Coats Ethics factory people

Ethics: A company wide priority

High ethical standards

Underpinning all of our sustainability effort is a deep commitment to running our business in an ethical, responsible and transparent way. We expect our employees and our suppliers to behave ethically in all their dealings relating to our business.

Our employees are core to the business, and we value them highly. Their leadership, talent and commitment ensure we remain leaders in our sector, are competitive in the marketplace, and operate our businesses effectively and efficiently. In return, we offer a safe, respectful and inclusive environment in which our employees can thrive.

Similarly, as a supplier of yarns, threads, zips and related products to a range of manufacturing industries and retailers, we play a key role in the industry supply chain. As such, one of our responsibilities is the maintenance of high environmental and social standards within the supply chain.

We support the UN Guiding Principles on Business and Human Rights throughout our operations. Underpinned by our global policies, we uphold the requirements of the UN Declaration of Human Rights and the Convention on the Rights of the Child, the core ILO Conventions and the OECD Guidelines for Multinational Enterprises. Every two years we update our Human Rights Risk Assessment and this was done in 2019. We use a range of external data sources to identify country risk levels and then we weight the risk by our employee numbers by country. Our 2019 assessment shows a marginal (4%) reduction in the weighted risk compared to our 2017 assessment. This change is not enough to warrant any change in our strategy or actions. The risk assessment helps us to ensure that we can focus activities where the risks are highest. Also in 2019, to improve the transparency of our employment practices we have introduced an overarching People Principles policy which is available along with other policies.

Our Group Internal Audit team are a key resource for policing our internal compliance with employment and human rights standards. Included in their audit scope are 30 human resource audit areas and many of these focus on compliance with policies or directly with Human Rights issues. They normally complete 10-15 audits per year (10 in 2019), and areas of non-compliance, if found, are rigorously addressed.

During 2019 we initiated a detailed assessment of our global remuneration polices against ‘living wage’ methodologies. During 2020 this work will continue, building our approach to ensure our remuneration policies are globally consistent and align with ‘living wage’ concepts.

Our global Ethics Code, Business Code of Conduct, Supplier Code and our raft of policies covering the full range of ethics and compliance issues set out what we expect from our employees, our suppliers and our partners. We uphold the aims of the California Transparency in Supply Chains Act of 2010 and the UK Modern Slavery Act 2015 and publish a statement on this website on what we are doing to prevent modern slavery in our business and supply chains.

In early 2019 we launched an internal training programme on Modern Slavery. The purpose of this was to inform employees about the profile of modern slavery in industrial environments, to highlight the areas of risk in our operations and to help people identify the signals and to guide them on the action to take if they have any concerns. By the end of 2019 over 3800 employees have undertaken the training and it is now a mandatory training module for new starters in roles for which it is appropriate.

As the training cycle is biennial, in 2019 only new starters or those moving into new positions were required to undertake our compliance training modules (AntiBribery, Ethics and Competition Law), so slightly over 300 people completed the three training courses. In addition, all senior and customer facing employees (more than 3,700) were required to self-certify their continued compliance to our Ethics Code in 2019. New, updated compliance training packages will be released for completion by all relevant employees in 2020.

This year, through our global ‘Doing the right thing’ programme, we ran several Compliance, Controls and Culture Workshops. These workshops, led by members of the senior leadership team were used as an opportunity to share real life experiences. In 2019, more than 600 employees participated in the 10 sessions held at various Coats sites located in Brazil, Bangladesh, Mexico, Honduras and India. These workshops will continue in 2020.

Our Whistleblowing Policy is in line with the EU Whistleblowing Directive that comes into effect in December 2021. The Directive provides guidance and support for whistleblowers and includes service level obligations and guarantees on anonymity (where requested) and legal protections.

We continue to actively promote our Whistleblowing Hotline through numerous ways and the number of incidents reported in 2019 increased to 119 (99 in 2018). All reports are fully investigated and the number that have been upheld has reduced from 39% in 2018 to 30% (provisionally) in 2019. This means an absolute reduction in detected infringements. Group Internal Audit also look at a range of corruption issues during their audits and identified 3 minor policy infringements in audits during 2019, none of which were evidence of corruption.