embracing the values of sustainability, crystal group · embracing the values of sustainability,...

Embracing the values of sustainability, Crystal Group continues to expand our foothold and bring positive social, environmental and economic impacts to these new frontiers.

Stitch for a Better World“We change the world one stitch at a time.”

CONTENTS

ABOUT CRYSTAL GROUP

ABOUT THIS REPORT05

07

12

32

28

35

38

40

06MESSAGE FROM THE CHAIRMAN & CEO

A GLOBAL COMMITMENTTO SUSTAINABILITY

OUR BRIGHTEST STAR

OUR RISING STARS

OUR NEW STAR

OUR AWARDS

GRI INDEX

People-oriented ManagementProtecting Our PlanetCreating Sustainable Profit

China

BangladeshCambodiaSri Lanka

Vietnam

05ABOUT THIS REPORT

Reporting Period: Jan-Dec 2014 (unless otherwise specified)

ABOUT THIS REPORT

SUSTAINABILITY FRAMEWORK

If we hold on together, I know our dream for a better world

will come true.

Website: www.crystalgroup.com

Catherine Chiu General Manager Corporate Quality and Sustainability [email protected]

GRI Facts:• GRI 3.1, Level C

• 5th GRI Sustainability Report

• 1st in 2010

This Sustainability Report is a tribute to our commitment to both sustainability and transparent communication.

Innovation

Product Integrity

Environment

Community

Employee Care

06 MESSAGE FROM THE CHAIRMAN & CEO

CREATING A BETTER INDUSTRY & A BETTER WORLD

All growth brings with it a certain element of risk. To ensure that we minimise these risks and continue to succeed and prosper as a group, it is imperative that we keep sustainability at the core of our growth strategy. This is crucial not only from an environmental point of view, but also from a business standpoint as it allows us to continuously improve our operations by increasing our efficiency, productivity and profitability.

Our success is reliant on the success of the communities that surround us. They provide us with natural and human resources, infrastructure and markets that support our businesses. This is why, as our operations expand, we are simultaneously taking more social, environmental and economic accountability for the development of the communities in which we have a presence.

In 2014, Crystal Group underwent an exceptional and unprecedented expansion. We set up a number of new production facilities and increased our global workforce by an astounding 25%, to 60,000 people.

The Group will continue to adhere to our three core sustainable development principles:

• Robust globalisation strategy,• Making conscious products, and• People-oriented management.

We will continue to strengthen our sustainability culture to ensure that all of us have an in-built awareness of and commitment to sustainability, which will allow us all to grow and flourish personally through being part of our business.

In the coming years, we will work even closer with our suppliers to spread our sustainability commitment to ensure that they become more engaged in our sustainability journey and gain their commitment to passing on these messages.

This ripple effect will appreciably increase the sphere of our positive influence, eventually having enormous impacts on global sustainability – creating a better industry and a better world.

Kenneth Lo, Chairman Andrew Lo, CEO

07ABOUT CRYSTAL GROUP

Crystal Group (or “the Group”) is a private group of companies founded in Hong Kong in 1970. With over 20 factories in Asia, today the Group is a leading original equipment manufacturer and original design garment manufacturer (OEM/ODM) and trader.

PRODUCT TYPES

Deni

m je

ans

IntimateT-shirt wear

Sweater

ABOUTCRYSTAL GROUP

Let’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.

MISSION

VALU

ES

Respect for People

Live Quality

Boundaryless Enterprise

Embrace Innovation

Energise Others

Delight our Customers

Integrity

Deliver Bottom Line Results

08 ABOUT CRYSTAL GROUP

O F F I C E O P E R A T I O N S P R O D U C T I O N B A S E SChinaVietnamSri LankaBangladeshCambodia

Hong KongUnited Kingdom

ChinaTURNOVER

35%

30%

MARKET Others: 1%

34%

GARMENT PRODUCED

304M pcs

OPERATIONS WORLDWIDE


The Board of Directors has the ultimate responsibility for monitoring and reviewing the Group’s corporate governance policies and practices. The Board meets quarterly to formulate and monitor overall strategies, financial performance, the Group’s long-term direction and other significant matters.

