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PEOPLECOUNT2016

Crystal GroupSustainability Report

PEOPLECOUNT

自分を変え会社を変えそして世界を変える




改变自己改变企业改变世界





THAY ĐỔI BẢN THÂN, THAY ĐỔI DOANH NGHIỆP CHÍNH LÀ THAY ĐỔI THẾ GIỚI




















改變自己改變企業改變世界



改變自己改變企業

改變自己

改變世界







改變自己改變自己

改變自己

改變自己

改變自己改變企業改變世界改變企業

改變世界

CHANGE OURSELVES, OUR COMPANY, AND THE WORLD















改变自己改变企业改变世界改变自己改变企业改变世界





改變自己

We inspire our people.We influence the world.






















改變企業

改變自己

改變世界

0506

0708

1424

4247

48

About This Report

Chairman’s Message

CEO’s Message

About Crystal Group

Green Operations

Human Capital Investment

Our Synergistic Partnerships

Our Recognitions

Appendix

CONTENTSCONTENTS

ABOUTTHIS

REPORT

www.crystalgroup.com

Environment

SUSTAINABILITY FRAMEWORKCommunity

Employee Care

Innovation

Product Integrity

ABOUTTHIS

REPORTThis sixth annual sustainability report is a tribute to our continuous commitment to transparency and accountability to our stakeholders. In this report, we explain in detail how we address the most significant economic, environmental and social impacts arising from our global operations from 1 January to 31 December, 2015.

In the report, we describe our sustainable management approach and our performance in sustainability in accordance with our sustainability framework set out in 2007. The report also includes highlights of the progress we have made over the year in three main areas: green operations, human capital investment and synergistic partnerships. This is the first year we are reporting in accordance with the core option of the Global Reporting Initiative (GRI) G4 Sustainability Reporting Guidelines.

We welcome your feedback on the report and we hope that you will enjoy reading it. ”

“

Catherine Chiu General Manager

Corporate Quality and Sustainability [email protected]

05ABOUT THIS REPORT

“areas of mainland China. So far, this programme has sent 1,400 people for the free eye cataract surgery and provided many more with vital medical support. Our staff have supported numerous disaster relief fundraising activities around the globe, helping many victims reshape their lives. We also support education by providing scholarships to students in mainland China and Hong Kong. Since 2010, a total of 1,424 students have benefitted from cumulative donations of USD 340,000. We also support the environment, with our global tree planting initiative seeing 1.7 million trees planted between 2007 and 2015. From home to the worldThe Qujiang Volunteer Association of Shaoguan, established with the support of Crystal Group in 2009 in the Qujiang District of Shaoguan City in Guangdong Province, is creating positive impacts on multiple levels as we help companies take part in philanthropic activities. Crucially, the Association has helped a mind-set of caring for the underprivileged and a culture of

mutual assistance take root in the Qujiang community. Since 2009, the Association’s many active registered volunteers contributed an impressive 90,000 person-hours of volunteer work.

Our philanthropic efforts at home have created a model for our community engagement work in other countries. Thanks to the commitment and dedication of every Crystallian, we will continue to inspire our people to spread positive influence and create benefits everywhere we operate.

Sustainable development is a core pillar of Crystal Group’s growth strategy. But we cannot achieve this growth by ourselves: truly sustainable businesses only thrive when the communities that surround them experience positive growth.

The countries and communities where Crystal Group operates provide us with the resources, infrastructure and markets which sustain us, and it is our duty and our obligation to give back to these societies. Over the years, we have created value for these areas in many ways: by adopting green production processes, providing quality clothing products, creating career opportunities and contributing to their economic development.

Giving back to societyAbove and beyond these operations-related benefits, Crystal Group has given back in many other ways. Since 1997, our direct philanthropic donations have totalled USD 6.3 million. In 2009, we started financially supporting the delivery of medical care to disadvantaged people in rural

SUSTAINABILITY AND CARING, ALL AROUND THE WORLD

06 CHAIRMAN’S MESSAGE

“advantage of rapid changes in technology. This powerful system now allows us to capture hitherto-impossible to imagine amounts of data, including information on finances, production status, costing, efficiency, quality and more. Analysis of this “big data” provides us with highly accurate information which helps us minimise design errors, and improves our efficiency and productivity in the most cost-effective way, contributing to greener, more sustainable manufacturing processes. Looking ahead, three future-oriented strategies will allow us to remain competitive no matter how troublesome the global economy may become: • continuous product innovation, • a robust globalisation strategy, and • the development of our future • leaders.

Focus: a sustainable futureIn terms of product innovation, today’s consumers demand the best value products. By investing in innovation, we will continue to improve the appearance and aesthetic value of our products along with their functionality and sustainability. We will be exploring and adopting new technologies to further improve production processes, techniques and materials in the years to come.

2015 was a challenging year for Crystal Group. The casual wear market went through a restructuring, and the general business climate was difficult. However, in spite of this challenging environment, the Group remained competitive, sustaining a small growth in turnover of about one per cent, for a total of USD 1.7 billion. We foresee that from 2016 onwards, we will regain double digit growth. Aside from our solid foundation and outstanding staff, two factors helped us maintain our competitiveness: our strong industrial engineering (IE) capabilities and our innovative information technology (IT) systems.

Creating efficiencies In terms of IE, our cutting-edge capabilities and our philosophy of embracing innovation allow us to create technical enhancements which drive productivity and capacity and increased our market share. This year was no exception.

We are also continuously working to evolve our IT system to take full

After decades of vigorous growth in China, our growth policy will now focus on globalisation – specifically the expansion of our overseas operations. Vietnam will remain our major growth focus, as we seek to maximise gains from the anticipated free trade agreement with EU countries and the Trans-Pacific Partnership (TPP) agreement. We are also planning on having more new operations in Bangladesh by 2020. Crystal Group is actively developing our next generation of leaders. We have invested significant resources in our people development strategies, cultivating a culture of empowerment in terms of business succession and sustainable development. At the same time, we are committed to the advancement of all our workers, both professionally and personally. We have begun expanding our female empowerment initiative and have set a target to provide life skills education to 40,000 workers by 2020. The Group will continue to enhance communication with our employees to keep them involved in our corporate values and culture as we continue on our path to sustainability, allowing them to grow and excel alongside us and keeping the Group vital and prosperous long into the future. The support and commitment of all our staff, our leaders and our stakeholders has made Crystal Group’s journey to sustainability a success so far. We look forward to continuing that journey in the years ahead.

SUSTAINABLE COMPETITIVENESS

07CEO’S MESSAGE

PRODUCT TYPES

ABOUTCRYSTAL GROUPCrystal Group (“the Group”) is a private group of companies founded in Hong Kong in 1970. With 20 factories in Asia, the Group has grown organically to become a leading original equipment manufacturer and original design garment manufacturer (OEM/ODM) and trader.

Guided by our core sustainability principles – a robust globalisation

strategy, the drive to make conscious products and our people-oriented management – we have built a global reputation as a top-tier garment manufacturer. Our mission is clear: to be the most productive enterprise in our industry in terms of sales and profits – an enterprise which produces quality products and services that our customers favourably regard as delivering value for money.

SWEATERSDENIMJEANS

INTIMATEWEART-SHIRTS

08 ABOUT CRYSTAL GROUP

MISSION

”“

MISSIONLet’s build the Crystal Group to

be the most productive enterprise in our industry in

terms of sales and profits, with quality products and services that our customers favourably

regard as value for money.

IntegrityLive Quality

Energise OthersRespect for People

Embrace InnovationDelight our Customers

Boundaryless EnterpriseDeliver Bottom Line Results

VALUESVALUES

09ABOUT CRYSTAL GROUP

300 MILLION PCS

USD 1.7 BILLION Garments produced:

Turnover:

Production BasesChina BangladeshVietnam CambodiaSri Lanka

Office operationsHong KongUnited KingdomChina

MARKETSUnited States

40%EU

26%

Japan

34%

OPERATIONS WORLDWIDE


GOVERNANCEAND

MANAGEMENT

backgrounds and professional qualifications, bringing profound business experience and expertise to the Group.

