Apresentação Beauty Fair - Nilsen


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Este é um summary sobre as iniciativas/problemas de sustainabilidade especificos de apparel industry.

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Apresentação Beauty Fair - Nilsen

  1. 1. 2009 management briefing Meeting the environmental challenge in the apparel industry Management briefing July/August 2009
  2. 2. Page i Meeting the environmental challenge in the apparel industry Management briefing July-August 2009 By Ben Cooper Published by Aroq Limited Seneca House Buntsford Park Road Bromsgrove Worcestershire B60 3DX United Kingdom Tel: +44 (0)1527 573 600 Fax: +44 (0)1527 577 423 Web: www.just-style.com Registered in England no: 4307068 © 2009 All content copyright Aroq Ltd. All rights reserved.
  3. 3. Page ii Single-user licence edition This report is provided for individual use only. If you would like to share this report with your colleagues, please order additional copies or sign up for a multi-user licence by contacting: Chris Clarke Research manager, just-style.com Tel: +44 (0)1527 573 615 Email: chris.clarke@just-style.com Copyright statement © 2009 All content copyright Aroq Limited. All rights reserved. This publication, or any part of it, may not be copied, reproduced, stored in a retrieval system, or be transmitted in any form by any means electronic, mechanical, photocopying, recording or otherwise without the prior written permission of Aroq Limited. This report is the product of extensive research work. It is protected by copyright under the Copyright, Designs and Patents Act 1988. The authors of Aroq Limited’s research reports are drawn from a wide range of professional and academic disciplines. The facts within this report are believed to be correct at the time of publication but cannot be guaranteed. All information within this study has been reasonably verified to the author’s and publisher’s ability, but neither accept responsibility for loss arising from decisions based on this report. Incredible ROI for your budget – single and multi-user licences We understand the pressure your research budget is under and price our reports realistically. You won’t find our reports with four, or even five-figure price tags, but you will find that they make some of the competition look expensive. Each title is available to you on a single-user basis, supplied on the strict understanding that each title is not to be copied or shared. Alternatively, titles can be shared within departments or entire corporations via a cost- effective multi-user licence. Multi-user licences can also save you money by avoiding unnecessary order duplication. To further add value, all multi-user © 2009 All content copyright Aroq Ltd. All rights reserved.
  4. 4. Page iii copies are hosted on a password protected extranet for your department or company – saving you time, resources and effort when sharing research with your colleagues. To find out more about multi-user pricing please contact Chris Clarke. just-style.com membership From just GBP99/US$169/EUR120* a year you will gain access to a growing portfolio of exclusive management briefing reports, and also receive all new briefings for each year you are a member. As well as this impressive list of members’ only reports, you also gain one year’s access to a constantly- updated stream of news, feature articles and analysis. Established in 1999, just-style has rapidly evolved into the premier source of global apparel industry news, analysis and data for busy senior executives. For details of the current special joining offer visit: www.just-style.com/offer.aspx *Prices correct at time of publication. © 2009 All content copyright Aroq Ltd. All rights reserved.
  5. 5. Page iv Table of contents Table of contents Single-user licence edition.......................................................................................................... ii Copyright statement ............................................................................................................... ii Incredible ROI for your budget – single and multi-user licences ............................................. ii just-style.com membership .................................................................................................... iii Table of contents ........................................................................................................................ iv Introduction.................................................................................................................................. 1 Frames of reference in the environmental debate ..................................................................... 2 Categorising the issues .......................................................................................................... 2 Environmental regulation ....................................................................................................... 3 Benchmarking and consistency .............................................................................................. 5 Environmental hotspots .............................................................................................................. 8 Chemical usage ..................................................................................................................... 8 Water ..................................................................................................................................... 9 Waste and recycling............................................................................................................. 11 Supply chain complexity....................................................................................................... 12 Changing consumer attitudes and green marketing ............................................................... 15 Growing demand ................................................................................................................. 15 Consumer commitment and pricing ...................................................................................... 16 Green ranges and eco labelling ........................................................................................... 18 Industry action ........................................................................................................................... 22 Corporate platforms ............................................................................................................. 22 Collective action, information sharing and competitive issues .............................................. 23 Engagement with NGOs and multi-stakeholder options........................................................ 25 © 2009 All content copyright Aroq Ltd. All rights reserved.
  6. 6. Page 1 Introduction Introduction The progress the clothing sector has made over the past ten years in improving labour conditions in its supply chain has shown what can be achieved by companies acting both individually and collectively to address an area of acute public concern. To a degree, the intense media focus given to social issues in the supply chain has resulted in less public attention being given to the environmental impacts of the clothing and textiles industry, and by the same token to the efficacy of the industry’s efforts to meet those environmental challenges. While the two areas have some issues in common, such as the problems created by complicated supply chains and the need for multi-stakeholder engagement, the environment, if anything, poses a raft of even tougher and more complex ethical challenges for the clothing and textiles sector to meet. This briefing provides an overview of what those challenges are and how the industry is attempting to meet them, with perspectives from corporate responsibility executives, industry advocates and campaigners. © 2009 All content copyright Aroq Ltd. All rights reserved.
  7. 7. Page 2 Frames of reference in the environmental debate Frames of reference in the environmental debate The clothing industry has already demonstrated a willingness to engage in improving labour standards in the supply chain, but the scope of that considerable task arguably pales in comparison with the challenges presented by the raft of distinct though often inter-related issues related to the environment. There are a number of ways of categorising or subdividing the areas in question, a fact which in itself underlines both the complexity of the field and the manner in which many of these issues inter-relate. Categorising the issues The European clothing and textiles trade association, Euratex, has been fully engaged in the environmental policy debate for a number of years. With regard to the environment, Euratex has four prime areas of activity: the definition and support of any action to improve sustainability in the supply of safe textiles in Europe; the definition of an integrated environmental strategy in the context of EU institutions and other decision makers; the dissemination of information on EU environmental policy to its members; and the coordination of actions to safeguard industry interests. As an industry advocacy organisation, environmental policy issues and the organisation’s relationship with EU environmental policymakers are an important part of Euratex’s mission. And how the association categorises the environmental challenge is therefore instructive. In 2001, it launched its 2001-2010 health and environmental strategy. The Euratex approach is informed by the main four areas earmarked for priority action over more or less the same timeframe by the EU. These areas are climate change; environment and health; protecting nature and biodiversity; and resource and waste management. © 2009 All content copyright Aroq Ltd. All rights reserved.
