Sustainable supply chain
Geographical distribution of suppliers to the Inditex Group
Inditex’s business model is based on the premise that all its processes must be sustainable and responsible. This concept of sustainability in Inditex not only covers the entire value chain but is also considered the focal point of all its strategic decisions. In this regard, it is understood to be a responsibility that is shared by all Inditex’s members of staff.
The value chain is characterised by what is known as proximity sourcing, which means that more than 50% of production is carried out in areas close to the head offices and logistical centres in Spain. The flexibility that defines Inditex has also spread to its suppliers that have flourished alongside the company.
Apart from the suppliers that can be found in close proximity (the largest group of suppliers), the rest up to the more than 1,400 come from different cultures and societies which allows the Group to ensure a wide variety of specialities in textile manufacture. All of these, as well as each factory where production is carried out, must be explicitly bound by the values of social and environmental responsibility that defines Inditex, through the Department of Corporate Social Responsibility, the Department of the Environment and the commercial and purchasing teams. Inditex’s response to this challenge was to create and implement policies that are in line with fundamental labour standards and environmental protection, setting up tools to aid direct communication with its suppliers and multilateral dialogue with the bodies and institutions that work in these areas. Moreover, Inditex’s customers are also aware of this commitment. Inditex guarantees its customers products that meet the most exacting health and safety standards.
Inditex's extensive team of in-house and external professionals in sustainability, comprising more than 2,700 people, works closely with the rest of the departments within the company, jointly facing the common challenge that entails not only strengthening and ensuring a sustainable supply chain but also striving for a positive impact on the communities where this is located.
In addition, social dialogue and coordination with different stakeholders (chiefly, unions, non-governmental organisations, business associations, governments and members of civil society) are considered essential elements. In particular, participation in international platforms, such as the Ethical Trading Initiative, the UN Global Compact and the Framework Agreement with IndustriALL Global Union, has proved itself a useful learning tool that encourages the application of best practices.
Inditex's supply chain in 2012*
| Region | Suppliers with purchases in 2011 | Suppliers not | Region | Suppliers with purchases in 2011 |
|---|---|---|---|---|
| Africa | 127 | 30 | 15 | 112 |
| America | 66 | 22 | 24 | 68 |
| Asia | 686 | 271 | 257 | 672 |
| Non-EU Europe | 134 | 45 | 47 | 136 |
| European Union | 477 | 106 | 75 | 446 |
| Total | 1,490 | 474 | 418 | 1,434 |
Protect, respect and remedy
Protect, respect and remedy
One of the fundamental principles of the UN Framework for Business and Human Rights obliges companies to act with due diligence to avoid infringing on the rights of others. In 2011, this Framework, known as the Ruggie Framework, was developed based on the “Guiding Principles on Business and Human Rights: implementation of the U.N. framework to protect, respect and remedy”.
Inditex is committed to respecting and applying these principles by implementing policies directed at maintaining the sustainability of its supply chain using a two-pronged approach: avoid causing adverse impacts in the community where it operates and seek to prevent or mitigate consequences directly linked to its operations, even if it has not contributed to those impacts.
The premises set up by Inditex to address the challenge inherent in maintaining a sustainable supply chain are:
