NEWSROOM
UNDER ARMOUR ANNOUNCES CEO TRANSITION
Patrik Frisk to Step Down; Colin Browne Appointed Interim President and Chief Executive Officer, Effective June 1, 2022 Board Initiates Comprehensive Search for Permanent Successor
Community
Labor, Health & Safety
By respecting the people who make our products, we Protect This House and our planet, which is Our Home. Under Armour is committed to protecting worker rights and engaging communities. That’s how we become stronger together.
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In 2014, Under Armour’s Sustainability team adopted the Fair Labor Association’s (FLA) Sustainable Compliance Initiative (SCI) methodology. This assessment approach allows us to measure and track business partners’ employment practices, working conditions, and performance over time against the Under Armour Supplier Code and the Fair Labor Association’s Workplace Code and Compliance Benchmarks, the FLA’s Fire Safety Initiative, and the Dhaka Principles for Migration with Dignity, as well as all applicable laws and regulations in the country of manufacture.
The SCI methodology is based on the “worker life cycle,” evaluating everything from how workers are hired to if, how, and when their employment with the supplier ends. By using it, Under Armour is able to review how employers perform their core management and employment functions, including whether effective policies and procedures are in place, and whether training, implementation and process responsibilities and updates are assigned. Thanks to this methodology and our assessment tool we better understand trends, implementation challenges, and areas in which business partners may benefit from training or capacity-building opportunities vis-à-vis improving management systems. We also have insight into the best and most efficient ways to address compliance issues over time.
Worker Life Cycle
Assessment Steps
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1
Desktop research
Prior to the assessment, Under Armour expects third-party assessment firms to conduct a desktop research on national and local labor markets, recent laws or regulations, known structural or systemic issues, any specific risks to be assessed, industrial relations situations in the factory and/or labor market, serious work accidents in the past, lawsuits, legal actions against the factory, and any other information that may be available online. -
2
Policy & procedures review
During the assessment, the assessors must review the factory’s policies and procedures, company general information, employee handbook, internal rules and procedures, collective bargaining agreements, and records of recent visits by labor inspectors or brand assessments—including actions taken to remedy issues identified. -
3
Task & risk mapping
Within the assessment team, and based on their skills and experience, each assessor will be assigned assessment areas based on the different Employment Functions (EF). At this stage, assessors will prioritize risks identified during the desktop review, and associated country risks. This process will determine the order in which to conduct the assessment. -
4
Opening meeting
This is the first step of the assessment at the factory, and is a meeting between the assessment team, management, and worker prepresentatives. During this meeting, the assessment team explains the nature and scope of the assessment and begins to build a courteous and professional relationship with factory management and worker representatives. -
5
Workflow mapping
This is a visual method of understanding how each EF is implemented—what has been done, when, where, by whom? This is an active and dynamic process that involves interacting with all aspects of the facility and provides the framework for further probing. -
6
Management & worker interviews
Management interviews focus on accurate evaluation practices, and aim to determine some root causes. Worker interviews focus on getting an in-depth view of worker perceptions and measuring understanding of workers of the factory’s management systems. -
7
Observation & document review
Assessors are expected to conduct a physical inspection of the factory. At this time, assessors are paying close attention to the physical space and ensuring that the factory has proper health and safety systems, and practices throughout all areas and facilities. Assessors may also be conducting informal, short interviews during this time with workers. During this process, assessors will also review documents and records not available prior to the assessment, as well as observe interactions between people and departments. -
8
Cross-checking & triangulation
During the assessment, the assessment team will meet at least twice a day to compare notes and cross-check documentation to help identify issues or patterns of risk. Once an issue or risk is identified, the assessors will triangulate documents, interviews, and observations to get in-depth understanding of labor practices and workplace environment. -
9
Closing meeting
The assessment firm meets with the management and worker representatives to present the Management Action Plan (MAP) and explain the findings raised in the MAP. Assessment firms will also share positive observations during this time. Lastly, the assessment firm will reiterate Under Armour’s policy on non-retaliation against workers who were interviewed or participated in the assessment process. -
10
Root cause analysis & reporting
Mainly during the assessment, and particularly during the closing meeting, the assessors will work with management to identify root causes by using the “5 Whys” method. To do so, the assessors must clearly define the problem and its significance; delineate the known causal relationships that combine to cause the problem; establish causal relationships between the root cause(s) and the defined problem; present the evidence used to support the existence of identified causes; and explain how the solutions will prevent recurrence of the defined problem.
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The Under Armour Human Rights Commitment outlines our dedication to promoting and respecting the rights of the people who create, make, wear, use, promote, and connect to our products. After extensive work in partnership with third-party experts to understand our human rights risks across our value chain, we are publishing the Under Armour Human Rights Commitment to formalize our commitments to adhere to international human rights frameworks; to respect human rights throughout our operations, our value chain, our digital products, our communities, and our environment; and to provide a remedy to those impacted by our operations. The Under Armour Human Rights Commitment has been approved by our Sustainability Leadership Council, our Executive Leadership team and the Corporate Governance and Sustainability Committee of our Board of Directors.