The Board has final authority when monitoring and reviewing the Group’s corporate governance policies and practices. They meet at least quarterly to formulate and monitor overall strategies, financial performance, the long-term direction of the Group and discuss other significant matters.

Internal ControlsThree Board committees have been set up to enhance the Board’s effectiveness – the Audit Committee, the Executive Committee and the Corporate Development Committee.

Audit Committee – In addition to the yearly financial audit and risk review conducted by a professional external accounting firm, the Group’s Internal Audit Department performs internal financial and operational audit and risk management analyses for allGroup companies and factories.

These internal reports are sent to the Audit Committee for review and follow-up.

Executive Committee – The Group has established an enterprise risk management (ERM) system which enables the early identification and mitigation of key business risks. The ERM framework captures business and operational key performance indicators which are then reviewed by the Executive Committee, enabling regular executive governance of the Group’s sustainable development performance.

Corporate Development Committee – Plays a “private equity” role and challenges strategic directions made in the areas of profitability, risk and return on equity for the Group. The Committee recommends strategic direction and reviews Group strategies regarding business expansion, capital expenditure, asset restructuring, and other related strategies. It also reviews the strategy execution organisational model and competency structure.

Strong governance is the foundation which allows the Group to achieve our corporate mission and maximise economic, environmental and social returns to our stakeholders over the long term. Strong governance also ensures that our business activities meet local laws and regulations, and that the Group acts in accordance with professional and ethical standards in order to achieve sustained, healthy and long-term growth.

Corporate Governance StructureAt the core of the Group’s governance structure is an effective, qualified Board of Directors which is committed to maintaining rigorous corporate governance, sound internal controls and structured risk management in order to earn theconfidence of our staff, customers and the community.

The Board is comprised of professionals from across societywith diverse academic

Board of Directors

Independent Non-executive DirectorCEO Executive Director Chairman Vice ChairmanMaleFemale

AuditCommittee

ExecutiveCommittee

Corporate Development

Committee

CorporateFunctions*

LineCompanies

EleganceIndustrial Co. Ltd.

CrystalApparel Ltd.

CrystalSweater Ltd.

Crystal Martin(Hong Kong) Ltd.

Crystal MartinInternational Ltd.

* Corporate Functions: Corporate Planning, Corporate Finance, Human Resources, Internal Audit, Company Secretary, Quality and Sustainability, Logistics, Information Services, Corporate Administration


ENGAGING OUR STAKEHOLDERS

YouTube Channel LinkedIn Page

Our stakeholder engagement mechanism supports the Group’s governance structure and ensures that sustainability is a prioritised, evolving process.

Stakeholders are the individuals, groups and organisations affected by the Group’s activities, products and services. Their perspectives provide us with advice and encouragement and challenge our thinking, giving us greater clarity

on the impacts of our business activities from both the small- and large-scale perspectives.

The Group’s various communication platforms allow us to regularly engage with our stakeholders, helping us build an understanding of priority issues and develop a shared vision of how the Group can continue our sustainability journey.

PUBLIC SHARINGSESSIONS ON

SUSTAINABILITY(CORPORATE LEVEL)

33

CRYSTALGROUP

Employees & their families

NGOs

Media

Institutions

Suppliers

Customers

Government

Community

COMMUNICATION CHANNELS

Membership of trade / industrial associations

Internet (intranet & external website)

Trade shows

In-person meetings

Site visits

Annual sustainability report

Tree planting events

Direct mails

Public displays & speeches

STAKEHOLDERS


FOCUSING ONWHAT MATTERSThe material issues identified in our materiality matrix are the issues of highest relevance to the Group and its external stakeholders. These are defined through a process of opportunity assessment and stakeholder engagement.

The Group priorities are rated based on the probability and potential impact of issues affecting our sustainable development.

External stakeholder priorities aredetermined by the importance of

issues to society and their relevance to the Group. These factors are then multiplied to determine the overall rating of a particular issue.

The materiality matrix helps the Group determine the next steps on our sustainability journey. The contents of this report have been determined by this matrix.

SUSTAINABILITY MATERIALITY ANALYSIS

Internal StakeholdersRELEVANCE

Exte

rnal

Sta

keho

lder

sBusiness Performance

Market Presence

Materials

Energy

Water

Emissions

Effluent & Waste

Compliance (Environment)

Chemical Management

Employment

Wage Policy

Industrial Relations

Occupational Health & Safety

Fire & Building Safety

Training & Education

Talent Attraction & Retention

Diversity & Equal Opportunity

Equal Remuneration for Women & Men

Female Empowerment

Supplier Labour Practices Assessments

Labour Practices Grievance Mechanisms

Non-discrimination

Freedom of Association & Collective Bargaining

Child & Forced Labour

Supplier Human Rights Assessments

Human Rights Grievance Mechanisms

Community Engagement

Consumer Health & Safety

RELE

VAN

CE


14 GREEN OPERATIONS

Some people may see the fashion world and the concept of sustainability as being on opposite sides of a great divide. However, we believe that there is no divide: excellent quality fashion can be created and produced in an environmentally-conscious way. In fact, we believe that eco-friendliness is an integral part of the fashion we create.

Crystal Group is committed to implementing robust environmental management and practices, and to making continuous improvements through self-control, innovation and by using the most appropriate technology. These commitments allow us to achieve cost effectiveness while preserving the environment for future generations.

Crystal Group has received several accolades for our environmental performance. Our Vietnam T-shirt factory won the National Environment Award; our China T-shirt and sweater factory clinched the highest-level Platinum Label under WWF-Hong Kong’s Low Carbon Manufacturing Programme (LCMP); and our T-shirt, denim jeans and intimates factories in China were commended as “Hong Kong-Guangdong Cleaner Production Excellent Partners (Manufacturing)” by the Hong Kong and Guangdong governments respectively.

29ENVIRONMENTAL

INITIATIVES

29ENVIRONMENTAL

INITIATIVES

GREENOPERATIONSGREENOPERATIONS

Honouring ourcommitments,

creating respect

15GREEN OPERATIONS

1.7 MILLION TREES PLANTED

Since 2007, Crystal Group and its global factories have been planting trees in communities where we have a presence, raising awareness of climate change and deforestation among our employees, and actively engaging them in reversing environmental damage. To date, as many as 1.7 million trees have been planted, with 300,000 more trees to be planted by 2017. When these 1.7 million trees eventually mature, they will help remove 39,100 tonnes of carbon dioxide from the Earth’s atmosphere every year.

16 GREEN OPERATIONS

Crystal Group’s core business comprises several garment manufacturing facilities operating at a high rate of productivity. Energy, water and waste management are clear operational priorities for us. Since 2007, we have set five-year global environmental targets to ensure we use resources efficiently and minimise adverse

environmental impacts. These targets create a blueprint for our environmental stewardship efforts and are a symbol of our ambition to take sustainable fashion to the next level. We are now on our second set of the targets, with eight measurable and time-bound goals to be achieved by 2017.

48%Increase the use of

recycled water to 50%

-7%Reduce carbon footprint

per garment by 6%

-4%Reduce paper consumption

by 10%

-11%Reduce energy consumption

per garment by 5%IN

PROGRESSSend ZERO

operational waste to landfill

710,553Plant 1M trees

Reduce fresh water consumptionper garment by 10%

-30%

Increase the use of renewable energy

to between 5 and 10%

39%

2ND GLOBAL 5-YEAR ENVIRONMENTAL TARGETS 2015 PERFORMANCE

GLOBAL VISION, LOCAL ACTION

17GREEN OPERATIONS

On-going focus on carbon and energyIn 2015, we continued to improve our carbon footprint and energy performance through environmental engineering projects like energy-efficient machine replacements, equipment upgrades, and increasing our use of renewable biomass fuel and wood waste for boilers. We also commissioned environmental experts to conduct an energy audit at some of our factories, aiding us as we search for further energy-saving opportunities. These efforts, and other, will continue throughout 2016.

