FOCUS AREAS

People

Strategy Pillars

PEOPLE

Our employees, their families, our neighbouring communities and those in our wider value chain are all the people that are immediately touched by our business. We have a responsibility to them all and our policies, procedures and programmes are there to ensure that safety, wellbeing, fairness, equality, diversity and opportunity are part of that relationship.

Great starts here

People are at the heart of our business at Coats, and this year we had 86% of our employees covered by the country level “Great Place to Work” certification, exceeding the target of 80% we set in 2019.

Great Place to Work (GPTW) is the world’s most reputable global authority on workplace culture, enabling us to assess and benchmark engagement levels across our workplace. The GPTW assessment framework enables us to measure an index of Trust, enabling employee feedback to be given on the levels of respect, fairness, and pride they associate with working for Coats. In the next phase of our sustainability journey, we will continue to utilise Great Place to Work as the primary barometer to measure levels of employee engagement and trust, and are committed to further enhancing our current percentage of employees covered with certification to 88% in 2026 and aspirations to achieve 90% by 2030.

To complement our GPTW programme, we continue to evolve our employee-listening strategy, enabling us to better understand and take actions to further improve employee experience and engagement. Fran Philip is our designated Non Executive Director for workforce engagement and she continues to make contact with employee representatives around the world.

In 2022, Fran conducted 7 Employee Listening Sessions across business units in EMEA, Asia and the Americas. During these sessions Fran undertook to understand how employees feel about working for Coats, and obtained feedback on areas where Coats stands out as a great place to work as well as areas where employees feel improvement is required in the working environment. The output from these sessions were then discussed in a dedicated session at the December 2022 Board meeting. Fran also attended and contributed to 2 Diversity, Equity and Inclusion calls with strong global attendance of approximately 300 employees.

Diversity, Equity and Inclusion

As a global employer, Diversity, Equity and Inclusion (DE&I) is part of our DNA and a top priority on our social sustainability agenda. We employ more than 17,000 colleagues worldwide and are proud to bring together talented people from diverse backgrounds and identities.

We value the far-reaching commercial and cultural benefits of a truly diverse workforce. Our core principles highlight the need and responsibility we hold to create a great place to work for all; one that makes everyone feel safe, valued, confident and where they can be themselves.

Everyone, regardless of race, ethnicity, nationality, gender, age, social background, disability, pregnancy or maternity, sexual orientation, marriage or civil partnership, education, beliefs and political opinion, must be treated fairly and with respect. “Coats for All” approach ensures we apply consistent global practices and provide a positive employee experience not for a few, not for many, but for all members of our teams, no matter who they are, where they work or what they do for the organisation.

At a global level we employ people from over 60 nationalities and our gender balance is 35:65 female to male. At a Board level we have 6 nationalities and a gender balance of 44:56 female to male, meeting the Hampton Alexander Review and Financial Conduct Authority targets for female representation at Board level. Our Executive Management team has a gender balance of 29:71 female to male. Our goal is to improve gender diversity at all management levels with a particular focus on senior management levels where our balance at the end of 2022 is 21:79 female to male.

During 2022, the proportion of female senior managers has dropped as a result of strategic projects undertaken during the year and the impact of the new acquisitions made in the year. To accelerate the pace of gender equity at Coats, a female employee-focused programme was developed and launched in late 2022. Our “Coats for Her” programme sits under our umbrella “Coats for All” programme and encourages more women to consider a career with us and nurtures our female talent through five key initiatives: Female Recruitment Campaign, Women in Leadership Fast-Track Programme, Mentoring, Women’s Visibility and Return to Work Programme.

Our Female Recruitment Campaign encompasses our updated recruitment policy and hiring guide which seeks to ensure full female candidate representation at all stages of the recruitment process and our Women in Leadership Fast-Track Programme focusses on developing female employees into shortlists for new job vacancies across our business and ensures equal opportunities are given to women to grow into leadership roles.

