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SOCIAL IMPACT

At GANNI, we approach our work on social impact through three key areas: Living Wages, Supply Chain Accountability, and Gender Equality, Diversity and Inclusion.

During 2023, we made substantial progress on our social responsibility strategy, getting us closer to our wider ambition of paying all contractual suppliers a Living Wage Premium by 2025 and embedding ethical considerations into the fabric of our operations and ensuring the same standards in our entire supply chain.


There is an important distinction between minimum wage and living wage in this context, as they are two different concepts. A minimum wage is a legal requirement calculated based on the overall economic condition of the country; as part of our code of conduct, all of GANNI’s suppliers are obligated to pay the minimum wage. A living wage, on the other hand, refers to a wage level high enough to afford a basic but decent standard of living for the worker and their family. The Global Living Wage Coalition describes a living wage as the following:


“The remuneration received for a standard workweek by a worker in a particular place sufficient to afford a decent standard of living for the worker and their family.” Elements of a decent standard of living include food, water, housing, education, healthcare, transport, clothing and other essential needs, including provision for unexpected events.”


Even though living wages are not mandatory by law, ensuring that workers receive living wages is crucial to creating more responsible fashion supply chains, which is why we are committed to this work. We have set a fairly ambitious target to enroll all Tier 1 suppliers to our Living Wage initiative by 2025.


You might be thinking, why is paying a living wage such a complicated process? There are no short answers here, but we will try and summarise the most important points. Because we do not own our supply chain, increasing our wages to a living wage standard involves multiple stakeholders and the sharing of otherwise classified information, which makes it immensely complex. On top of that, the suppliers we work with are not necessarily asked to set the same objectives from the other fashion brands they work with, meaning that we have to work with suppliers to create a structure for paying a premium when producing GANNI products, which is only a percentage of their total production volume.


In 2023, we included 3 suppliers into our Living Wage Initiative and identified 8 of our suppliers who are already paying above the Living Wage benchmark for their respective regions. 


By the end of 2023, 55.6% of the production facilities we work with were audited by third parties, and non-compliance issues were actively followed up on, meaning we have taken concrete steps to ensure the well-being of workers in our supply chain, with independent audits confirming our adherence to ethical labour practices.


We carried out 10 independent third-party audits, 12% of total number of production facilities throughout the year and strengthened our policies and processes when onboarding new suppliers, with special attention paid to subcontractors. 


Towards the end of 2023, we switched our Fair Wear Foundation membership from Full Membership to Fair Wear Foundations new membership option – The Academy – which means we have decreased our financial spend with them. Our choice was guided by a series of considerations, but can be summarised into two main points:


  1. Global Reach: Fair Wear Foundation is currently active in 11 countries, mainly in Asia, Northern Africa and Eastern Europe; for GANNI, this means that Fair Wear does not cover our suppliers in Portugal, Spain, and Italy, which account for 50% of our supplier base. This poses challenges in accessing expert advice and support in these regions.
  2. The Fair Wear Foundation primarily focuses its efforts on Tier 1 facilities involved in cutting, making, and trimming (CMT) processes, along with certain sub-processing facilities. Consequently, its array of training programs, audits, and grievance mechanisms are specifically tailored for suppliers within this tier. This approach, however, highlights a notable limitation in addressing the broader complexities and depths of the supply chain. Beyond Tier 1, the supply chain extends into Tier 2 and Tier 3 suppliers, which play crucial roles in the overall production process but fall outside the Fair Wear Foundation's current operational scope. These additional tiers, essential components of the supply chain, are not covered by the organisation’s training, audits, grievance mechanisms, or factory management systems. This exclusion poses a significant challenge, as it does not align with our commitment to implementing human rights due diligence across the entirety of our supply chain.


While we value the tools and methodology Fair Wear has pioneered, especially in Human Rights Due Diligence (HRDD) and living wage contexts, we recognise the need to adapt to our evolving requirements. We believe that maintaining a close connection with the Fair Wear community while utilising platforms that allow us to effectively monitor our entire supply chain is the wise way forward.


As we step into 2024, we're excited to expand the Living Wage Initiative to a further 8 suppliers, and continue our commitment to fostering fair and responsible relationships with our suppliers. We will persistently refine our sourcing strategy, collaborating with suppliers to proactively address and improve working conditions.


