COP REPORT 2018/19 Contents 2

COP REPORT 2018/19 Contents 2 Page 3 CEO commitment Page 4 UNGC 10 principles Page 5 - 8 Labour, human rights and sourcing Page 9 People and colleague culture Page 10 Body image Page 11 Charity Page 12-13 Environment and travel Page 14 Anti-corruption Page 15 Data, security and privacy Page 16-17 Financial services Page 18 Summary CEO commitment 3 Since I joined the business in May 2018, we have driven strong progress in our continued transformation journey. We are pleased to have reported membership, we remain members of colleagues and partners and ensure strong underlying financial the Ethical Trading Initiative, we remain a sustainable business. performance, despite a challenging SEDEX, Fast Forward and the retail environment and changing Carbon Trust, and a signatory to We are proud of our progress economic conditions. the Bangladesh Accord on Fire and over the past 12 months, including Building safety, all of which continue launching a number of projects in our As the UK’s largest integrated to drive and monitor our work in this supply chains aimed at improving pureplay digital retailer and financial area. This year, we also became the lives and livelihoods of workers, services provider, we exist to make signatories to the UK Apparel and supporting two homelessness good things easily accessible General Merchandise Public and charities in the North West, and to more people. With our multi- Private Protocol. continuing in our quest to reduce our category range of famous brands, environmental impact by reducing market-leading technology and data We place a strong focus on the usage of single use plastics from capabilities and unique financial sourcing responsibly, reducing our sites. services products offering flexible our environmental impact, lending ways to pay, we are well placed to responsibly, engaging our colleagues We are looking forward to what we deliver on that promise. and being the best citizen we can we will deliver on our CSR agenda be in the communities in which we over the next 12 months. In the Since joining the UNGC in January operate. To further our ambitions meantime, our report on progress for 2004, we have continued to actively in these areas we have taken the the 2018/19 calendar year provides support the United Nations Global decision to centralise CSR activities an overview of key activities Compact and to abide by the ten and create a holistic strategy which undertaken across our business principles in all of our business covers all areas of the business. Our during this period. operations. We actively participate new strategy will be linked to the in both the Modern Slavery and UN Sustainable Development Goals We hope you find it useful. Sustainable Development Goals and will be underpinned by a set of working groups, and this year our public commitments which we hope Head of CSR was asked to join the to achieve by 2025. We believe that local network’s advisory group. this new strategy, which will align with our broader business strategy, Henry Birch Alongside our UN Global Compact will deliver value to our customers, Group CEO The United Nations global 4 compact ten principles The United Nations Global Compact (UNGC) is the world’s largest voluntary corporate citizenship initiative. The UNGC issues Ten Principles on Human Rights, Labour Standards, the Environment and Corruption. Membership of the UNGC requires companies to issue a ‘Communication on Progress’ report annually. This report is our ninth COP and outlines Shop Direct’s activities in support of these ten principles. Human rights Labour Principle 1 Principle 3 Businesses should support and respect the Businesses should uphold the freedom of protection of internationally-proclaimed human association and the effective recognition of the right rights; and to collective bargaining; Principle 2 Principle 4 Make sure that they are not complicit in human The elimination of all forms of forced and compulsory rights abuses. labour; Principle 5 The effective abolition of child labour; and Principle 6 The elimination of discrimination in respect of employment and occupation. Environment Anti-corruption Principle 7 Principle 10 Businesses should support a precautionary Businesses should work against all forms of corruption, approach to environmental challenges; including extortion and bribery. Principle 8 Undertake initiatives to promote greater environmental responsibility; and Principle 9 Encourage the development and diffusion of environmentally-friendly technologies. Labour, human rights and 5 sourcing and Labour Abuse Authority (GLAA), through the use of the SEDEX POLICIES Department for Work and Pensions system, an online platform for factory We maintain and abide by rigorous (DWP), Health and Safety Executive audit sharing. policies on labour, human rights and (HSE), and HMRC to help eradicate modern slavery in the UK textiles sourcing across our supply chain, Our dedicated responsible sourcing industry. The Apparel and General and all suppliers must sign up to team, both in the UK and key Merchandise Public and Private our code