Our Women’s Visibility Programmes seeks to increase the visibility and profile of Women across the business through spotlight campaigns of Coats Women on our Coats Link employee communication platform. Biannual Diversity, Equity and Inclusion calls will continue in 2023. Our Return to Work Programme is specifically targeted at supporting the return to work process for both Maternity and Paternity leavers, with return to work guidelines established and shared with Expectant Mothers, HR teams and Managers.

Our target for gender diversity is to achieve a level of 30% females in senior leadership roles by 2026, and to extend this target to 40% by 2030. This target not only subscribes to the United Nation’s goals of gender equality and women’s empowerment, but it also links strongly to Coats purpose of connecting talent, textiles and technology to make a better and more sustainable world.

Occupational Safety

Our ‘Journey to Zero’ was launched in 2018 and continues to be at the heart of our business strategy. The focus of this programme is firmly on ‘leading’ measures that we take to ensure that safety behaviour, training and hazard identification are embedded in our daily business practices. 6 sites globally are covered by ISO 45001, ISO standard for management systems of occupational health and safety (OHS).

Leading measures are those which are aimed at identifying and reducing hazards, and improving safety related behaviour, and lagging indicators are incident rates and their outcomes, such as lost days.

Obviously the ultimate measure of success for this is consistent reduction in our ‘lagging’ indicators and primarily in our Lost Time Incident Rate (LTIR). At 0.4 (incidents per 100 employees) our LTIR is already significantly below equivalent textile industry rates (latest US rates are 1.9). The LTIR rate has increased as a result of our acquisitions in 2022 and improving the performance in these businesses is our current highest priority. We will also be continuing the focus we have on commuting safety as we continue to find that our employees’ journey to and from work is a significant hazard in many countries.

Our Richtlinie zu Gesundheit und Sicherheit is available and is underpinned by a full suite of sub-policies and procedures which are rigorously applied across all Coats units and which are incorporated into our digital workflows in our Intelex Health and Safety cloud based reporting system. Health and Safety reports on leading and lagging indicators are made to every Board meeting which are scheduled at least 7 times per year.

Health & Wellbeing

Coats is committed to the wellbeing of all employees, acknowledges workplace mental health as an important issue for the business and its employees, and takes a stand for employee wellbeing. Coats Board and senior management are committed to promoting mental health in the workplace.

Through our ‘Energy4Performance’ strategy we are seeking to ensure that our employees’ health and wellbeing is supported through structured programmes covering physical, mental, emotional and personal zones. We have a long history of providing such interventions, and our new strategy builds on and enhances this.

Our Energy4Performance strategy provide a healthpromoting workplace which aims to cover the following aspects:

Health-related opportunities and risks being identified and regularly assessed

Increased Employee awareness about the benefits of a healthy lifestyle

Incentives being provided to local management to offer health-promoting programs

Medical services in plants based on local law and regulations

Our Mental Health and Wellbeing Statement can be accessed at download centre

Ethics

We are deeply committed to operating our business with the highest possible levels of ethics and integrity and fully expect all our employees and suppliers to deliver on this commitment. To ensure our high ethical standards are embedded across our supply chain, we make it our responsibility to provide our employees with the correct tools and training to achieve this.

We have an Anti-Bribery and Anti-Corruption Policy, a Data Breach Notification Policy, a Data Protection Policy, a Whistleblowing Policy and an Anti-Retaliation sub-Policy.

We have a comprehensive multi-language suite of mandatory compliance trainings covering Ethics at Work, Antibribery, Competition Law and Anti Slavery that are completed by all relevant employees on a biennial basis, and by all new starters. This training was scheduled across the business in 2022, with over 2,500 employees participating and undertaking short post training examinations to prove understanding. We continue to promote open discussions around the importance of ethics through pursuit of our global ‘Doing the right thing’ programme, led by members of senior management.

We fully support the United Nations (UN) Guiding Principles on Business and Human Rights in our operations. We uphold the UN Declaration of Human Rights and the Convention on the Rights of the Child, the core International Labour Organisation (ILO) Conventions and the Organisation for Economic Co-operation and Development (OECD) Guidelines for Multinational Enterprises and the related Due Diligence Guidelines for the Garment and Footwear Sector.

