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Uniqlo – research

About

Fast Retailing owns Uniqlo,  GU, Theory, PLST, Helmut Lang, Comptoir des Cotonniers, Princesse Tam Tam and J Brand.

THE PROS:

In fiscal 2014, the percentage of employees with disabilities in the FR Group was 6.36%, the highest among companies with 5000+ employees in Japan.

Fast Retailing discloses a summary of workplace monitoring results (the grades factories received) from the last three years.

Fast Retailing runs an All Product Recycling Initiative in Uniqlo and GU stores in Japan, South Korea, UK, US, France, Singapore, Hong Kong, Taiwan, Shanghai, Thailand and Malaysia. The company takes back end of life items and donates them to the UNHCR for refugees or converts them into fuel or fibre.

THE CONS:

In 2015, Students and Scholars Against Corporate Misbehavior (SACOM) published a report that cited Uniqlo for poor occupational protection and health for workers at two of its China factories.

The company does not disclose a public list of suppliers or the countries in which their suppliers are located.

It is unclear if the company can trace their entire supply chain.

Business model

/ Fast Retailing owns Uniqlo, GU, Theory, PLST, Helmut Lang, Comptoir des Cotonniers, Princesse Tam Tam and J Brand.

/ As of August 2014 Uniqlo had 1487 stores worldwide.

/ By 2012, Fast Retailing employed one person with a disability per store in Japan. In fiscal 2014, the percentage of employees with disabilities in the FR Group was 6.36%, the highest among companies with 5000+ employees in Japan.

/ Uniqlo monitored 322 factories in 2014. It is unclear what percentage this number represents of their overall suppliers.

/ We don’t have any information on: how many people Uniqlo employs in its supply chain, lead times, how many garments Uniqlo makes a year, how many collections the company releases annually and how long their products are designed to last.

Transparency

/ The company does not disclose a public list of suppliers or the countries in which their suppliers are located.

/ It is unclear if the company can trace their entire supply chain.

/ Fast Retailing conducts both social audits and environmental monitoring.

/ Fast Retailing aims to collect quantitative data on the environmental impact generated by all processes in its SPA supply chain.

/ The company communicates some issues which have been discovered in their supply chain during monitoring and auditing and what they have done to resolve these issues.

Working conditions

/ Pre-contract monitoring is conducted to determine whether a given factory is eligible to do business with Fast Retailing.

/ Fast Retailing permits factories to use subcontractors and homeworkers as long as they report it to the company and ensure all business complies with the code of conduct. Fast Retailing does not state whether or not they monitor these subcontractors or homeworkers.

/ Fast Retailing discloses some of the violations of their code of conduct that were discovered through their monitoring program and summarises how they addressed these issues.

/ Employees and management responsible for sourcing finished goods and materials for Fast Retailing are trained and instructed regarding factory monitoring results. They are also provided with training toward raising awareness of the importance of human rights and environmental issues in supply chains.

/ In 2015, Students and Scholars Against Corporate Misbehavior (SACOM) published a report that cited Uniqlo for poor occupational protection and health for workers at two of its China factories. Ecouterre reported that Fast Retailing acknowledged several problems, including the long work hours, however they contend that it has “different views on some of the issues” listed by SACOM’s staff. In response, Sourcing Journal reports that Uniqlo has implemented the following changes:

At Tomwell Garment Co., Ltd., which manufactures garments for Uniqlo in the Guangdong Province, Fast Retailing has taken the following actions: reviewed working hours to ensure they remain within the companies regulations, changed workers’ masks from regular to dust protective following air quality checks, established a Personal Protective Equipment (PPE) management program under the supervision of the Administration of Work Safety, and selected worker representatives and established a framework for regular committee meetings.
At Pacific (Pan Yu) Textiles Limited, which supplies textiles to the company’s garment factories, Fast Retailing increased the number of employees by roughly 700 and strengthened production capacity to manage working hours, introduced new rules to regulate temperatures throughout the factory, did construction on windows to improve ventilation, moved chemical storage to prevent cleaning water from flowing into the storage area, rolled out training to workers on the use of PPEs and had a government institution investigate dust, odor, noise and temperature for all production areas.
/ In 2015, The Business of Fashion reported that hundreds of factory workers at a Chinese supplier to Fast Retailing were striking over the dismissal of some of the employees.