Our energy consumption generated a total of 125,974 tonnes of CO2 equivalent, of which 50.3 per cent was from direct greenhouse gas emissions. Our Group carbon intensity was 0.54 kg of CO2 equivalent, 7% lower than our 2012 baseline.

We continued and introduced a variety of energy saving initiatives. Under the “business as usual” scenario, these avoided energy consumption of 14,400 GJ and carbon emissions of 12,000 tonnes of CO2 equivalent when compared to 2012 baseline figures. We also avoided adding USD 2.3 million to our operational costs for the year.

Our main focus in 2016 will be on developing a bespoke Corporate Environmental Management System Manual for our worldwide operations, covering energy use, greenhouse gas emissions, water use, waste management and chemical management.

Our China T-shirt and sweater factories were certified to

ISO 50001 Energy Management System standards, implementing technical and management strategies to significantly cut energy use and greenhouse gas emissions. The T-shirt factory replaced several drying machines with new energy-efficient dryers equipped with servo-motors and energy recovery capabilities and yielding an estimated annual savings of USD 450,000 in electricity costs, 972 GJ of energy and over 7,000 tonnes of steam.

ENERGY CONSUMPTION

(GJ)

2013 Total: 997,163

2014 Total: 1,062,099

2015 Total: 1,176,443 RenewableDirect Electricity

PRODUCT FOOTPRINT - CARBON(KG CO /PC)2

SWEATERSDENIMJEANST-SHIRTS INTIMATE

WEAR

2015

2014

20130.23

0.29

0.28

2.17

2.21

1.77

0.12

0.13

0.13

1.91

1.50

1.45

OurISO 50001-certified

factories

18 GREEN OPERATIONS

In 2015, the Group used 3,730 million litres of water across our operations, 22% more than in 2012, an increase which was mainly due to our recent rapid business expansion. However, our water intensity in 2015 was 31.73 litres per garment piece, 32% lower than the 2012 baseline.

Our production processes also consumed 30% less fresh water for each garment piece, since most divisions increased their use of recycled water.

Despite serious and on-going efforts, regrettably only 48% of the water used across the Group was recycled water, 2% shy of our 50% target. This missed target was due in part to continuing upgrades at some of our factories’ wastewater treatment plants, which caused disruptions to the plants’ recycled water systems. The upgrade will be completed in 2016, and the capacity of the plants will be increased.

Our sweater division saw an impressive year-on-year increase of 120% in recycled water consumption and a 30% reduction in total water consumption, mainly due to the completion of process improvement work and wastewater treatment plant upgrades.

PRUDENT WATERSTEWARDSHIP

Fresh WaterRecycled Water

3,493,320

51%

49%3,730,324

52%

48%

WATER CONSUMPTION (M3)

2014 2015

32% WATER INTENSITY REDUCTION

3,300,391

49%

51%

2013

19GREEN OPERATIONS

Laser: washingwithout water

Our Washing and Development team in our China denim jeans factory successfully developed a new washing process involving the application of laser technology. The new washing process replaces conventional bleaching and dry-processing methods, achieving a stunning 100% water savings – not a drop of water is required in the new process! This new process also does not require the use of any chemicals, further reducing environmental impacts.

Wet-processing equipment

upgrades

The laundry workshop in our China sweater factory was revamped in 2015 with a new layout and enhanced processes, and retrofitted with new eco-friendly washing machines which save 91,100 cubic metres of water annually. First introduced at our China T-shirt factory in 2014, these new water-saving machines, which reduce water consumption by an impressive 95.5% and steam consumption by 43.4%, were also introduced at our Vietnam T-shirt factory during the year.

PRODUCT FOOTPRINT – WATER(L/PC)

SWEATERSDENIMJEANST-SHIRTS INTIMATE

WEAR

2015

2014

20136.8

7

7

96.8 0

0

0

108.02

105.86

22.3

17.36

18.64

Expanding our water reuse programme

into Cambodia

Our new denim jeans factory opened in Cambodia in 2015. The factory has the largest wastewater treatment plant in the Cambodian garment industry, reusing 60% of

SAVING

91,100M3 OF WATER YEARLY

its wastewater. The wastewater treatment programme was endorsed and promoted by the Cambodian government as a role model in the local industry.

20 GREEN OPERATIONS

If waste is not managed properly, it causes environmental, social and health problems which negatively impact our staff and our communities. Crystal’s five-year environmental targets seek to reduce our paper consumption by 10% from the 2012 baseline, and send zero operational waste to landfills.

DigitalisationIn the 2000s, Crystal Group adopted an SAP Enterprise Resources Planning (ERP) system that has led to an approximately 80% reduction in the use of paper.

In 2015, our T-shirt and sweater division developed a new system which digitises and centralises the procurement process. Staff use the platform to purchase a range of items, from equipment consumables to office supplies. The entire process is electronic and no paper is used anywhere along the chain – from purchase applications to quotations, approvals, generation of purchase orders and more.

Unfortunately this year we only achieved a 4% reduction in paper consumption compared to the 2012 baseline, falling short of our target of a 10% cut. In 2016 we will redouble our efforts, focusing on raising awareness of wise paper use and best practices. In addition, due to technology constraints, our new facilities are not as yet employing electronic systems to the extent that our more maturefacilities do. We are working on

speeding this process up as part of our never-ending pursuit of reducing our paper use.

Operational wasteThe Group’s goal is to prioritise avoiding and reducing the waste we generate, diverting as much waste as possible away from landfills. We will soon launch corporate-level waste management guidelines which will give factories guidance and standardise waste management procedures, data calculation and collection methods across our operations. These guidelines will follow Crystal’s environmental approach of “avoid, reduce, recycle, dispose”, and assist factories with resource selection and use, waste generation, collection and proper disposal. Up until now, our factories have handled waste in full compliance with the requirements of local laws. Standardising data calculation and collection methods across our operations will produce comparable data, which in turn will help us benchmark our performance and discover opportunities for improvement.

Effluent-free digital printing

Our China denim jeans factory is now equipped with innovative digital printing machines, allowing almost infinitely more product design possibilities. When compared to conventional manual screen-printing, these new machines are effluent-free and deliver consistently high-quality designs using eco-friendly inks. Before we installed these machines, we began with the perfect solution in mind – if these machines generate no effluent, then would be no need to set up effluent treatment facilities.

MANAGING WASTERESPONSIBLY

21GREEN OPERATIONS

Effluent-freeHigh quality

andconsistency

Eco-friendlyinks

DigitalPrinting ~80%

reduction of paper use

SAP ERPSystem

Standardises procedures

Unifies data collection

and calculation

Benchmarking

Waste Management

Guidelines

PAPER

OPERATIONAL WASTE

PRODUCTION

MANAGING WASTERESPONSIBLY

22 GREEN OPERATIONS

With our global supply chain, Crystal Group knows that the choices we make have a direct impact on the environment and the communities where our products are made and sold. We are committed to upholding our product integrity standards, and to ensuring that our products comply with hazardous substance requirements. However, this commitment cannot be achieved alone – we need to form close partnerships with suppliers that share the same values and commitment to standards.

Good management begins at the sourceIn 2009, the Group released its own Restricted Substances List (RSL). Since then, frequent updates have set concentration limits for substances in materials and finished products. The RSL compliance agreement clearly articulates our expectations of suppliers regarding hazardous chemical use. The agreement is

part of the compliance requirements mandated by the Group’s purchasing procedures and ensures that our suppliers help us uphold our commitments.

We provide our suppliers, and our sourcing, sales and quality assurance teams with hazardous substance awareness training which is conducted by a well-established professional body. They are also trained on our preference for APEO-free and Oeko-Tex compliant chemicals. We also provide reference materials to these stakeholders and ensure that these materials are updated regularly.

