As an international retail company the Otto Group actively promotes the safe and environmentally friendly handling of chemicals, particularly at wet-process factories (involving dyeing, washing, printing) by employing different measures.
We believe that we have the greatest leverage to achieve improvements in the upstream supply chain - i.e. particularly at wet-process factories - when we raise awareness for managing chemicals and their risks with the help of our business partners. While our EMPact training programme provides support in developing know-how, it also empowers suppliers and their factories by enabling them to help themselves as well as through the provision of on-site training. Due to the complex global textile value chains, transparency is essential – something we also aspire to achieve as a retailer. We are convinced that together we can achieve more! When different partners agree a common approach, this makes it easier for us to implement the necessary changes and reinforce positive developments more strongly. By taking a multi-pronged approach to chemical management we have already achieved significant improvements at several processing plants – particularly in Asia. See the ‘Achievements’ tab to learn more about first success stories.
Transparency plays a decisive role in chemical management at the Otto Group. As a retail company, we do not have our own factories – and our business partners are often not the owners of those factories in which the biggest use of chemicals takes place. This is why we rely on our direct business partners to disclose which factories they work with. It is particularly relevant when it comes to wet processing plants (dyeing, washing, printing), as this is where the greatest leverage exists to achieve improvements in chemical management.
Through our own guidelines we underline our requirements regarding the handling of chemicals towards our business partners and the wet-process factories. At the same time, we offer them assistance to meet our standards. Through audits and monitoring we verify whether and how our requirements are being implemented – and can provide on-site support if required.
In recent years the Otto Group has developed guidelines and support measures that provide business partners and wet-process factories with guidance on improving chemical management along the supply chain.
- The Chemical Management Manual that we have developed provides an overview of the most vital production-process topics. It includes instructions and practical advice on how a factory can implement good chemical management practices and in doing so meet the Otto Group’s and other companies’ requirements.
- As a member of the Partnership for Sustainable Textiles, the Otto Group uses the Manufacturing Restricted Substances List (MRSL) of the ZDHC Foundation (a foundation in which major companies have joined forces to improve chemical management globally) as the industry standard. The MRSL sets threshold values for selected chemicals in textile production and provides guidance on which ones are to be avoided or replaced in the production process (for further information see the ‘Partnerships’ tab).
- Our own internal regulations define which chemicals are banned either entirely or above a certain threshold in the end-product.
- For PFCs (perfluorinated and polyfluorinated chemicals, used in many consumer products due to their special water, oil and soil repellent properties) we have prepared a brochure for our business partners that explains the potential risks of PFCs, identifies suitable alternatives and provides recommendations for substitutes.
The documents are available to our business partners in their local language. We also require them to forward the brochures to their factories.
The Otto Group does not have its own production facilities, so it is important to our business to develop long-term relationships based on trust with our key business partners. Only by doing so, we can establish the basis to obtain the required information and ensure transparency in the supply chains. Through trusting business relationships we also strengthen our influence significantly over work processes in the suppliers’ factories. To improve our partners’ approach to chemical management in a targeted way we have additionally developed the EMPact programme: this offers our business partners and their supplier factories many and varied forms of free support.
As part of our collaboration, our key business partners commit to sharing their relevant wet-processes with us. In a first step, we ask the wet-process factories to complete a self-assessment. Together with the factory management team, this self-assessment helps us identify any needs for improvement and to record this in a corrective action plan. However, should we discover any irregularities during on-site inspections, we provide assistance in implementing an improvement process at the factory. Our EMPact programme is an important tool in this regard. While our underlying philosophy is to achieve improvements together, our business partners may face targeted sanctions – through to the termination of the contractual relationship with the Otto Group – if a factory refuses to make any specified improvements to their chemical management processes.
Besides chemical management in the supply chain, the finished product naturally matters a great deal to our customers. This is why we have systematic checks performed by accredited testing laboratories to ensure our products’ quality and safety remains consistently high. Learn more about this topic by clicking this link: Product safety.
Complex activities along global supply chains are addressed most effectively through partnerships. Based on this firm conviction the Otto Group is involved in many initiatives including the BSCI, the Bangladesh Accord, and through the Aid by Trade Foundation/Cotton made in Africa to promote sustainable cotton cultivation. Furthermore, since June 2015 the Otto Group has been a member of the Partnership for Sustainable Textiles initiated by the German federal government. As in other initiatives, the joining of different forces in the Textiles Partnership enables us to expand our reach in the supply chain and improve processes together. With representatives from business, politics and civil society working together, this cross-sector approach in the Textiles Partnership is particularly effective.
As a retail company the Otto Group does not have its own production facilities. The majority of our products are manufactured in factories with which we have no direct contractual relationship and which also manufacture goods for other brand companies and retailers. Particularly in the upstream production stages, such as wet processes, the influence of a single company is often not strong enough to bring about specific changes. In terms of effective chemical management this means that we can only achieve material changes if we work together in a coordinated manner with our allies. Through applying common standards, developing a uniform language and presenting a united front in production countries, we can be effective in initiating improvements in the handling of chemicals.