Please find our policies on Code of Conduct, Involuntary Workers Policy, Migrant Workers Policy, Child Labor Policy, Code of Ethics, Bribery and anti corruption, and Modern Slavery Statement

LIVING WAGE

VISION

100% of Tier 1 suppliers to be included in the Living Wage initiative by 2025


Ensure all workers are working in respectful, safe and healthy conditions

GOAL 7

Complete 1 pilot project in India to find a proof of concept to scale our Living Wage initiative by 2022

We successfully completed this goal in 2022 and wrote a case study about the journey in last year's report, which you can read here. Throughout 2023, we have continued to pay a living wage premium to the supplier. To conclude the pilot, we commissioned Fair Wage Network to verify whether the wage gap had been narrowed. Fair Wage Network looked into detailed payslips for a representative sample of workers, and checked the level of wages and distribution of the living wage premium to the workers. 


In summary, the results indicated that: 


  • The inclusion of the living wage premium is making a difference since it increased total wages by nearly 20% 


  • The proportion of workers being paid at or above the living wage increased from 19% to 73% when including the living wage premium. This has impacted 220 employees and their families

 

According to the supplier, employee retention has also improved since their enrollment to the Living Wage initiative, and they’ve seen a positive attitude among employees who received higher wages. 


Indeed there is still a wage gap remaining, as a percentage of the workers employed by the specific supplier in the case study continues to be paid below the living wage. We have to acknowledge the fact that we do not own the factory, and we only occupy a percentage of the supplier’s total production capacity. We encourage other brands to join our pursuit and take action. We’re open to sharing our experience and the structure of how we approach paying a living wage premium to our suppliers. Only through a collaborative approach can we truly close the wage gap. 

GOAL 8

Ensure that strategic suppliers in India and Turkey paid a living wage premium by 2023

With success from 2022, in 2023, we enrolled 2 more suppliers into the Living Wage initiative, taking the total to 3 strategic suppliers we’re paying a living wage premium. These suppliers produce GANNI's iconic items, including the Cotton Poplin Peplum Tie Blouse, the V-Neck Maxi Dress, and Leopard Betzy Cropped Jeans, among others. We have long-standing partnerships with these suppliers and share a mutual commitment to sustainability.


The verification of the impact measurement for these suppliers will take place in 2024, and we will share the insight and the results in our next Responsibility Report.


For more context and transparency, the 3 suppliers that were onboarded to the Living Wage initiative in 2023 are: 


Fancy Images

Located in India with 300+ employees. They produce light wovens for us, including cotton poplin and pleated georgette.


Radnik

Located in Indian with 1,900+ employees. They produce a variety of products for us such as stripe cotton, rib jersey and sequins. 


Sarp

Located in Turkey with 100+ employees. They produce a variety of denim and washed cotton canvas styles for us. 

GOAL 9

Ensure strategic suppliers in China and Italy paid a living wage premium from 2024

In 2022, we collaborated with the Fair Wage Network to conduct a comprehensive wage gap analysis for 6 suppliers in China. The average wages paid by all of these suppliers were found to be well above the living wage benchmark set by the Fair Wage Network. 


In Italy, all our contractual suppliers adhere to the National Collective Employment Contracts (CCNL), which guarantees fair wages. CCNL includes provisions that benefit workers, such as wage increases, employer contributions to complementary social security, and funds for supplementary health care.


Despite this, there is a risk of undercutting the CCNL, especially among small hidden workshops deeper in the supply chain, also known as subcontractors. GANNI is committed to monitoring labour practices at subcontractors and ensuring that collective agreements are consistently followed. This ongoing oversight aims to maintain fair labour practices throughout the supply chain.


Moreover, one of our longstanding Italian suppliers operates two facilities outside Italy, in Romania and Moldova, where a portion of GANNI's products are made. While the average salary for production workers at both facilities exceeds the minimum wage, a gap remains in reaching the living wage. In response, we have extended the Living Wage initiative to cover these two facilities in 2024.

GOAL 10

Ensure strategic suppliers in Spain and Portugal paid a living wage premium from 2024

The textile sector in Portugal is known for having some of the lowest wages. In our efforts to address this issue, we conducted three audits in 2023 and visited multiple suppliers across the country. Our observations revealed that a significant majority of workers, irrespective of their seniority or skill level, are only receiving a minimum wage.


