Icebug AB Responsible Business Conduct Policy 230228_DRAFT (final version
will be published latest 230415)
Icebug’s vision is to be a changemaker for a society where people can thrive, on a planet in balance. As a consequence of this, the space that we have to conduct our business has an inner boundary of not exploiting people and an outer boundary of not exceeding planetary boundaries. This is the space where we have to create value, and that value should also benefit a wider range of stakeholders than just the shareholders. Our by-laws says that Icebug has a purpose that is not restricted to maximizing profit and our owner’s directives also clearly states that when there is a conflict between Icebug’s best interest short term and what is in the best interest for people and planet long term, society and nature are the prioritized stakeholders.
We use five purposes to interpret the vision into everyday work:
- Inspiring more sustainable lifestyles
- Empowering people to get out more
- Scaling climate action
- Disrupt the destructive industry
- Develop and spread good work, that works on developing people
The last three of our purposes has most relevance for this document.
This Responsible Business Conduct policy sums up what we at Icebug expect from all our staff and representatives, working in the core processes of our daily operations, as well as what we expect from our partners in the value chain, such as sourcing partners, suppliers, their sub-contractors, distributors. We also expect our logistic partners and retailers to follow the same principles of responsible business practices. Icebug is aware that there are cultural and legislative differences between countries.
This Responsible Business Conduct Policy contains the basic way that Icebug works in our whole value chain.
Responsible business conduct (RBC) encompasses: “Human rights, including workers and industrial relations, environment, bribery and corruption, disclosure, and consumer interests” (OECD, 2018).
The policy is based on international regulations set by the International Labour Organization (ILO)1, the UN Universal Declaration of Human Rights2, the OECD Due Diligence Guidance for responsible supply chains in the Garment and Footwear sector3 and it includes the Code of Labour Practice used by Fair Wear Foundation (FWF)4, where Icebug is a member.
Icebug complies with labour laws and regulations in the countries where we are active. We actively use our resources and knowledge to improve sustainability practices including labour conditions and environmental impact at our partner factories. We strive for continuous improvement of the sustainability impact in the Icebug value chain and to actively spread best practice to our peers. We establish long term business relations with our suppliers where cost is only one part of supplier
assessment. Quality aspects including environmental and social sustainability standard are equally important.
Transparency is a key part of Icebug’s sustainability work. We are open with where we source and produce our products and components. With our communication concept Follow the footprints Icebug display the key suppliers and the sustainability key indicators for each footwear style, making sustainability data publicly available. We expect our suppliers to provide us with relevant data regarding social conditions, environmental impact and energy use, and letting Icebug publish this publicly.
Sharing is caring We believe in mutual learning to raise the sustainability level including workers’ conditions, and that this will allow Icebug and our suppliers to grow together on a market with growing sustainability concern. We strive for openness between brands about labour conditions and other sustainability information, to raise the level in the footwear sector and to avoid unnecessary workload on the production facilities (by sharing we also optimize the work). Icebug actively seeks collaboration with other brands.
As a Fairwear member Icebug collaborates with other Fair Wear member brands and non Fair Wear member brands in risk identification, mitigation, remediation and prevention of labour risks.
Icebug will include the workers’ representatives when working on prevention of risks and remediation of adverse impacts. This means that voices of those who are affected by adverse human rights impact are structurally included.
Greenhouse gas emissions are measured by Icebug for all scopes, including a breakdown of each footwear style, and we have committed to reduce the climate emissions in line with the 1,5 degrees target, reducing 50 % latest by 2030 (approximately 0,7 kg per shoe pair and year in average) and then further continuous reduction to reach net zero well before 2050. Suppliers are expected to share energy data, available climate data and other sustainability data for their materials and processes.
Suppliers are asked to align their emission reduction targets with the 1,5 degrees roadmap and take action accordingly. Icebug actively participates in supporting suppliers in their emission reduction work.