With an initiative focussing on chemical management, the Partnership for Sustainable Textiles intends to reduce negative environmental impacts caused by textile production and to develop measures which the Partnership members report on. Correspondingly, the Otto Group also has to align its ongoing measures and achievements with the Partnership’s goals. With this in mind, as part of our membership, we publish a Roadmap annually.
Together with our partners in the Textiles Partnership, we intend to develop sustainable solutions for the industry that are supported by the majority of textile companies, policy-makers and NGOs in equal measure – with the additional goal of ensuring that these solutions can be applied internationally. The Otto Group’s focus is on training and raising the awareness of its business partners and their factories. We can only achieve sustainable, long-term changes by supporting self-empowerment, particularly through a specific training programme. Another important task is to remove highly hazardous chemicals progressively and systematically from production processes. Fundamentally, chemicals are indispensable for the industrial production of textiles and clothing. Nevertheless we want to play our part in substituting hazardous chemicals with harmless alternatives. Further, to reduce environmental impacts, correct storage and disposal must also be ensured.
Supplier-training, the successive substitution of hazardous chemicals and the development of a uniform language are topics that are being tackled in the Partnership for Sustainable Textiles. The resulting training measures supplement our EMPact programme offering for our business partners. For example, we are supporting the development of training videos on various aspects of good chemical-management practice along the supply chain. We also collaborated on a supplier brochure that explains the Textiles Partnerships' requirements on chemical management in simple terms and by using practical examples. We were also able to contribute content from our own Chemical Management Manual. And we welcome the fact that the Partnership for Sustainable Textiles has adopted the Manufacturing Restricted Substances List (MRSL) of the ZDHC Foundation, as this will further standardise regulations for factories in production countries.
Based on the ‘impACT’ management process we developed, EMPact represents the Otto Group’s capacity-building programme. The name brings together supplier ‘EMPowerment’ with the ‘actions’ derived from that.
Many different chemicals are used in textile manufacture, especially in wet processing (dyeing, washing, and printing). Some can be dangerous to humans and the environment if handled, stored, or disposed of incorrectly. As there is often a lack of awareness or the necessary knowledge and experience about this in factories – particularly in emerging and developing countries – we launched the EMPact programme to counter these issues specifically.
To ensure our chemical management activities have a high impact, we are focusing on wet-process factories. In this regard, we need and aim to work very closely with our key business partners to gain access to information about wet processes. We then enter into direct dialogue with the affected business partners or upstream suppliers through EMPact. The programme has two strategic priorities. In the first stage, awareness is raised for the impact of inadequate chemical management – both among the factory management team and the workforce. In the second stage, any lack of know-how is addressed and applicable knowledge is strengthened through appropriate improvement measures. In doing so we always address specific local circumstances, as different production facilities sometimes face very different challenges in respect to chemical management. By keeping these discussions on a peer basis we are achieving sustainable improvements through EMPact.
We believe that empowering others is key to achieving lasting improvements. As an element of our integrated approach, the CPI2 industry initiative was founded in 2013 by seven trading companies together with the Otto Group. CPI2 is designed to support our manufacturers in identifying and minimising negative environmental impacts by means of an online tool. CPI2 also includes a specific section on chemicals. Among other things, this allows factories to look up specific information about the safe storage of the chemicals they use – with practical instructions provided to help with implementation. In 2017 the Otto Group invited around 300 factories to use the tool, giving them access free of charge.
In addition, we provide all of our business partners with an information pack for forwarding to the wet-process factories. Among other things, it comprises the Chemical Management Manual, the Manufacturing Restricted Substance List (MRSL) and an overview of the other forms of support we offer.
Besides CPI2 and our information pack, we offer our business partners and their factories training programmes to provide them with targeted on-site support in implementing new measures and processes. Together with our project partners Sequa gGmbH and Systain Consulting GmbH, in March 2016 the Otto Group developed a pilot programme focusing on wet-process factories. The 14-month training programme was developed in close collaboration with 44 of our key suppliers and their wet-process factories in China, Bangladesh and Turkey, as well as with experts from the scientific community and civil society. Through a combination of several days of training on relevant topics (including basic knowledge of chemicals, safe storage, safe handling, waste management and wastewater treatment) and site visits by experts, the participating factories were able to improve their chemical management processes substantially. We are already sharing many of the approaches with other factories as examples of good practice.
Including the feedback from our project partners and those from the Textiles Partnership, enabled us to further develop this pilot project, which is part of our EMPact programme. We are focusing our activities particularly on business partners with whom we have long-term relationships. As a retail company it is here that we have the greatest leverage to achieve effective changes in our textile supply chains. Besides on-site training and support, we offer free discharge water tests for wet processes. This enables potential sources of hazardous chemicals to be identified and compliance with our requirements to be verified. We will also continue to train our key business partners in the coming years to further raise awareness of good chemica -management practices.
On the basis of our EMPact programme we have already made improvements in wet-process factories in China, Bangladesh and Turkey.
Several days of training and on-site visits by experts have already brought us initial successes in chemical management, chemical storage, chemical handling and chemical disposal.