HOW WE GOVERN AND MANAGE

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

BOARD OF DIRECTORS

IndependentNon-executive

Director


Director


Director


DirectorExecutiveDirector

ExecutiveDirector ChairmanCEO Vice

Chairman

AUDITCOMMITTEE

EXECUTIVECOMMITTEE

CORPORATEFUNCTIONS*

LINECOMPANIES

EleganceIndustrial Co. Ltd.

CrystalApparel Ltd.

CrystalSweater Ltd.

Crystal Martin(Hong Kong) Ltd.

Crystal MartinInternational Ltd.

10 ABOUT CRYSTAL GROUP

LISTENING TO OUR STAKEHOLDERS The opinions and ideas of our stakeholders – both inside and outside the Group – are enormously valuable to the sustainable development of our business. Their perspective provides us with advice and challenges our thinking, giving us greater clarity on the impacts of our business activities on both small-scale and large-scale perspectives.

We consistently seek input from different stakeholder groups through a variety of channels, building a shared understanding of our priority sustainability issues and laying a solid foundation upon which the Group can continue our sustainability journey.

EMPLOYEES & FAMILIES

NGOS

MEDIA

INSTITUTIONS

SUPPLIERS

CUSTOMERS

GOVERNMENT

CRYSTALGROUP

COMMUNITY


Mem

bers

hip

of T

rade

/ In

dustr

ial Ass

ociati

ons

Annual Sustainability Report

Public Display & Speech

Tree Planting Event

In person Meeting

Inter

net (

Intra

net &

Ext

erna

l Web

site)

Site Visit

Trad

e Sh

ow

Direct Mail

Public Sharingon Sustainability

(Corporate Level)

YouTube Channel LinkedIn Page

61

SUSTAINABILITY AFFILIATIONS

COMMUNICATION CHANNELS

12 A GLOBAL COMMITMENT TO SUSTAINABILITY

Crystal Group is committed to sustainability in every geography we operate in. Despite differences in the scale of our production facilities, our goals are the same: to find the right balance between social, environmental and economic considerations.

Our 45 years of history has given us abundant skills and experience in the garment manufacturing industry, and has allowed us to develop an enormous body of knowledge on sustainability, enhancing and amplifying our global presence.

Our Sustainability Steering Committee sets the direction of our sustainability policy, provides a framework, and determines our sustainability principles. These principles allow us to “export” our commitment to sustainability to our newest frontiers – bringing economic gains as well as positive social and environmental impacts.

A GLOBAL COMMITMENT TO SUSTAINABILITY

PEOPLE-ORIENTED MANAGEMENTThe most valuable capital for Crystal Group is undoubtedly our people. They are the heart of our business, the face of our brand and the engine that drives our business. Their passion for quality, devotion to detail and their innovative attitude allow them go above and beyond to deliver sustainable products and services to our clients.

The Group takes a people-oriented management approach through a comprehensive employee care programme which meets our employees’ needs while providing a solid foundation to nurture and sustain them; allowing them to create value for themselves, their families, the company and eventually the surrounding community.

551 EMPLOYEE CARE INITIATIVES

13A GLOBAL COMMITMENT TO SUSTAINABILITY

Bangladesh

7%

Cambodia

6%

10,132employees under annual performance reviews

PROVIDING FAIR AND EQUAL WORKPLACECrystal Group’s recent rapid expansion makes it more important than ever to prioritise attracting and retaining the right talent to strengthen our team, meet our operational needs and support our business growth.

Incentivising excellenceWe conduct regular performance reviews to assess performance over the year, identify development needs, and provide options for further career development. In 2014, 17% of the Group’s employees received performance reviews. We also regularly conduct benchmarking exercises to ensure we are offering competitive remuneration and benefits.