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At Under Armour, we are driven by our purpose, We Empower those Who Strive for More, and work as a team to live our values, which include Stand for Equality and Act Sustainably. We work as a team to respect the human rights and dignity of the people who make our products. To that end, the Under Armour Fair Compensation Commitment Statement both confirms our recognition that fair compensation is a fundamental human right and describes how we strive to uphold that right. Since 2016, our Supplier Code of Conduct has stated:
“Every worker has a right to compensation for a regular work week that is sufficient to meet the worker’s basic needs and provide some discretionary income. Employers shall pay at least the minimum wage or the appropriate prevailing wage, whichever is higher, comply with all legal requirements on wages, and provide any fringe benefits required by law or contract. Where compensation does not meet workers’ basic needs and provide some discretionary income, each employer shall work with the FLA to take appropriate actions that seek to progressively realize a level of compensation that does.”
We continue to partner with the Fair Labor Association (FLA) as an affiliate and accredited participating company, and learn from experts and stakeholders. Together with them, we aim to drive strategies, learn best practices, collect relevant data and implement tools and approaches to help improve workers’ compensation, including the wages workers receive from our manufacturing partners who employ them. We remain steadfast in our commitment to ensuring that over time such manufacturers take the appropriate actions to realize progressively a fair compensation level for their workers, as declared in the Under Armour Supplier Code of Conduct and the FLA Workplace Code of Conduct.
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The Under Armour Supplier Code of Conduct reflects core ILO conventions and includes provisions on Child Labor, Forced Labor, Compensation, Hours of Work, Freedom of Association and Collective Bargaining, Non-Discrimination, and Harassment or Abuse. These provisions set forth expectations for the protection of workers and seek to mitigate risks including forced labor/slavery, human trafficking and risks related to our suppliers’ employment of migrant workers. The Under Armour Code has been approved by the Audit Committee of the Under Armour Board. To read more about our efforts to address the risks of modern slavery in our business and supply chains see our Modern Slavery Statement.
Migrant Worker Policy and Standards (MWPS): In January 2021, we distributed the MWPS to our vendors/suppliers. The MWPS further describes our commitment to, and expectations about, respecting human rights and dignity of those who make our products, components and materials. Through the MWPS and related due diligence, we seek to ensure the protection and equitable treatment of migrant workers throughout our value chain and across their employment life cycle. Suppliers must implement systems, processes and conduct related due diligence to ensure Responsible Recruitment, Hiring and Employment of migrant workers. The MWPS addresses key concepts including that migrant workers must not pay for their employment, retain control of their personal identity documents, obtain work free of coercion, deception, fees and debt. Vendors/suppliers are expected to confirm in writing that they understand, support and commit to implement the MWPS and comply with all applicable laws, conventions, rules, regulations and standards. To develop the MWPS, Under Armour consulted key human rights experts and specialized NGOs to ensure that the guidance it provides is accurate and that potential issues associated with migrant labor are addressed properly.
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The purpose of our Human Rights Due Diligence model is to identify conditions within countries that may expose Under Armour to greater risk of violating human rights. It is part of the impact assessment portion of the Human Rights Due Diligence process, as outlined in the United Nations Guiding Principles on Business and Human Rights (UNGPs). The UNGPs identify the International Bill of Human Rights and the eight core conventions of the International Labour Organization’s (ILO) Declaration on Fundamental Principles and Rights at Work as the baseline set of human rights that business enterprises must respect and protect. In an attempt to cover the topics contained in these documents, our model organizes data into three broad thematic categories:
- General governance capacity, which aims to gauge the state’s capacity for good governance
- Protect, which aims to measure the degree to which the rights contained in the International Bill of Human Rights are protected in a given country.
- Respect, which aims to examine the degree to which the ILO’s eight core conventions are respected in a given country.
Based on this assessment we engage with suppliers, civil society organizations, and other third party stakeholders to focus on specific issues and risks to ensure FLA and Under Armour Codes are met and embody core labor standards, and related conventions, of the ILO. Only after these requirements are met do we approve our suppliers to start production for Under Armour in that specific country.
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Under Armour strives to listen to all our key stakeholders and has a number of mechanisms in place to help identify and respond to potential incidents in our supply chain, including the process noted in the Reporting Potential Misconduct provision of our Supplier Code of Conduct and our participation, as a Fair Labor Association affiliate, in the FLA’s Safeguard Mechanism. When action is required, we seek to develop plans that consider local circumstances and to consider the safety of those potentially impacted, engaging third parties for support and expertise if needed. We seek to engage effectively with civil society organizations and unions representatives in key sourcing regions. For additional information, please see civil society overview related to FLA Principle 9 in Under Armour’s February 2019 FLA Accreditation Report.