EarthX Website: https://earthxmedia.com/
Sean Cady (VF Corporation) manages multinational programs in sustainability, responsibility & trade. Sean clarifies the pillars of VF's strategy and their mission for transformative solutions.
About Law & Nature:
Discussions of Environmental Law & Policy developed by the EarthxLaw Advisory Council
Law & Nature promises lively discussions by environmental thought leaders on legal and policy issues of critical importance to environmental protection. This series is developed by the EarthxLaw Advisory Council, a blue ribbon board of prominent environmental law practitioners brought together by EarthX to assist in developing programs and facilitating dialog on environmental law and policy.
EarthX
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At EarthX, we believe our planet is a pretty special place. The people, landscapes, and critters are likely unique to the entire universe, so we consider ourselves lucky to be here. We are committed to protecting the environment by inspiring conservation and sustainability, and our programming along with our range of expert hosts support this mission. We’re glad you’re with us.
EarthX is a media company dedicated to inspiring people to care about the planet. We take an omni channel approach to reach audiences of every age through its robust 24/7 linear channel distributed across cable and FAST outlets, along with dynamic, solution oriented short form content on social and digital platforms. EarthX is home to original series, documentaries and snackable content that offer sustainable solutions to environmental challenges. EarthX is the only network that delivers entertaining and inspiring topics that impact and inspire our lives on climate and sustainability.
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Sean Cady (VF Corporation) manages multinational programs in sustainability, responsibility & trade. Sean clarifies the pillars of VF's strategy and their mission for transformative solutions.
About Law & Nature:
Discussions of Environmental Law & Policy developed by the EarthxLaw Advisory Council
Law & Nature promises lively discussions by environmental thought leaders on legal and policy issues of critical importance to environmental protection. This series is developed by the EarthxLaw Advisory Council, a blue ribbon board of prominent environmental law practitioners brought together by EarthX to assist in developing programs and facilitating dialog on environmental law and policy.
EarthX
Love Our Planet.
The Official Network of Earth Day.
About Us:
At EarthX, we believe our planet is a pretty special place. The people, landscapes, and critters are likely unique to the entire universe, so we consider ourselves lucky to be here. We are committed to protecting the environment by inspiring conservation and sustainability, and our programming along with our range of expert hosts support this mission. We’re glad you’re with us.
EarthX is a media company dedicated to inspiring people to care about the planet. We take an omni channel approach to reach audiences of every age through its robust 24/7 linear channel distributed across cable and FAST outlets, along with dynamic, solution oriented short form content on social and digital platforms. EarthX is home to original series, documentaries and snackable content that offer sustainable solutions to environmental challenges. EarthX is the only network that delivers entertaining and inspiring topics that impact and inspire our lives on climate and sustainability.
EarthX Website: https://earthxmedia.com/
Follow Us:
Instagram: https://www.instagram.com/earthxmedia/
LinkedIn: https://www.linkedin.com/company/earthxmedia
Facebook: https://www.facebook.com/EarthXMedia/
TikTok: https://www.tiktok.com/@earthxmedia
YouTube: https://www.youtube.com/@EarthXMedia
How to watch:
United States:
- Spectrum
- AT&T U-verse (1267)
- DIRECTV (267)
- Philo
- FuboTV
- Plex
- Fire TV
#EarthDay #Environment #Sustainability #EcoFriendly #Conservation #EarthX
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TVTranscript
00:00Hello, everyone. I'm Jim Bruin. I'm a past president of the American College of Environmental
00:08Lawyer and counsel for the law firm Farrell, LeBron, and Martel. I'm delighted today to
00:13have Sean Cady as our interview guest. Sean is renowned for being a visionary for leading
00:19multinational business organizations. He's particularly respected for being the vice
00:25president of global sustainability, responsibility, and trade for VF Corporation. Welcome, Sean.
00:33Thanks so much, Jim. Thanks to you and to the entire EarthX team for having me here today.
00:39Sean, we've got a lot to cover today, so let's dive right in.
00:43Many people watching this show have not heard of VF Corporation, but of course, many of them
00:49have worn apparel or footwear from VF's popular brands. Tell us a bit about VF Corporation,
00:56generally. Sure, Jim. Thanks for asking. It's an interesting fact that most people don't know
01:02VF Corporation, but you know our brands. VF Corporation is one of the world's largest apparel,
01:08footwear, and accessories companies. We started our history in 1899 as a woman's silk glove
01:17manufacturer. We've evolved our portfolio of brands over the 122 years to where we are today
01:26as a powerhouse operating in 170 countries around the world. Sean, what do you make?
