PROJECT STRUCTURAL SAFETY GOING ONE STEP AHEAD IN …

PROJECT STRUCTURAL SAFETY

GOING ONE STEP AHEAD IN PAKISTAN

Ansgar Lohmann

Head of CSR Department

KiK Textilien und Non-Food GmbH

November 2016

Corporate Social Responsibility at KiK

Project Structural Safety – Going one step ahead in Pakistan

Ansgar Lohmann

Head of CSR

Contents

KiK Textilien & Non-Food GmbH – Who we are

Corporate Social Responsibility @ KiK

Environmental and supply chain related topics established in CSR dept.

Recent implementations

Key project in 2016/ 2017 related to Pakistan

3

KiK – Who we are

Family owned business

Textile basic retailer with high quality and low price products

Motto: Clothe yourself from the top to toe for less than EUR 30

Amongst TOP 10 of the biggest German retailers

KiK has more than 3,200 shops in Europe and out of that more than 2,600 shops in Germany

KiK has more than 21,000 employees in 9 countries

4

KiK – Who we are

This makes the difference

Customer-friendly service

Close relationship with our suppliers and other business partners

Openness, fairness and appreciation for our employees

Ongoing integration for more sustainability

Low prices in accordance with the discount principals

5

Network of shopsPurchasing/ Production

LogisticsRange of products- Mostly basics styles- No frequent changes in assortment- Less expensive styles

- Economical transport by sea- Fast stock turn over in our own warehouse in Boenen- Cross-dock warehouse

- Purchasing without intermediate trade- Big order volumes- Long production lead times

- Easy and structured shops- Tidy POS without expensive details

KiK – Who we are

Our range of products

70% of our total range consists of textiles of the following range:

Assortments for men's wear, ladies wear, children's wear, baby wear, underwear

40% of our textile assortment are certified by Öko-Tex Standard

30% of our assortments are home textiles, accessories, households and toys

We are providing a wide choice for the whole family

6

Corporate Social Compliance @ KiK

Working Atmosphere

Working Hours

Compensation

Conditions of Employment

Heath & Safety at Work Forced Labour Child Labour Discrimination

Freedom of Association

Environment

Transparency

Corruption


Enlistment visits by

our agencies and

own unit in Dhaka

with focus on 0

Tolerances

Initial- and Re-Audits via 3rd party auditing companies

Follow-up, capacity building and training via certified consultant companies

Own visits via staff from Germany

Supported by CSR software

Legal liability of the business partners

Fire Electrical, Building Safety

How we ensure compliance at the factories


Accord on Fire and Building Safety Bangladesh

KiK is one of the first ACCORD signatories in Germany

As the ACCORD will officially end in 2018 a specific committee is planning the further procedure ‘beyond 2018’ - KiK is engaged in this project group

In addition to the ACCORD inspections (initial/ follow-up) KiK established an ‘intensive program’ to support the factories in regards to their ACCORD remediation work individually

The current improvement rate is 63%

Our target is to reach an improvement rate of 70% till December 2016


Partnership for Sustainable Textiles - TxB

The Textile Partnership was established in 2014 and is a multi-stakeholder initiative which pools the strength and expertise of its members in order to bring about social, ecological and economic improvements all along in the textile supply chain

KiK is also engaged in all working groups to give an essential contribution and best-practice knowledge

Environmental and supply chain related topics

Carbon Performance Improvement Initiative (CPI2)

CPI2 is an association of 9 trading and branded companies

Target: Reduction of CO2 emissions at suppliers and production facilities in emergent and developing countries important contribution for climate protection

Focus on textile and shoe sector

Water and chemical management is included for one year


Social products – Patchwork rugs and seaweed baskets

Our patchwork rugs and seaweed baskets are being produced in Rangpur and Bogra – two poor regions in the north of Bangladesh

Cooperation partner: CHP Bangladesh

Capacity building

Preventive action against movements to other cities

The profit of the sales of the products is being transferred to our social and environmental projects


Awaj – Doctor Stations, Training and Child Care Center

Established in 2008

The Training reached 3000 workers in 2014, 3520 in 2015 and in the first half of 2016 2520 workers in our garment factories

From March 2008 to July 2016, 56.146 People received medical attention. (40,962 women, 11,288 men and 3,896 children)

