THE 7 VALUES AT H&M via Karl-Johan Persson

We're working closely with our suppliers as well, and as a starting point there we started working with Fair Wage Network, an independent organization specializing in fair wages. We let them review several hundred of our suppliers to look into what was working and, more importantly, what wasn't working. Based on that, they developed a method that we're now testing in three role model factories – two in Bangladesh and one in Cambodia – where we have a five-year commitment and 100% of the capacity so we can have time to test this method. I visited one myself a month ago; it was really exciting. It's early still, but the signs are promising. Overtime has been reduced by 50%, wages have increased, better wage structures are in place, the dialogue between management and workers is better, and productivity is up. So as I said, it's early still, we still have to learn more, but the signs are positive and the suppliers are also positive that it will help their companies in the long term and that it will benefit the workers. Based on these learnings from the three role model factories, we will scale it up to all our strategic suppliers by 2018 at the latest. The third part was the suppliers' workers, and here we are investing heavily to empower the workers – to invest in trainings, to give them technical skills, to get them knowledgeable about their rights, to improve their negotiation skills – all important things in this work to improve fair living wages. The final part is working with the governments to ensure that they improve and enforce labor laws so that salaries are revised annually. I've been to Bangladesh twice, met with the Prime Minister there, and in Cambodia also met with the Prime Minister to discuss these topics. All together, it's very exciting. During the last two years we have seen improvements in these markets, so that's great. There's still a lot to do; we're nowhere near where we should be, but it's getting better, and I'm very optimistic that this fair wage roadmap, together with collaborating with others, will make a really big difference in the coming years. On the environmental side, as we all know, we want to continue to grow, and in doing that we have to respect the planetary boundaries. The fashion industry is dependent on natural resources, and we have to change how fashion is made, learn to do more with less, go from a linear model to a circular model, and do that at scale. Our approach to this was a two-step approach. The first one was when we launched our global garment collecting initiative last year in all markets and in all stores, where customers can come in and leave their garments that they no longer want – H&M garments or any other brand – and these garments will then be reused for charity or recycled. There's no profit in it for H&M, but so far we have collected more than 8,000 tons of garments, so that's really good – garments not ending up in landfill. That was the first step, but the most exciting and important part is closing the loop, getting these products or yarns or fibers back into production again. Here we are investing a lot of resources in this, both in new materials but also in research and development in finding these new fibers. When it comes to new materials, we use a lot already and we are increasing use of recycled materials such as Tencel, for example. But the most important, exciting part is this research and development in finding the technical solutions, in getting fibers that can be reused at scale. We have invested in some really exciting projects run by really good people. Same thing here, it's only early stages but it looks really promising. We're optimistic that this will actually be something that can be scaled up, and if it is done by these projects or any other projects around the world, it will have major positive impact on the environment. So we're quite optimistic that innovative people will crack the code and we will see big improvements because

Well, it's part of – I mean the soft parts as well. It's part of the company values that we speak a lot about, it's part of the culture, and we talk about it and we want people who live the values every day. So that's one thing. And then we also, in a bit more the hard things, we have it in the goals. So all functions and all countries have sustainability goals that they are measured on, and that connects also to the values, of course, to recruit the right people and to keep the right people – not only with great drive and delivering good results, but with good values as well, with a good heart. And all of that comes together nicely.

The idea is to have a label. What exactly will it be? It is not just final, it's not yet finalized, but it will cover everything – the entire value chain from the raw materials to the end-of-life solutions. It will be both on the environment side and on the social side, so different KPIs that are easy to understand for the customers. And then maybe also connected to that – I'm not sure, it's not yet decided – but that you can scan the label and get more information about the company's total sustainability work or more detailed information about that exact product.

Well, it goes back to what I said earlier. One is that it's part of the company – it should be part of the company culture, the values, to have that mindset. It is at H&M; it's been like that from the very start. We are in a way listed, but in a way a family company as well, and we have a long-term perspective, so that helps in having that culture. And then it's also in the goal-setting – not only set goals that are connected to delivering the short-term results, but have goals that are connected to sustainability work and with a longer time perspective. So yeah, that's what I think.