01:34Yeah, we have about 20 different brands under the umbrella of VF Corporation,
01:4013 consumer-facing brands. We make a myriad of different products from pants to shirts,
01:48outdoor jackets. We make tents and sleeping bags. We make footwear from vans and timberland,
01:56and we make a ton of other accessory products sold all over the world.
02:02Sean, give us the big picture, if you would, of where VF distributes its apparel and footwear.
02:10Yeah, like I briefly mentioned already, we sell our products today in 170 countries
02:17throughout the world. Obviously, our home here in the U.S. is one of our larger markets,
02:22as is the European Union, but we have a number of emerging markets around the world that are
02:27very important to the growth of VF. We sell products in all of those countries and source
02:33those products from around 45 countries around the world.
02:40Tell us, what are VF values? What is the company's purpose?
02:45Yeah, thanks, Jim. VF is and has always been a purpose-led organization. At VF, we say we're
02:54purpose-led and performance-driven, which means that we grow the company through the lens of
03:00activating our purpose. Across VF, our purpose is to power movements of sustainable and active
03:09lifestyles for the betterment of people and the planet. I'm super fortunate at VF to lead a team
03:17of hundreds of professionals around the world that activate each day on our purpose, creating
03:25better livelihoods for people and reducing our overall global impact on the planet.
03:33Sean, let's take a little deeper dive now. I'd like to have you tell us a little bit more
03:39about the global distribution of VF's 13 apparel and footwear brands.
03:45Sure. Well, initially, I mentioned we sell those products in 170 countries.
03:51Of our 13 consumer-facing brands, four of which are what we consider our large brands.
03:57That would include Timberland, Vans, The North Face, and Dickies. We also have a portfolio
04:05of emerging brands. Those emerging brands include smaller brands, such as Smartwool
04:11or Icebreaker. In Europe, we have brands like Nappa Pieri and Eastback. Many people on this
04:18call today have probably bought a Jansport backpack sometime in their life. We own Jansport.
04:25We have a broad portfolio of consumer-facing brands that operate in different regions around
04:32the world and in different product categories. One of the interesting things, we talked about
04:38VF as the enterprise being purpose-led and performance-driven. Each one of our brands
04:44has their own purpose that ladders up into the umbrella purpose of VF Corporation.
04:50That purpose is focused on the consumers of those products in that brand. It's aligned to engage
04:59from the heart and soul and the minds and performance of each of those consumers of
05:05the branded products. We sell those products, 170 countries around the world, to delight
05:13and exceed the expectations of our consumers. We also activate our purpose throughout our
05:20global supply chain, which operates in 45 countries around the world, where we bring
05:27our expertise and our support to each one of the factories that manufactures our products
05:33for the betterment of people in that factory, the communities around that factory,
05:38and for the environment in which that factory operates. We call this responsibility and
05:45sustainability across VF, crossing our portfolio of brands, and crossing our global supply chain.
05:53Sean, I understand that VF uses its emerging brands to learn and test certain principles
06:00and techniques. Tell us about that, if you would. Of course. It's one of the benefits of having a
06:06broad portfolio of brands that are different sizes and in different categories. For example,
06:13when we have a new initiative we want to try out at a brand, often we will test and learn that
06:20initiative at one of our smaller emerging brands, because we can fail fast if that new idea isn't
06:27going to work. We can adjust quickly, on the fly, agilely, with those emerging brands. When we find
06:36the right solution that works, scale that solution quickly to other brands in our portfolio that are
06:43larger to create scale and to create the change we're hoping to see. Sean, let me turn now to your
06:50personal responsibilities and ask you how you elevate the importance of VF's global sustainability
06:57and responsibility principles to achieve the goals of your business. As I mentioned earlier, Jim,
07:05I'm fortunate to lead a team of hundreds of professionals around the world that activate
07:10against our purpose. When we think about the purpose at VF, it's for the betterment of people
07:19and the planet. Let me tell you a little bit about people first. At VF, we have 50,000 employees
07:26at the organization. How we activate our workplaces, our culture, our benefits for the
07:35betterment of those people, obviously in scope. When we think about our global supply chain, we
07:41estimate there are a million factory workers in our tier one supply chain and probably five million
07:48altogether in our extended supply chain, all the way back to the farm where maybe cotton is grown.