60,000GLOBAL EMPLOYEES

China

39%

Vietnam

29%Sri Lanka

8%

CRYSTAL’S TALENTSALL OVER THE WORLD

Others: 11%


Celebrating diversity and equal opportunity

We provide recruitment and development opportunities to all staff regardless of gender, sexual

orientation, disability, age, nationality or religion. We are delighted that our people come from diverse roots, and believe

that diversity offers every one of us the opportunity to learn from one another, in turn helping every Crystal member to connect with our

customers around the world.

32%

WORKFORCE BY GENDER

FEMALE

MALE

68%

Language and cultural workshop

To help our employees communicate with customers and colleagues from diverse roots, we regularly hold different workshops where employees learn other languages and cultures of their local communities.

16-20 21-30 31-40 41-50 >51

50%

29%

13%

1%7%

WOR

KFOR

CE B

Y AG

E


SAFEGUARDING EMPLOYEE WELL-BEING Group operations build a healthy workforce through initiatives to raise personal health awareness amongst our employees, making them less vulnerable to illnesses, while we benefit from having a healthier and more reliable workforce.

Occupational health and safety (OHS)We have OHS committees dedicated to implementing educational and other projects which improve OHS across our factories.

To ensure a safe working environment for our employees, in 2014, our China T-shirt factory’s R&D team conducted a risk assessment of all production equipment. The project involved 11 types of safety issues and 128 machines were modified to make them safer.

All o

wned factories

unde

r compliance monitoring

Heightening awarenessOther OHS initiatives include:

• Publishing an OHS Guide• Holding production safety exhibition


Employee Care Fund

While building our healthy Crystal family, we also support our employees’ families. Many factories now have an Employee Care Fund that is raised, managed and approved by employees. It supplements medical insurance and assists colleagues’ families when they are in urgent need. The programme in our China denim jeans factory has collected a massive USD 140,000 since 2010, giving financial assistance and care to 509 beneficiaries.Going the extra mile

Other innovative health initiatives include giving employees vitamin C supplements to improve their immunity and giving workers

ice-creams and drinks during hot summer days.

The Group’s concern for employee well-being extends to their mental health as well. Some factories in China have launched a “Caring Hotline” and Caring Centre to provide counselling services to employees who need someone to talk to about their work and personal lives.

Vitamin

C

Ensuring work-life balanceWe have focused predominantly on educating our female workers about the importance of personal health, providing training on sexual health, AIDS prevention, personal hygiene and financial literacy.

Since 2012, we have been collaborating with major clients including Abercrombie & Fitch, ANN INC. and Levi’s on female empowerment projects. One example is the Health Enables Returns project (HERproject), a workplace initiative launched to empower female workers through promoting health, financial knowledge and women’s rights. Participating factories in China and Vietnam also published a “Women’s Health Handbook”, educating workers about general and reproductive healthcare.


PREPARING TOMORROW’S LEADERSOur training and development programmes cover ways to improve daily work processes and facilitate long-term career and professional development, which allow for both personal growth and career enhancement of our people.

The Leadership Development Programme for executives and senior managers ensures that our aspiring leaders are poised to support the Group’s succession planning and expansion into new frontiers.

The Group also provides life skills and workplace training to workers, allowing them to increase their productivity and income and advance from the factory floor.

LEADERSHIP TRAINING

8,000HOURS

Associate Programmes

Since 2012, all product divisions have launched “Associate Programmes” to recruit high calibre fresh graduates globally, when successful candidates undergo two to three years of systematic and professional training, paving the way along the promising career development path.

74%Orientation

4%Communication

22%Health & SafetyWORKER TRAINING

206,130HOURS

PARTICIPATION

25,000EMPLOYEES

DEVELOPMENT PROGRAMMES


SOCIALISING SELF-ACTUALISATIONThe Group makes regular and significant contributions to the welfare of the underprivileged, the sick and the elderly by engaging our employees in monetary donations, in-kind sponsorships and pro bono services. To help them become self-sustaining, we strategically support the development of these communities through our core business. Ca

sh contribution

111,081

Perso

ns benefitted

Community services

98

USD

$

380K


Engaging our communityIn addition to regular blood donations made by our employees across the Group, we also support the underprivileged through in-kind donations and participation in charity campaigns.