of conduct prior to doing sourcing countries, continues to Protocol commits signatories to work business with us. Alongside this, work hard to understand risks together to eradicate slavery and we have worked hard to update and specific to our supply chain and the exploitation in textile supply chains. develop further policies to support countries we source from. They do As a partner, we have pledged to our responsible sourcing programme this by utilising internal expertise raise awareness to prevent worker and to improve our knowledge and and databases, as well as third party exploitation, protect vulnerable understanding of our suppliers. information including audits, ETI and exploited workers and disrupt These include an updated young updates, trade union risk maps and exploitative practices within the worker policy as well as a migrant NGO country reports. and contract labour policy, to support industry. our factories in developing their own From this work we recognise that policies in these areas and adopting Recognising that in some there is an increased risk of potential a best practice approach. This year geographies we have specific human rights abuses where there we launched a new supplier website, challenges that cannot be tackled are: with copies of the code of conduct by working alone, we have launched and other responsible sourcing partnerships with United Work • A prevalence of migrant labour policies included on the website to and Mudem, two NGO’s in Turkey • Contract and agency workers allow suppliers access at all times. working to support Syrian refugees • High presence of refugees into formal employment. • Young workers and risk of child We continue to be transparent about labour our supply chain by publishing a full Our memberships of these • Vulnerable workers list of our first tier manufacturing organisations and our involvement • Unauthorised subcontracting sites on our corporate website. We in new partnerships allow us to build update this list every six months. and maintain strong relationships This year, we have worked on with a varied group of businesses Certain countries within our gathering data for sites beyond tier as well as trade unions, NGO’s and operations may have one or more one, which will support in increasing government departments. They lead of these risks and this leads us to visibility and traceability of our to shared information and resources, more closely monitor these areas. product, through the various stages which in turn benefit workers in our We do this through regular visits of production. We believe that supply chains. These partnerships, by our in-country teams, who offer sharing this data will help support collaborations and shared learnings additional support and guidance to us in our efforts to better understand are incredibly valuable to our work our suppliers to ensure that they and make improvements within our in responsible sourcing and will are managing these situations supply chain. continue to drive our approach in this responsibly. area. PARTNERSHIPS SUMMARY Alongside membership of the United Nations Global Compact, we are At Shop Direct, we have a broad also members of the Ethical Trading and varied supply chain sourcing Initiative, Fast Forward and SEDEX, both own brand fashion and home and continue to be a signatory to and living products from over 600 the Bangladesh Accord on Fire and factories in 30 countries worldwide, Building Safety. To further increase including China, India, Bangladesh, our commitment to finding and Malaysia, Poland and Turkey, where tackling modern slavery in our supply we have in-country sourcing offices. chains, both at home and abroad, we We are aware that our supply chain have recently signed a revolutionary remains complex and is constantly agreement with UK enforcement evolving, so we work in collaboration bodies including the Gangmasters with our suppliers to ensure visibility of sites manufacturing our product Labour, human rights and 6 sourcing SUPPLY CHAIN MONITORING issues occurring. Over the past were established to ensure the We continue to develop our 12 months we have rolled out our protection of child rights and responsible sourcing policies responsible sourcing training to over observance of labour laws, while and due diligence approach and 200 factories in five key supply chain families with young children took recognise that these are a key countries giving factories a better part in interactive sessions to learn aspects of our responsible sourcing understanding of our requirements about issues related to underage programme. Our human rights due but also informing them of best employment. diligence is based on the Ethical practice and how to implement this at their own sites. Trading Initiatives Human Rights Other community activity included Due Diligence Framework and mass awareness days on gender ensures that we have a holistic HUMAN RIGHTS equality and labour welfare, using risk assessment in place, not only Over the past 12 months we have digital content and performances.

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