  8. 8. Page 3 Frames of reference in the environmental debate Meanwhile, six working groups within Euratex correspond directly to EU environmental policy areas. The working groups therefore cover chemicals; integrated product policy (IPP); integrated pollution prevention and control (IPPC); waste and recycling; ecolabelling; and trade and environment. The environmental issues facing the clothing and textiles sector were also categorised by Jef Wintermans, director of Netherlands trade association Modint, when addressing the Global Responsibility Committee of the International Apparel Federation (IAF) in Cologne in April. The seven areas highlighted by Wintermans serve as a further useful frame of reference for assessing the industry’s response and future action on both a company and collective basis. The criteria are as follows: the use of more sustainable raw materials; chemical usage; fossil fuel usage; volatile organic compound (VOC) emissions; adsorbable organohalogen (AOX) emissions; water usage in textile processing; and water wastage in general. Environmental regulation The Euratex environmental mission in particular underlines the importance for industry of engaging with regulators, policymakers and legislators. It is easy to view environmental consciousness on the part of companies primarily as a component of a responsible business platform, a necessary element in today’s business environment but still, to a significant degree, elective. However, the environmental field covers a whole area of regulatory compliance for companies, arguably every bit as exacting as that relating to financial governance. According to Adil Elmassi, who leads the environmental work at Euratex, this creates competition issues between manufacturers in Europe, where legislation is the toughest, and other parts of the world. “In the EU there is a green production process, something that you do not find in China or in India or in other places, because there is a battery of legislation that needs to be respected. There is a minimum standard, stemming from all the legislation you have, and Europe is much higher than anywhere in the world. Not even in the US do they have such a high level of environmental and consumer safety policy. Our main action is to negotiate policies in a way that we maintain sustainable development.” © 2009 All content copyright Aroq Ltd. All rights reserved.
  9. 9. Page 4 Frames of reference in the environmental debate Dr David Santillo, senior scientist at the Greenpeace Research Laboratories, believes one of the reasons why the clothing and textiles industry has to pay closer attention to the environmental agenda is because so much of the primary production occurs in industrialising countries where there is “a much lower regard for environmental protection and waste management”. However, Malcolm Ball, chairman of the Association of Suppliers to the British Clothing Industry (ASBCI), believes the disparity between developing and developed countries is fast disappearing: “We know there have been abuses in the past and there probably still are, but the major manufacturers and organisations that are supplying the European and US markets are serious people, and the investment in good practice, looking after the environment, has become a prime part of their planning.” Ball adds: “What you see now in investment in China and India and other parts of the world is that the impact on their environment from poor industrial practices has been horrendous, and so there is a great initiative, a move to correct these areas on their own behalf. It‟s not just a matter of keeping western consumers happy. There‟s a dire need to protect their own resources, their own population from bad practices.” Steve Lamar, executive vice president at the American Apparel and Footwear Association (AAFA), agrees. “I think a traditional view might tell you that that‟s the problem but that‟s certainly not where the industry is,” Lamar says, adding that the supplier base in developing countries is now being informed by new regulations, new consumer demand and new retailer demands, as well as a greater general sensibility towards sustainability and the environment. Jef Wintermans also warns against black-and-white distinctions between developed and developing countries: “It is way too simple to say that because the legislation is in order, everything produced in Europe is environmentally sound and everything that is imported is not.” The influence of regulation is clearly key to the environmental debate, so companies’ environmental strategies have to cover compliance with existing regulatory standards and negotiation with regulators regarding future regulation, as well as going ‘beyond compliance’ as part of any ethical business agenda. Indeed, these areas are themselves interconnected. The more proactive industry is in terms of improving itself, and raising its own © 2009 All content copyright Aroq Ltd. All rights reserved.
  10. 10. Page 5 Frames of reference in the environmental debate standards, the more influence its advocates are likely to have with legislators and regulators when it comes to framing legislation. Certainly the Outdoor Industry Association (OIA) in the US has found that its strong stance on environmental issues has helped to forge a good relationship with legislators. “Because our industry is viewed as a leader in this area we‟ll get Congressional staff and members of Congress reaching out to our industry as they craft legislation, to say we want to craft legislation that protects consumers, but in a way that makes sense for industry,” says OIA director of government affairs Amy Roberts. “And that‟s kind of the ideal situation, that we see that we have input into the legislative process.” And in the environmental field, this does not have to mean lobbying for a more permissive regulatory approach. Roberts says that while companies in the outdoor industry are effectively taking a lead through innovation and in spite of an instinct to “see the marketplace work”, if there are companies are getting away with lower standards then regulation is desirable. Currently before Congress is the Optimal Use of Trade to Develop Outerwear and Outdoor Recreation (OUTDOOR) Act, which would reduce tariffs on imported recreational performance outerwear such as ski jackets. Roberts says the OIA is supporting the creation, within the same legislation, of the Sustainable Textile and Apparel Research (STAR) Fund, under which companies benefiting from the reduced tariffs would contribute to funding research into sustainable manufacturing processes. “We‟re willing to keep a small tax on ourselves to fund, as a collective, precompetitive sustainable research,” Roberts says. Meanwhile, Levi Strauss, Nike and Timberland are members of Business for Innovative Climate and Energy Policy (BICEP), a coalition in the US which is lobbying for stronger climate and energy legislation. Benchmarking and consistency One important distinction between work on social improvements and environmental issues, according to Jef Wintermans, is a lack of clear established international standards. He believes International Labour Organization (ILO) standards have greatly helped companies in their bid to © 2009 All content copyright Aroq Ltd. All rights reserved.
  11. 11. Page 6 Frames of reference in the environmental debate raise working conditions in their supply chains, and says the lack of an equivalent in the environmental field is a drawback. “What I notice is lacking in the environmental sphere is a commonly agreed worldwide set of standards defining which behaviour we all should try for, not from the perspective to block people off the market if they don‟t comply yet,” he says, “but to help them focus their energy and enter into a process aimed at improving.” Wintermans believes industry organisations have a role to play in this regard. “That‟s exactly what I am trying to do within the IAF now, and I‟m making some progress I feel. If IAF could engage in a process to work towards defining the criteria or the goals more or less equivalent to the ILO social standards then the worldwide industry would have a point of orientation and could really start making progress.” To this end, Wintermans has been forging links with the International Union for Conservation of Nature (IUCN). He says one advantage of the IUCN is that it already has multi-stakeholder credibility, drawing its membership from government agencies, NGOs large and small, economic development agencies, scientists and academics, the private sector and representatives of civil society. Other industry associations have a role to play in this area. The OIA, for instance, sees some form of environmental indexing as a key element in its sustainability work. Amy Roberts reports that its eco committee is working towards establishing an eco index, modelled on OIA member Timberland’s Green Index, measuring criteria such as water usage and the use of environmentally friendly materials, which all its members, large and small, could use as a resource. The index would have three elements: environmental guidelines, which are qualitative principles and practices to be used as an educational tool, promoting continuous improvement for companies and suppliers; environmental performance metrics, units of measure of environmental impact, including an industry-wide common methodology of calculating the metric; and a comparative scoring system which would be used to inform product design. The OIA plans to set aside a period to collect additional stakeholder input once these principles are in place. © 2009 All content copyright Aroq Ltd. All rights reserved.
  12. 12. Page 7 Frames of reference in the environmental debate The AAFA takes a similar view towards benchmarking. Steve Lamar says sustainability “means a lot of things to a lot of different people” and companies “are at all different sorts of places” in trying to implement sustainable business practices, whether in terms of restricted substances, water, packaging, carbon footprint or other criteria. “So some of what we‟ve been doing has been really trying to establish benchmarks to help them see what some of their peers are doing, to help them break the problem down into smaller chunks, so they can decide what they want to implement, or how they want to implement, or what they are going to put as a priority.” © 2009 All content copyright Aroq Ltd. All rights reserved.
  13. 13. Page 8 Environmental hotspots Environmental hotspots While there may be a raft of environmental areas that all need to be addressed by any industrial sector, it is clear that some are more pertinent to, or problematic for, some industries than others, and so it is for clothing and textiles. Moreover, the sheer breadth of scope in the environmental area makes some degree of industry-specific prioritisation in itself desirable. There is naturally some divergence of view among experts as to precisely which are the most pressing areas of concern for the textiles and clothing sectors, but in researching this briefing, there were three issues that were consistently identified as key priority areas, and they are water, chemical usage and waste/recycling. Chemical usage While the clothing and textiles sector does not attract the level of attention in terms of environmental impacts as say the oil, automotive or nuclear industries there is no doubt that on the issue of chemical usage the industry does have significant exposure. Dr David Santillo of Greenpeace points out that while consumers may view garments made from natural fibres as more environmentally friendly than those made from synthetics, both types are often treated with a whole range of chemicals. “And the problem is that often those chemicals are quite water soluble, so it‟s done within a water matrix, often with quite little recovery of the contaminated waste water, so they can be quite polluting,” says Santillo. “It‟s not always very complicated substances, it can be a lot of salt for example, or it can be a lot of degradable organic material which is going into rivers and streams, but those can be equally devastating in terms of aquatic life.” In 2005, Greenpeace Research Laboratories produced a report, entitled An Overview of Textiles Processing and Related Environmental Concerns, highlighting these issues, and Santillo, who was one of the report’s authors, says there has been some improvement since then. “There has been some © 2009 All content copyright Aroq Ltd. All rights reserved.
  14. 14. Page 9 Environmental hotspots progress,” he says, citing work by the Department of Environment, Food and Rural Affairs (DEFRA) in the UK specifically addressing chemical usage in textiles manufacturing. “I think what else has happened since 2005 is that a number of retail outlets have taken their responsibilities more seriously on both ethical and environmental grounds.” Ingrid Schullström, CSR manager at H&M, a company which has put environmental issues at the forefront of its corporate responsibility agenda, says chemical usage was the first environmental area that the company focused on. Schullström says chemical use is a priority area not only for environmental reasons but also “a clear responsibility for a company” from a health and safety perspective. Santillo also believes there are safety issues to be addressed in chemical usage. In addition to the environmental damage caused by the discharge of chemically contaminated waste water into local water sources, he points to the problem of workers in industrialising countries handling chemicals and dyestuffs without sufficient protective clothing. The list of environmental improvement options put to the IAF Global Responsibility Committee by Jef Wintermans of Dutch trade association Modint contained several recommendations relating to chemical usage. In addition to paying careful attention to the storage and handling of chemicals, companies should avoid unnecessary use of chemicals such as detergents and surfactants, complexing agents and lubricating oils and should strive to recycle chemicals wherever possible. Water Water usage is another prime area of environmental concern for the clothing and textiles industry, not least because it is an issue in three different stages of a garment’s life: the growing of natural fibres, particularly cotton; the processing of textiles; and during garment care by consumers. Steve Lamar, who heads up environmental affairs for the American Apparel and Footwear Association (AAFA), believes the significance of water usage during these three phases makes it a “huge” issue for the industry, and one where a lot of companies are striving to improve practices. “Really if you back at the supply chain, you‟re talking about cotton products for example, you see © 2009 All content copyright Aroq Ltd. All rights reserved.
  15. 15. Page 10 Environmental hotspots water usage in growing cotton, then you see water usage in the production of the textiles, and then you also see water usage in the care of the garment itself,” he says. Water usage in clothing production has become a key issue for clothing companies. Nike, for example, monitors water usage at its supplier factories using a traffic light system. According to John Frazier, head of Nike’s restricted substances list and green chemistry programme, it takes 2,650 litres of water to make one T-shirt and around 10,000 litres for a pair of jeans, while the clothing industry uses around 40bn gallons of water per year in the production process. The question of water usage also brings two desirable environmental goals into potential conflict, as Santillo explains. “People have generally assumed in the past that if they are buying natural fibres that they‟re avoiding some of the environmental problems that might be associated with synthetic fibres,” he says. “What people have really got to realise is that what they are actually getting is a different set of environmental, and in fact social, problems associated with producing natural fibres.” The growing of cotton, Santillo points out, can be “very fertilizer-intensive, very water-intensive and very pesticide-intensive”, while wool production can raise environmental issues related to animal husbandry and associated agriculture. The reduction of unnecessary water and energy usage by consumers during the life of clothing has become an important consideration for clothing producers. Like Lamar, Ingrid Schullström believes that the fact that water usage is an issue both in production and during the life of a garment makes it “particularly relevant” to clothing companies. However, the degree to which clothing companies have responsibility for the water consumers use to wash clothes is a difficult question. “I‟m not sure I would use the word „responsibility‟ because the consumer obviously has a responsibility,” says Schullström. “But there is perhaps something companies can do in terms of consumer education. “We actually already do it on our website. A lot of people in Sweden wear things once and then they wash it. Also normally the temperature mentioned on the garment is the highest that you can wash it without harming the © 2009 All content copyright Aroq Ltd. All rights reserved.
  16. 16. Page 11 Environmental hotspots garment but usually if it‟s not that dirty you don‟t need that temperature. And just washing at a lower temperature saves a lot of energy and water usually. So it‟s a question of educating customers about garment care, you don‟t need to wash so often and at such high temperatures.” So far, for H&M, the emphasis has been more on consumer education than product development, and product development in this area, Schullström points out, has to be carefully considered, as once again two desirable outcomes could be in opposition. “Synthetic fibre, for example, dries very quickly [and] doesn‟t need tumble drying, so that is good but then we have to look what materials it is made of. Is it is synthetic fibre made from oil? So would we promote a synthetic? So I think one would have to think very carefully about what issue is it that you want to give priority to over another.” By the same token, she adds, a product that is ‘non-iron’ may have been treated with a chemical finishing agent. Waste and recycling The Association of Suppliers to the British Clothing Industry (ASBCI) has held a series of environmental conferences in recent years, and chairman Malcolm Ball says the issue that has constantly come up is waste. “And that is waste across everything,” he says, “waste in agriculture, where we‟re using an awful lot of water and energy to create fibres, we‟re wasting energy and resources in processing. Processing is inefficient or equipment is not being used properly.” Part of the problem has stemmed from the evolution of the market in recent years, Ball says, and specifically the growth in fast fashion. “Fast fashion is extremely wasteful because by its very nature it creates waste because of the amount of material coming through. It‟s forcing organisations to really look at their planning but until they get on top of that, there‟s bound to be a waste of resources in moving material around and ineffective deliveries and things like this, where containers are not completely full, so you‟re actually shipping fresh air.” Fast fashion and the mass availability of cheap clothing, which encourages a high turnover of clothing among consumers, also puts an onus on recycling but so far the industry’s record on recycling of garments is poor. Ball believes this is a key issue for the industry to address. “An awful lot of clothing goes to © 2009 All content copyright Aroq Ltd. All rights reserved.
  17. 17. Page 12 Environmental hotspots landfill either from people who are discarding it when it‟s not really worn out or just out of fashion, and from shops that just cannot move the material. If we‟re not going to recycle it, it‟s just lost resource.” According to UK retailer Marks & Spencer (M&S), as much as 80% of clothing in the UK is simply discarded as waste away after use. Indeed, M&S has included a recycling initiative, in collaboration with Oxfam, within its Plan A environmental strategy, which Mike Barry, the retailer’s head of corporate responsibility, describes as one of the company’s most exciting projects. Under the scheme, M&S customers can take their secondhand clothing to Oxfam stores and receive a GBP5 price-off M&S voucher on a GBP35 purchase. In the 12 months since the scheme’s launch, around 800,000 M&S customers have donated clothes to Oxfam, which amounts to over 3m items. As a result, Oxfam has raised GBP1.8m. Barry also points out that around 55% of customers participating in the scheme are bringing the vouchers back to M&S which is much better than the traditional rate of redemption for marketing vouchers. Wintermans makes the point that much could be achieved in waste reduction through more sophisticated garment size coding. “Size coding research and harmony would do enormous good for the environment,” he says. “Taking average dimensions you could steer production much more intelligently and prevent the production of garments that are never worn and that would be more interesting to do rather than to say that fast fashion is not OK.” Supply chain complexity Another general factor that exacerbates many of the environmental challenges facing the industry is the complexity of the clothing and textiles supply chain. For David Santillo, this sets the industry apart from many others that he monitors for environmental impacts. And while it makes it difficult to assess true accountability, by the same token it hampers the industry’s own attempts to improve its environmental performance. “The textiles industry is quite different from, for example, the oil industry or the nuclear industry or the coal industry, in that what you‟ve got as being the very visible part of textiles is the retail side,” Santillo says. “The retail side is disconnected in many ways from the production side. When you‟re dealing © 2009 All content copyright Aroq Ltd. All rights reserved.
  18. 18. Page 13 Environmental hotspots with the nuclear industry you know who is handling the fuel and producing the waste, the same with the coal industry and oil industry. They are all big-name companies that are directly responsible for the management of those activities and for any waste and pollution that results. “The tricky thing with the textiles industry is knowing precisely who is making what and where, and often it can be a large, very complicated network of smaller companies which are much more difficult to track down, and I think that‟s why it‟s routinely been done by targeting the retailers at the far end.” The recent exposé by Greenpeace of certain footwear companies sourcing leather from farms linked to illegal deforestation underlines the problems that convoluted supply chains can create. Amy Roberts of the US Outdoor Industry Association (OIA) says the Greenpeace report showed “the complexity of the system and the difficulty of making sure you‟re able to stay on top of each step of the supply chain”. Sarah Shoraka of Greenpeace UK says its findings showed that companies were “not paying sufficient attention” to their supply chains, but acknowledged that the complex nature of the supply chains in question did make the task of tracing the raw materials concerned difficult. David Santillo says the complexity of supply chains means making an accurate read of the industry’s environmental performance is not easy. However, he says that notwithstanding the progress on chemical usage, the textile industry globally “is a major source of environmental pollution, a major source of air pollution, of water pollution”, while “production of solid waste is also a major issue”. Santillo continues: “There needs to be some kind of global coming together of information, sharing of information, to get an idea of just what the scale of that problem is, and to look at ways in which supply chains can be simplified, in order that, firstly, they can be more sustainable and, secondly, the retailers can keep a much more careful audit of their own supply chains, because the way it‟s set up, the way things have developed historically, just makes that incredibly difficult for anybody to do.” Precisely that type of collective action is discussed later in this briefing. But it should also be borne in mind that the strides the industry has made, both on a © 2009 All content copyright Aroq Ltd. All rights reserved.
  19. 19. Page 14 Environmental hotspots collective and individual company basis, in terms of rendering complex supply chains less problematic in terms of the ethical treatment of workers has shown what can be achieved. © 2009 All content copyright Aroq Ltd. All rights reserved.