In 2014, we held various fundraising activities at the factory level to collect donations to support victims of natural disasters like floods and earthquakes which occurred in the regional vicinity of the factories.

Internship programmesAlong with organising factory visits for students, the Group works with institutions around the world to develop new talent for the apparel industry. We provide work placement opportunities for students to experience the industry’s internal workings. These interns receive guidance from our professionals who share their knowledge and experience, empowering them to seek future employment opportunities.


Increase the use of

by 10%

Reduce paper consumption

-18.6%

per garment by 5%Reduce energy consumption

recycled water to 50%

Increase the use of

Plant 1M trees

428,140

2ND GLOBAL 5-YEAR ENVIRONMENTAL TARGETS 2014 PERFORMANCE

+12.5%

per garment by 6%

Reduce carbon footprint

per garment by 10%Redu

ce fresh water consumption

-21.9%49.0%

+1.8% to landfillSend NO operational waste

IN PROGRESS

ren

ewable energy to 5-10%

37.5%

PROTECTING OUR PLANETCrystal Group’s core business involves owning and managing a portfolio of garment manufacturing facilities with a high productivity rate.

Since 2007, we have set five-year global environmental targets across the Group to ensure we use resources efficiently and minimise any adverse environmental impacts. We are now on our second set of the targets, which will run from 2013 to 2017.

40 ENVIRONMENTAL INITIATIVES

*Base year as 2012


2.17

1.91

1.50

To improve this situation, our engineering team has been relentlessly seeking innovative solutions to make the best products using less energy and water. In 2014, the Group made our first voluntary response to the CDP’s Climate Change Questionnaire. This improved insight into our greenhouse gas emissions and climate change strategy.

Looking forward, we will launch the Corporate Environmental Management System Manual for our operations worldwide, which covers:

• energy use• greenhouse gas emissions• water use• waste management • chemical management

BATTLING OUR ENERGY USE AND CARBON EMISSIONS CHALLENGEIn 2014, our Group-wide energy consumption and carbon intensity increased due to:

Capacity Expansion

MoreAutomation

New Facility Constructions

2.19

2.17

2.210.

190.

230.

29

Intimate

Deni

m je

ans

T-shirt wear

Sweater

FOOTPRINTS OF OUR PRODUCTS - CARBON (KG CO2 /PC) 201220132014

0.12

0.12

0.13


Our first ISO 50001 certified factoryIn late 2014, our China sweater factory was the Group’s first facility certified to ISO 50001 Energy Management System Certification standards.

2014

Total: 1,062,099

Total: 997,163

Total: 901,862

ENERGY CONSUMPTION (GJ)

Renewable Direct

INCREASING THE USE OF RENEWABLE ENERGY While seeking energy-saving opportunities, we are using more renewable energy by increasing the use of biomass fuel and wood waste for boilers to replace fossil fuels.

Recognised for carbon reduction by WWFThrough participating in WWF-Hong Kong’s Low-carbon Office Operation Programme (LOOP) and Low Carbon Manufacturing Programme (LCMP) between 2010 and 2014, the Group avoided over 31,500 tonnes of carbon emissions compared to the “business as usual” scenario using baseline data from 2009.

Electricity

20132012


TACKLING WATER RISKWater management is a significant focus of our sustainability strategy.

In 2014, we exceeded our per-garment fresh water reduction target. And of the recycled water we used, it is close to our ambitious target across our global operations.

WE ACHIEVED THIS THROUGH:

1

Upgrading wet-processing

equipment

2

Enhancing wastewater treatment 3

Adopting preventive

maintenance programme

Our new “clean and green” washing machines

Saving an impressive 95.5% of water and 43.4% of steam, our China T-shirt factory introduced these new water-saving washing machines to replace more conventional ones.

These savings were verified by Hong Kong Productivity Council, under the Cleaner Production Partnership Programme.

3,493,320

3,055,254

3,118,364

WATER CONSUMPTION (M3)

Fresh water Recycled water

2012

2013

2014


MANAGING WASTE WITH CONSCIOUSNESSERP and RFIDIn 2000, Crystal Group became the first garment manufacturer in Asia Pacific to adopt the SAP Enterprise Resources Planning (ERP) system. The system has led to an approximately 80% reduction in the use of paper, receiving various recognitions from the system service provider for applying ERP at the global operational level.