Recognising the existing gap between the minimum and living wage, we have decided to take action. In 2024, we plan to enrol 6 Portuguese suppliers into our Living Wage initiative. 


In 2023, we phased out our supplier in Spain and, therefore, no longer have any production in this country, so will be excluded from the Living Wage initiative. 

GOAL 11

Ensure all Tier 1 suppliers to be included in the Living Wage initiative by 2025

Our approach to achieving a living wage involves two main pathways. Firstly, we conduct a thorough wage analysis at the factory level to assess the current wage levels. For suppliers already paying above the living wage benchmark or those with existing collective bargaining agreements (CBA), we closely monitor wages and ensure compliance with the CBA.


To establish living wages across various regions, GANNI collaborates with The WageIndicator Foundation, purchasing living wage benchmark data. To ensure these benchmarks accurately reflect real-world conditions, we engages with suppliers and their worker committees. By conducting on-the-ground cost of living surveys, we can adjust our target benchmarks accordingly, ensuring that the data not only represents statistical figures but also mirrors the actual living conditions of workers in diverse locations.


For suppliers whose wages fall below the living wage benchmark, we enrol them in our Living Wage initiative. As part of this programme, we provide an additional premium to these suppliers, contributing to narrowing the wage gap.


As of 2023, we have identified that 5 suppliers are already paying above the living wage benchmark, and 3 have existing collective bargaining agreements. Additionally, we have successfully onboarded 3 suppliers into the Living Wage initiative.


To streamline our efforts, we've developed standardised procedures and guidelines. This framework will allow us to efficiently scale up our initiatives to include more suppliers in the future, ensuring a faster and more widespread impact. We feel confident that by the end of 2025, all GANNI’s contractual suppliers will be paying a living wage premium. 2024 is a crucial year to make that a reality. 

supply chain accountability

GOAL 12

By 2025, 95% of Tier 1 and sub-contracted suppliers will be audited and continually monitored

The majority of our contractual suppliers have undergone audits, with a few exceptions for those based in low-risk regions or those in the process of relocating to new factory premises. Our focus for auditing and monitoring is particularly on subcontracting within the supply chain.


Since 2020, we've actively traced our supply chain and worked on consolidating our tail-end suppliers. This strategy helps us concentrate efforts and increase our influence on suppliers. However, in 2023, we fell short of our 60% monitoring goal due to the use of subcontractors for production needs. In response, we've taken the opportunity to reflect and re-evaluate our processes. We're in communication with suppliers to ensure consistent adherence to our supplier authorisation procedures. This will enhance our monitoring efforts and help us achieve our goals effectively.


In 2024, we'll continue with the consolidation plan and reinforce the policy on the authorisation of subcontractors. Additionally, we're adopting the EiQ platform, a comprehensive supply chain analytics tool developed by LRQA. This tool enables us to assess risks on a geographical and product level throughout the supply chain. The monitoring program will extend to upper tiers beyond Tier 1 and subcontractors.


Using a centralised platform, we'll manage and track supplier labour practices and improvement progress continuously. Our commitment is to extend human rights due diligence throughout our entire supply chain, ensuring that all workers involved in making our products operate in respectful, safe, and healthy conditions.

GENDER EQUALITY, DIVERSITY AND INCLUSION

GOAL 13

All GANNI employees to complete ‘Know Your Bias’ training by The Other Box within the first 3 months of joining the company

We have been working with The Other Box since 2021 and conducting mandatory unconscious bias training as part of GANNI’s onboarding procedure. In 2023, we set up a voluntary Diversity and Inclusion Working Group for all office employees. Around 25 employees joined, and together the team has been strategising how best to embed diversity and inclusion in the workplace across the areas of education, allyship, training, and policies; looking at internal and external policies, as well as learning events. In 2023, we hosted a panel with a range of external speakers, including Mary C. Namagambe, Aram Ostadian-Binai, and Manilla Ghafuri, to break down educational barriers on the subject of diversity and inclusion, aiming to make the conversation a more tangible and personal one. We saw a great turnout for the event and received very positive feedback. The programming of both internal and external events across GANNI forums will continue in 2024.