Hazardous chemicals Icebug performs risk analysis on each new Collection to define risk chemicals, as defined by the Restricted Substance List (RSL) an extend version of the REACH regulation provided by RISE chemicals’ group Textiles, where Icebug is a member. The ruling RSL is sent to suppliers whenever updated and compliance is verified through a program where shoes are picked from the production line for testing against the EU REACH legislation and the extended RSL prior to shipping. The ongoing phase out of the use of PFAS in Icebug’s production will be completed by 2024. Water consumption Icebug has identified the most water consuming parts of the supply chain and how to best mitigate it as:
- Batch dying and wet processing (Icebug uses exclusively low impact dyeing techniques)
- Tanning (Icebug uses Ecco Dritan for all nubuck, and Gold standard LWG for all leather)
- Cultivation of fibers (Icebug avoids virgin cotton). We will continue to measure and reduce the water consumption. Waste reduction Icebug is reducing waste in several ways and will explore how we can do more in collaboration with our suppliers. First step is to map all the waste streams and evaluate how they could be treated in ways creating most value according to the waste hierarchy: 1) Prevented not to become waste in first place 2) Reduced 3) Reused 4) Recycled 5) Recovered (often burned with energy recovery). The last step in the waste hierarchy 6) Disposal shall be avoided totally. We encourage all suppliers to do environmental self-assessments to get an overview of their environmental performance, and share that with Icebug. We recommend to use the Higg FEM
(facility environmental module) tool as this is widely used and shared in the footwear and outdoor industry.
Corruption and bribery is strictly forbidden. Icebug has zero tolerance of all forms of bribery and corruption. Icebug and its employees are strictly prohibited from giving or receiving, directly or indirectly, bribes, kickbacks, other illicit payments, or improper benefits intended to achieve a business advantage or financial gain. Situations that involve a conflict, or the appearance of a conflict, between duty to employers and personal interest must be avoided. This applies to everyone working for Icebug worldwide, and we expect all our business partners, such as agents and consultants acting on behalf of the company, to respect and follow the anti-bribery and anticorruption policy.
Fairwears Code of Labour Practices (CoLP) The eight elements of Fairwears code of labour practices, as explained below, are expected to be followed by all suppliers.
Employment is freely chosen There shall be no use of forced, including bonded or prison, labour. (ILO Conventions 29 and 105).
Freedom of association and the right to collective bargaining The right of all workers to form and join trade unions and bargain collectively shall be recognised (ILO Conventions 87 and 98). Icebug shall, in those situations in which the right to freedom of association and collective bargaining are restricted under law, facilitate parallel means of independent and free association and bargaining for all workers. Workers' representatives shall not be the subject of discrimination and shall have access to all workplaces necessary to carry out their representation functions (ILO Convention 135 and Recommendation 143).
There is no discrimination in employment Recruitment, wage policy, admittance to training programs, employee promotion policy, policies of employment termination, retirement, and any other aspect of the employment relationship shall be based on the principle of equal opportunities,
regardless of race, color, sex, sexual orientation, gender identification, age, religion, political affiliation, union membership, nationality, social origin, deficiencies or handicaps (ILO Conventions 100 and 111).
No exploitation of child labour There shall be no use of child labour. The age for admission to employment shall not be less than the age of completion of compulsory schooling and, in any case, not less than 15 years (ILO Convention 138). “There shall be no forms of slavery or practices similar to slavery, such as the sale and trafficking of children, debt bondage and serfdom and forced or compulsory labour. [...] Children [in the age of 15-18] shall not perform work which, by its nature or the circumstances in which it is carried out, is likely to harm their health, safety or morals." (ILO Convention 182)
Payment of a living wage Wages and benefits paid for a standard working week shall meet at least legal or industry minimum standards and always be sufficient to meet basic needs of workers and their families and to provide some discretionary income (ILO Conventions 26 and 131). Deductions from wages for disciplinary measures shall not be permitted nor shall any deductions from wages not provided for by national law be permitted. Deductions shall never constitute an amount that will lead the employee to receive less than the minimum wage. Employees shall be adequately and clearly informed about the specifications of their wages including wage rates and pay period.