In our workshops, we also employ an Electronic Production Management System with radio-frequency identification (RFID) application which helps eliminate paper use in the production lines.

Turning waste into treasureIn our search for a meaningful employee care recreational activity, our sweater factory in China organised an activity when employees and their family members were invited to DIY and up-cycle domestic waste, turning it into useful objects.

PaperGroup operations have long sought technological innovations to achieve paperless operations. One example of best practice in action was the replacement of printers with multi-function copy machines in our offices. These allow documents to be scanned and emailed to users.

Operational wasteThe Group’s goal is to avoid and reduce the waste we generate, and divert as much waste as possible from landfills. We will be launching the Corporate Waste Management Guidelines that incorporates the Group’s “Avoid, Reduce, Recycle, Dispose” approach.


We will continue to enforce better chemical controls by:

• Developing chemical management guidelines• Launching a Manufacturing Restricted Substances List (MRSL)• Expanding regular wastewater monitoring for hazardous substances

Wider Higg Index adoption

Adding to the current eight, six more Crystal factories will adopt the tool to measure environmental performance in 2015.

MANAGING CHEMICAL HAZARDSChemicals are inevitably used in the production of garments. The Group’s chemical management system pays special attention to hazardous substances to ensure safety of our workers, our customers and the environment.

The Group has its own Restricted Substances List (RSL) which sets concentration limits for substances in materials or finished products. In 2014, we made over 240 amendments to the RSL, with 59 newly-added items and 177 items now under stricter restrictions. These updates bring us in line with the increasing concerns of our customers and the community regarding hazardous substances.`


CONTINUING OUR ROBUST GLOBALISATION STRATEGYAs one of our most important sustainability principles, our globalisation strategy sees us build strategic partnerships with our international brand customers, invest in different countries to satisfy our customer requirements and form strategic alliances with our suppliers to achieve virtual vertical integration.

This strategy will allow us to reap the benefits of the global economy, fulfilling our obligation to build a better community while responsively catering to our customers’ needs.

CREATING SUSTAINABLE PROFITWe continuously endeavour to build a conscious enterprise and ensure our business activities create positive impacts on the economy, social cohesion and the environment.

EmployabilityLiving

StandardEnvironmental

Awareness


QUALITY INDICATORS

0.04% Customer ComplaintsTarget: 0%

0.12% Quality ClaimTarget: 0.1%

1.7%Observed Quality Level (OQL) Target: 4%

99.2%Customer FinalInspection Pass Rate (CFIR)Target: 99%

TOTAL INNOVATIONWe work closely with customers to develop new products with enhanced aesthetics and functionality. To maintain our leadership in the industry, we place great emphasis on the adoption and application of innovation technologies in the spheres of machinery, equipment, management systems and information technology, so that we can provide our customers with quality and value-for-money products.

In this way, we gain and keep the trust of our customers.

A nod to manipulating Big Crystal Group recently won the “Big Data Analysis Award 2014” for the manufacturing sector, organised by the China and Hong Kong Enterprise Market Development Association and The Hong Kong Polytechnic University.

The Award recognises innovative enterprises in Hong Kong that have successfully implemented big data analysis to identify new opportunities in business and operations.

A nod to manipulating Big Data

6M&S PLAN A ECO FACTORY

6ISO 14001

6ISO 9001

1ISO 50001

1OHSAS 18001

28 CHINA

OUR BRIGHTEST STARChina is home to Crystal Group’s established, mature production base. The country is also our hub for pioneering and innovating new operations, processes and management strategies.

Given the intense competition in the current market, our China operations focus on maintaining our competitive edge through innovation and transformation, aiming to sustainably increase our capabilities, speed and productivity.

Many of the Group’s “firsts” happen in China, with customers collaborating with Crystal on pilot programmes that allow us to remain on the cutting edge of innovation.

