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Puma says it wants to go “forever faster”. But its sustainability reporting looks too tired to win any races
Puma, the global sportswear company owned by Kering Group, is among a growing number of companies to include sustainability information in their annual reports.
“Forever Faster » is the theme of Puma’s annual report, which aligns with the company’s new marketing strategy. This tag line supports Puma’s mission to be the “fastest sports brand in the world”, as the company tries to re-establish itself as a leader in the fiercely competitive sportswear industry. Puma is focusing on faster products, innovations, decision making and problem solving.
But Puma will not be overtaking anyone with its reporting. After producing a “combined” report for five years, you might expect a bolder attempt at integration. But sustainability doesn’t get much of a mention in the front of the annual report. Sustainability is not part of Puma’s strategic priorities or brand strategy. And in the CEO message, Bjorn Gulden is silent on the subject. This is surprising, given the number of accolades Puma earned for its pioneering environmental profit-and-loss (EP&L) accounts back in 2010.
Puma deals with sustainability in a 30-page self-contained section of the annual report, showing performance against two strategic pillars: social and environmental. We learn that being sustainable is no longer part of the company mission statement. It is instead a value that guides the company to work faster. Clearly, there has been a change of heart (and CEO) since those heady days in 2010.
Measured, not managed
Puma’s social reporting focuses on labour standards and capacity building in its supply chain. Raw materials use and chemicals management are the main environmental issues covered.
Audits, training and promoting fair wages are the main efforts to improve labour standards. In 2014, the company launched a new, more comprehensive audit tool, which it used to assess nearly a quarter of its suppliers. It expects to assess all active suppliers in 2015. In 2014, Puma held roundtables with 288 direct and indirect suppliers to help them understand new procurement policies.
The company’s “S-Index” rates the sustainability of the leather, cotton, polyester and card it sources. But the index does not seem to have much bearing on the materials it actually uses. For example, in 2014 it used around 85 per cent less organic cotton and 80 per cent less recycled polyester than it did the previous year. Puma explains that this was due to hikes in the cost of the more sustainable raw materials.
Balancing costs and principles is clearly a major challenge for any business. Puma’s openness about the reason for its poor performance in using environmentally friendly cotton and polyester is refreshing – full marks for honest reporting. But this U-turn on better sourcing casts doubt over Puma’s long-term commitment to its sustainability priorities.
Puma has conducted a materiality assessment and identified the issues that are most important to the business and its stakeholders. It set eight targets that are aligned to the identified issues and main supply chain risks. But it would be interesting to understand a little more about why these targets were chosen because for some it’s not immediately obvious. For example, Puma set a target to continue to measure its externalised environmental impact by creating an E-P&L at least every two years.
Interviews with key stakeholders help bring Puma’s sustainability story to life. For example, a Greenpeace campaigner shares his views on the company’s solid commitment to the Greenpeace Detox Campaign, which aims to eliminate hazardous chemicals from garments manufacturing by 2020. Puma was the first of 29 fashion companies to sign up and is considered a detox leader alongside Marks & Spencer and Burberry.
Overall, a little of the vigour and ambition that is driving the business to be “Forever Faster” should be directed to revitalising its sustainability strategy, performance and reporting.
Follows GRI? Yes
Assured? Yes, limited assurance in line with (ISAE) 3000
Materiality analysis? Yes
Stakeholder input? Yes
Seeks feedback? No
Key strengths? Open and honest about difficult issues
Chief weakness? Poorly integrated, and strategy lacks ambition
Pleasant surprise? Interviews provide interesting external perspectives
Phoebe Hayes is a consultant for Context Europe contexteurope.comCR report review CR Reporting review Puma sports
November 2015, London
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