07:55We have an opportunity and a responsibility to create better livelihoods for all of those workers
08:01in the communities we touch through the manufacturing of our products and raw materials.
08:06In addition, our products touch tens of millions of consumers around the world every year.
08:13By producing high quality, safe, performance driven products, we're able to improve the
08:20livelihoods of our consumers as they purchase and use our products. People is a core component
08:27of our sustainability and responsibility strategy. I also talked about the planet. As I mentioned,
08:34planet is core to our purpose as a company for the betterment of the planet. We estimate today
08:41our carbon impact on the planet is 6.8 million metric tons of carbon equivalents every year.
08:49The majority of that impact happens in our global supply chain and our product manufacturing,
08:55including 42% of our impact at the extraction and processing of raw materials for our products.
09:02That includes the processing and growing of cotton, wool from sheep, down from geese,
09:11polyester, etc. We have a significant impact on the planet and we have a strong and aggressive
09:19strategy to continuously reduce our impact on the planet. This is what we call our responsibility and
09:28sustainability strategy across the company. A couple things I would like to share with
09:34the audience today is how those strategies and those choices and activities come to life.
09:41When you think about the products we put on the market through all of our consumer-facing brands,
09:46it is through the design, manufacturing, and marketing of those products that our purpose
09:53truly comes to life. Depending on how we design our products impacts the impact we have on the
10:01planet. The factories we choose to manufacture our products can have a direct impact on the people
10:08and how that factory operates in the community. Products and the design and development,
10:15manufacturing, and sales of our products brings one of our pillars to life on our sustainability
10:22and responsibility strategy, and that is for the betterment of people on the planet.
10:26I might also share with you from a product perspective, we have a strong focus on what
10:32we call product stewardship, and that is having the ability to stand behind each and every one of
10:40the 300 plus million products we place on the market each year of how that product is made,
10:47where that product is made, what it's made with, and the impact that product has
10:51as it travels across the world to the end consumer. In addition, we have a strong focus on
10:59stakeholder engagement and advocacy. We believe that by engaging external to the company with our
11:07stakeholders, whether these are non-governmental organizations that care about the planet,
11:13or care about workers, or these could be our customers, governments, etc.,
11:21these stakeholders play an important role for activating a framework and enhancing the
11:28frameworks we need to achieve our sustainability and responsibility goals.
11:35Thanks, John. Tell us a little bit more about your definition of global sustainability and
11:42responsibility, and explain a bit, if you would, a little bit more about the three pillars of VF strategy.
11:50Indeed, Jim, to activate against our strategy for sustainability and responsibility across our broad
11:56portfolio of brands and at the enterprise, we've highlighted a strategy called Made for Change.
12:03You can find that on our website at vfc.com. Made for Change articulates our strategy in three
12:11pillars of work, and let me walk you through each one of those. The first we call circular business
12:18models. So we recognize that we are manufacturing and producing and selling to consumers and
12:26placing on the market in circulation 300 plus million products every year. Well, those products
12:33end up somewhere, and so we have a strong focus on making that apparel supply chain circular.
12:40So moving from a linear model, which is take, make, and sell, to a make, sell, take back, make again,
12:51and sell again. So a re-commerce model of circularity. The second pillar we call scale for good,
12:58and scale for good is around how we use VF scale as one of the largest apparel, footwear, and
13:04accessory companies in the world to create change across the world that we want to see for the
13:11betterment of people and the planet. Under our pillar of scale for good, we have strong goals,
13:19aggressive targets, and robust action plans around use of renewable energy,
13:26zero waste from our company, use of sustainable raw materials, impacts on people, etc. So there's a
13:36strong focus on how we use our scale operating in 170 countries, sourcing products from 45 countries,
13:44using our scale for good. And lastly, the third pillar of our made for change strategy,
13:51we call movement makers. And this is how VF can use our scale to bring others with us,
13:58to knock down barriers, to test and learn as we talked about earlier, to create pathways for
14:04others, whether they're competitors or others across different industries, to leverage what
14:11we may be able to build and do more because of our ability to create movements versus what we
14:18could do alone. John, what challenges are facing the apparel industry? And what is VF doing to
14:25meet those challenges? Well, Jim, the challenges in the apparel industry have been around for
14:33hundreds of years. One of the interesting things that we'll think about as we talk about clothing
14:39is that 7 billion people or more on the planet wear clothes every single day. And so our industry
14:47literally touches every single person on the planet. And we've been doing so for many years.