CLONING SUCCESSTaking the advantage of the mature and efficient material supply chain in China, we tactically use China as our primary production base for sophisticated manufacturing that requires speedier response time.

China is our “innovation centre”. Each of our product divisions has its own R&D team here, tailoring their research to the operational needs of their global facilities in order to drive:

Innovation

Productivity

Profitability

Sustainability

29CHINA

Self-developed hanger systemOur denim jeans factory in China developed a hanger system in the laundry workshop, utilising residual heat from the drying machines to dry the washed jeans, reducing drying time and steam and electricity usage by about 30%.

CREATING NEW VALUES Responding to increasing customer expectations in terms of product fashionability and creativity, the Group has prioritised increasing customer satisfaction as well as adding aesthetic and financial value to products through an increase in product variety.

VAPAs early as 2004, our T-shirt factory set up our first in-house Value-Added Processing (VAP) workshop, manufacturing garments decorated by printing, embroidery, rhinestones and beads.

The R&D departments of denim and intimate divisions are also developing a wider variety of their VAP offerings.

VAP

2008 VAP

2014

30 CHINA

Globalising sustainability In 2014, we organised a Global Sustainability Forum in China, when over 50 representatives from our sustainability teams around the world visited our pioneering denim jeans and intimate factories and exchanged experiences of managing CSR risks in daily operations.

X 25

Saved60 million litres

of fresh water

500,

000

PAIR

S

Made with

100%RECYCLED

WATERmeeting WRRS

PIONEERING FOR SUSTAINABLE INNOVATIONIn 2012, Crystal Group began collaborating with Levi’s to establish the first industry standard for water recycling and reuse in apparel manufacturing.

Our denim jeans factory’s existing wastewater treatment plant allows the factory to utilise 90% of its recycled water in the production process, and for landscape irrigation and cleaning. Levi’s environmental experts worked with our engineers to ensure that treated wastewater met their proposed Water Recycle/Reuse Standard (WRRS), aiming to maximise the amount of recycled water for production. The Group will apply this standard at our new denim jeans factory in Cambodia.

31CHINA

(1 worker photo )

To date, a total of 361 female workers from our China denim jeans factory have graduated from our one-year intensive Personal Advancement and Career Enhancement (P.A.C.E.) programme, a collaborative project with our top-tier customer Gap which was first launched in 2013. We are now rolling out this highly-successful programme to our male workers and in other factories.

Making its debut in 2014, the Supervisor Development Unit (SDU) Programme at our China denim jeans factory welcomed its first batch of 30 trainees mainly outstanding P.A.C.E. graduates. They have now completed a four-month full-time trainings under the programme, which aims to elevate high-performing workshop workers, allowing them to cope with the growing demand for supervisory talent as the business expands.

SDU PROGRAMME

(*1 supervisor photo)

CRYSTAL EAGLE PROJECT 450 line supervisors and production unit managers from three T-shirt and sweater factories are now participating in a new 18-month workshop leadership development programme, which aims to improve their managerial and professional skills.

Focusing on communication, team building, stress management and many other managerial skills, the project also aims to improve the process and technology and quality concept skills of these high-achieving staff members. The project will conclude in June 2016.

GLOBAL PEOPLE DEVELOPMENT HUBThe stability of our China operations makes the country the perfect place to develop our people to meet our growing global need for talent. Several projects crystallise our efforts in this regard.

Scholarships for life-long learning Our intimate and denim jeans factories gave scholarships to 24 employees engaged in advanced studies at a local university, recognising their perseverance in working full time while studying part time.

32 VIETNAM

OUR NEW STARVietnam is host to a rapidly-developing production base and is a key part of the Group’s medium-term growth strategy.

In 2014, our main focus in Vietnam was enhancing our capacity to meet our customers’ global supply and sourcing consolidation strategies. At the same time, we worked to sustainably build the strength of our local supply chain to make sure our ambitious expansion plans can be accommodated. Internally, we focused on localising our management to build a strong and committed in-country workforce to support this remarkable and continuous growth.