In the future, we will begin using the Manufacturing Restricted Substance List (MRSL) from theZero Discharge of Hazardous Chemicals (ZDHC) Programme to help our upstream suppliers avoidusing potentially hazardous substances.

Internal controlsIn 2011, the Group began regularly monitoring wastewater for hazardous substances. In 2014 we expanded the testing to ensure it was in accordance with the comprehensive “9+2” classes of chemicals. During the reporting period, we expanded this programme to two more factories in Cambodia and Vietnam, bringing the total number of participating factories to seven.

New chemical management practice guidelines are being developed for rollout in all Crystal facilities in 2016 which will further improve our chemical management performance. The guidelines will cover sourcing practices, chemical waste handling, emergency procedures and more, consolidating good practices from various industries.

CHEMICAL MANAGEMENT

23GREEN OPERATIONS

Transparent collaborations

In 2015, our China denim jeans factory stepped up our communication with brands, communicating frankly about our current use of chemicals and what control mechanisms are in place. In return, the brands provided advice, enhancing mutual understanding and helping to formulate priorities for improvement.

WASTEWATER TESTING ON “9+2” PRIORITY CHEMICALS

NEW CHEMICAL MANAGEMENT PRACTICE GUIDELINES

TRANSPARENT COLLABORATIONS

Human capitalINVESTMENTThe success of Crystal Group’s sustainability programmes is completely dependent on our high-calibre people. To ensure that our staff are engaged, loyal and committed to carrying out our mission, we have made Maslow’s hierarchy of needs the backbone of our employee care programme. Using this hierarchy enables us to take a systematic approach to understanding our employees’ different needs and implementing targeted employee care initiatives. With this system in place, we can provide comprehensive care to our people – ensuring that their basic physiological and safety-oriented

needs are supported, along with their need to succeed and realise their full potential.

The Group has made several commitments in terms of meeting the needs of our people. We are committed to providing a safe, healthy, ethical and respectful working environment for our employees, we strive to connect with our employees through effective communication mechanisms, and we endeavour to nurture them to make a positive impact on themselves, their families, the Group and the wider communities.

24 HUMAN CAPITAL INVESTMENT

60,228Global employees

734

12345

Maslow's hierarchy of needs

Self-actualisation

Esteem needs

Social needs

Safety needs

Physiological needs

734

25HUMAN CAPITAL INVESTMENT

34%China

30%Vietnam

9%Sri Lanka

11%Bangladesh

16%Cambodia

WORKFORCE BY LOCATION

We are devoted to providing an environment that promotes equality, respect and diversity. Our Social Compliance Policy, Code of Conduct and corporate values outline the standards of behaviour that we expect from our employees at all times regarding a range of ethical issues, including integrity, anti-bribery, fair competition, the protection of intellectual property, denouncing child and forced labour, and recognising the right of workers to form and join unions to protect their interests.

Equal opportunity begins at recruitmentThe Group is committed to providing an inclusive, non-discriminatory workplace which provides continuous development for all employees and gives fair consideration to all applicants regardless of gender, age, nationality, religion, sexual orientation or physical abilities.

In all our operations across the world, we employ people with disabilities to perform duties which effectively utilise their expertise and talents. For example, a mending worker at our Vietnam sweater factory has a physical disability, but this has not impeded her success as a fully-fledged member of the Crystal family. In addition, our Bangladesh T-shirt factory provides hearing equipment and communication training for workers who are hearing impaired.

Reinforcing a fair and ethical culture


WORKFORCE BY GENDER

WORKFORCE BY AGE6%

49%

31%

13% 1%

16-2

0

21-3

0

31-4

0

41-5

0

≥51

32%

Male 68%

Female

My Fair Ladies

On Vietnamese Women’s Day, our factories celebrated the festival by dancing, singing and taking part in competitions. Some of our female employees dressed in traditional costumes and were given flowers by their male colleagues as a sign of their respect and appreciation.

Ensuring fairness through

science-based procedures

At Crystal’s factories, scientific procedures are adopted to ensure that jobs are offered based on the candidates’ competencies and that no discrimination is involved. Wage calculation methods for workers are standardised according to their job nature, skills required and responsibilities. For example, at our China denim jeans factory, wage calculation methods are explained to the workers during orientation, with banners and posters put up at the factory to ensure clear communication, while workers can also keep track of their wages using touch-screen terminals to maximise transparency. Workers use their personal factory identification cards to access their information, which ensures that their privacy is maintained.


Compensating PerformanceIn addition to ensuring that employee compensation complies with all legal requirements in our various countries of operation, the Group has clear policies in place and conducts benchmarking exercises regularly to ensure that competitive salaries are paid to all employees according to their job

responsibilities and job performance. We believe in clearly communicating the Group’s compensation philosophy to our staff, and provide incentives to reward achievements and motivate our people to reach higher levels of performance.

Staff received annual performance reviews

8,548


Measuring skills to help

workers progress

Our Vietnam sweater factory launched a Skill Certificate Programme (SCP), creating a standardised assessment method to measure the skill levels of linkers (the workers responsible for linking panels on sweaters). The programme established four skill levels and a standardised mechanism for workers to progress and gain more skills and thus a higher salary. Having this

programme in place, the factory saw a 16 per cent year-on-year hike in linkers’ efficiency, while their average income also increased by 10 per cent. The SCP’s assessment criteria are clearly communicated to workers, allowing them to view their career path and motivating them to improve their lives.

“”

We believe in clearly communicating the Group’s compensation philosophy to our staff, and provide incentives to reward achievements and motivate our people to reach higher levels of performance.


Making sure our factories are safe for our employees is of paramount importance to Crystal Group and to our stakeholders. We are committed to conducting our operations in accordance with the industry standards and legal requirements of the countries in which we operate, so as to offer a legitimate, safe and dignified working environment for our employees.

Our group-wide Social Compliance Policy and Social Compliance Manual provide guidance and instructions on health and safety, building structural safety and fire safety,

and many other aspects involvinghuman rights, compensation and environmental protection. The manual applies to all of Crystal’s wholly-owned factories as well as subcontractors approved by our customers. We only cooperate with factories which comply with the requirements of the manual and that earn the endorsement of our customers.

We recently updated our Corporate Social Compliance Manual to align our guidance with updated legal and key customer requirements and new market norms. The new version of the manual was launched in early 2016.

Health and safety firstHealth and safety first


Prevention and monitoringTo ensure the well-being of our employees and to eliminate disruption to our business activities, the Group takes a preventive approach to health and safety through training and incident management. All our operations have occupational health and safety committees. These committees include members who represent workers, and they meet regularly to review performance and devise appropriate improvement plans.

In 2015, a total of 65,000 person-hours of health and safety training were delivered across the Group, 44 per cent higher than 2014. During the year, fire safety and production equipment safety were the key training topics, followed by training given on the use of personal protective equipment (PPE), and first aid and life support.

At the Group level, our Corporate Quality and Sustainability Department (CQS) conducts annual on-site social compliance risk assessments at our factories and customer-approved subcontractors. This auditing is done to ensure compliance with health and safety standards and codes of conduct as well as human rights and labour practices. Some health and safety issues identified in 2015 included: • locked emergency exits, • improper chemicals management, • and • workers not using personal • protective equipment. We are working towards eradicating these issues by reinforcing training for workers, supervisors and management, and by raising employee awareness.

Corporate AnnualRisk Assessments

HEALTHY & SAFE, FAIR & TRANSPARENT WORKPLACE

Training and Communication

SOCIAL COMPLIANCE POLICY

1. No Child Labour2. No Forced Labour3. No Discrimination4. No Harassment and Abuse5. Wages and Benefits6. Work Hours7. Freedom of Association & Collective Bargaining8. Health and Safety9. Environmental Standards10. No Unauthorised Subcontracting

CODE OF CONDUCT


Life-saving improvements

Our China T-shirt factory provided production safety training to 427 workers in the Value-Adding Processes workshop who frequently work with production equipment and machinery. This training focused on accident prevention and fire safety measures, including evacuation procedures.