14:54But there's been a number of challenges in the industry that we've worked diligently across the
15:01industry and within VF to overcome. Let me talk to you about a few of those. First,
15:08we all should recognize that climate change is one of the most severe and important, impactful
15:16issues our planet, what should I say, our entire planet is dealing with today. Climate change is
15:28the issue of this decade. And we have a decade of action to ensure that the planet does not warm
15:36beyond 1.5 degrees Celsius. We have strong goals around science-based targets today.
15:42And we recognize that if we don't solve climate change, this is an issue for humanity at large.
15:51Yes. And we also recognize that climate change disproportionately impacts those people at the
15:57lower end of the socioeconomic ladder across the planet. When we think about people,
16:05whether those are people in our supply chain affected directly by climate change, we also
16:11look to human rights across the global supply chain, what we would also call worker rights.
16:19Across VF, we have a strong focus on worker rights, ensuring that every worker is treated fairly
16:27and treated with respect within the four walls of the factory in which they produce our garments.
16:34Another opportunity I would tell you that comes from recognizing a challenge is that many of
16:39apparel and footwear products today, whether at VF or at other companies, they originate
16:47in developing countries where maybe the rule of law or the community infrastructure does not
16:53support robust livelihoods. And VF has recognized that we have a direct opportunity to improve
17:02working conditions in the community and improve conditions in the community at large, which
17:07results in better performance at the factory, lower quality defects, et cetera. So we have a
17:15strong opportunity as an industry to do more for the communities in which our products are
17:21manufactured. Jim, I'm happy to answer any additional questions you may have around the
17:26challenges in our industry. Let me talk to you just quickly about the VF's role in leading the
17:34standards that it complies with. Give us just a little bit of your philosophy on how VF meets
17:41and even leads the standards that it is supposed to comply with around the globe.
17:49You know, we operate in a complex spider web of rules and regulations and legislation
17:57all over the world. At times, those laws and those regulations align, and at times they actually
18:05conflict. So as a global enterprise operating in multiple countries, our focus is to understand
18:14all the applicable laws for VF's operations within those countries and to look to
18:23shared common denominators of laws where we can set in place one practice or one policy
18:30to enable us to operate consistently across the globe. Now, there are some outliers, of course,
18:36in different countries where we operate specifically within that country. But let
18:41me back up a little bit to something we talked about earlier, which is the products we place on
18:46the market. At VF and across our global brands, our goal is to design, develop, and manufacture
18:55one product that can be sold anywhere in the world. And we have to recognize that in many
19:01countries, product standards, quality standards, safety standards even differ. And so at VF,
19:10we look to the law first and foremost. We look to the science to tell us how to develop and design
19:18a very high quality product that meets and exceeds all the safety requirements across
19:24the world. We set in place internal standards, and those internal standards are complied with,
19:31designed into, and tested against before we send our products around the world for sales.
19:37I might share with you one area of product standards that is kind of unique to us and an
19:44area I believe VF leads and shares some of that leadership with the industry at large.
19:50And that's what we would call our restricted substance list. And this is a list of chemical
19:55substances that are restricted or prohibited from use in the manufacturing of our products.
20:03Now, many of the viewers today may not think their clothes contain chemical substances,
20:09but you are wearing a blue shirt or a black North Face fleece for me, or maybe blue jeans today.
20:17Well, those dyes are chemical substances. And we have to recognize that in many countries around
20:23the world, specific dyes that were used historically may now be restricted from use
20:30because of new science. And so we have scientists on staff, we have chemists that
20:36look to these laws and look at the safety characteristics of water repellent chemistry,
20:43dye chemistry, et cetera, and ensure that our internal product standards meet and exceed not
20:51just the existing laws and existing safety standards today, but also those that we can
20:58certainly anticipate for the future. Sean, I know that in doing its work in
21:06170 countries around the world, VF encounters a number of production and supply chain variables.
21:13Would you please tell us how VF navigates those variables, if I can say navigates?
21:21Of course, Jim, no problem at all. And it's interesting when we think about our sales
21:27countries, that's probably not the most challenging of navigating variables around
21:32the world. I would answer your question with a conversation around our supply chain.
