How Fanatics is improving its global FLA work ecosystem
- Sportswear company Fanatics received accreditation from the Fair Labor Association in 2021.
- The FLA holds its partners accountable for standards such as health and safety and non-discrimination.
- This article is part of the “Financing a Sustainable Future” series exploring how companies are taking action to finance and set their own sustainability goals.
The apparel industry has long been the subject of intense scrutiny of its environmental and human lossesincluding poor working conditions and low wages. Fanatical brandsa licensed sports fanwear producer, declared its commitment to improving the labor ecosystem throughout its supply chain.
In 2021, the company received accreditation speak Fair Labor Association (FLA), an organization that promotes workers’ rights and improves working conditions through partnerships with businesses, colleges and universities, and civil society organizations.
Fanatics Brands is a division of Fanatics Inc, headquartered in Jacksonville, Florida. The parent company, as The Wall Street Journal reports, raised $1.5 billion from investors, pushed into the NFT market with Candy Digital, prepared a sports betting offering and acquired Topps trading cards in January 2022.
The WSJ reports: “The company said an IPO is likely, but it remains focused on growing the business and did not provide an update on timing.”
Sustainability credentials, including investment in workplace safety and fairness, are becoming important for companies considering going public, both in terms of potential risk factors and brand differentiation. .
“Pre-IPO companies need to be prepared for the type of scrutiny they are going to receive,” said Martin Whittaker, CEO of JUST Capital. “There is also a strong demand from investors for companies to show that they can create value through the stakeholder model. This will make them more attractive in the market.”
Partnerships help companies set their workforce standards
The decision to work with the FLA was an “obvious”, Michaela Hepburnsenior director of Fanatics Sustainability, told Insider.
“We take our commitment to mitigating labor impacts throughout our supply chain very seriously, and accreditation signals that commitment to our stakeholders,” she said, adding that a work fairness, including safe working conditions and appropriate wages, is a key element of the organization. sustainability goals.
Fanatics Brands is among 30 others FLA Accredited Organizations, including Adidas, Nike, New Balance and Patagonia. Several others are working on designation.
FLA helps fashion and apparel companies integrate International Labor Organization standards – such as occupational health and safety, non-discrimination and fair compensation – into their own corporate governance practices. The association ensures compliance with these commitments, Sharon Waxmanchairman and CEO of FLA, told Insider.
“We accredit companies that have demonstrated that they meet these standards and continue to make progress,” she said. “It’s not one and it’s done – it’s a journey.”
Global supply chains can be complex, and navigating various international laws and standards related to worker safety and compensation can be daunting, Waxman said.
Salaries are particularly complicated. Waxman said some countries have no minimum wage and others have a minimum wage below the poverty line. FLA offers a Fair compensation dashboardallowing companies to upload their salary data to compare it to other organizations and make more informed compensation decisions.
FFL participating companies must commit to providing fair compensation, and the data helps guide conversations internally and with manufacturers and working groups on compensation standards.
Accreditation is a multi-year process to ensure that companies’ supply chains comply with FLA Workplace Code of Conductwhich is based on international labor law and best practices in labor relations, non-discrimination, compensation, anti-abuse or harassment, child labor and collective bargaining.
The FLA assesses a company’s fair labor principles, responsible sourcing, and responsible manufacturingincluding adopting and communicating workplace standards, training staff at all levels to recognize and resolve issues of non-compliance, conducting internal assessments and providing workers with means of Report issues confidentially.
Ongoing performance reviews ensure companies are making progress toward their goals, Waxman added.
Fanatics Brands’ accreditation was based on several factors, including its Social Compliance Program, which includes 11 staff members worldwide. The company also publishes its social commitments online, has an extensive social compliance training program for employees, conducts social compliance audits at contracted facilities and is making progress in delivering living wages throughout its supply chain.
Accountability and Expectations
According to the FLA external accountability report, Fanatics Brands, which began its affiliation with the FLA in 2016, has more than 90 factories (contracted and owned) worldwide, with the highest numbers in the United States and Thailand.
The report includes a checklist of accreditation requirements that include making internal and public commitments to standards, training staff on social compliance and consulting with unions. Fanatics Brands has met the majority of the baseline requirements, with a few rated “in the process of implementing baseline requirements within disclosed timelines.”
One “ongoing” area concerns governance policies. “New governance work includes the inclusion of sustainability in the charter of the current Board-level compliance committee and the integration of sustainability KPIs into Fanatics management audits,” reads the report.
The mission of the FLA is to monitor and confirm progress towards these goals. “We’re tracking to ensure and confirm that engagement is actually embedded into how the company does business,” Waxman said. “It’s not enough to say they do X, Y or Z.”
Still, she stressed that the FLA is not a “gotcha organization.” Companies are expected to identify labor issues in their supply chain – just as importantly, they create a system to resolve the issues.
People are the most valuable resource in any business, she said. “It’s in every company’s interest to have a system and standards that ensure their workers are treated properly.”