In late 2014, our intimates division moved to a new and larger production site, while our T-shirt factory in Vietnam celebrated the opening of two huge production blocks in a new industrial zone. This extension will continue to expand and occupy a total land area of 33 hectares by 2019, contributing to a threefold increase in production capacity and an 80% increase in employment for the entire Vietnam T-shirt division.

Other expansion projects are also underway – the country’s sweater division is planning to relocate and expand, aiming for a seven-fold increase in production in four years’ time.

The Group is also busy adding value-added processes like embroidery and washing to our facilities to enhance efficiency and eliminate the time taken to source these services, as well as improving our capabilities and ensuring robust quality control. By strategically looking at the whole supply chain, we can holistically grow and improve our competitiveness.

2nd

USD 300MShipping products

valued at over

largest T-shirt exporter

BUILDING MEGA-CAPACITY

33VIETNAM

A VISION FOR TOTAL INTEGRATIONOur virtual vertical integration strategy is focused on bridging some of the missing links in our local supply chain, to make sure that spinning mills, fabric mills, threads, laces, garment dyeing and trim operations are all available in close proximity to efficiently support our operations.

Crystal Group has teamed up with fabric manufacturer Pacific Textiles Holdings to set up a joint venture textile facility in an industrial park near Hanoi. The facility will begin production in early 2015 and employ around 8,000 local workers eventually. The Group is also inviting other supply chain partners to set up production facilities in the industrial park. When complete, we expect this location to be the largest vertical textile and garment operation in Vietnam.

In late 2014, our intimates division moved to a new and larger production site, while our T-shirt factory in Vietnam celebrated the opening of two huge production blocks in a new industrial zone. This extension will continue to expand and occupy a total land area of 33 hectares by 2019, contributing to a threefold increase in production capacity and an 80% increase in employment for the entire Vietnam T-shirt division.

Other expansion projects are also underway – the country’s sweater division is planning to relocate and expand, aiming for a seven-fold increase in production in four years’ time.

The Group is also busy adding value-added processes like embroidery and washing to our facilities to enhance efficiency and eliminate the time taken to source these services, as well as improving our capabilities and ensuring robust quality control. By strategically looking at the whole supply chain, we can holistically grow and improve our competitiveness.

Cross exposure programme 20 employees from our intimate factory’s human resources, sales, sourcing and quality teams visited our mature T-shirt factory, returning with new ideas to improve operations.

15 experienced workers from the T-shirt factory’s ironing department went to our sister sweater company to help their counterparts re-organise the ironing section and provide training for new hires to boost efficiency.

34 VIETNAM

Sense of ownership

Proposed by the G7 team, the factory launched a series of celebration activities after the Vietnamese New Year holiday in early 2015 – including a lucky draw – to encourage workers to return to work on time. Together with other incentive bonus programmes in place, the return rate was over 96% after the holidays.

MANAGEMENT LOCALISATIONThe Group’s philosophy is to build and empower a committed local management team. We treasure our long-term relationships with our employees – their experience and deep understanding of our corporate values alongside their familiarity with local culture and heritage puts them in an ideal position to take on management roles.

NURTURING ENTREPRENEURIAL SPIRITIn 2012, our Vietnam T-shirt factory launched its “G7” programme to develop local management in preparation for future factory expansions through building a sense of accountability. This project engages our future leaders to think, act and work like owners of a factory, preparing them to bring Crystal to the next level of success.

35BANGLADESH

OUR RISING STARS

ENSURING SAFETYSafety has always been a top priority for Crystal Group. The tragic collapse of the Rana Plaza building in 2013 served as a warning to the entire industry and a reminder of the importance of building safety. Crystal Group immediately took steps to ensure the structural integrity of our factory buildings and the safety of our workers.

We are committed to growing a safe and sustainable industry in which no worker would be in fear of fires, building collapses or other accidents that are preventable through reasonable health and safety measures.

Our willingness to act promptly to ensure worker safety continues today. In 2014 – following a visual inspection by a local university in 2013 – certified structural engineer conducted assessments of our factories in Bangladesh, including assessments of the strength of the structure, materials used, and the stability of the building’s foundation, which confirmed the factories are safe.