21:39Today, we source products from over 700 direct suppliers that have after that a spider web of
21:47what we will call tier two suppliers and then tier three suppliers, et cetera.
21:52We're constantly looking to source products from new innovative manufacturers around the world.
21:59But when we look for a supplier, there are three criteria we look at at VF before selecting
22:06a supplier to do business with. First and foremost, do they have the capabilities
22:12to produce the high quality products that we make at VF? Do they have the capabilities to
22:19produce a North Face jacket that's going to keep you warm at the top of the mountain
22:24or a Vans shoe that's going to keep you on your skateboard as you do tricks in the trick park?
22:31First and foremost, we look at supplier capability. Number two, when we look for new suppliers,
22:37we're seeking suppliers that share our core values. And that includes complying
22:44with our factory standards, treatment of workers, wages, working hours, environmental protection
22:52around the factory, safety within the factory. That's the second criteria we look at when we
22:59evaluate a potential new manufacturer in our supply chain. And third, of course, we will look
23:05at total landed cost. So the cost of that product. But when we look at cost, and I'll talk a little
23:12bit more about this at VF, when we look at the cost of product, we don't only look at the cost
23:19of product to manufacture that product. We're constantly looking at what is the total landed
23:26cost of that product in the sales country. So when we think about that, we think about the
23:32manufacturing costs, including the cost of the raw materials. Then we look at the transportation
23:37and logistics cost. And then we also look at the tariffs and duties we pay to import that product
23:45into the sales country. And maybe I'll spend a minute talking about tariffs and duties,
23:51because that is a huge variable for the apparel and footwear industries. Just in the US alone,
23:59apparel and footwear imports into the US represented 11% of all imports into the US
24:08in the year 2019. However, of all the duties paid to the US government for imports into the US,
24:17the apparel and footwear industries represented well over 50% of all duties paid in the US.
24:26Apparel and footwear industries are one of the highest tariffed industries across the world.
24:32And therefore, we're constantly looking for ways to reduce the burden on the company for paying
24:38duties and tariffs to import products. We certainly support free trade, but we only support free trade
24:46if it's fair trade. And to VF, what that means is the inclusion of labor and environmental protections
24:55in free trade agreements. A great example is what happened just in the last few years in
24:59the renegotiation of NAFTA, where now what's called the USMCA, US, Mexico, Canada, America,
25:07free trade agreement, or agreement is now inclusive of very strong labor protections
25:15and environmental protections in all of the countries covered by that free trade agreement.
25:20Those are some of the infrastructure frameworks that we advocate for that not only reduce
25:27variability in how we run our business, but also reduces cost enabling us to do more for the
25:34consumer. Now, do you take an open costing approach towards these variables? That's a
25:43really good question, Jim. And yes, we do. And we're one of the few companies in our space that
25:48takes this approach. And what that means for us is, as we grew up as a company, now 122 years old,
25:56we grew up as a manufacturer. So we understand how to manufacture a product where we buy each
26:02and every raw material and produce a final product through labor and operations and industrial
26:09engineering. So as we go into new manufacturers around the world for new product designs,
26:16first and foremost, our teams will look at what should the cost of that product be, because we
26:23know what the raw materials cost, we know how much the fabric costs and the buttons cost and the
26:27zipper and the thread, etc. We know the logistics and transportation costs. We also know the amount
26:34of time it should take because we have the manufacturing expertise to produce that garment.
26:40And we can use that and go sit with the factory management to talk to them about how much should
26:46the product cost to manufacture, given their labor costs, and given their operational costs and their
26:52overhead and the profit because we want our manufacturing product partners to be profitable.
26:58And if for some reasons our numbers don't match, we're always looking to bring our engineers to
27:04the table to help that supplier become more efficient. I'll give you a story. I walked into a
27:10factory once and I watched the fabric come in on the north end of the factory. And then I watched
27:16the fabric get cut into the panels, as we would call it, or you might say the pieces of the product.
27:22And then those pieces were carried by hand to the south side of the factory, where they were sewn
27:27into the first part of that product. And then those additional pieces were then carried to the
27:33other side of the factory again, where the zippers and the buttons were attached, and then carried to
27:38the other side of the factory, where they were packed, the quality was checked, the labels were
27:45attached, they were packed into boxes. And our industrial engineers looked at that flow in the
27:50factory and said, we have a great opportunity to help you become more efficient. And that was to
27:56arrange the factory flow in a way that the products flowed from one end of the factory where they came
28:02in, all the way through the factory methodically, incrementally becoming a garment until the end of
28:10the factory on the other side, where they were packed and shipped. Just those small changes can
28:15have a massive effect on factory operations. John, as I'm sure you know, several European high courts
28:25and the United States Securities and Exchange Commission are holding governments and business
28:31organizations accountable if they fail to live up to their global environmental commitments.
