Crocs, Inc. (NASDAQ: CROX), the company best known for its colorful and comfortable rubber clogs, has issued its first sustainability report. The report outlines the company’s sustainability efforts across three categories: workplace and supplier standards, environmental management and community engagement.
The company’s major accomplishments include: reducing packaging to save around 640,000 pounds of waste from going to landfills, donating more than $840,000 to various nonprofit organizations in 2012, and enhancing working conditions across its primary production facilities by improving enforcement of its Suppler Code of Conduct.
“Acting as a responsible steward for the health and well-being of our people, our environment and our communities has always been a priority at Crocs,” said Scott Crutchfield, Chief Operating officer at Crocs. “With the release of our first sustainability report, we’re proud to be able to further define our approach to sustainability, share our progress to-date and establish baseline metrics against which our future progress can be measured.”
The report was compiled using the Global Reporting Initiative (GRI) G3 reporting framework, which provides a common sustainability reporting standard and is used by over 3,000 organizations globally.
Crocs received a C application level from GRI, representing the lowest level of disclosure for reporting companies. Still, it is not uncommon for first-time reporters to receive a C application level, and Crocs ought to be lauded for issuing a sustainability report after only ten years in business.
Issuing the report was Crocs’s way of formalizing and consolidating sustainability efforts that have been underway since the founding of the company. In 2007, the company launched Crocs Cares, its corporate social responsibility platform. Crocs has since donated 3 million pairs of shoes to people in Latin America, Africa, and the Middle East.
“While many elements of our sustainability program were well underway as we began to compile the report, bringing all the initiatives together to get a comprehensive look at our efforts and their benefits was a substantial undertaking for the organization,” says Crutchfield.
Perhaps the weakest element of Crocs’s sustainability performance is enforcement of its Supplier Code of Conduct. The Code of Conduct, launched in 2009, prohibits the use of child and forced labor, requires that its factory work environments are safe and healthy, and demands that workers are compensated in a fair and timely manner.
The company has set goals of standardizing the auditing process that measures compliance with the Code of Conduct, and ensuring at least 90 percent compliance with the audit checklist for all factories and contract suppliers by the end of 2013. These goals are impressive, but they also leave open the possibility of labor violations occurring at Crocs’s production facilities.
Still, the company is committed to sustainability for the long term. Crocs has set several impressive goals to accomplish as it further implements sustainability practices across its operations.
Many of the company’s major goals center on product innovation, where the company wants to implement more sustainable designs. Crocs seeks to eliminate the use of glue and cement, and its designers are developing outsoles made of 100 percent reused material. Crocs is also designing shoe styles that require fewer raw materials.
For Crocs, the most significant benefit of compiling its first report came from the opportunity to formally share its sustainability efforts with its employees.
“Our sustainability efforts are important to our employees and we want to ensure they can continue to feel good about working for a company that is dedicated to supporting them, the environment and the communities in which it does business,” says Crutchfield.
Founded in 2002, Crocs went public in February of 2006. Crocs reached $1 billion in annual sales for the first time in 2011.