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Social Compliance

Contractors & Suppliers

GRI Content Index

When the decision is made to outsource production to any new contractor, we carry out a comprehensive assessment in order to determine the contractor’s ability to comply with our cost structure and quality standards. We also evaluate their ability to comply with our stringent labour and environmental standards. The selection process includes a thorough analysis of the contractor’s social responsibility practices. This is done by having all potential contractors complete a self-assessment questionnaire weighing in on critical issues as outlined by Gildan. Gildan then performs a preliminary onsite audit prior to engaging with any contractor.

  • SUPPLY CHAIN TRANSPARENCY

    We manufacture the majority of our products in our vertically-integrated manufacturing facilities (please refer to the map of our operations for details). Outsourced production represents less than 20% of our total production in terms of volume. By the end of 2016, we were outsourcing production to 97 third party manufacturing contractors globally.

    Manufacturing Contractors by Region (End of 2016)

  • PURCHASING PRACTICES

    A contractual clause is included in all of our commercial agreements to ensure that Gildan’s contractors and suppliers receive, understand and acknowledge our Code of Conduct. As a standard practice, this clause stipulates that compliance with our Code of Conduct is a condition of doing business with Gildan. It is included in the following agreements:

    • Manufacturing contractors’ agreements (including sewing or any other third party manufacturing agreements);
    • Raw material suppliers’ agreements; 
    • Agreements with third party service providers at our manufacturing locations (including security, cafeteria, transportation and maintenance staffing); and
    • Agreements for major equipment purchases.

  • DUE DILIGENCE AND SOCIAL COMPLIANCE PROCESS FOR SOURCING FACILITIES

    When the decision is made to outsource production to a new contractor, we evaluate their ability to comply with our cost structure and quality standards. We also evaluate their ability to comply with the stringent labour and environmental standards under our Code of Conduct. We conduct a thorough analysis of the contractor’s social responsibility practices, supported by a preliminary onsite audit prior to engaging with any contractor.

    New and Potential Third Party Contractors

    Gildan’s sourcing policy states that all potential third party contractors intended for use in the production of Gildan’s family of brands or licensee products must be audited to verify their social compliance practices prior to any business being awarded. These audits are conducted by experienced auditors who are thoroughly trained on Gildan’s monitoring guidelines and social compliance programs. In some instances, Gildan will mandate a third party audit service provider to conduct these audits on its behalf. 

    Internal teams assess the audit results and assign a rating classification based on the severity of the findings and level of compliance with our Code of Conduct when compared to the benchmarks outlined in our Sustainable Social and Environmental Compliance Guidebook. If a potential third party contractor fails an initial audit at their facility, Gildan may accept to reaudit the facility after a three-month period. Should the contractor fail a second audit, orders cannot be placed and the facility will no longer be considered for future business. 

    Current Third Party Contractors

    Third party contractors involved in ongoing production of Gildan orders are regularly assessed for compliance with our Code of Conduct. If a current contractor achieves a low rating following an audit, our internal social compliance team will partner with the facility’s management to remediate any major issues found during the audit with the establishment of an action plan. In addition, systematic follow-ups are conducted to verify progress made towards resolving any pending issues. Our objective is to help the facility improve their overall performance and remains in compliance with our Code of Conduct.

    If a facility fails to demonstrate sufficient progress within a prescribed timeframe, contractually, Gildan reserves the right to end the business relationship with the contractor. In 2016, Gildan chose to cease production at several manufacturing contractor facilities due to unsatisfactory compliance with our standards.

  • Contractor training

    China

    In September 2016, our regional compliance team provided CSR Orientation training to all Peds® brand suppliers in China. The aim was to introduce these new business partners to Gildan’s CSR program as an integration exercise following Gildan’s acquisition of Peds® brand earlier that year.  A total of 47 participants attended the 1-day session.

    During October 2016, our Director of Legal Affairs and Corporate Compliance travelled provided anti- corruption training to Peds® brand suppliers in China as part of the integration following our acquisition. Fourteen suppliers attended the 1-day session.

    Haiti

    We provide ongoing training for workers employed by our long-standing sewing contractors situated in Haiti. In 2016, Code of Conduct refresher training was provided to one of our contractors and close to 1,500 employees participated. Additional training will be provided to the remaining Haitian contractors in 2016. Gildan also provided fire safety training to over 450 employees at these facilities in 2015.

    Moreover, managers at these facilities have benefitted from various labour training programs through Better Work Haiti since 2011. These trainings include the following topics:

    • Human Resources planning;
    • Environmental Health and Safety (EHS);
    • Mastering recruitment efforts for key positions;
    • Securing employee loyalty;
    • Organizing successful training sessions; and
    • Establishing remuneration and motivation systems and policies.

    In 2014, training on Gildan’s Code of Conduct was provided to three major third-party contractors in Mexico. Training sessions were provided to a total of 11 mid-management employees across all facilities. No additional training was provided in 2015.

    Central America and the Caribbean Basin

    In 2015, a refresher course on Gildan’s Code of Conduct was provided to a total of 255 sub-contracted security personnel stationed across Gildan-owned operations in Central America and the Caribbean Basin. Designed specifically for third party security service personnel, the training course focuses on common situations that security personnel may encounter while performing their duties on behalf of Gildan.

    Finally, all third party manufacturing contractors in all regions will receive training on our principles as an integral part of the 2017 roll-out of our newly revised Code of Conduct principles.

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