28:36How is VF handling this development? Actually, while we're watching this development
28:44happening across the world, it is truly not very impactful to the way we operate.
28:51One of the core values at VF, even starting back 100 years ago, is the value of integrity,
28:59which is that we don't say we're going to do something unless we already know how we're going
29:05to achieve that. We have a saying in VF is that we do what we say, and we say only what we do.
29:14And we always, always substantiate any public statements or any claims we make on product.
29:24So let me tell you a little bit about that. We might say this product contains 100% organic
29:31cotton. But if it's a product made under the VF umbrella for one of the VF brands,
29:37I can assure you that in our databases at VF, there are certificates of organic cotton
29:45certification all the way through that supply chain from the farm to the product. In case
29:51anybody wants to see how we can claim that product contains organic cotton. Just one example,
29:59I could give you many examples of that. However, what I would also tell you from a macro perspective
30:05at the enterprise level, we have made a number of commitments publicly. We've committed to
30:12aggressive science-based climate targets for 2030. We've committed to renewable energy goals by 2025.
30:22We've committed to zero waste distribution center operations by 2021. This year now,
30:29we publicly report not only our results every year, but also our activities to achieve those
30:38results. And we are the first to say when we've tried something and failed, but that just helps
30:43us get ourselves back up and try harder next time to achieve our goals. We're very transparent as a
30:51company and we're very transparent in doing what we say we will do. Sean, notions of sustainability
31:00and responsibility are constantly evolving. Sometimes VF is pushing science, sometimes
31:06science is pushing you. What lessons has VF learned along the way? Yeah, it's interesting, Jim,
31:13because there's a joke is that, aren't we just making shirts and shoes? Actually, when you think
31:21about how our business operates, it's complex. And a lot of the decisions we make and the ways we
31:30produce our products are based on science. We are constantly monitoring external forces on the
31:38company, whether those are here in the US or globally. Many of those external forces that
31:45cause us to pause and rethink some of our goals and strategies are science-based. We're members
31:53of many science-based associations where we work collaboratively with others in our industry and
32:01outside of our industry to understand how new scientific developments may affect our industry
32:08and the way we make our choices. One area I talked about briefly, and maybe I'll expand a little bit
32:15on that, is our restricted substance list. So as I mentioned before, I have the fortune to have a
32:23number of scientists on my team across the world, including PhD chemists that help us understand
32:31the science of chemistry and the science of green chemistry and how we move not only from doing less
32:39bad to more good across the world. The restricted substance list or the RSL across VF and our brands
32:47takes a perspective of science. First and foremost, it's based on the rule of law,
32:54but after that we add to this global policy at VF using science, using toxicology, using
33:02dermatology, using chemistry to understand how chemistry is added to our products, whether those
33:09are dyes or performance enhancing chemistries or different types of new innovative chemistries,
33:17how they could affect people and the planet. Maybe I'll give you another more emotional perspective
33:26on how we operate our business. Let me take packaging for example. Remember I talked about
33:31one of the opportunities I have at the company is to lead our environmental sustainability initiatives.
33:38Well, when we measure our impact as a global organization across the planet,
33:44packaging of our products, the cardboard boxes when you buy a product from VF that is shipped
33:50to your home, have minimal impact on the planet from the way we operate our business. Less than
33:581% of our global impact is from our packaging, whether that's plastic bags or cardboard boxes
34:06or stuffing. However, the way we show up as a brand and as a global enterprise to our consumers
34:14is when that product shows up at your door or when you buy that product in a retail store and it's
34:20packed at the cash register and we recognize that there is a perception, an emotional perception
34:29many times that the way our packaging shows up is reflective of how committed we are to
34:37environmental sustainability. So while changing out packaging into recycled packaging or minimizing
34:43packaging truly is not impactful to the environment from a VF global perspective, it is very visible
34:51and emotional for many consumers and that's a key focus area of our strategy is turning our
34:58packaging into sustainable packaging. One more example I'll give you and this is something
35:06that has been talked about often in the apparel industry is how workers are treated across the
35:14world. I'll give you an example of when one colleague of mine walked into a factory in a
35:22country in South Asia and the factory was operating humming along a thousand workers in
35:30the factory and my colleague observed on the floor that one of the operators was being yelled at and
35:38berated by a line supervisor and as that continued the line worker was physically slapped in the face.