  20. 20. Page 15 Changing consumer attitudes and green marketing Changing consumer attitudes and green marketing As with concerns over labour standards in the supply chain, changing consumer opinions and priorities on green issues is proving to be a significant influence on corporate behaviour, both at an individual company level and collectively. In addition to building environmental awareness into their corporate responsibility platforms, pioneering companies, such as Nike and M&S, are making much more explicit reference to green issues in their direct consumer marketing, through labelling, consumer education and the marketing of green ranges, such as organic cotton garments. Not only is this a response to changing consumer demands but it is also catalysing further development of the green market. The marketing of organic cotton garments within core ranges by retailers such as Top Shop and H&M serves to underline how eco consumerism is spreading into the mainstream. Growing demand As Paula Andrea Trujillo, internationalisation director at Colombian clothing and textiles trade association Inexmoda, puts it: “Some years ago, ideas such as „green‟, „organic‟ and „eco‟ seemed distant and expensive. Today‟s consumer is changing and commercial brands understand these new demands.” Like in other areas of ethical consumerism, the strength of the trend varies significantly from market to market. “It is really something that is not clear cut. It all depends on geographic area for example,” says Adil Elmassi of Euratex, citing Sweden, Denmark and Germany as having “more of an environmental culture in their way of thinking, in their way of doing things”. Overall, however, Elmassi adds that “there is an increased awareness when it comes to environment and health issues” which, he says, was prompted to a degree by health and food scares, such as BSE, which have made people © 2009 All content copyright Aroq Ltd. All rights reserved.
  21. 21. Page 16 Changing consumer attitudes and green marketing “really aware of and more focused on certain aspects related to environment and health”. Mike Barry, head of corporate responsibility at M&S, cites consumer opinion as one of the four key drivers behind the retailer’s sustainability agenda. “80% of M&S customers, about 21m people in our shops every week, say in some shape or form they want us to take a lead on environmental and social issues on their behalf.” Barry adds that there has been a 1% rise in customer expectations on sustainability in the last 12 months, suggesting that economic concerns have not seriously disrupted the green trend. Beth Holzman, manager of CSR strategy and reporting at Timberland, says Timberland has certainly been affected by the downturn but believes the differentiation its sustainability commitments provide is, if anything, a buffer to the depressed market conditions. “I really think that Timberland has been working on these things for a long time and while resources are certainly being scrutinised and tightened in some areas I think that we really believe that our CSR objectives and the improved products on both the social and the environmental side are going to help distinguish us as we move forward.” Referring to strong sales of its Earthkeepers eco friendly range, Holzman adds: “We are seeing consumers starting to reward us for putting these products into the marketplace and doing so at a price point that isn‟t much higher.” H&M’s Ingrid Schullström says the interest shown in the Swedish retailer’s organic cotton range underlines a clear consumer trend. “If you look at our organic cotton collections that we started a couple of years ago, the demand has been really good. The customers really welcome those collections and that response, we feel, is a sign of the consumer being aware and wanting to make a sustainable choice in their shopping.” Consumer commitment and pricing However, there is often a discrepancy between what consumers say they want and how they behave when they are actually shopping, so the issue of price remains central in the environmental debate. © 2009 All content copyright Aroq Ltd. All rights reserved.
  22. 22. Page 17 Changing consumer attitudes and green marketing Malcolm Ball of ASBCI says while there is far greater concern among consumers about the production of the goods they buy, price may well be the determining factor. “Judging from a lot of material that we‟ve seen, if there are two goods sitting on the shelf in one store, one says it‟s green and one doesn‟t have any labelling at all, and the one that isn‟t green is cheaper that will sell,” he says. While Ball does not expect the downturn to derail the strong trend towards environmentally friendly goods, he believes financial hardship can be expected to exacerbate that price sensitivity in the short term. Steve Lamar of AAFA shares Ball’s reservations about consumer willingness to pay a premium for environmentally friendly clothing. “Consumers will always say they want something that‟s more green,” Lamar says, “but are they willing to pay for something if it costs more?” With this in mind, he believes regulators have an important role to play in improving consistency in terminology so consumers can have absolute confidence in the environmental claims that are being made. Lamar adds that persuading consumers to act when purchasing in the way they say they want to act in opinion polls is “at the heart of everything my members do”. Ultimately, however, he adds if companies strive towards a “greener doesn‟t have to be more expensive” concept then the issue “goes away”. Euratex’s Adil Elmassi says consumer behaviour needs to “be targeted by companies to translate the way they are thinking into buying goods”. The evidence from the Fairtrade movement supports the contention that burgeoning ethical consumerism is given a significant boost when price parity between mainstream and ethical choices is achieved. Holzman says pricing parity is what Timberland is striving for. “Our goal is to design products that don‟t necessarily have to cost more money to consumers as well as to ourselves in our business process.” Ingrid Schullström believes there has also been a problem with the design of environmentally friendly ranges in the past, and suggests that in order to appeal to mainstream consumers retailers should strive to normalise the eco friendly idea. “I think sometimes, for some reason designers have thought that this is organic cotton so we have to make a garment that is really comfortable and practical, somehow connected to some sort of healthy living,” she says. “Let‟s just make © 2009 All content copyright Aroq Ltd. All rights reserved.
  23. 23. Page 18 Changing consumer attitudes and green marketing the latest fashion; the only thing we change is that the cotton we use is organic, that‟s all – same colours, same style – so that our fashion-conscious customer can go in and buy their fashion garment that they‟re really looking for, and as an added benefit that garment is made out of organic cotton.” She believes this approach has been an important factor behind the success of H&M’s organic cotton range, because people are not “making a sacrifice buying it”. Green ranges and eco labelling Growing consumer awareness places greater onus on labelling and merchandising of greener products, and as the eco trend has gathered pace, a number of companies have developed green ranges. By giving consumers more environmental information on products, companies are not only appealing to already environmentally aware consumers but also fostering the burgeoning interest that many other consumers are beginning to show. For example, Nike’s Considered Design range is a line of environmentally friendly products covering all six of its major categories: basketball, running, soccer, women’s training, men’s training and sportswear. Nike CEO Mark Parker has said of this range: “We are designing for the sustainable economy of tomorrow, and for us that means using fewer resources, more sustainable materials and renewable energy to produce new products.” Timberland’s Earthkeepers range is marketed as a line of premium Timberland footwear and apparel that reflects “our commitment to „Make it Better‟”. Launched in 2008, the Earthkeepers label has to meet design criteria in relation to recycled, organic and renewable material content, solvent-free adhesives and reduced climate impact. For example, the Earthkeepers Mountain Sneaker includes a ‘Smartwool’ fabric lining made from sustainable, biodegradable merino wool, organically tanned, premium full-grain leather and fast-growing hemp. The ‘EcoStep’ outsole is made from 30% recycled rubber. Timberland is among a number of companies making strides in eco labelling generally. Indeed, Beth Holzman considers the work the company has done on eco labelling to be one of its foremost achievements in the environmental sphere over the past 18 months. © 2009 All content copyright Aroq Ltd. All rights reserved.