As with all Crystal operations, the factory holds a fire drill twice a year. Over the course of the year, the factory improved the fire drill exercise in numerous ways – mainly by delegating specific tasks to specific teams and raising awareness of evacuation methods through promotions. These procedural improvements led to real, potentially life-saving results: the evacuation time improved from the 15-minute mark reached in previous years to just seven minutes in 2015!

Third-party environmental condition tests

The Occupational Health and Safety Committee at our China denim jeans factory completed 15 environmental improvement projects, covering production workshop ventilation improvement, the upgrading of mechanical safety guards on production machines and the provision of higher-standard personal protective equipment. The factory also employs third-party testing organisations to test several environmental conditions in the production workshops every year: • laser and microwave radiation, • power frequency electric and • magnetic fields, • indoor air quality, and • dust and noise.

The factory passed all these tests, putting it in full compliance with governmental standards. The test reports are put up in workshops for review to incease transparency.

ALL OUR FACTORIESAND APPROVED SUPPLIERS

ARE UNDER COMPLIANCE MONITORING

“”

All our operations have occupational health and safety committees.


“

”

The team will carry out a study on a fire safety management and enhancement plan for all Group operations with an aim to enhance the safety requirements and standards for all our existing and future factory buildings.

Fire and building structural safetyIn order to meet the corporate goal in reinforcing building safety related standards, a new Construction and Facilities Team was established. The team is responsible for all new development projects and managing the structural and fire related safety risks of all our existing buildings.

The new team has reached out to all our local line managements and has visited all the related factory buildings and operations to identify building related issues. Initial reports and structural findings were communicated with the local teams to formulate rectification priorities and methodologies.

Pertaining to new development projects, the team has established a “Facilities Planning and Management Framework” which is a project management guideline providing standardised governance control procedures with flexible applications at all stages of a

project development cycle. Abiding by this guideline will ensure that all future development projects are implemented systematically, with careful project management consideration given to every stage of the project from conceptual development, design, to construction and physical operation of the buildings.

To date, several new development projects in Bangladesh and Vietnam have commenced following the framework guideline, which has proven successful in providing much clarity and control to management during all phases of the projects. The team has also commenced a feasibility study on international green building accreditation for our future factories. Furthermore, the team will carry out a study on a fire safety management and enhancement plan for all Group operations with an aim to enhance the safety requirements and standards for all our existing and future factory buildings.

FIRE AND BUILDING STRUCTURAL SAFETY



Promoting health and well-beingCrystal cares deeply about the health and well-being of our employees, indeed, we believe it is vital to our continued business success. Across the Group, we strive to increase the wellness of our workforce in many ways: by setting up fitness and recreational centres on factory premises, or by organising sports and wellness programmes to help employees adopt a healthy lifestyle – from a yoga club in Cambodia, to a table tennis tournament and cricket match in Bangladesh, to dance lessons in China and a fun and

memorable sports day in Vietnam which provided exciting games, races and athletic events for our colleagues.

We have also become aware of the need to provide not only tasty, but also nutritionally balanced, safe and hygienic meals at our canteens. In addition, many operations have also expanded maternity care assistance for our female employees.


The Dongguan Food and Drug Administration recently recognised our China T-shirt factory in Changping as being a “Food and Beverage Service Safety

Demonstration Unit”, in recognition of the factory’s superior food procurement processes, food processing operations, and the canteen’s environmental hygiene. To earn this accolade, the canteen standardised acceptance procedures and standards for purchased ingredients including vegetables, meat, frozen food and more. The canteen also sends food ingredients to the provincial food inspection centre for testing every quarter, with the results posted on a bulletin board for colleagues’ review, further increasing transparency.

The Group provides maternity training, regular health checks and consultation services, and has set up dedicated facilities for female workers in all our locations to

help ensure a safe transition to motherhood. Our intimates factory in Vietnam for instance provides regular training for female workers on maternity health, and pre- and post-natal care. Every month, the factory arranges transport for pregnant workers to hospitals and clinic centres where they receive vaccinations and general health checks. A dedicated breastfeeding room will also be ready for action in 2016.

DIGITALTRAINING

TOOLS

ENRICHING MATERNITY SUPPORT

GUARANTEEING FOOD SAFETY

In collaboration with our customer Lindex, our China intimates factory started using a new digital learning platform to educate workers, office staff and managers about health and safety issues. Developed by Swedish company QuizRR, the platform is tablet-based

and delivers educational videos and quizzes in local languages on various topics. The content is based on international conventions, codes from global companies and industry associations as well as local laws and regulations.

So far, the results have been promising: workers averaged over 90 per cent on the quizzes, while office staff and managers averaged 98 per cent. The factory will scale up this project in 2016, with more employees taking part and more training areas added, including fire and building safety, workplace dialogue and employment policies. The factory is also working with QuizRR to develop and adapt the platform for use with the factory’s existing facilities (i.e. desktop computers). This will help optimise the use of existing hardware.


Employee relationsWe are committed to creating a culture of engaged employees across the Group. We treat our employees like family members – they are encouraged to be well informed and to communicate openly. From regular meetings and informal gatherings to newsletters and online social networking platforms, the Group management uses different channels to enhance and maintain close relationships with their teams. At the Group level, we use the intranet and digital methods to share information and keep employees abreast of the latest Group happenings. Management also speaks to all employees throughout the year via regular webcasts.

Building social dialogueA prerequisite for an engaged workforce is a robust communication mechanism between a company and its workers. We believe that effective communication is vital to building an employee’s sense of belonging and avoiding disputes that may arise due to a lack of mutual understanding.

During the reporting year, our Cambodia T-shirt factory collaborated with brand customer H&M and the International Labour Organisation (ILO) to launch a one-year programme aiming to improve industrial relations through training and capacity building for factory management and unions. The ultimate vision for the programme is that workers should be able to collectively negotiate with their respective factories about rights and obligations, and resolve conflicts peacefully and in good faith through established structures and processes. The ILO performed a mapping exercise of the industrial relations situation in the factory and a final evaluation will be completed in June 2016.

The Group’s denim jeans factory in Cambodia also participated in a “Workplace Dispute Prevention and Resolution Training Programme” with the support of our customer Levi’s and The Cambodia Arbitration Council. Colleagues from the factory’s Human Resources and Administration departments attended the programme. The participants included workshop supervisors, line leaders and workers’ representatives.

Buddhist culture – Buddhism is the country’s state religion and is practiced by an estimated 95 per cent of the population – in communication sessions for workers and supervisors, in a bid to create a more harmonious workplace environment. Buddhist principles – love, compassion, appreciative joy and equanimity – are introduced to workers and supervisors during these sessions in the hopes that they will embrace these positive values in their working lives, and discuss and resolve issues together with the company.

Promotingculture and harmony

Our Cambodia T-shirt factory began using concepts from

Seeking to listen

Our Vietnam T-shirt factory conducted a worker satisfaction survey to learn more about workers’ feelings, what they thought we did well and where we could improve. While greatly encouraged by the positive feedback, we have not been complacent. Management teams from Human Resources, Production and other relevant departments have reviewed the result and developed action points in identified improvement areas.

Also during the year, our China T-shirt factory launched the “Sunshine Workshop” project, aiming to proactively provide assistance to workers. The idea is simple yet effective – workers express their daily mood through a “face display card” by their seat, with a smiley face on one side and a sad face on the other. Whenever the unhappy face is displayed, supervisors offer immediate assistance to the worker, whether it is a result of personal or work-related issues. For serious issues, supervisors can refer the matter to their superiors or the HR team.