In line with our biannual cycle, in 2021 we carried out an update to our Human Rights Risk Assessment. As in previous years we used data on child protection from Unicef, the Human Development Index from the United Nations Development Programme, the Freedom in the World Index from Freedom House, the Global Rights Index from the International Trade Union Confederation and the Global Slavery Index from Walk Free.

“To ensure our high ethical standards are embedded across our supply chain, we make it our responsibility to provide our employees with the correct tools and training to achieve”

All of these indices were updated in 2020 or 2021 except for the last one where the data has not been updated since 2018. We factor all of these indices by normalising them and weighting them all equally to produce a final score for each country in which we operate and then we apply the employee numbers to weight those scores into a global total. In our latest calculations the analysis is showing a deterioration in the external environment risk level in a number of countries in the Americas and Asia. By drilling into the detail we have identified that the bulk of this deterioration is driven by worse country level child labour risk ratings and is caused by the filling of gaps in the Unicef data sets as they improve their access to reliable data. This indicates that the overall risk level in these countries might not have actually deteriorated in the last two years, but that we are more accurately measuring the risk. We police employee age very rigorously and have had no cases of underage employment in our operations.

Nevertheless, this continues to highlight the necessity to ensure very robust application of the policies and procedures that we have in place to ensure that child labour, modern slavery, and human rights violations do not occur in our operations and that where legally permissible, freedom of association and access to collective bargaining are open to all our employees. This will be revisited in 2023.

Our Group Internal Audit (GIA) team include a series of 30 human resource audit areas in their audit templates. Most of these are related to compliance with our employment policies or directly with human rights issues. During 2022 they completed 8 audits (compared to 11 in 2021) and identified 10 minor issues requiring remediation within a number of people-related process areas, compared to 13 in 2021.

Following our earlier work on ‘living wage’ analysis across all our units, we completed the small amount of remedial action necessary to ensure that all employees met this benchmark. Our Living Wage Policy which describes our approach is available to download from our website. In addition, our membership of the Fair Wage Network, provides a source of information for our annual remuneration assessments.

We aspire for all our suppliers to be fully compliant with Coats’ health and safety, labour and environmental standards, and will increasingly transfer our operational standards into firm targets for our suppliers. Having updated our Supplier Code in 2020 we have continued our programme of audits that are targeted at suppliers that have a high risk profile. We have implemented a system through Bureau Veritas that tailors audit frequency to supplier performance in the audit, with supplier’s rated good visited every 3 years. Since we started this programme in 2021, 322 audits have been completed with 92% being rated good or acceptable. Of the 8% where improvement is required, or significant risks have been identified, there are 3 suppliers where we are currently requiring urgent amendments to their practices, and if these are not completed we will delist the supplier.

Prior to qualification of a new supplier, and on an annual basis thereafter, all suppliers are required to make a declaration that all materials supplied by them will be fully compliant with Coats Materials Restricted Substances List (CMRSL). The CMRSL is reviewed and updated on an annual basis and aligns to the strictest standards of all of our customers.

We uphold the aims of the California Transparency in Supply Chains Act of 2010 and the UK Modern Slavery Act 2015 and publish a statement on our website on what we are doing to prevent modern slavery in our business and supply chains.

Our annual Global Ethics Day took place in October and the theme was sustainability. Both ethics and sustainability are core to how we do business and embedded in our suite of policies reflecting our commitment to observing ethically and environmentally sound business practices throughout the world. To mark Global Ethics Day, multiple local team based activities took place as well as a global digital live event. In addition all employees were invited to make a pledge and commit to an action they could take at work, and in their personal life to either reduce waste or reduce energy or water usage.

The day was a great success with high engagement and many people across Coats either made their pledges on the Coats Link Community Wall or on posters.

Our Whistleblowing Policy has been updated in 2022. In 2022, we transitioned from an internally managed whistleblowing hotline to an external web-based channel to give our employees greater confidence that the process is secure and independent. As well as internal options for whistleblowing, we have 2 external options for whistle blowers to use; a confidential external voicemail system and a confidential multi-language external web-based reporting system. Our Whistleblowing Hotline has continued to provide support to our employees and received 91 incidents (compared to 98 in 2021). Of the investigations that have been completed 18 [20%] have been upheld (versus 30% in 2021).

