Due diligence
Due diligence and risk assessment
We monitor high risk areas, such as the cotton supply chain and migrant workers in the supply chain, and have additional mitigation measures in those areas, like our work with the Better Cotton Initiative. Since 2017, we have published our annual ASICS Group Modern Slavery and Transparency Statement. It sets out the progress we made and the steps we have taken with regards to modern slavery and human trafficking in our business and supply chain.
Responsible recruitment
In 2018, ASICS Corporation is a signatory to the AAFA/FLA Apparel & Footwear Industry Commitment to Responsible Recruitment. Developed in conjunction with the American Apparel & Footwear Association and the Fair Labor Association, the Commitment is a proactive industry effort to address potential forced labor risks for migrant workers in the global supply chain.
To address the risk of forced labor, our monitoring process verifies that workers are not required to pay placement or recruitment fees. Based on audits and assessments conducted during 2022/2023, including internal reviews, third-party audits, and evaluations by partner organizations, we have not identified any direct instances of forced labor within our supply chain.
However, during this period, a Better Work audit identified a case related to the employment of dispatched labor at a contractor factory in Vietnam, which is not in compliance with Vietnamese Labor Law. In collaboration with Better Work Vietnam, our sourcing team, and the supplier, we engaged in extensive dialogue and provided education to the factory management. Consequently, the factory successfully remediated the situation by transferring labor contracts, allowing workers to have direct employment with the factory, eliminating their employment relationship with the dispatching agency.
Reducing potential forced labor risks for migrant workers in the global supply chain is next to impossible for a single company to accomplish alone. True progress towards these goals can only be made when the industry collectively works together in collaboration on this important issue.
ASICS is deeply committed to responsible recruitment practices and continues to uphold this commitment by endorsing the 2023 revision of the commitment.
By sign the commitment, we have incorporated it into our standards and that we commit to work with our global supply chain partners to create conditions so that:
- No workers pay for their job;
- Workers receive a timely refund of fees and costs paid to obtain or maintain their job;
- Workers retain control of their travel documents and have full freedom of movement; and
- All workers are informed, in a language they understand, of the basic terms of their employment before leaving their country of origin.
You can learn more about this commitment here: AAFA Commitment to Responsible Recruitment.
Responsible Sourcing
Responsible Purchasing Practices
ASICS recognizes that the purchasing practices of global enterprises can impact a variety of issues in the supply chain, including excessive overtime at suppliers, wage and benefits, and unsafe working environment. ASICS believes that by supporting responsible labor practices, compliance with human rights-related laws and improvement of purchasing practices can reduce the above risks. As part of human rights due diligence, ASICS recognizes the impact of purchasing practices to the workers in the supply chain and tackle to improve the working environment at our suppliers. Product Sourcing Department and Sustainability Department will work closely to ensure that responsible purchasing practices are implemented. ASICS also confirms planning/forecasting, design/development, price negotiations, sourcing/ordering, payment, etc. as particularly important items to promote responsible purchasing practices and has been working for fair trade with our suppliers. As a result, ASICS has been in a stable business partnership with major suppliers for an average of 15 years or more.
Examples of our responses for each item are as follows:
Planning and Forecasting
ASICS sourcing team conducts on-going business planning and forecast updates with each supplier continuously to review granular forecast to each supplier is usually 3 months prior the first production month in each season, then communicate with suppliers every month and make adjustments to ensure proper labor distribution on the production site.
Design and Development
If the free samples in development stage are not commercialized, ASICS bears the material costs.
Cost and Cost negotiation
Labor costs related to production are calculated based on the quarterly average wage schedule provided by each supplier, and any increase in labor costs is basically reflected in product costs.
Sourcing and Order placement
ASICS coordinates the production capacity and the actual order with the factories at the time of ordering every month. And leftover materials generated during production are passed on to the next production, and ASICS also deals with purchases.
Payment and Terms
ASICS strives to adhere to the payment terms outlined in the manufacturing contract. The standard maximum payment term for footwear factories is 75 days.(as of October 2023)
Responsible Raw Material Sourcing
When it comes to the raw materials we use, ASICS wants to make sure they are as sustainable as possible. ASICS continues to work towards our 2025 target to source 100% more sustainable cotton. Regardless of geography, products or materials, ASICS strictly prohibit all forms of human rights violation and environmental violation. ASICS has strengthened our policy for the procurement of raw materials and established a process for checking the traceability and status of the cotton materials purchased, including expecting our suppliers to hold documents of material origin certification. In addition, ASICS continues to work towards our 2025 target to source 100% more sustainable cotton* that is also environmentally considerate.
Our use of cotton is limited, but it is one of the natural fibers used in ASICS apparel products. Since 2019, ASICS has been a member of Better Cotton (BC). BC works with a diverse range of stakeholders across the cotton supply chain to promote measurable and continuing improvements for the environment, farming communities, and the economies of cotton-producing areas.
*Better Cotton, Organic cotton (GOTS certified), Fairtrade certified, Recycled cotton (GRS certified), Cotton Made in Africa (CmiA) certified, U.S. Cotton Trust Protocol certified.