35:50Well obviously that is not acceptable to us and our my colleague stepped in right away. We had a
35:57long conversation with that factory owner but the challenge we were facing in that situation was that
36:05as we think about our purpose for the betterment of people that clearly was not for the betterment
36:09of that individual worker but the culture in that country and if you look at the statistics for that
36:16country in South Asia domestic abuse is rampant and this is how the supervisor was raised watching
36:27this abuse and thought it was normal as was his manager and her manager and there was nothing
36:33wrong in that culture of physically abusing a worker if they didn't perform the way you expected.
36:40So VF we still stood back we had a very deep conversation with the management team of that
36:46factory we brought in training resources to train all the line supervisors that that type of
36:53punishment was not acceptable in any supplier or any business that does business with VF. So those
37:02are values-based decisions we do not compromise our values but we also integrate as I mentioned
37:08early on science into our strategic choices and activities across the country.
37:17John what innovations has VF developed in meeting its sustainability and responsibility challenges?
37:24You know it's interesting Jim as I mentioned briefly we thought we were just making shirts
37:28and shoes but we're constantly innovating and we're innovating processes and we're
37:34innovating products. Maybe I'll share a few with you. We talked at length about the restricted
37:41substance list a list of chemicals that are prohibited or restricted from use in manufacturing
37:46of our product but one of the things we recognized is that policy across VF and our brands was a
37:53policy based on what was left on the product itself. We recognized that there was an opportunity
38:00to go in earlier in the process and ensure that the chemicals that were selected for use on our
38:08products were actually compliant with the RSL that was verified when we tested the final garment.
38:17And so we innovated through partnerships with universities and non-governmental organizations
38:24and chemistry laboratories. We innovated a program called Chem IQ at VF and this is a program where
38:31we take a very small amount five milliliters of any chemical used anywhere in our process
38:38a liquid or a powder from a dye to a softener to a soap and we can cheaply cost-effectively scan
38:47that in an innovative scientific process VF developed to screen for over 600 unique substances
38:56that are restricted by law and by toxicology all over the world. So we can quickly understand
39:04if a new chemistry meets or does not meet VF's strict chemistry standards. In addition
39:13in the recent past we've innovated a new app for worker smartphones across the world where VF can
39:22communicate directly to workers on their smartphones and workers have the opportunity to directly
39:28communicate to VF staff if they didn't receive a pay on time if they were abused or not treated
39:34fairly in a factory somewhere anywhere in the world and they can quickly and even anonymously
39:41communicate to VF of an issue in that factory and our teams can step in right away
39:47to correct that problem and find a sustainable solution. The other process innovation I might
39:54share with you before I talk about a few of our product innovations is one around efficiency.
40:01As I mentioned VF started as a manufacturer for most of our 120 years we've been a manufacturer
40:09of products. We have that blood the manufacturing blood. We are constantly bringing our engineering
40:17talent across the world into key partners to help them operate their factories more efficiently
40:24by doing so that reduces the unneeded cost in those factories and actually puts more money
40:29in the pockets of workers manufacturing our products. Talking about products let me give
40:36you three examples of product innovations that are aligned with our purpose as a company
40:44for the betterment of people on the planet. I mentioned briefly one of our emerging brands
40:49in Europe is called Napa beer Napa Piri. It's a Scandinavian brand designing and producing and
40:56selling outdoor apparel products. Well Napa Piri took to heart this concept of circular apparel
41:05and built an entire series of products called the circular series. Products that we take back
41:11at the end of their first life to repurpose those products into a second life. They produced an
41:19amazing jacket called the infinity jacket which was that pinnacle product made fully from the
41:26buttons and the zippers to the fabrics and the lining and the stuffing out of a single material
41:33and that material can be mechanically recycled back into the same material again to produce the
41:39same garment again mechanically. It's an amazing product and they innovated that under the auspices
41:46I would tell you of the VF purpose for the betterment of people on the planet. For the
41:52North Face I'm wearing a North Face fleece today one of our key large brands at the company.