Reasonable working hours Hours of work shall comply with applicable laws and industry standards. In any event, workers shall not on a regular basis be required to work in excess of 48 hours per week and shall be provided with at least one day off for every seven-day period. Overtime shall be voluntary, shall not exceed 12 hours per week, shall not be demanded on a regular basis and shall always be compensated at a premium rate (ILO Convention 1).
Safe and healthy working conditions A safe and hygienic working environment shall be provided, and best occupational health and safety practice shall be promoted, bearing in mind the prevailing knowledge of the industry and of any specific hazards. Appropriate attention shall be paid to occupational hazards specific to this branch of the industry and assure that a safe and hygienic work environment is provided for. Effective regulations shall be implemented to prevent accidents and minimize health risks as much as possible (following ILO Convention 155). Physical abuse, threats of physical abuse, unusual punishments or discipline, sexual and other harassment, and intimidation by the employer is strictly prohibited.
Legally-binding employment relationship
Obligations to employees under labour or social security laws and regulations arising from the regular employment relationship shall not be avoided through the use of labour-only contracting arrangements, or through apprenticeship schemes where there is no real intent to impart skills or provide regular employment. Younger workers shall be given the opportunity to participate in education and training programmes
Icebug commits to secure that we live up to this policy:
Step 1: Establish a Responsible Business Conduct (RBC) policy
The Responsible Business Conduct Policy is approved by Icebugs top management and concerns all of Icebug’s employees. For the suppliers it will mainly be the Development & Production team and the Vanbestco team that manage sourcing and follow up Fairwear audits. The Sustainability manager is responsible for developing and up-dating Fairwear policies and educate the rest of the organization.
Step 2: Conducting a scoping exercise, risk assessment and informing workers and suppliers
Icebug’s Human Rights Due Diligence risk assessment of the supply chain can be sent upon request. It describes the risks at country, sector, factory and product level and is updated yearly (or more often when new supplier conditions require an update) by the CSR and the sourcing departments. It is
reviewed by the management and form the basis for the next year Fairwear work plan and what we will focus on to prevent risks.
Gender inequality is a high risk in the textile and garment supply chains in the countries where Icebug has the main production. Therefore, Icebug includes a “gender lens” throughout the work.
From the initial period of Fairwear membership, based on country reports, audits and audit followup, the following risks are identified as prioritized on a general level:
• Freedom of association and collective bargaining,
• Reasonable working hours (overtime),
• Payment of a living wage
• Gender issues such as lack of lactation room, work conditions for pregnant women, inequal payment for parents
• Site specific safety issues as chemicals, safety passage, storage, PPE
Step 3: Stopping harm, prioritising and implementing programmes
Based on the outcomes of the risk assessment (step 2 of the HRDD process) Icebug determines a risk profile and prioritise follow up actions. This is done in the Fairwear work plan on a general level. On a facility level, depending on the factory’s risk profile, Icebug formulates a plan to implement the corresponding improvement or prevention programmes, including a timeline and capacity estimation. Gender, social dialogue and freedom of association should be included in the follow-up actions.
Step 4: Tracking and validating on progress made in the Implementation and Prevention Programmes
The eight elements of Fairwears code of labour practices, with special focus on the identified risks and on gender issues, are monitored by:
• Fairwear audits of Tier one factories (producing Icebugs labelled goods) – minimum every third year.
• Yearly risk assessment of Icebug suppliers, based on Fairwear audits, external audits and regular factory visits and sourcing dialogue.
• Special follow up on pilot projects and Fairwear trainings on various topics.
• The Fairwear social report summarizes the years’ actions and results.
Step 5: Publicly reporting on risks and progress
Icebug is reporting the sustainability performance in the supply chain in the yearly Impact report. The Fairwear system (Fairforce, Brand performance check, audits and Corrective action plans CAPs) provides a framework for tracking implementation and validate the progress made. Icebug is developing a set of social indicators that will be added to the impact report, where workers and suppliers will play an integral role in monitoring progress against goals.