  24. 24. Page 19 Changing consumer attitudes and green marketing The Timberland eco label system, called the Green Index, was introduced in 2007. So far only applied to footwear, it has three components, based on life cycle analysis: a climate impact score; a chemical use score; and a rating related to the use of renewable resources. “The goal there is that we‟re communicating with consumers to empower them to really be able to make responsible purchasing decisions,” Holzman says. While to a degree the Green Index gives Timberland something of a USP, Holzman would like to see green labelling becoming far more widespread in the marketplace. “One of the challenges we face is that in order to really have comparable shopping take place for our consumers, all companies should be using these types of labels.” The principal challenge as eco labelling initiatives proliferate, however, is analogous with the observations about benchmarking made in the first section of this briefing: that there needs to be more standardisation and uniformity of green claims so that consumers can make accurate comparisons. “There has to be a common approach,” says Malcolm Ball. “We have seen in the past that we‟ve had care labelling that has been different in the US, Japan and Europe. A garment from anywhere can end up in any country, and labelling tends to be applied at the source when the garment is fabricated, so to have common system of labelling, a common language and a common understanding of what these labels mean is essential.” To this end, Timberland has been working collaboratively with its peers in the outdoor industry in a bid to broaden the scope of the Green Index. “One of the things that I think we can really be proud of and it‟s still a work in progress is our work with the Outdoor Industry Association and their eco labelling working group which we helped to co-found,” said Beth Holzman. “The goal there was really to create a standardised label for products in the outdoor industry that is based on the same standards and methodology, so that there can be a consistent label applied to our products as well as others. So we‟re now in the process of working with the group, which is over 60 brands, to actually create a comparable and multi-stakeholder-informed label that all brands could adopt in the future. Our goal is to really take what we have started with the Green Index and really use that as a tool for empowering consumers.” © 2009 All content copyright Aroq Ltd. All rights reserved.
  25. 25. Page 20 Changing consumer attitudes and green marketing Amy Roberts says that at the moment the work in the OIA on eco indexing is more industry-facing than consumer-facing, but the idea of developing this work into the creation of an eco label to be used by all OIA members is a possibility. Its aim now is to give companies “information and an index to work off of; how they present their progress to the consumer is still up to each company to decide. The outdoor industry is not necessarily going to have a label or a certification process.” She continues: “After we‟re able to complete an industry-facing index, I think there will be discussion about do we keep it industry-facing or do they want to make a consumer-facing label, and that would require a separate certification body and that type of thing. That‟s something I think will be discussed within the next year or so as we get this first piece of the work done.” In Europe, there is, of course, the official EU ‘Ecolabel’ programme which was established in 1992. Products and services meeting the necessary criteria can carry the Ecolabel flower logo. The scheme covers a wide range of product groups, including cleaning products, appliances, paper products and clothing and textiles. In fact, Adil Elmassi points out that the clothing and textiles sector is the largest user of the scheme. However, even so Elmassi adds that “the vast majority of our members tend to use more private or national schemes. There are many labels in our sector that are competitors. The vast majority are using more national or private labels than European Ecolabel.” While some are more forthright about the difficulties created by this fragmented picture and the lack of consistency and uniformity in eco labelling, Elmassi believes companies are justified in choosing the scheme which is appropriate for them. He says the most important fact is that some form of eco labelling is used and that it is consumer-friendly. “The main message we deliver is that there is need to use these labels but the decision is made by the company. We do not dictate conduct and we don‟t say you should use this label rather than the other. They know which one they want to link their image to, which one costs less, which one suits their marketing best. So there are lots of considerations.” © 2009 All content copyright Aroq Ltd. All rights reserved.
  26. 26. Page 21 Changing consumer attitudes and green marketing Malcolm Ball says the fragmented nature of the landscape to a degree comes down to the fact that many companies are still at a fairly early stage in this regard, “and people are still working out what works and what doesn‟t”. However, he adds that the sooner something more uniform can be developed in terms of messaging to consumers, the better. “We want to work together with the other key trade associations to get our message right,” Ball says, to eliminate the confusion created by “this cacophony of different messages”. © 2009 All content copyright Aroq Ltd. All rights reserved.
  27. 27. Page 22 Industry action Industry action Environmental concern has become increasingly important for clothing and textiles producers and retailers. However, just as we have seen in regard to social issues, some companies have moved faster than others. Given the changing views of consumers, what the leading companies in this field have in common is the recognition that a strong green agenda can be an important differentiator in the marketplace. Corporate platforms Companies such as Nike and Timberland in the US, C&A in the Netherlands, M&S in the UK, and H&M in Sweden have all been acknowledged for the environmental platforms they have established. Meanwhile, specialist clothing manufacturers such as Patagonia, which have made environmental- consciousness their prime selling point, have also played an important role in greening the clothing sector. In addition to the clear consumer demand, Barry identifies three other key drivers behind M&S’s ‘Plan A’ sustainability platform: business efficiency, employee motivation and the need to innovate and cater for new markets. All these elements serve to underline the clear business case which now exists for having a strong environmental agenda. Malcolm Ball of ASBCI believes what we are seeing in the environmental area is a convergence of two beneficial factors. A strong environmental programme is good from a marketing point of view and “there is a gain to be made against the bottom line”. Beth Holzman of Timberland supports the business efficiency argument. “You look at the energy that we‟re saving in our buildings that will help us get to our carbon neutral goals but, at the same time that is really helping us reduce our total costs as a business.” © 2009 All content copyright Aroq Ltd. All rights reserved.
