Published 23 March 2017
This is the Statement of Ted Baker Plc (“Ted Baker”) published in accordance with the Modern Slavery Act 2015 and the California Transparency in Supply Chains Act 2010 (the “Acts”). At Ted Baker we believe in being open and honest in the way we do business. This includes doing the right thing by all of our stakeholders throughout our supply chain and operating in a fair and sustainable manner. As such, this statement is published as part of our ethos of working closely with our supply chain and protecting the people who create Ted Baker products.
- Ted Baker’s Business
Ted Baker is a global lifestyle brand with controlled distribution through three main channels: retail (including e-commerce), wholesale and licensing (territorial and product). In the financial year 2016/17 (“FY 16/17”), Ted Baker’s revenue was £530million. Ted Baker directly employs over 3200 people worldwide including over 650 based in our head office, The Ugly Brown Building, in London.
Retail is owned and managed by Ted Baker and we retain full oversight of labour practices for our employees. Our wholesale trustees and territorial licensees are carefully selected partners who represent the Ted Baker brand within specific territories or channels. Our product licensees develop specialist products and are responsible for their supply chain. All such partners are subject to strict contractual conditions, including Ted Baker’s Code of Conduct (the “Code”).
As at today’s date, Ted Baker has 490 stores and concessions worldwide, comprising of 192 in the UK, 98 in Europe, 111 in the US and Canada, 80 in the Middle East, Africa and Asia and 9 in Australasia. Combined with our diverse supply base, this significantly complicates the threat of modern slavery within our operations and requires strategies that are tailored to the needs of each particular area of the business and territory in which it is based.
High risk areas of the business, including each distribution channel, are represented in a cross-functional committee, the Modern Slavery Act Working Group (“MSWAG”). The focus of MSWAG is to ensure Ted Baker’s actions to tackle modern slavery address the challenging and complicated issues associated with slavery and trafficking. The function of MSWAG will develop with the changing needs of the business and we understand that meaningful impact can only be achieved through continued and sustained improvement.
- Policies relating to Slavery and Human Trafficking
The offences contained within the Acts do not happen in isolation and require a wide scope of insight in order to fully prevent the actions that culminate in an individual being enslaved or trafficked. Ted Baker’s Code sets out the minimum working conditions and ethical standards that we demand from our suppliers.
In 2016, our Code was enhanced to address the actions that can enable slavery and trafficking and to reflect the Acts. We included additional provisions for migrant workers, strengthened protection of minorities and expressly stated policies to protect worker’s freedom of movement. Suppliers are required to implement these standards beyond the first-tier to their subcontractors. The Code forms the core of our strategy to tackle Modern Slavery and can be found here.
Our first-tier suppliers are audited by independent third parties against the Code and we have a dedicated team, Ted’s Conscience, which works directly with the business and suppliers to continually improve our suppliers’ standards. Members of Ted’s Conscience and our production teams regularly visit factories to make sure our relationships are maintained and the standards of our Code are upheld.
- Risk Assessment and Due Diligence as of FY16/17
Our supply chain consists of over 175 first-tier suppliers for our own product alone. Suppliers based in China make up over 50% of our first-tier and suppliers in Turkey and Portugal make up another 20%. After taking into consideration this and other risk factors we have identified China and Turkey presenting the biggest challenges. The scale and complexity of our manufacturing base in China makes it particularly difficult to accurately assess compliance beyond the first-tier.
Recent events in Turkey have impacted the garment workforce in the region. We continually monitor the influence of external events on our supply base to ensure the principles of the Code are adhered to. These include ensuring that all workers are of an appropriate age, are earning at least the minimum wage and are not facing exploitation.
We have begun a mapping project of our supply base to improve transparency which is pivotal in maintaining a robust supply chain. Having a better understanding of our supply base beyond the first-tier will increase the effectiveness of the due diligence conducted through enforcement of our Code, auditing and factory visits.
In 2016, Ted Baker became members of the Better Cotton Initiative (“BCI”). The BCI’s objective is to make global cotton production better for workers and the environment, improving sourcing practices within the industry. By increasing the ratio of BCI cotton sourced we have greater transparency within our cotton supply chain.
Following a review of our own operations, the representatives of MSWAG have developed tailored assessments to target high risk factors in their respective departmental areas. The assessments consider the characteristics of the industry and political environment, including efficacy of regulation and strength of national governance. We have extended the implementation of the Code to all partners across our three channels. We have a zero-tolerance approach and will not work with anyone who is unwilling to acknowledge and accept the standards set out in the Code.
Our human resources department, known as Coach Station, has been an area of particular focus. In order to meet the needs of the business employees are sourced through our internal processes as well as agents. In order to retain insight into the employment practices of recruitment agents Coach Station requires every agent to complete a due diligence assessment that will flag any factors that have significant risk attached.
We have senior members of management within our distribution centres, a high risk area, who assist in ensuring standards set out in our policies are upheld in practice.
- Performance Assessment and the Year Ahead
We can confirm that no reports or findings of slavery or victims of human trafficking within our supply chain have been received to date. With the continued development of our program we are working towards deepening our insight into the working practices of our supply chain and own operations to ensure this can continue.
Our key performance indicators for FY 2017/2018 will be to:
- Introduce a tailored training programme to assist specific departments within the business in identifying indications of modern slavery;
- Have made progress in mapping our second tier supply chain in China and engage directly with the suppliers to implement the code beyond the first-tier; and
- Reduce the business’ reliance on conventional cotton by steadily increasing the quantity of BCI cotton in our collections.
- Training and Awareness
Internal training programmes have already been implemented to raise awareness of the risk of modern slavery within our business. Our board of directors have received training that highlighted the risk of slavery and its prevalence around the world, including the United Kingdom.
Our focus with external stakeholders has been to raise awareness of the requirements of the Acts. This includes the distribution of our enhanced Code and supporting materials to our suppliers and licensees detailing the threats and warning signs of unfair recruitment practices. These efforts will be expanded upon by 2018 as more training is made available to our teams.
- Board’s Approval
This statement has been approved by the Board of Directors.
Chief Operating Officer, Ted Baker Plc.
23 March 2017