36 CAMBODIA

SAFEGUARDING HEALTHIn 2013, two of our Cambodia intimate factories partnered with an international health organisation called Project HOPE (Health Opportunities for People Everywhere) to implement a pilot workforce health programme called HealthWorks, bringing preventive and curative health services to female workers.

Participants received health education and counselling and enhanced health services including:

• Family planning• Anaemia detection and treatment• Information on hygiene and nutrition• Maternal care

HealthWorks staff also trained factory health staff in communication techniques, and improved the range and quality of services offered by the factory.

Funded by client Marks and Spencer, the project has seen about 2,000 workers from both factories participate to date. Though the programme targets female workers, our factories included male workers in the AIDS prevention portion of the training.

Initial results have shown that the participants’ lives have been transformed, their sick leave reduced and productivity increased.

CREATING BETTER FACTORIES All Crystal factories in Cambodia are registered with Better Factories Cambodia (BFC), an international independent assessment programme that evaluates factory conditions in Cambodia, helping them make workplace improvements.

Factories in Cambodia have begun working with local governmental labour bureau to conduct worker training on labour rights.

BFC

ENHANCING WORKPLACE & HEALTH

37SRI LANKA

BUILDING A BETTER COMMUNITY

Since 2010, our factories in Sri Lanka have been partnering with the Sri Lankan government’s Coconut Cultivation Board to conduct an

integrated tree farming project.

Integrated tree farming is an eco-friendly agricultural practice which supplies food, fruits, medicinal herbs, timber and other

useful crops planted together in the same area.

Practising integrated tree farming with coconut trees increases the land-use efficiency and micro-environmental condition.

M&S Plan A Eco FactoriesAll Crystal’s manufacturing facilities in Sri Lanka have been accredited.

150,000 trees planted

50,000 trees will be planted.

2015

a further

2010-14

38 OUR AWARDS

OUR AWARDS

CSR & EMPLOYEE CARE

ENVIRONMENT

BUSINESS

21

21

18

39OUR AWARDS

Crystal Group

Crystal Group

Dongguan T-shirt Factory

Ye Ji Sweater Factory

Yida Denim Jeans Factory

Crystal Apparel Ltd.

Crystal Headquarters

Yida Denim Jeans Factory

HKGO 065251Martin Zhongshan

Intimate Factory

40 GRI INDEX

A Global Commitment to Sustainability









GRI INDEX

Strategy and Analysis

1.1 Message from the Chairman & CEO P. 6

Organisational Profile

2.1 Cover --2.2 About Crystal Group P. 7

2.3 About Crystal Group P. 9






2.9 GRI Index P. 40

2.10 Our Awards P. 38

Report Parameters

3.1 About this Report P. 5




3.5 GRI Index P. 40

3.6 GRI Index P. 40

3.7 GRI Index P. 40


3.10 GRI Index P. 40



Governance, Commitments, and Engagement

This report is aligned to the Global Reporting Initiative (GRI) G3.1 guidelines at Application Level C. The GRI index, showing which indicators we have reported against is outlined below. The scope, boundary and measurement in reporting have no significant change and no specific limitation.

Full disclosure: Partial disclosure:;







Economic Performance

EC1 About Crystal Group P. 8

Environmental Performance

EN3 A Global Commitment to Sustainability

EN4 A Global Commitment to Sustainability P. 22

P. 22

EN6 A Global Commitment to Sustainability P. 22EN7 A Global Commitment to Sustainability P. 20EN8 A Global Commitment to Sustainability P. 23EN10 A Global Commitment to Sustainability P. 23



Social Performance

LA1 P. 13

LA8 P. 17

LA10 P. 17

LA11 P. 17

LA12 P. 13

HR3 P. 17

HR10 P. 15

PR1 P. 25

PR5 P. 26

Kenneth Lo, Chairman

“Let’s reshape the industry - be more innovative and sustainable for a better world.”

Designed by Chinny Wong & Eva Tam

embracing the values of sustainability, crystal group · embracing the values of sustainability,...

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