PUMA’S FOREVER BETTER SUSTAINABILITY STRATEGY

PUMA’s Code of Conduct and our vendor compliance program, which were introduced more than 20 years ago, are still the basis for any contractual relationship with manufacturers globally, and remain as the foundation of our responsible sourcing strategy and program.

Our Forever Better sustainability strategy is based on our 10FOR25 targets, which were introduced in 2019, following an extensive materiality analysis and stakeholder dialog.

As a result, we have identified 10 target areas: Human Rights, Climate Action, Circularity, Products, Water and Air, Biodiversity, Plastic and the Oceans, Chemicals, Health & Safety as well as Fair Wages to improve our sustainability performance.

For each of these target areas, which reference the United Nations Sustainable Development Goals, we have defined a minimum of three concrete targets as well as key performance indicators to follow the progress we have made.

With our Forever Better sustainability strategy, we continue on our path to fully integrate sustainability into all our core business functions. Sustainability targets are part of the bonus arrangements of every member of our global leadership team, from the CEO to team heads.

Sustainability and the communication of our efforts have also been integrated into the strategic priorities for PUMA.

AWARDS AND RECOGNITIONS

Our long-term sustainability efforts continue to be externally recognized in various benchmarks and indices.

In 2021 PUMA remained a member of the FTSE4Good Sustainability Index (sector lead), received a Triple A rating from MSCI ESG ratings as well as an ESG Prime rating from ISS. PUMA was also awarded Climate Leader status by the Financial Times.

For the first time in our history, PUMA received Climate Leader status from the CDP (A- and A for Supplier Engagement) and was included in the Global Top 100 most sustainable company Index by Corporate Knights.

PUMA was also awarded an Industry Mover Status by S&P on sustainability and a Material Change Index Leader Status from Textile Exchange.

We will continue to collaborate with the most relevant industry benchmarks and aim to improve our ratings for these benchmarks further, particularly where our performance is not yet among the leaders of our industry.

STAKEHOLDER DIALOG

Our first PUMA stakeholder dialog dates back to 2003. Since then we have organized 15 in-person stakeholder meetings. Last year (2021), we conducted our first ever virtual stakeholder dialog meeting. 

More than 100 participants including suppliers, customers, investors, sports clubs, NGOs, industry peers, sustainability experts and representatives of the younger generation met for 1.5 days to discuss the key topics of Circularity and Climate Action. All members of the PUMA Management Board, as well as selected members of PUMA’s Supervisory Board, attended the meeting. The results from these intense talks and discussions will help us shape PUMA’s future strategy and action plan for Circularity and Climate Action. As a concrete first step from the stakeholder dialog meeting, we have decided to evaluate our future products for their readiness regarding circularity and to roll out a Circular Design guideline. The meeting informed the further focus of our PUMA Circular Lab and emphasized the need for increased consumer communication on the topic of Circularity.

On Climate Action we decided to calculate a product carbon footprint for each of PUMA’s top selling products. We confirmed our intention to upgrade our science-based CO₂ emissions target to a 1.5 degree pathway and we want to enhance our consumer communication on climate topics.

We also continued our regional responsible sourcing dialog meetings in the form of 3 regional supplier virtual meetings, which we held in all major sourcing regions, covering social, environmental and chemical topics.

Our PUMA CEO Bjørn Gulden attended the UN Climate Summit in Glasgow and discussed with industry peers the increased ambition level of the Fashion Industry Charter for Climate Action and how the Fashion Industry can align to a 1.5-degree climate pathway.

Our stakeholder dialog includes active participation in several sustainability initiatives. In 2021,we partnered with Canopy, a Canadian NGO which focuses on the protection of forests and biodiversity and we joined the International Safety Accord, an agreement with International Trade Union Federations following the Bangladesh Accord on Fire and Building Safety, which expired in 2021. We also became a member of econsense, a German partner of the World Business Council for Sustainable Development. This membership became effective in January 2022.

MOST MATERIAL ASPECTS

For the current 10FOR25 target period, we reviewed our most material aspects based on a detailed materiality analysis conducted in 2018/2019, including external and internal stakeholder interviews, a survey and a stakeholder dialog meeting. Coordinated by Business for Social Responsibility (BSR), the process resulted in the materiality matrix displayed in graph G.02 below. Although the Water and Air target was not specifically identified in the formal materiality analysis process, we retained this target area. Honoring our commitment to the Fashion Pact as well as the growing importance of the issue, we also included Biodiversity as a target area. Please refer to graphic G.02 for the results of our materiality matrix, and the transfer of these results into our 10FOR25 targets.

PUMA 10FOR25 SUSTAINABILITY TARGETS PERFORMANCE SUMMARY

DUE DILIGENCE AND RISK ASSESSMENT

PUMA conducts regular due diligence on Human Rights & Labor, Environmental and Integrity risks (listed in table) on its own activities and on its suppliers across its supply chain as per the recommendations of the UN Guiding Principles for Business and Human Rights as well as the OECD Due Diligence Guidance for Responsible Supply Chains in the Garment and Footwear Sector | en | OECD and other relevant responsible business conduct standards. We embed responsible business conduct through our own policies, training and management system. We identify actual and potential harms in our own operations and supply chain through our monitoring programs and risk assessment. We aim to cease, prevent or mitigate harm in own operations and supply chain, keep tracking and communicating with relevant stakeholders as well as cooperating in remediation when appropriate.

Due diligence is an ongoing process, in which we can identify, mitigate, prevent and account for how to address existing and potential adverse impacts (e.g., child labor, discrimination, hazardous chemicals etc.).

In response to the COVID-19 pandemic, the possibility of future crises and implementing our policies, our vendors are recommended to conduct their due diligence, virtually when necessary.

PUMA BRAND AND RETAILER MODULE VERIFIED SCORE

As part of our risk assessment and industry benchmarking, we use the Brand and Retailer Module of the Sustainable Apparel Coalition (HIGG BRM). The Higg Brand & Retail Module (Higg BRM) guides brands and retailers on their sustainability journeys and identifies hotspots and opportunities for improvement along their global value chain.

In 2021, for the first time, we engaged an external and accredited verification body to verify our HIGG BRM score based on our 2020 HIGG data. The results of our first verified BRM scores are displayed in graph G.05 and G.06 below. While our overall scores are clearly above the sector average, we have also identified some areas where more focus is needed, as logistics operations, for example.

PUMA has been an active member of the Sustainable Apparel Coalition (SAC) for the past decade and remains committed to partnering with intent and collaboration to drive collective action and positive change. Since joining the SAC, PUMA has rolled out our Higg Index tools, integrating them into their day-to-day business, demonstrating the kind of leadership needed to tackle the climate crisis and addressing social justice across our industry. Leveraging the Higg Facility Environmental Module (FEM), the company has scaled the use of the tool across all its strategic suppliers. PUMA has also participated in the Higg Brand and Retailer module (BRM) and in 2021 was among the first companies to get its score externally verified. It is also one of the brands to have piloted an environmental product label based on the Higg Material Sustainability Index (MSI). The SAC is proud of PUMA’s achievements and leadership within the industry and looks forward to continuing to support them on their journey, as we work towards an inclusive, equitable and sustainable future for people and the planet.