Environment

/ In 2010 Fast Retailing began environmental monitoring at fabric producers for Uniqlo products. the company uses a third-party agency that assesses suppliers against their environmental guidelines for fabric production.

/ In fiscal 2014, Fast Retailing monitored 62 supplier factories that had been monitored since June 2010.the company shares a summary of the results of their environmental monitoring program including the overall compliance rate of suppliers and the steps Uniqlo have taken to improve this.

/ Fast retailing discloses some of the violations of their environmental guidelines for fabric production that were discovered through their monitoring program including inadequate disposal of chemicals and waste and child labour. the company summarises how they addressed these issues.

/ Fast Retailing communicates very little about its animal welfare policies; the company does state that it has stopped sourcing mulesed wool. PETA does report that Uniqlo has stopped using angora.

/ Fast Retailing have measured the carbon footprint of their headquarters, sewing and fabric manufacturers, logistics facilities and stores. There is a table outlines the number of tonnes of CO2 for each of these categories. the company has also measured the energy and raw materials used in each of these categories.

/ In 2013, seven Chinese environmental NGOs released an investigative report into the textile industry, drawing attention to the fact that a large number of dye houses have broken China’s new emission standards and requesting Polo Ralph Lauren, Uniqlo and Youngor face up to the serious water pollution problems caused by their supply chains. Suspected violations of new discharge standards were discovered at factories that supply to Uniqlo.

Innovation

/ Fast Retailing states that they are working with partner factories to improve their management capacity for more effective workplace monitoring. These efforts include requiring the appointment of on-site CSR employees and creating systems for self-auditing.

/ The Business of Fashion reports that as of October 2015, Fast Retailing offered approximately a fifth of its workforce based in Japan a four day work week in order to retain full time staff that have young families.

/ By 2012, Fashion Retailing employed one person with a disability per store in Japan. In fiscal 2014, the percentage of employees with disabilities in the FR Group was 6.36%, the highest among companies with 5000+ employees in Japan.

/ Uniqlo runs an All Product Recycling Initiative. the company takes back end of life Uniqlo items and donates them to the UNHCR for refugees or converts them into fuel or fibre. The program operates in Uniqlo and GU stores in Japan, South Korea, UK, US, France, Singapore, Hong Kong, Taiwan, Shanghai, Thailand and Malaysia.

/ In 2013 the company set a target for UNIQLO stores in Japan, aiming to reduce CO2 emissions per floor area 10% by 2020. From fiscal 2015 onward, Fast Retailing states that it will increase its efforts across all of its brands.

/ In 2011, Fast Retailing committed to eliminate the emission of hazardous chemicals from its entire product lifecycle by 2020. In 2015, the company reported on the progress it has made towards the commitment.

/ In Japan, 58% of Uniqlo stores work with a recycling company that collects store waste materials, recycles all reusable materials, and reports monthly recycling volumes. Fast Retailing states that it is seeking to broaden the collection activities to stores that do not currently have collection programs, such as those located in commercial complexes.

/ The company states that starting in 2015, it will assess the status of specific environmental impacts, decide which to focus on, and take rigorous steps to set targets and reduce those impacts.

Community

/ In early 2014, Uniqlo began a series of in-store shopping experience events, where store employees assisted people with disabilities to shop for clothes.

/ In 2013, Fast Retailing committed to donate US$1 million over a five-year period to the Asian University for Women in Bangladesh.

/ Fast Retailing has established a recovery assistance fund combining ¥300 million (around US$2.5 million) from the March 2012 revenue of Uniqlo stores in Japan with donations from customers globally. The fund is assisting five NGOs in their work to promote self-reliance, job creation, and economic recovery in northeastern Japan, which was hit by the March 2011 earthquake.

/ Fast Retailing has partnered with the Grameen Bank Group and launched Grameen Uniqlo Ltd. Since 2010, Grameen UNIQLO has operated its own SPA business model to help combat poverty, develop local industry, provide employment, and support the self-sufficiency of workers in Bangladesh.

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