  28. 28. Page 23 Industry action Collective action, information sharing and competitive issues There seems little doubt that major companies can turn environmental challenges into commercial opportunity. However, notwithstanding progress across the board and particularly the attention start-ups often give to sustainability, going ‘beyond compliance’ is more difficult for SMEs, which have nowhere near the resources of the large companies to fund product and technological development, and may not stand to gain the same marketing benefit. In this context, the work of trade associations and industry networks to assist in information sharing and the spreading of best practice is clearly critical. However, given that an environmental platform can potentially be a differentiator in the marketplace and that the technological innovation required to produce products more sustainably can entail substantial investment, the principle of information sharing is a delicate one. However, Amy Roberts of the Outdoor Industry Association (OIA), which has a large eco working group, says that with regard to sustainability there is a strong commitment to a broader environmental objective. “I think there‟s a bigger environmental ethic within the outdoor industry to maybe put those competitive edges aside to some degree and bring best practices together,” she says. Roberts points out that some of the larger companies may have ten, 20 or even 50 people working on different environmental efforts, while a smaller company or start-up may just have one. “One person obviously is not going to make the same advances on their own. And so it [the eco working group] enables the smaller companies to come in and adopt some of the best practices, even at a baseline level, that maybe they wouldn‟t know about or wouldn‟t have the resources to try to come up with on their own.” Part of the reason why there is this particular commitment to a collective approach, Roberts says, comes down to the particular connection that OIA companies have with the natural world. As the companies are making shoes and clothes to allow people to recreate in nature, the “natural desire to protect the natural world is instilled already in a lot of people that already work in the outdoor industry”. © 2009 All content copyright Aroq Ltd. All rights reserved.
  29. 29. Page 24 Industry action Fortunately, the spirit of cooperation does not appear to be restricted to outdoor specialists. Steve Lamar says the environmental projects at the American Apparel and Footwear Association (AAFA) are there “to help everybody”, enabling “companies that haven‟t taken as many steps on this path to learn from what others have done”. And there is also information- sharing among the leaders: “The ones that are most advanced, they learn from each other.” While M&S’s Mike Barry concedes that there is inevitably a competitive element too, this actually underlines that talk of a tangible business benefit is not just PR. “There‟ll always be a little bit of it now that is competitive,” he says. “I think real step-change innovation comes from businesses trying to compete to get market advantage. Those that succeed are the ones that can walk that fine line, collaborate and compete at the same time.” The environmental working groups established by trade associations underline the importance this area is assuming within the overall work and remit of industry groups. Steve Lamar says the amount of time the AAFA devotes to environmental matters is increasing every year. But it is not just cooperation within the membership of trade associations that is furthering the environmental agenda. Information sharing between industry groups on environmental matters is also proving valuable. For example, the OIA has been briefing the Environment Committee of the AAFA on its eco labelling work. Malcolm Ball believes the integrated nature of the supply chain means there is a great need for cooperation between different forums. He describes ASBCI as the type of “networking forum” which can foster just such cooperation. “Our organisation has traditionally been drawn from middle management, technical people, lab people, buyers, merchandisers. Our membership needs to know what the common goals and common issues are. But our membership doesn‟t have senior board members. They meet in other forums. If all these forums communicate then we get an in-depth relationship through our organisation and there‟s a common approach or a common knowledge.” The RITE Group, meanwhile, is an information-sharing network set up in the UK specifically to work in the environmental field. Formed in 2007 by two academics from the University of Leeds, it aims “to provide advice and fact- based information to minimise the negative environmental impact of the © 2009 All content copyright Aroq Ltd. All rights reserved.
  30. 30. Page 25 Industry action production, use and disposal of textiles and apparel”. Its stated aim is “to drive forward the sustainable production of textiles and clothing throughout the global supply chain through a number of new initiatives and expert working groups”. The working groups develop best practice for sub-sections of the textile industry and coordinate conferences, seminars, publications and interactions with other like-minded groups. The RITE Group has a bold agenda, covering most of the challenges highlighted in this report. In addition to providing a forum for inter-disciplinary discussions on sustainability/green debates, it aims to promote best practice in reducing the impact of textiles on the environment; to develop methods of objectively assessing the ‘greenness’ of textile production, processes and products, eventually through a scoring/grading system based on a full life cycle analysis; to develop clear, industry accepted, definitions of commonly used green/sustainability terms; to develop clear ways of objectively communicating ‘greenness’ information to consumers; to promote and encourage the use of scientific facts in all sustainability/green debates; and educate brands, retailers, manufacturers consumers, media and pressure groups to understand what is fact and what is hype. Meanwhile, Jef Wintermans of Dutch trade association Modint says he was buoyed by the positive view taken towards environmental challenges by representatives from a wide variety of countries at the IAF’s Global Responsibility Committee meeting in Cologne in April this year. He views IAF as a “meeting place” where representatives from different countries can share insights and work together on common problems. Engagement with NGOs and multi-stakeholder options Engaging with the campaign community and NGOs is also seen as important. “One of the things we try to do is reach outside the industry and find what lessons that we can find there,” says Steve Lamar. He says one of the themes companies he is speaking with are stressing is the importance working with all stakeholders, including environmental groups. Beth Holzman says multi-stakeholder engagement is fundamental to Timberland’s approach to environmental issues. “Our commitment to working with multi-stakeholder organisations and institutions is I hope very apparent. It‟s really embedded in our transparency and accountability philosophy, and © 2009 All content copyright Aroq Ltd. All rights reserved.
  31. 31. Page 26 Industry action our philosophy around stakeholder engagement is that we want to be as open and communicative with stakeholders, so we can improve our programmes and the impacts that come out of those programmes.” Holzman says Timberland believes in “collaborative opportunities that can help scale our impacts” and also aims to be “as inclusive as possible to get all different sides of the equation that we should be considering when designing and implementing those programmes”. Consulting all stakeholders, including representatives of government and NGOs, is a key element in the development of the OIA’s eco index, says Amy Roberts. Once a provisional index has been developed, she says the OIA will “need to go out and get stakeholders to come in and look at it and criticise it and make suggestions so that it will be credible. And that would include NGOs but also currently within the eco working group we do have a participant from the US Environmental Protection Agency so we have a Government participant already.” She also points out that the OIA’s eco working group has open meetings about four times a year, and the organisation is keen to invite NGOs in to make presentations to these meetings. “I can see a scenario where we would have them come in, do a presentation to our group, share the information that they feel can help these companies make better-informed decisions. I think they‟ll find our industry very open to getting knowledgeable input from lots of different sources about the different impacts and different manufacturing environments in different countries.” However, while clothing companies have joined in multi-stakeholder partnerships, such as the Ethical Trading Initiative and the Fair Labor Organization (FLA) in the US, to address the issue of working conditions in the supply chain, there has to date been less in the way of formalised multi- stakeholder collaboration on environmental issues. The most notable example of such cooperation in the clothing and textiles field is the Better Cotton Initiative (BCI). BCI describes itself as “a collaborative global process, involving a wide range of stakeholders from farmers and their representatives along the cotton value chain to brands, and retailers”. Its long- term aims are to demonstrate the inherent benefits of better cotton production, particularly the financial profitability for farmers; to reduce the impact of water © 2009 All content copyright Aroq Ltd. All rights reserved.