Approximately one third of the upheld allegations were related to unfair employment practices while disrespectful behaviour, ethics code violations, conflicts of interest and health & safety issues make up most of the rest.

In all cases we take robust action, up to and including dismissal, where an incident is found to be justified. The geographical distribution of incidents by region is broadly aligned with our employee distribution which indicates that our work to broadly publicise the availability of the whistleblowing system is successful.

Career Management, Training and Mentoring

We are proud of the long tenure of many of our employees and our ability to match career development opportunities with their personal growth and development aspirations. This is managed through our annual performance review process.

We actively promote a safe, respectful and inclusive work environment and are dedicated to developing our employees through training and mentoring. In 2022 we continued to drive our “Unlock Your Potential” mentoring programme with 60 trained mentors and 134 designated mentees across the business. This programme promotes collaborative learning and development and brings together mentees from across the business to share knowledge, skills and perspectives to support personal development.

As the heart of our business, our employees are highly valued as it is only through their talent, knowledge and commitment that we are able to operate our business in the effective and efficient manner that enables us to remain leaders in our highly competitive industry. To ensure that we can supply high quality and competitive products and services alongside fulfilling high ethical, environmental and social standards our employees must be engaged and fully equipped, and maintain a growth mentality and a thirst for constant improvement. In return for this commitment we are dedicated to ensuring our people have a safe, respectful, fair and inclusive work environment and the ability to develop and progress.

Our Manager Excellence programme continued in 2022, with 88 training sessions delivered by our Talent Team and more than 100 managers completing the programme.

In 2022 we launched our Commercial Academy as part of our wider Commercial Excellence Programme. This delivered targeted training and provision of tools to aid sales competencies, with over 90 Managers completing the Sales Leadership Programme in Q4 2022. We plan further activities in this area, and across further markets in 2023.

Significant progress has been made through 2022 in consolidating our employee systems into our Success Factors platform. We now have all performance management, recruitment and learning activities integrated within a single system, improving accessibility and overall employee experience.

Coats Cares

Our community activities, many of which have been ongoing for many years, are now collected under our Coats Care programme which was launched late in 2022.

This programme encourages our employees to volunteer in their local communities and beyond, supporting everything from children’s cancer care to homeless initiatives. Our Coats Cares program will highlight and recognize their efforts.

Across Coats we have many examples of employees dedicating their time outside work for volunteering activities in their local communities and beyond. Our plan is to build on this through country level high impact community interventions clustered under our ‘Coats Cares’ programme and underpinned by a small number of focussed global community initiatives such as on breast cancer awareness.

Pakistan

Flooding

In August and September 2022, significant parts of Pakistan were affected by a series of devastating and unprecedented floods. This catastrophe left more than 1,500 people dead and millions homeless. Government and private sector welfare organizations worked to evacuate the affected people from flooded areas and provided them food, shelter, and basic medical supplies.

Our team were able to raise a combined donation of approximately PKR 840,000 (USD 5,000) for this cause, contributing to the to Edhi Foundations (http://edhi.org/) local provision of food and shelter to impacted community members.

Mexico

Save the children

Through September and October 2022, employees at the Orizaba plant managed to collect 230 kilos of PET caps, which were donated to the Asociación Orizaba Propone AC (AOPAC) to support children and adolescents in their cancer treatment in the region of Orizaba and its surrounding neighborhoods. Through this donation – AOPAC will be able to fund operations and continue with its altruistic work. The total amount donated was $200,000 MXN that were delivered to AOPAC representative, in addition to the collected material which will be sold by the Foundation to continue funding children’s treatments.

