2009 SUSTAINABILITY REPORT Transparency weighs nothing. Therefore I GoLite. A MESSAGE FROM THE FOUNDERS [GRI 1.1, 1.2] GoLite started as a simple idea: that experiencing nature would be better with less. Less weight, less fuss, less waste…and more fun. It’s a philosophy that drives us to make simple, beautiful, high performance gear that’s light on the planet. It is also a philosophy that makes us committed to building a sustainable business. Sustainability has been part of our ethos since our founding in 1998. It is imbedded in every aspect of how we operate through an integrated set of guidelines, policies, and company and individual goals, all bound together by our mission, vision, and shared values. Building a sustainable business is an expression of our brand essence and our passion. It is also good for our planet, good for our customers, and good for our business. Our definition of sustainability includes respect for everyone involved in our supply chain from fabric mill workers, to our employees, to our valued customers. It includes strong financial performance, and it includes avoiding or minimizing the environmental impacts of producing our products. Long-term, we are striving to achieve a value chain that goes beyond leave no trace and eventually nourishes the environment. We want to be a real part of the solution to the challenges facing our planet. We are making aggressive changes in how we do business, because we want to reach a truly sustainable – and replicable – business model as fast as possible while continuing to make premium, high-performance products that serve the needs of outdoor athletes. We have made real progress to date, but we have a lot to learn and a long way to go. We are a passionate group here at GoLite. If you are reading this, GoLite’s first Sustainability Report, we thank you for your interest in our journey. Our guess is that you are as passionate about going light on the trail and on the planet as we are. We invite your feedback, questions, and ideas about how we can do better and how we can improve this report in the future. Please email us at [email protected]. Demetrios G. C. Coupounas Kimberly Riether Coupounas Co-Founder & President Co-Founder & Chief Sustainability Officer Photo by Stephen Collector. © 2009 GoLite, LLC. All rights reserved. GoLite® and the GoLite logo are registered trademarks of Timberland Switzerland GmbH. All rights reserved. PAGE 1 | 2009 GOLITE SUSTAINABILITY REPORT TABLE OF CONTENTS A MESSAGE FROM THE FOUNDERS 1 Financial Controls 44 Public Policy Positions, Lobbying, and 71 Direct Economic Value Generated and Distributed 44 Contributions EXECUTIVE SUMMARY 4 Risks Due to Climate Change 45 Anti-Competitive Behavior 71 Defined Benefit Plan Performance 45 Compliance 71 STRATEGIC CONTEXT 5 Financial Assistance Received from Government 45 GoLite Brand, Products, and Services 6 Wage Comparison 46 OUR COMMITMENT TO THE ENVIRONMENT 72 GoLite Mission, Shared Values, Vision 6 Local Purchasing Policy 46 General Management Approach 73 Laying Our Sustainability Foundations 7 Local Hiring 46 Management Approach to Product Responsibility 73 Progress to Date 9 Infrastructure Investments for Public Benefit 46 Quality Assurance 74 The Journey Ahead 10 Indirect Economic Impacts 46 How We Measure Our Factories’ Environmental New for 2010 11 LABOR PRACTICES 47 Performance 75 Key Impacts, Risks, and Opportunities 14 Management Approach 47 2008 Eco-Footprint 75 Policy Regarding Flexible Work Options 47 Practices to Source Safe and Ethical Substances 80 ABOUT THIS REPORT 17 Wages and Working Hours Policy 47 Materials Used in 2008 Selling Seasons 83 Report Profile 18 Policies that Protect Pregnancy and Maternity 48 Use of Recycled and Environmentally Preferred 85 Report Scope and Boundary 19 Rights Materials (EPMs) GRI Content Index 20 Workforce by Type, Region, and Focus 49 Direct and Indirect Energy Consumption by 91 Report Review and External Assurance 20 Employee Turnover 50 Primary Energy Source Benefits Provided Full-Time, Part-Time, and 51 Energy Efficiency Improvements and Initiatives 91 ABOUT GOLITE 26 Temp Employees Water Usage, Sources, and Impacts 92 ORGANIZATIONAL PROFILE 27 Occupational Health + Safety 52 Biodiversity 92 Operational Structure 27 Training and Education 52 Direct and Indirect Greenhouse Gases 93 Headquarters Location 27 Performance and Career Reviews 53 Initiatives to Reduce Emissions 94 Countries of Operation and Scope of Report 27 Diversity and Equal Opportunity 53 Other Significant Emissions 96 Ownership and Legal Form 28 Emissions, Effluents, Waste 96 Markets Served 28 OUR COMMITMENT TO GLOBAL HUMAN RIGHTS 55 Spills, Haz-Mats 99 Scale of Organization 29 Management Approach 56 Product and Packaging Reclamation 99 Awards and Recognition 30 Investment and Procurement Practices 56 Environmental Compliance 100 CORPORATE GOVERNANCE AND ENGAGEMENT 32 Employee Training on Human Rights 57 Environmental Protection Expenditures 100 Governance Structure 32 Risk of Discrimination, Child Labor, Forced Labor, 57 Assessment of Products’ Health and Safety 101 Performance and Compensation 33 Violation of Right to Freedom of Association Product Warranty Returns and Material Recalls 102 Corporate Principles, Policies, and Codes 34 Fair Labor Code of Conduct Content, Coverage, 58 During Reporting Period of Conduct and Audit Process Product Labeling 103 Precautionary Principle 35 Supplier Selection, Management, and Termination 64 Marketing Communications Compliance 103 Commitments to External Standards 36 Code of Conduct Non-Compliance, Analysis, and 65 Customer Privacy 105 and Initiatives Remediation Product Use Compliance 105 Association Memberships and Governance 38 Positions OUR COMMITMENT TO COMMUNITY 67 APPENDICES 106 Stakeholder Engagement 39 AND SOCIETY ECONOMIC PERFORMANCE 43 Management Approach 68 Management Approach 43 Community Impact Tracking 70 Financial Commitment to Sustainability 43 Community Investment 70 Goals and Performance 44 Corruption 71 PAGE 2 | 2009 GOLITE SUSTAINABILITY REPORT LIST OF APPENDICES GRI REF APPENDIX NO. CONTENT PAGE 3.12 Appendix 1 GRI Content Index 106 n/a Appendix 2 List of Charts and Exhibits 112 n/a Appendix 3 Glossary of Terms 114 Strat Context Appendix 4 Calculation of The GoLite Index™ Scores 128 4.8 Appendix 5 GoLite Ethics Policy 129 4.8 Appendix 6 GoLite Product Design + Responsibility Guidelines 130 4.8 Appendix 7 GoLite Purchasing Policy 131 4.12, AF1 Appendix 8 Timberland® Code of Conduct 132 4.12 Appendix 9 Outdoor Industry Association® Packaging Guidelines 133 4.12 Appendix 10 Outdoor Industry Association® Materials Guidelines 136 EC Mgmt Approach Appendix 11 GoLite Financial Controls 141 EC1 Appendix 12 Charitable Efforts and Organizations GoLite Supported 145 (2007 – 2009) LA4 Appendix 13 GoLite Safety Policy 149 SO5 Appendix 14 GoLite Public Policy Positions and Participation 152 AF20 Appendix 15 List of Environmentally Preferred Materials used in Apparel 155 and Equipment Products EN18, EN26 Appendix 16 2006 – 2008 Carbon Offset Projects Purchased 157 through Native Energy PAGE 3 | 2009 GOLITE SUSTAINABILITY REPORT EXECUTIVE SUMMARY This is GoLite’s first Sustainability Report. It was designed and written to meet the standards of the Global Reporting Initiative (GRI) (www.globalreporting.org) according to the G3 (third generation) protocols. The report has been reviewed by an independent review committee. GoLite designs and brings to market a full range of premium, sustainable men’s and women’s apparel and equipment for outdoor pursuits. We believe lighter products are not only better for the environment, but they make the experience of being outdoors more fun. This has been our focus since our founding in 1998. Corporate responsibility has been part of GoLite’s ethos since our founding. GoLite is following a multi-year, metrics-based path to sustainability. We are striving to eliminate or mitigate 100% of our environmental footprint and be a model company in how we treat our people and community. Our long-term objective is to aim past neutrality towards becoming “net positive” to environment and civilization across our entire value chain. We don’t have a “green collection:” we are striving to address 100% of our products and 100% of our operations. We are on track to achieve four out of five of our 2010 sustainability goals as devised in 2006. We have an integrated set of mission, vision, values, policies, guidelines, and goals that guide every decision we make. Our Commitment to Global Human Rights As a global brand and corporate citizen, we work in partnership with our factories to ensure that our products are made in workplaces that are fair, safe, and non- discriminatory. We annually audit 100% of our production facilities according to strict social and environmental guidelines. Our Commitment to Community and Society At GoLite, we believe we are inseparable from the communities in which we operate. We believe in giving back to society, and we strive to do so in a wide variety of ways. Our Commitment to the Environment GoLite is committed to reducing its impact on the environment at every level of our operations. Most GoLite products are “greener” by nature: less materials = less carbon, less toxics, less waste. From an eco-footprint analysis conducted in 2008, we know that greater than 60% of our company’s carbon footprint comes from the materials in our products, so improving our materials choices is high on our list of sustainability priorities. We are already at over 67% Environmentally Preferred