day
seminars bring together national leaders in
the social entrepreneurship field, local change
leaders and citizens who tackle a myriad of social
problems in their communities for dialogue,
critical thinking and networking. The Office
of Social Entrepreneurship, a first-of-its-kind
office in the United States, presents Changing
Louisiana. Lt. Governor Mitch Landrieu created
the office in Fall 2006.
Boston College Center for
Corporate citizenship
The Center’s executive education program is the
only one in North America offering professional
certificates in managing community involvement
and corporate citizenship. In 2006, 145
certificates were awarded to corporate managers.
Phillips–van heusen corporation
PVH believes in the strength of stakeholders’
efforts and is a founding member of the Fair
Labor Association (FLA). During 2006, they
focused on critical issues and conducted several
pilot programs with the FLA such a “workers’
committee” in China and the eradication of
discriminatory labor practices in Central America.
In addition, PVH rolled out an initiative to
develop “health and safety committees” at
factories in all of their regions.
Levi Strauss & Co
In 2006, Levi Strauss & Co. (LS&CO.), using a
global environmental engineering consultant,
tested wastewater effluent from 113 finishing
facilities and nine fabric mills to validate data
the facilities had been providing pursuant to the
requirements of the company’s Global Effluent
Guidelines (GEG) which apply to all LS&CO.
contract laundries. With 80 percent of laundries
registering compliance with 14 of the GEG’s
Backpacker
16 parameters, LS&CO. was encouraged by the
With its April 2007 issue, Backpacker switched
paper stocks from a 40-pound sheet to a 36pound high-bulk sheet. The change will reduce
annual paper consumption by approximately 10%.
results and is using the information to develop
training and tools for suppliers, and program
improvements to build supplier wastewater
management capability and ownership.
Ceres
GAP Inc.
Ceres organized 65 leading companies and
investors managing $4 trillion in assets to call on
the US Congress to adopt strong climate-change
legislation that includes a 60-90% greenhouse
gas reduction target from 1990 levels by 2050.
From 2005 to 2006, GAP experienced a 40%
increase in the number of approved garment
suppliers that earned their highest compliance
rating, which suggests that progress is being
made in the working conditions of many
factories in our supply chain.
SAI
More than 650,000 people in 60 countries
work at 1,200 factories, offices and farms
certified to SA8000.
Walden Asset Management,
a division of Boston Trust &
Investment Management Company
During 2006, Walden Asset Management
held constructive conversations with over
100 companies on a range of corporate social
responsibility issues. These private discussions,
sometimes combined with public shareholder
pressure, contributed to company decisions to
decrease emissions and waste, increase attention
to human rights and workplace equality,
and strengthen corporate transparency and
governance practices.
Pou Yen
As one of the overseas footwear factories of
Pou Chen international group, Pou Yen Vietnam
produces many famous footwear brands and
supplies their customers with high quality goods.
Deloitte & Touche USA LLP’s
A best practice example is Deloitte’s relationship
with College Summit, an organization that works to
increase college access for low-income students.
Deloitte is providing cash, board leadership,
volunteer writing coaches and an exciting pro bono
project that is designed to facilitate a performance
scorecard for high schools to measure and
report the rate at which their graduates enroll in
college—an important component to improving
enrollment rates nationwide.
Sustainable south bronx
SSBx has overseen the convergence of
Timberland’s volunteer and in-kind contributions
in the building of beautiful wooden tree guards
around vulnerable South Bronx street trees.
In addition, they have utilized Clinton Global
Initiative funds to pay living wages to local,
well-trained Greenway Stewards who maintain
and add benches around the trees—weaving
them into a culture of environmental care in
low-income urban areas. And guess whose boots
their stewards are wearing.
The Climate Group
The Climate Group has grown to 40 member
corporations and governments, whose members’
footprint consists of 8.6% Global CO2 Emissions
(discounting overlap) of 0.8% corporate (direct)
and 7.8% from government jurisdictions.
CREA: Center for Reflection,
Education and Action, Inc.
CREA has been part of the GRI since 2000 when
they began raising the questions: Sustainability
of whom? Sustainability of what? Rather than
stand outside the GRI and criticize, we have
worked within the GRI structure to bring about
change. As a member of the GRI Stakeholder
Council, as co-chair of the Apparel and Footwear
Sector Supplement Working Group, as a member
of the Core Measurement Working Group
for the 2002 Guidelines and of the Society
Working Group for the 2006 Guidelines, they
have continued to raise the same questions:
Sustainability of whom? Sustainability of what?
2006 CSR report
87
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by The Forest Stewardship Council (FSC) and produced with wind-generated energy.