Bangladesh

Book donation and tree plantation program for school children

In June 2022, Coats Bangladesh implemented another Coats Cares program at Utsho Biddyaniketon- a school for underprivileged children in Gazipur, Bangladesh. Coats donated books for school libraries and also gave away 500 tree saplings to the school and its students, connecting them with the green environment initiative. The program turned out to be one with significance as Bill Watson, COO – Asia was joined during his visit to Bangladesh and supported in tree planting.

Earlier, Coats supported to reorganize the school library, painting library room walls, reading chairs and also donated bookshelves with books. Coats and its employees will donate more books to further enrich the library.

The students enthusiastically displayed their creative skills and sporty attitude through participation in arts competitions and sports events. They also presented their drawings to Bill and Coats Management as souvenir. The initiatives were well appreciated by the school management and believed to be beneficial for the development of young minds.

Sri Lanka

Supporting Learning for Employees’ Children

The Sri Lanka manufacturing team have organised a series of factory visits for the children of Coats Sri Lanka employees to teach them about the workplace of their parents and to provide exposure into the operations of leading multi-national companies such as Coats.

Orizaba, Mexico & Odorhei, Romania

Reforestation

Our teams in Orizaba, Mexico and Odorhei, Romania celebrated World Environment Day through tree planting and reforestation initiatives. The initiative in Mexico planted hundreds of Pinus hartwegii species in one of the most emblematic locations on the slopes of the Pico de Orizaba volcano, supporting local communities and helping reduce carbon footprint. Our team worked with a topical slogan: “You must be the change that you want to see in the world!”

In Odorhei, Romania, the Coats team supported a 16 hectare reforestation project through provision of packed lunches to approximately 100 local students as well as participating in planting hundreds of tree saplings. The event served as a great opportunity for participants to learn about the cities future forestation plans as well as the personal satisfaction of supporting such a beneficial local cause.

Sri Lanka & Bangladesh

Beach Clear-Ups

Our beaches are bridge between our world and the ocean. Summer weather attracts thousands of visitors to beaches and sometimes visitors bring waste. Beaches have fragile environment, and we must be attentive in how we treat these. Keeping our earth as well as the oceans clean is a great way to help us understand about the importance of having a sustainable earth.

On the occasion of World Ocean Day more than 30 employees from Coats Chattogram, Bangladesh plant volunteered in this community activity under Coats Care program and handed over collected wastes to a recycling unit.

Employees were very enthusiastic about such an amazing event as organizing such local beach cleanups can help eliminate pollution from the marine ecosystem. We believe such program also causes a ripple effect by raising awareness and encouraging locals to take care of their environment.

In September our team in Sri Lanka organised a beach cleaning programme on Wadduwa Saffron Beach, removing many bags of plastic and discarded rubbish and returning the beach into a much cleaner and more attractive place of natural beauty. We aspire to organize such community activities in future.

Coats Employee Profile

We have refined our sustainability framework to better align with our material issues. As part of this, our Social pillar is now the People pillar. This recognises that all of our employees are the lifeblood of our organisation and their welfare and that of their families and the wider communities in which we operate is of utmost importance to us.

We have a comprehensive suite of policies, procedures and programmes in place to ensure that safety, wellbeing, fairness, equality, diversity and opportunity are an integral part of our relation with our people.

Through 2022, the impact of Covid on our business operations reduced significantly. As with the two previous years of the pandemic, we have continued use of our proactive contact tracing systems meaning virtually no cases of workplace infection in the company. In areas of higher risk, for example China, we have continued to implement rigorous workplace controls including Covid-related communications internally and to surrounding communities. Where possible, working from home has been supported and through our 2022 Future of Work programme we have implemented a new framework for remote and flexible working including development and rollout of training packages for business leadership on effective management of remote teams.