41:59Well many people might I say all people watching this program today have seen somebody or even have
42:07in your closet a puffy winter North Face jacket. Well what fills that jacket that's down. Down comes
42:16from geese. Geese I'm sorry down it originates from geese and the clusters and feathers of geese.
42:23Well we had some external pressure a number of years ago around the amount of down we were using
42:29in our North Face products. We innovated because of that external pressure to create a new standard
42:37called the responsible down standard that traced all the way back to the origin of the down on the
42:44goose farm to ensure the geese were treated fairly humanely under our animal rights program.
42:52In addition at the same time once we developed that standard we gifted that standard to the
42:59industry. But we also innovated a new product to replace down. It was called Thermoball. It was
43:07lighter and warmer than down and only because of that external pressure on the organization and
43:14on the brand did we start up an innovative procedure and process in the company to look
43:20for an alternative that ended up being lighter and warmer than the original material it replaced.
43:27Good. Sean let me turn now to strategies that the company may have developed to talk with its
43:34consumers. Can you tell us just a little bit about that in the time we have left?
43:40Sure Jim. Yeah you know one of the interesting things is that VF alone does not communicate
43:45with consumers. We communicate to consumers through our brands. Our consumer facing brands.
43:51But VF enables that brand conversation through a robust back-end platform. We listen and we
43:59respond to consumers where they're willing to talk with us. We monitor purchasing behaviors and
44:05we know especially now as we are emerging from COVID that consumer purchasing behaviors are
44:12skewing more and increasingly toward responsible businesses. And that's where our brands are
44:19leaning in to communicate to consumers today. One of the really interesting areas where VF enables
44:26brands to speak with consumers is through our traceability and transparency initiatives.
44:32Today we map multiple supply chains of products transparently on our website where consumers can
44:40go in and they can look at every single node in that supply chain. What was produced, where it
44:46was shipped to, and the impacts of that factory itself. And lastly what I would tell you is that
44:53VF as an enterprise we're constantly talking to our stakeholders. Maybe not the consumers
45:00of the branded products but our global stakeholders. And that presents us an opportunity to learn
45:08which enables us to build better strategies and activities for the company.
45:13Thanks Sean. Sean let me ask you about the Sustainable Apparel Coalition. I know that
45:19you're the chairman of the board of that coalition. Would you tell us a little bit
45:23about the coalition and why VF participates at such a high level?
45:29The Sustainable Apparel Coalition which I as you say are fortunate to be the chairman of the board
45:35of has been around for a decade now. And that coalition represents a significant portion of
45:42the apparel industry today. And we work together to create aligned harmonized tools to measure
45:51sustainability in the apparel space. Whether that's how brands activate on their performance
45:58as a brand, communicating to consumers, operating their business, or how the products are designed
46:05and developed, the raw materials used, and even how the supply chain operates. So the Apparel
46:10Coalition is a group of leading companies today over 250 global members that are working in concert
46:19to harmonize measurement opportunities and importantly impact reduction opportunity
46:26together at scale to reduce our global impact on the environment and enhance social justice
46:32throughout the world. Thank you Sean. Sean I know that we've been talking throughout this program
46:40with how VF continually works to meet its global sustainability and responsibility challenges.
46:48How do you and how does VF stay on target each day? Yeah you know it's a great question and
46:57at times I acknowledge it can be daunting. But one of the great things here at VF is we're not
47:05only a product company. We are purpose-led, we are performance-driven, and we are people first.
47:13And when we say people first that's not only how people are treated and supported but how we
47:20minimize our impact on the environment. Because after all the reason we're concerned about the
47:26environment is because we all live on this little blue ball floating through the universe called
47:32earth. We believe in something beyond just us and we believe that we can do more at scale together
47:43in our industry than we can do alone. As I mentioned before our business at VF touches millions of people
47:54and every place on the planet. Our industry at large touches almost every single person
48:03on the planet. So when I get up every single day I know that because of the work I'm doing
48:11and I'm fortunate enough to do with my colleagues here at VF we are able to give people a better
48:18life through our products to give people a better life because of how we run our business and our
48:26supply chain and do our part to not only reduce our impact on the environment but in the future
48:34give back to the planet. Thank you Sean Cady and thank you VF Corporation for educating us
48:42on VF's industry leading vision for global sustainability and responsibility. Thanks Sean.
48:49Thanks Jim and thanks to the EarthX team.