GENDER HQ


GANNI is dedicated to empowering women, in line with our commitment as a signatory of the UN Women Empowerment principles. The majority of our community identify as women, making women the heart of everything we do. We’re pleased to have 84% of women in general leadership positions and 64% occupying senior management positions.


You can see our progress in the chart below.

Women 86%

Men 14%

Women 90%

Men 10%

Women 82%

Men 18%

MANAGEMENT


GANNI is dedicated to empowering women, in line with our commitment as a signatory of the UN Women Empowerment principles. The majority of our community identify as women, making women the heart of everything we do. We’re pleased to have 84% of women in general leadership positions and 64% occupying senior management positions.


You can see our progress in the chart below.

Women 83%

Men 17%

Women 84%

Men 16%

Women 67%

Men 33%

SENIOR MANAGEMENT


GANNI is dedicated to empowering women, in line with our commitment as a signatory of the UN Women Empowerment principles. The majority of our community identify as women, making women the heart of everything we do. We’re pleased to have 84% of women in general leadership positions and 64% occupying senior management positions.


You can see our progress in the chart below.

Women 73%

Men 27%

Women 64%

Men 36%

Women 50%

Men 50%

BOARD OF DIRECTORS


GANNI is dedicated to empowering women, in line with our commitment as a signatory of the UN Women Empowerment principles. The majority of our community identify as women, making women the heart of everything we do. We’re pleased to have 84% of women in general leadership positions and 64% occupying senior management positions.


You can see our progress in the chart below.

Women 50%

Men 50%

Women 50%

Men 50%

Women 41%

Men 59%

TRACABILITY AND TRANSPARENCY

VISION

Verify all traceability claims through increased data integration and supplier relationship management by 2025

With supply chain traceability at the heart of achieving elements of our social and environmental strategy, we are moving away from conventional reliance on geographical data and have started integrating product impact-related metrics throughout our supply chain. Partnering with Fairly Made®, an impact assessment platform based in Paris, France, we successfully executed a pilot project analysing the environmental footprint of some of our products made in India and China based on primary supply chain data. In 2024, we are diligently working to broaden the scope of our pilot initiative. Our aim is to conduct comprehensive analyses of all primary materials utilised across our collections and present accessible and consumer-friendly product impact breakdowns on GANNI.com.

TIERS EXPLAINED

TIER 1: CONTRACTUAL SUPPLIERS

Contractual suppliers are suppliers that GANNI has a direct contractual relationship with. These suppliers sign a mutual business agreement with GANNI that sets the standard for the relationship between the parties and outlines general requirements and codes of conduct.

TIER 1+: SUBCONTRACTORS & SUBSIDIARIES

It is a common practice for suppliers to outsource production to subcontractors due to production capacity or specific skill requirements. Subcontractors are not owned by the subcontracting facility. Subsidiaries on the other hand are separate and legally independent entities that are owned or controlled by the contractual supplier.

TIER 2: MATERIAL SUPPLIERS

Tier 2 suppliers produce the materials used to manufacture the finished product. This tier involves processes, such as weaving, printing, and dyeing. While GANNI has a contractual relationship with its Tier 1 suppliers, it is not common to have a contractual relationship with Tier 2 suppliers and beyond. To gain a comprehensive understanding of Tier 2 suppliers GANNI collaborates with its contractual suppliers to request supplier information.

TIER 3: YARN SUPPLIERS

In Tier 3 raw material is transformed into yarn by undergoing spinning, dyeing and other preparatory processes. It is common to have very limited contact and visibility over Tier 3 suppliers. Through good collaboration in the supply chain, GANNI has achieved a comprehensive overview of the reported Tier 3 suppliers. 

TIER 4: RAW MATERIAL

Tier 4 in the supply chain corresponds to the raw material source, such as cotton and animal farms as well as man-made fibre producers. Farmers usually work with agents consolidating the raw material input. This makes it difficult to track and report on this stage of the supply chain. GANNI is continuously working to improve visibility on this tier by collaborating with its supply chain partners.

SUPPLY CHAIN MAP

You can see our full supply chain list on the Open Supply Hub via this link.

32 SUBCONTRACTORS & SUBSIDIARIES

The following list represents GANNI subcontractors and subsidiaries responsible for 80% of Ganni’s production value

59 MATERIAL SUPPLIERS

The following list represents Ganni fabric suppliers responsible for 80% of GANNI’s production value