People: 88% employees in units with Great Place to Work certification

Indicator	Unit	2022*	2021 restated¹	2021	2020 restated¹	2020	2019 restated¹	2019	2018 restated¹	2018
Permanent employee headcount⁷	No.	16,709		18,811		17,943		17,725		18,239
Permanent employee average tenure	Years	10.0		9.7		10.3		11.1	10.3	10.2
Permanent employee turnover	%	28%		23%		20%		25%		27%
Permanent employee turnover (voluntary)	%	19%
Permanent employee turnover (involuntary)	%	19%
Temporary Employee Headcount	No.	3,702		4,104		3,163		-		-
% female permanent employees	%	38%		42%		42%		41%		39%
% female senior managers	%	21%		23%		22%		24%		23%
% female Board members	%	44%		50%		40%		33%		30%
Employee engagement score	%	N/A		83%		N/A		N/A		83%
Safety training	Hours/employee	30		29		23
Sites accredited to OHSAS 18001	No.	5		7		7
Sites accredited to ISO 45001	No.	6		5		4
Near misses reported	No.	1,653		1,765		1,320
Near miss reporting rate	No./100 FTE	6.9		6.6		6.1
Hazards reported	No.	47,369		47,400		35,083
Hazard reporting rate	No./100 FTE	196		179		162
Improvement actions completed	No.	53,389		54,228		39,689
Improvement actions completion rate	No./100 FTE	221.3		204.3		183
Work related incident rate	Incidents/100 FTE	0.4		0.45
Number of recordable incidents	No.	97		120		129		135
Average lost days per lost time incident	Days	13.31		20.69		24.3		19.7		16.8
Total lost days from incidents	Days	785		1,916		1,669		1,672
Lost time case rate	Lost time incidents/100FTE	0.24		0.34		0.36		0.31		0.37
Work related fatalities	No.	0		0		0
Health & safety prosecutions	No.	0		0		0
Commuting incident rate	Incidents/100 FTE	0.38		0.37		0.37
Number of commuting incidents	No.	92		98		80
% workforce with 'Great Place to Work' or equivalent certification	% workforce.	86%		83%		6%
Permanent employees subject to a collective agreement	%	50%		53%		46%		43%		37%
Permanent employees that are members of a union	%	44%		40%		47%		43%		38%
Diversity in employees	No. of nationalities	57		62		60		60		63
Diversity in senior managers	No. of nationalities	30		32		31		31		32

¹Due to the sale of our Brazilian and Argentinian businesses in 2022 all years from 2018 to 2022 have been restated to exclude these businesses.

^*2022 Data – All data excludes Brazil/Argentina, except emissions data, H&S data and economic value data.

⁷Permanent headcount includes JV operations in China so the numbers don’t reconcile exactly to the statutory headcount in the Annual Report.

For more information on our historical performance, please download Performance Summary Data

People: 88% employees in units with Great Place to Work certification

Indicator	Unit	2017	2016	2015	2014
Permanent employee headcount⁷	No.	19,419	19,079	18,985	19,204
Permanent employee average tenure	Years	10.4
Permanent employee turnover	%	19%
% female permanent employees	%	41%	40%	41%	40%
% female senior managers	%	22%	21%	19%	19%
% female Board members	%	30%	22%	11%	13%
Employee engagement score	%	83%	83%	83%	81%
Near misses reported	No.	1,583
Near miss reporting rate	No./100 FTE	5.4
Hazards reported	No.	33,112
Hazard reporting rate	No./100 FTE	114
Improvement actions completed	No.	36,014
Improvement actions completion rate	No./100 FTE	124
Work related incident rate	Incidents/100 FTE	0.56	0.56
Number of recordable incidents	No.	163	163
Average lost days per lost time incident	Days	34.1	17.9
Total lost days from incidents	Days	2,320	2,015
Lost time case rate	Lost time incidents/100 FTE	0.24	0.26
Work related fatalities	No.	1	0	0	0
Health and safety prosecutions	No.	0	0	0	0
Permanent employees subject to a collective agreement	%	38%
Permanent employees that are members of a union	%	34%
Diversity in employees	No. of nationalities	68
Diversity in senior managers	No. of nationalities	43

⁷Permanent headcount includes JV operations in China so the numbers don’t reconcile exactly to the statutory headcount in the Annual Report.

For more information on our historical performance, please download Performance Summary Data

Kleidung

Schuhe

Performance Materials

Weltweites Verzeichnis

Threads

Yarns

Zips

Composites

Structural Components

Insoles

Fabrics

Trims