Employee relations


Recognising achievementWe believe that expressing appreciation is another important component of communication. In addition to performance prizes given to individual staff members and large-scale events put on by the Group to celebrate various efficiency and production milestones, we thank our teams in a myriad of other fun and meaningful ways. For instance, to show their appreciation to office staff for their hard work, our T-shirt and sweater factories in Vietnam put on a three-day annual holiday trip to a neighbouring city complete with entertaining games, tasty treats and dance parties. Our China denim jeans factory invited its outstanding employees and their family members on a four-day holiday to Guangdong province. The trip included a visit to the factory for the workers’ family members,

which helped them understand more about the day to day working environment at the factory.

Treating our workers

like family

In Cambodia, on the eve of the new academic year, our T-shirt factory distributed school bags, educational books and pencils to workers whose children were starting primary school. In Vietnam, on the eve of every lunar new year, representatives of our T-shirt factory management visit the homes of underprivileged workers to present festive gifts, give encouragement to overcome difficulties and inquire about the well-being of their family members.


Growing Our TalentsAs a responsible and caring employer, we truly believe that our people are our most valuable capital. During the Group’s continuous expansion, investing in our people is the most important investment we can make for the sustainable development of our business.

Training and developmentThis year, we continued to grow our learning and development programmes. The Corporate Human Resources team began developing a comprehensive, structured learning and development programme called the C.A.R.E. – short for Crystal Advocates Respect and Engagement – covering a range of programmes which support our workers in their daily working lives as well as their longer-term professional development.

Our Next Generation Leaders Programme (NGL) continued to support the Group’s succession planning, while the Group continued our efforts to provide development opportunities for every employee at every level to promote personal advancement, leadership skills and continuing education. Some of these efforts included: • training on The Seven Habits of • Highly Effective People, • communication, effective

• supervision, delegation and • leadership, • positive thinking and listening • skills workshops, • scholarship for tertiary education, • and • industrial engineering • certification programme.

Another development focus of our factories was on providing training programmes to increase employee exposure to new perspectives. The knowledge gained from this training may not be strictly related to the employees’ duties, but it helps broaden their horizons in general. For example: • introductory training on global • free trade agreements for staff • and executive management, • sewing and washing training for • merchandising and product • development teams, and • computer literacy training for • workers.

PEOPLE DEVELOPMENT INVESTMENT

USD 18 MILLION

PARTICIPATION IN DEVELOPMENT PROGRAMMES

26,000EMPLOYEES

WORKERTRAINING

4%Communication skills

22%Health & Safety

74%Orientation


Abercrombie & Fitch, ANN INC., Marks & Spencer, and Levi’s on other female empowerment projects. In 2015, our denim jeans factory in northern China partnered with Levi’s to launch the second Health Enables Returns project (HERproject), the first having been held in 2013. HERproject is a workplace initiative launched to empower female workers through promoting health, financial knowledge and women’s rights. Such female empowerment initiatives will be integrated into the C.A.R.E. Programme mentioned earlier. These initiatives will benefit all Crystal workers, and indeed benefit the Group as a whole.

Empoweringour female colleagues

Empoweringour female colleagues

Females account for over 60 per cent of the Group’s workforce. Recognising that women’s personal and work lives are inextricably linked, we believe in providing opportunities that enhance both their managerial and their life skills, enabling women to move upwards and to take on bigger roles. By advancing their careers, we empower women to be part of the growth of our company.

In 2015, Crystal Group announced that the company will expand its female empowerment initiative – the award-winning Gap Inc.’s P.A.C.E. (Personal Advancement and Career Enhancement) Programme – with the promise to advance the lives of up to 40,000 female workers by 2020.

This announcement comes in the wake of the highly satisfactory results produced by the 2012 pilot of this life skills and education programme which ran in our denim jeans factory in Zhongshan China. The programme saw close to 400 female workers take part in seven learning modules: • communication, • time and stress management, • problem solving and decision

making, • general and reproductive health, • financial knowledge, • legal literacy, and • execution excellence.

Statistics revealed that the factory’s P.A.C.E. participants increased productivity by 15 per cent on average. The Group is now gearing up to bring the programme to our operations in Cambodia, Bangladesh, Sri Lanka and Vietnam.

While we have committed to providing this programme to an impressive 40 per cent of the Group’s projected 2020

workforce of 100,000 people; the actual number of beneficiaries is expected to exceed even this ambitious target, since this worker-oriented initiative also engages factory staff, and many volunteer to undergo capacity building, be assessed and become qualified before mentoring other workers.

Tailor-made P.A.C.E.Since the programme debuted in 2012, our denim jeans factory has further customised the syllabus to include excursions and expeditions to increase the workers’ exposure to new environments. The factory compound has been retrofitted with a dedicated caring centre where P.A.C.E. participants can gather for activities and where workers receive employee support services. Designated bulletin boards displaying programme progress and workers’ course work are installed around the factory.

Extending the benefitsAlso in 2012, we began collaboratingwith majorclients including


Welcoming new talentThe Group actively seeks to attract new talent to support the rapid growth of our business. A number of our factories participated in university campus talks, career festivals and other recruitment events to attract high-calibre graduates to our Crystal family.

The Crystal Associate Programme

In 2012, we launched our Associate Programme to groom young talented people seeking to embark on a career in the garment industry, in the hopes that they will become future Crystal Group leaders. We offer five function-specific Associate Programmes – business, production, technical, finance and human resources – in each of our divisions, T-shirt, sweater, denim jeans and intimates. Each programme is designed to unlock the candidates’ leadership potential and shape their capabilities through a lively and demanding 30- to 36-month journey of learning, experience and self-exploration.

THE CRYSTAL ASSOCIATE PROGRAMME STRUCTURE

Learning, experiencing and self-exploring journey (30-36 months)

FunctionalAttachment

Orientation&

Familiarisation

ManagementTraining

AssistantManager

TechnicalTraining

ProgrammecompletionSharing

with Senior Management

Mentor-menteeScheme

Coach-coacheeScheme

ProjectPresentation

PerformanceReview

FinanceAssociate

HRAssociate

TechnicalAssociate

ProductionAssociate

BusinessAssociate

Programme

LearningSupport

Over the year, we held 16 recruitment events, engaging around 1,000 participants. Over 430 applications were received from Hong Kong, Malaysia and further abroad this year and the 16 candidates selected have now commenced their challenging yet rewarding careers with the Group.


Catering to community needsThe close relationship between the Group’s operations and our various local communities helps us tailor our community engagement efforts to the precise needs of these communities. By way of example, aside from monetary donations, our Vietnam T-shirt factory donated computers to a neighbouring secondary school. Our denim jeans factories in Cambodia also donated mosquito nets and blankets to residents living in remote areas, tyres for an ambulance to a local health centre, and sheet metal to a police station for a new roof.

Employee volunteerismEmployee volunteerism is an integral part of our community engagement strategy; it provides an excellent way for our employees to connect with their local communities and give back to society. From holding singing performances and games for the elderly to visiting nearby sick people and orphans; raising fundsfor earthquake victims in Nepal or

simply cleaning up the neighbourhood around the factory, our employees contributed their skills, time and compassion to serve the needy in their local communities.

Leveraging our expertise

During the school summer holidays, 21 teachers from a nearby Industry and Trade Technical School worked at our China denim jeans factory for five days to gain practical experience and get a taste of the “life of a worker”. Most of the teachers were placed in the finishing workshops, where they were responsible for packing, thread trimming, hangtag placement and the heat press rhinestone transfer. When they returned to the classroom, the teachers shared their practical factory experiences with their students. The factory organised visits for other educational institutions throughout the year.

With community engagement being one of the five pillars of the Group’s sustainability framework, Crystal strives to integrate our aspiration to support the development of our communities with our core operations in several ways: through employment opportunities, through leveraging our garment manufacturing expertise, and most importantly through mobilising our huge workforce to support meaningful causes. The aim is to bring lasting benefits to the communities in which we have a presence.