  32. 32. Page 27 Industry action and pesticide use on human and environmental health; to improve soil health and biodiversity; to promote Decent Work for farming communities and cotton farm workers; to facilitate global knowledge exchange on more sustainable cotton production; and to increase the traceability along the cotton supply chain. In keeping with the multi-stakeholder ideal, the BCI is governed by a Steering Committee which includes companies, producer organisations, NGOs, trade and industry organisations and civil society institutions, as well as international organisations. Current members are Adidas, Gap Inc, H&M, the International Federation of Agricultural Producers (IFAP), International Finance Corporation (IFC), Ikea, Organic Exchange, Oxfam, Pesticide Action Network UK and WWF. The organisation also draws its funding from a broad range of stakeholders, and says it strives for a well-balanced financial support to avoid financial dominance of one specific stakeholder group. It is currently funded by the Swedish International Development Agency (SIDA), the State Secretariat for Economic Affairs (SECO) of the Swiss Confederation, as well as members of the Steering Committee and Better Cotton Partners, which are described as “stakeholders that consistently participate in the development of Better Cotton over time, playing an active role in BCI on a cross-section of issues, and contributing financial or in-kind support to BCI”. Current Better Cotton Partners include Cotton made in Africa, ECOM Agroindustrial Corp., International Labour Rights Forum, Hemtex, Levi Strauss, Marks & Spencer and Nike. There appears to be consensus among both NGOs and companies that multi- stakeholder collaboration can be extremely effective. The success of BCI and of multi-stakeholder initiatives dealing with social issues appears to bear this out. But in spite of the success of the Ethical Trading Initiative (ETI) and others in dealing with social issues, many have reservations about whether the clothing industry could establish some form of counterpart dealing with environmental matters because the area is too broad to be approached in the same way. With an overall umbrella approach, Steve Lamar says, it would be “really hard to create something that was meaningful because the issue is so enormously huge”. Most feel that multi-stakeholder collaboration in the environmental © 2009 All content copyright Aroq Ltd. All rights reserved.
  33. 33. Page 28 Industry action space may be more effective if focused on specific issues, such as the Better Cotton Initiative. Mike Barry adds: “I think the ETI has been very successful on the social side. Do we need something similar on the environment side? There is clearly going to have to be more collaboration there. Clearly over the next five years there have to be more collaborative mechanisms about environmental protection in clothing. I think generally you‟ll see things progressing on two routes. One is the multi-stakeholder group that looks at all issues generally, so looks at sustainable clothes in its entirety. And you‟ll get sector-specific or issue- specific groups working on cotton, on polyester, on wood, dye-houses that can focus on practical solutions for that area.” Ingrid Schullström believes there could be scope for existing multi-stakeholder initiatives which deal with supply chain issues to expand their remit to look at environmental factors specifically related to the supply chain. However, she shares Lamar’s reservations about a multi-stakeholder collaboration that could take on the entire environmental mantle. “If you mean everything that is concerning us, that we could join in a multi- stakeholder initiative and deal with every environmental issue that is relevant for a company, I would doubt that it would be very efficient,” Schullström says. “Then I think it would be easier to work with climate separately and maybe water separately.” David Santillo of Greenpeace also feels there is merit in focusing multi- stakeholder collaboration on specific issues. “There is an element these days of proliferation of multi-stakeholder consultations on various things which can sometimes have difficulty getting away from the superficial,” he says. “They focus on coming out with common statements which are very watered down by the time they come out, or they start on processes that don‟t really seem to have a specific end. Where there is perhaps a much greater need to put some effort in is on much more direct, much more case-specific working with stakeholders, maybe an individual stakeholder, an individual NGO, or a small group of NGOs that are actually focused on finding solutions to a particular case.” Nothing may seem more likely to compromise multi-stakeholder dialogue, or be more disconcerting for companies striving to improve their environmental © 2009 All content copyright Aroq Ltd. All rights reserved.
  34. 34. Page 29 Industry action profile, than a report from a campaign group revealing or alleging environmental abuse or failings in monitoring. The recent Greenpeace report, Slaughtering the Amazon, which alleges that companies, including Nike and Timberland, have been sourcing leather from farms linked with Amazon deforestation is a highly topical case to point. The problems of traceability of the suspect leather demonstrate all too well how convoluted supply chains exacerbate the challenges facing the textiles, clothing and footwear sectors. Such incidences may highlight the tensions that exist between the corporate sector and NGOs, but they also serve to underline how important cooperation between the two is. Indeed, what the Greenpeace revelations show is that the campaign community, even if it often takes a sceptical view of industry, can be an important source of information. Dialogue with NGOs is not just about hearing the other side of the argument. It can provide invaluable intelligence. While Santillo says that Greenpeace does not have “any permanent adversaries and nor do we have any permanent allies”, he adds that “where we can help people by providing information, getting them in touch with other companies in that field that maybe have got new approaches and new technologies, we‟re all for it”. A number of companies implicated in the Slaughtering the Amazon report, including Nike, Adidas and Timberland, all expressed a desire to meet with Greenpeace to discuss the report’s findings. Sarah Shoraka of Greenpeace UK, who worked on the report, says “the olive branch is there”. She adds: “I think the way we‟ve tried to approach this is by telling these companies that they‟ve got these problems and we want to work with them to sort it out. I don‟t think we‟ve taken an aggressive stance and said that they‟re irredeemable. And in a way the fact that they‟ve got these CSR policies in place and they‟re trying to make progress in other areas means that I think they will want to work with us.” So in fact, rather than driving a rift between companies and campaigners, there is a sense that even this potentially damaging and embarrassing report could be a catalyst for further stakeholder collaboration. © 2009 All content copyright Aroq Ltd. All rights reserved.