Since 2010 37 people received an operation


UCEP - Scholarshisp/ sponsoring school

Established in 2012

24 students have successfully graduated since the beginning of the project

8 schools in total have received sponsoring from KiK


RDRS – Drinking Water and Hygiene

Established in 2012

Since the beginning, 188 tube walls have been installed and 7.828 have been repaired andupgraded

1.986 public latrines have been installed and 30 latrines have been renovated in schools

629,977 people of 53 villages in Dimla benefit from the project so far

200 People are currently employed within this project


Green Energy

Since the beginning of 2011 all German shops have been converted over to Green Energy

Since 2012 all Austrian shops have been converted to Green Energy as well

Lighting concept/ smart meter

In context with ‘KiK 17’ we introduced a new lighting concept

Energy saving up to 50%

We tested LED lighting in our warehouse and HQ in Boenen

Environmental and supply chain related topics - Sustainability reports


Multi-way bags

As of October 2015 KiK exclusively changed their bags from plastic bags into multi-bags (Cotton and Polypropylene)

Target of this change is to support the society in regards to the emotionally topic of environmental pollution via plastic bags

The sales figures are quite positive

Recent implementations

Implementation of a grading system

In the past we had an audit grading system based on the traditional categories:high risk, non-compliant, improvements needed, good

As of 2016 we changed our general social auditing system into a „Audit scoring system“ so that we have more transparency and a more detailed evaluation of each category percentage wise

Target of this implementation is to motivate our suppliers for their cooperation and increase their responsibility

Key project – Factory assessments Pakistan

Building & Fire Safety Assessment Overview


Due to the past horrible factory disasters and safety performances of factories which are in great need of improvements, KiK wants to transfer the main elements of the Bangladesh ACCORD on Fire and Building Safety to our Pakistani factories

Building collapse - Rana Plaza - 2013Factory fire - Ali Enterprises - 2012Factory fire – Ha-Meem - 2010


Why?

Workers’ safety is ensured

KiK wants to support suppliers in Pakistan to ensure that factories will become safe as it is an important sourcing market

Jump start to do the initial building inspection to start remediation

Big advantage in order to the suppliers’ competitiveness as this is the 1st approach ever in regards to fire, electrical and building safety outside Bangladesh

Building safety in sourcing countries is part of the political agenda of the German government


General information

Basis: Standards of Alliance for Bangladesh Worker Safety and incorporate Pakistani law, where appropriate

Design of a remedial retrofit scheme for the factories individually is ensured

Partner of this project will be Elevate, who will support us with their experience and know-how on fire, electrical and building safety

KiK will start the cooperation with Elevate and the suppliers in January 2017

Other sourcing markets will also be focused in future


Fire and Life Safety Assessments Structural Integrity Assessments

Electrical Safety Assessemts Detailed Engineering Analysis

Building and Fire Safety Assessment


Contents Fire and Life Safety

Objectives & What it Covers:

Structural fire resistance with appropriate fire resistance ratings

Separation of hazards

Adequacy of fire protection systems, including fire alarm and detection systems

Equipment maintenance and inspection documentation

Key Service Deliverables

Comprehensive assessment report, including analysis and risk for each non-compliance

Draft Corrective Action Plan (CAP) with suggested plans of action for management


Contents Electrical Safety

Objectives and What it Covers:

Availability and accuracy of single-line diagram (blueprint for electrical system analysis)

Electrical safety and system testing

Full thermographic scan of all electrical equipment




Thermographic scan report


Contents Structural Safety


Physical verification of the factory structure, with particular focus on signs of distress / lack of performance

Review of load management plans and related documentation




Determination of whether Detailed Engineering Analysis (DEA) is required


Contents Detailed Engineering Analysis


Completion of structural assessment tests:

Confirmatory soil test

Foundation Check

Concrete Core test

Rebar strength test

Rebar Scanning

As-built data collection

Identification of physical distress and overloading


Comprehensive DEA report with the following elements:

As-built architectural / structural drawings and models

Design for structural retrofitting

Load management plan


Assessment process

Follow-up phase via regular Audits

(if needed)

Remediation phase

Requesting for a DEA (if

needed)

Reporting by certification

body

Factories assessments

Documents review by

certification body

Kick-off meeting with the

suppliers in Pakistan

Questions & answers

THANK YOU!