Community Engagement

160,000+

PERSONSBENEFITTING

103COMMUNITYSERVICES

CASHCONTRIBUTION

USD337K

St. James Settlement

A partner which engages our employees in reducing waste and caring for the community.

Participation in festive food collection programmes which transfer excess festive treats to the underprivileged.

A

R

Our Synergistic PartnershipsOne of Crystal Group’s core values is to become a boundaryless organisation. As we work to achieve this goal, we actively seek the support and engagement of industrial associations, non-governmental bodies, environmental and academic organisations that are aligned with our sustainability vision. Beyond this, our collaborations

with our stakeholders create social and environmental benefits, develop synergy and result in widespread positive impacts throughout society.

The following is a list of selected organisations and initiatives with which Crystal Group was involved in 2015.

42 OUR SYNERGISTIC PARTNERSHIPS

8CommunityCollaborations

AR = Rationale = Actions

A partner which encourages our employees to care for the needs of the disadvantaged through volunteering.

Crystal Group volunteers participate in tree planting programmes and community visits organised by the Trust.

A

RYuk Ching Charity Trust

We support WWF-Hong Kong’s conservation initiatives, which include preserving biodiversity, reducing our ecological footprint and building awareness of climate change.

Double Diamond Member since 2010; signatory to the No Shark Fin Pledge; Earth Hour event T-shirt sponsor; participation in Earth Hour and the Low Carbon Manufacturing Programme (LCMP).

A

RWWF-Hong Kong

We support Redress’ mission to reduce waste in the fashion industry by educating and nurturing emerging fashion designers; inspiring and informing fashion consumers and helping catalyse change in the fashion industry.

The Group participates in the “Keep Caring Clothing Drive” which collects second-hand clothing and accessory donations for environmental and welfare charities.

A

RRedress

We support the WGO’s Green Office Awards Labelling Scheme (GOALS) – we believe it raises the awareness of Hong Kong businesses of the nature and extent of global environmental challenges.

Mr Kenneth Lo, Group Chairman, serves as a member of the Board of Governors of the WGO. The Group is also a sponsor of GOALS 2015.

A

RWorld Green Organisation (WGO)

The Foundation provides social assistance to new arrivals and the elderly. Crystal Group employees take part in voluntary activities for the Foundation.

Mr Kenneth Lo, Group Chairman, serves as the Foundation’s Chairman of the Board. Crystal volunteers also participate in fundraising campaigns for the Foundation.

A

RWindshield Charitable Foundation

We are committed to helping bring Oxfam’s vision to life – helping the underprivileged improve their livelihoods.

Sponsor and participant in the “Home For Dinner” campaign, raising funds to support Oxfam’s global efforts to eliminate poverty.

A

ROxfam Hong Kong

The Group supports Greeners Action’s approach to waste management, which centres on avoiding and reducing waste generation.

Sponsor of the Lai See Recycle and Reuse programme; we also participate in programmes which collect festive waste for reuse or recycling.

A

RGreeners Action

43OUR SYNERGISTIC PARTNERSHIPS

9Industrycollaborations


We support the Council’s role of conveying the industry’s views to the authorities. The council provides advice to the government, helping influence policy and advance the interests of the textile industry.

Mr Kenneth Lo, Group Chairman, and Mr Andrew Lo, Group CEO, serve as General Committee Members of the Council.

A

RTextile Council of Hong Kong

Crystal Group believes that continual investment in the research and development of technology is vital to enhancing the competitiveness of the fashion and textile industry.

Mr Andrew Lo, Group CEO, serves as a member of the Board of Directors of the HKRITA and is a member of the Technology Committee.

A

R

The Hong Kong Research Institute of Textiles and Apparel (HKRITA)

We are committed to fostering the sustainable growth of the knitwear trade and to making Hong Kong a world-class hub for sales and purchasing.

Mr Kenneth Lo, Group Chairman, serves as the Society’s Honorary Chairman.

A

R

Knitwear Innovation and Design Society (KIDS)

We support the Association’s mission to enhance the techniques and general knowledge of practitioners in the knitwear and synthetic knitting manufacturing industries.

Mr Kenneth Lo, our Group Chairman, serves as the Honorary President and Director of the Association.

A

R

Hong Kong Woollen and Synthetic Knitting Manufacturers’ Association

(HKWoollen)

Crystal Group supports the SFBC’s mission: to create a platform which continuously improves the textile and apparel manufacturing processes and procedures throughout the supply chain to minimise the industry’s impact on the environment.

Crystal Group is a founding member of SFBC. Ms Catherine Chiu, the General Manager of our Corporate Quality and Sustainability Department, serves as Vice Chairman of the SFBC.Sponsor of Higg Index Smart Toolkit development.

A

R

Sustainable Fashion Business Consortium (SFBC)


We believe in SAC’s focus on building and advocating the adoption of the Higg Index, a standardised supply chain measurement tool for industry participants which measures the environmental, social and labour impacts of making and selling their products and services.

Supplier member since 2012; Higg Index (eco-module) adoption in all Crystal’s factories; Higg Index (social and labour module) adoption in selected factories; signatory to the Social and Labour Convergence Project.

A

RSustainable Apparel Coalition (SAC)

We support the FIDC in providing an effective forum for cooperation for the garment industry, academia, the government and NGOs; allowing all groups to work together to advance Hong Kong’s garment industry.

Mr Eddie Lo, President of our Intimates Division, serves as a member on the Committee’s Innovation and Sustainability Working Group.

A

R

Fashion Industry Development Committee (FIDC)

Crystal Group is highly supportive of our customers’ sustainability efforts. H&M is working to develop a strategy to put structures in place which will mandate a fair living wage in the textile industry. We are aiding their efforts by contributing our perspective as a manufacturer.

Ms Catherine Chiu, General Manager of Corporate Quality and Sustainability Department, serves as a member of the H&M Wage Advisory Group to the Fair Living Wage Roadmap.

A

RH&M

We seek to enhance communication, interaction and cooperation among industry peers, in order to establish a liaison with government bodies and trade and industrial organisations in Hong Kong and overseas to convey the industry’s collective views.

Mr Eddie Lo, President of our Intimates Division, served as the Vice Chairman of the HKIAIA. From time to time, the Group participates in sharing sessions at the HKIAIA, offering our viewpoint on sustainability issues.

A

R

Hong Kong Intimate Apparel Industries’ Association (HKIAIA)

45OUR SYNERGISTIC PARTNERSHIPS

5AcademicCollaborations


The Group offers support and recognition to tertiary students who achieve solid academic performance, possess leadership qualities, and aspire to advance in their field.

The Group set up a “Crystal Group Outstanding Student Award” which was given to two undergraduates in 2015: an undergraduate from the School of Energy and Environment; and an undergraduate from the College of Science and Engineering’s “Bachelor of Engineering (Industrial Engineering and Engineering Management)” programme.

A

R

City University of Hong Kong (CityU)

We support the annual Lingerie Fashion Show which provides an opportunity for intimate apparel students from the university’s Institute of Textiles and Clothing (ITC) to showcase outfits they have designed.

The Group contributed a donation in support of the PolyU Lingerie Fashion Show 2017.

A

R

The Hong Kong Polytechnic University (PolyU)

The Group recognises VTC students who achieve outstanding performance during their industrial work experience attachments.

Sponsor of the Outstanding Industrial Attachment Scholarship 2015/16.

A

R

Vocational Training Council(VTC)

The Group believes that the VTC Design Education Fund fosters excellence in creativity, design and innovation among young people, enriches students’ educational experience and develops their international perspective and cultural sensitivities.

Sponsor of the VTC Design Education Fund 2015/16.A

R

Vocational Training Council (VTC)

We believe in nurturing creative talent for the industry. The Group supports the Institute in organising a graduation show to publicly exhibit the best work produced by graduating students.

Sponsor of the annual Student Graduation Fashion Show in 2015.