Icebugs annual Impact Report is available on our website, displaying our targets and the yearly sustainability progress, https://icebug.com/impact-report . The Brand Performance Check made annually by Fair Wear Foundation is available at https://api.fairwear.org/wpcontent/uploads/2022/11/BPC-Icebug-AB-2022.pdf, where the result of our social sustainability performance is shown, including the areas which need improvements. Our yearly Social Report is displayed here https://icebug.com/sustainability/workersconditions.
Sourcing strategy and sourcing dialogue:
The sourcing strategy forms the framework for the outsourced supply chain of the Icebug brand. It is the basis for the development of all responsible purchasing practices that are crucial to reach a good level of the elements in Fairwears Code of Labour Practices (CoLP).
The basis for Icebugs sourcing strategy is long-term cooperation with suppliers where mutual trust is created through a practice of treating each other as equal partners. We then collaborate to raise the sustainability level of the supply chain. Further corner stones in the sourcing strategy are: Concentrating our supplier base so that Icebug can be a valued customer, avoid dependence of high risk areas, and the two which has most practical implications for our operations: planning production to avoid causing excessive overtime and paying prices that allows for paying a living wage.
A responsible production planning starts with a deep understanding of the supply chain partners capacity and respecting lead times. Based on Icebug’s forecast, the supply chain partners can provide a production plan with allocation of quantity in different periods, with a corresponding order placing plan that Icebug then follow
Icebug has deliberately set up the business model in a way that enables us to spread production over a longer period: No fashion or single season styles or colorways. A high degree of carry over styles that last for many years enable long-term planning and to avoid campaign prices thus keep the margins up. Safeguarding the value of the products is also a mechanism that enables us to pay correct purchase price – FOB prices paid by Icebug should always allow to pay living wages throughout the supply chain.
Icebugs sourcing partner in Taiwan, Vanbestco, is also a shareholder of 30% of Icebug. Vanbestco supports Icebug in the sourcing process and quality control. The team from Taiwan, therefore, visit the factories regularly to carry out quality controls and check production. In addition, an Icebugemployed sourcing expert and quality controller in China conducts regular on-site inspections at the factories. The production team in Sweden has frequent exchanges with them. Suppliers are regularly visited by the Director of Product before placing the order to understand the setup of the production locations and ensure there are no obvious human rights violations. Some of the details that are treated and evaluated on a season to season basis are:
• Quantities per country / supplier / style / season
• The factory capacity and how to plan production to avoid excessive over time
• Ratio sampling vs. bulk production
• Supplier matrix per product
• Supply chain mapping (partners per supply chain step)
• Internal analysis (key success factors, strategic success position, strengths and weaknesses, key performance indicators)
• External analysis (industry trends, industry benchmarks, opportunities and risks)
• Tracking and validation of social progress are included in the sourcing dialogue between member brands and suppliers.
Based upon these parameters Icebug take decision on whether to place orders, how to prevent and mitigate risks, and what remediation steps may be necessary.
Upon the start of a new business relationship (BEFORE first order is placed) Icebug needs to gain a basic level of insight into the human rights situation at a potential factory to inform sourcing decisions. As a Fairwear member Icebug commits to:
• Raise awareness of the workers and the management on human rights;
• Stress the importance of gender-representative social dialogue (with democratically elected worker representatives);
• Assess whether there is an effective operational-level grievance mechanism established through social dialogue with workers;
• Establish the Fair Wear helpline as a safety net.
• If the supplier is in a new country, update the HRDD risk assessment at country level.
1. The Icebug Responsible Business Conduct Policy is one part of the operationalisation of the vision for Icebug to become a changemaker for a society where people can thrive on a planet in balance. It’s a humble start and a minimum level, and as we learn more we intend to go beyond and develop the policy and the practical work to amplify Icebug’s positive impact.
Place and Date
David Ekelund, CEO and co-owner of Icebug