A

R

Hong Kong Design Institute(HKDI)


OUR RECOGNITIONS

22

Crystal GroupCrystal GroupCrystal Headquarters

17 23CSR & Employee care Environment Business

Crystal HeadquartersYe Ji Sweater Factory Dongguan T-shirt FactoryYe Ji Sweater Factory

Crystal GroupCrystal Headquarters

2217 23

OUR RECOGNITIONS

1 × OHSAS 18001: 2007

1 × OEKO-TEX STANDARD 100

1 × SAP Advanced Customer COE

1 × ISO 26000: 2010

2 × ISO 50001: 2011

2 × GLOBAL RECYCLE STANDARD 2.1

4 × ORGANIC CONTENT STANDARD 1.0

5 × ISO 14001: 2004

5 × ISO 9001: 2008

6 × M&S PLAN A ECO FACTORY

STANDARDS & SYSTEM

CERTIFICATIONSATTAINED

47OUR RECOGNITIONS

APPENDIXBusiness performance

Occupational health and safety

Fire and building safety

Child and forced labour

Industrial relations

Wage policy

Customer health and safety

Compliance (Environment)

Market presence

Chemical management

Training and education

Employment

Effluent and waste

Talent attraction and retention

Community engagement

Female empowerment

Emissions

Equal remuneration for women and men

Water

Diversity and equal opportunity

Energy

Non-discrimination

About Crystal Group






Green Operations

Green Operations

About Crystal Group

Green Operations



Green Operations




Green Operations


Green Operations


Green Operations


Material Issues(in order of significance) Section

Impactsoutside the

organisation

Impactsinside the

organisation

MATERIAL ASPECTS AND BOUNDARIESAPPENDIX

48 APPENDIX

Name of the organisation

Primary products and services

Location of the organisation's headquarters

Countries of operation

Nature of ownership and legal form

Markets served

Chairman's MessageCEO's Message

Externally developed economic, environmentaland social charters

Defining the report content and the aspect boundaries

67

GRI Indicator PageSectionDescription

General Standard DisclosuresGRI CONTENT INDEX

As an owner, developer and manager of garment manufacturing facilities, as well as a provider of apparel

products and relevant services, Crystal Group's supply chain is comprised of hundreds of suppliers of products and

services. Significant procurement categories include fabric, trims, accessories, building materials, furniture and fittings,

cargo and logistics services, as well as production equipment and machineries.

No significant changes from previous reporting period have been made in this report’s scope and aspect boundaries.

We report in accordance with the core option of the GRI G4 Sustainability Reporting Guidelines and our report is not

externally assured at the moment.

The organisation's values, principles, standards andnorms of behaviour

G4-3

G4-4

G4-5

G4-6

G4-7

G4-8

G4-1

Crystal Group is headquartered in Hong Kong.

58.5% of total employees are covered by collective bargaining agreements.

Statement from the most senior decision-maker

G4-9

G4-10

G4-11

G4-12

G4-13

G4-14

G4-15

G4-16

8

8

49

10

8

10

258-10

26-27

19

14-23

42-46

42-46

G4-17

G4-18

G4-19

G4-20

G4-21

G4-22

About Crystal Group

About Crystal Group

Appendix

Appendix

Appendix

No restatements from previous reports.

G4-23

8-11

13

48

48

48

49

49

Entities included

Materials aspects identified

Aspect boundary within the organisation

Aspect boundary outside the organisation

Restatements of information

Significant changes in the scope and aspect boundaries

G4-24

G4-25

G4-26

G4-27

About Crystal Group

About Crystal Group

About Crystal Group

About Crystal GroupGovernance structure of the organisation

About Crystal Group

About Crystal GroupOur Synergistic Partnerships

12

12

13

1342-46

Stakeholder groups

Identification and selection of stakeholders

Approaches to stakeholder engagement

Key topics and concerns raised

G4-28

G4-29

G4-30

G4-31

G4-32

G4-33

Reporting period

Date of most recent previous report

Reporting cycle

Contact point for questions

The "in accordance" option and external assurance

Policy and current practice with regard to seekingexternal assurance

About This Report

The Sustainability Report 2015 was published on 4 May 2015.

About This Report

About This Report

Appendix

5

49

5

5

49

49

G4-34

G4-56

11

9


Human Capital InvestmentAbout Crystal Group

Strategy and analysis

Organisational profile

Identified material aspects and boundaries

Stakeholder engagement

Report profile

Governance

Ethics and integrity

About Crystal Group

About Crystal Group

About Crystal Group

About Crystal Group

About Crystal Group

Green Operations

Green Operations



Scale of the organisation

Profile of workforce

Percentage of total employees covered by collectivebargaining agreements

Description of the organisation's supply chain

Significant changes during the reporting period

Precautionary approach

Memberships in associations

49

49

一點一滴，啟廸每個人49APPENDIX





Risk for incidents of child labour and preventive measures taken

Risk for incidents of forced or compulsory labour andpreventive measures taken

Our workers are remuneratedaccording to their job responsibility and productivity.

Breakdown of employees according to indicators of diversity

GRI Indicator PageSectionDescription

Specific Standard DisclosuresGRI CONTENT INDEX

G4-EC1

G4-EC5

G4-EN3

G4-EN6

G4-EN8

G4-EN10

G4-EN15

G4-EN16

G4-EN24

G4-EN27

G4-EN29

G4-LA6

G4-LA9

G4-LA10

G4-LA11

G4-LA12

G4-LA13

G4-HR3

G4-HR5

G4-HR6

G4-HR9

G4-SO1

G4-PR1

G4-PR5

67

41

67

28

17

17

18

18

17

17

50

14-23

50

50

38

24-41

28

26-27

50

50

26, 31

26, 31

31

4142-43

22-23

50

Direct economic value generated and distributed

Energy consumption within the organisation

Reduction of energy consumption

Total water withdrawal by source

Total volume of water recycled and reused

Direct greenhouse gas (GHG) emissions (scope 1)

Indirect greenhouse gas (GHG) emissions (scope 2)

Total number and volume of significant spills

Non-compliance with environmental laws and regulations

Average hours of training Human Capital Investment




There were no incidents of discrimination reported.




Mitigation of environmental impacts of products and services

Green Operations

Green Operations

Green Operations

Green Operations

Green Operations

Green Operations

No significant spills reported.

No fines or non-monetary sanctions for non-compliance recorded.

Green Operations

Green Operations

Type and rates of injury, and total number ofwork-related fatalities

No fatalities or occupational diseasesrecorded during the reporting period.

Programmes that support continued employability of employees

Percentage of employees receiving regular performance reviews

Ratio of basic salary and remuneration of women to men

Number of incidents of discrimination

Operations subject to human rights reviews

Operations with implemented local community engagement

Results of surveys measuring customer satisfaction

Significant product and service categories for whichhealth and safety impacts are assessed for improvement

Human Capital InvestmentOur Synergistic Partnerships

Ratio of standard entry level wage to local minimumwage

Economic

Environmental

Social

Economic performance

Market presence

Energy

Water

Emission

Effluents and waste

Products and services

Compliance

Occupational health and safety

Training and education

Diversity and equal opportunity

Equal remuneration for women and men

Non-discrimination

Child labour

Forced or compulsory labour

Assessment

Local communities

Customer health and safety

Product and service labelling

Customer complaints: 0.02%, Target: 0%Quality claim: 0.22%, Target: ≤0.1%

Observed quality level (OQL): 1.6%, Target: ≤4%Customer final inspection pass rate (CFIR): 99.4%, Target: ≥99%

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LEAVE A LITTLE SPARKLE WHEREVER YOU GO


HÃY ĐỂ LẠI MỘT CHÚT ÁNH SÁNG TRÊN NHỮNG CON ĐƯỜNG MÀ BẠN ĐÃ ĐI QUA



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50 APPENDIX






行く先々で、少しの輝きを残しておいで


一點一滴，啟廸每個人一點一滴，啟廸每個人










一點一滴，啟廸每個人一點一滴，啟廸每個人





































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