2022 SGC - Corporate Social Responsibility Report

CORPORATE SOCIAL RESPONSIBILITY REPORT

About this report

This report covers Superior Group of Companies, Inc.’s (SGC) priority environmental, social, and governance (ESG) topics for our three reportable business segments as presented in our 2022 financial statements: (1) Branded Products, (2) Healthcare Apparel, and (3) Contact Centers. Unless otherwise noted, all information and data presented within this report are reflective of SGC’s performance for fiscal year 2022 (January 1-December 31, 2022).

The purpose of this report is to support and improve the transparency of our ESG priorities and the results we have achieved. This marks our fourth annual corporate social responsibility report and the first year that we have incorporated considerations from the Sustainability Accounting Standard Board (SASB) Standards for Apparel, Accessories, & Footwear and Multiline and Specialty Retailers & Distributors. We look forward to continuing this momentum and enhancing our SASB disclosures and reporting alignment in the future as our reporting processes continue to mature.

LEGAL STATEMENTS

This report may make forward-looking statements about SGC’s expectations or predictions about the future. Because these statements are based on current assumptions and factors that involve risks and uncertainties, SGC’s actual performance and results may differ materially from what is included in the report. Please refer to SGC’s SEC filings, including our 2022 Annual Report on Form 10-K filed on March 20, 2023 and our subsequent periodic filings, such as our first quarter 2023 Quarterly Report on Form 10-Q filed on May 8, 2023, for detailed discussions of principal risks and uncertainties that could cause such differences.

For more information about this report or to inquire about our corporate responsibility performance, please contact us at CorporateSocialResponsibility@superiorgroupofcompanies.com.

2022 was an exciting year for SGC. Despite challenges presented by the remnants of the ongoing global pandemic, strengthening macroeconomic headwinds, and geopolitical events, we remained committed to providing innovative solutions that meet the needs of our customers, support our employees and communities, and enhance shareholder value.

Throughout the year, we made significant progress in expanding our market reach and strengthening our industry positions. We achieved this through a combination of strategic investments in systems, people and equipment, operational excellence, and a focus on innovation. We are bringing new products and services to the market with greater speed and through a more efficient cost structure.

Some of the key highlights of the year were completing our corporate re-segmenting into three cohesive business units, enhancing our customer-facing digital capabilities, including work to launch our direct-to-consumer scrubs website (winkscrubs.com), and continued investment in internal technologies, such as the creation of a unified backend for customer-facing websites, that have allowed us to further streamline our operations, increase our efficiency, and improve our customer experience.

On both a personal and professional level, I am honored to have become a Trustee of the Committee for Economic Development of The Conference Board (CED), sitting on its workforce committee. The CED is a non-profit, non-partisan business-led public policy center that delivers well-researched analysis and reasoned solutions to our nation’s most critical business and economic issues.

I also am proud to report that SGC’s commitment to sustainability has remained a top priority throughout the year. We are environmentally responsible across our operations and continually search for ways to be even better.

Benstock CEO

In 2022, we formed our first-ever ESG Council, consisting of a cross-section of senior business leaders from our organization, to guide our ESG initiatives, announced new eco-friendly products, developed new recycled fabrics, and expanded our recycled material products beyond fabrics and garments. We also continued to boost our recycling efforts to reduce waste for the fourth consecutive year. We expect to report even more successes for 2023.

Finally, I want to express my gratitude to our employees, who have shown remarkable resilience and dedication throughout the year. Their hard work and commitment was instrumental in driving our successes and ensuring that we continue to deliver value to our customers and shareholders. We recognize how crucial it is to retain and cultivate our valued talent by offering unique development opportunities and competitive benefits. The company and workplace awards that we received demonstrate the success of our approach to growth and commitment to our people, including being recognized once again in Forbes Magazine’s 2022 America’s Best Small Companies ranking and Fortune Magazine’s 100 Fastest Growing Companies list.

Looking forward to 2023, we will continue to embrace the sense of togetherness achieved through SGC’s commitment to our people, our sustainability initiatives, and our responsible business practices. We are proud of the growth that we achieved and the people who made that growth possible.

Sincerely,

Michael Benstock CEO

We are environmentally responsible across our operations and continually search for ways to be even better.

Michael

About SGC

Superior Group of Companies is a publicly traded company that helps our customers unlock the power of their brands by creating extraordinary brand engagement experiences for their employees and customers. Through our family of companies, SGC unleashes exceptional brand experiences by providing strategic and tactical solutions learned through a thoughtful understanding of our customers’ needs. Our business is organized into three segments encompassing a range of products and services.

SGC LOCATIONS WORLDWIDE

Eudora, AR

Monticello, AR

Lake Village, AR

Tempe, AZ

Phoenix, AZ

Compton, CA

Los Angeles, CA

Seminole, FL

Atlanta, GA

Peachtree Corners, GA

Chicago, IL

Romeoville, IL

Oak Grove, LA

Lake Providence, LA

Lexington, MS

Coppell, TX

Seattle, WA

Vernon, BC

Ouanaminthe, HT

Belmopan, BZ

San Ignacio, BZ

Santiago, DR

Kingston, JA

Sao Paulo, BR

Minas Gerais, BR

Guangzhou, CN

Hong Kong, CN

Dehradun, IN

For over a century, we have been providing leading companies with tools to enhance their brands, creating lasting connections through exceptional customer and employee experiences. Our success is measured by our customers’ successes, achieved through a diverse offering of innovative, high-value products and services. We are proud to have a legacy of balancing stability and consistent growth while staying true to our commitments to sustainability, quality, professionalism and continuously innovating to deliver exceptional experiences for all of our stakeholders.

KEY ORGANIZATIONAL HIGHLIGHTS

100+

Years in Business

6,800 Headquarters location

Employees Worldwide

St. Petersburg, FL Materials facilities

AWARDS/RECOGNITION IN 2022

NASDAQ Stock Market Symbol

8 Locations

45 Facilities Worldwide

Our Corporate Social Responsibility

Focus Areas:

We recognize the importance of identifying and addressing the most significant sustainability issues facing our business and society. We conducted a thorough analysis in 2021 to identify material topics that are aligned with our values and vision, business strategy, and feedback from our investors, customers, employees, and other key stakeholders. We continue to focus on these topics in our corporate social responsibility efforts.

Our commitment to transparency and accountability is reflected in this corporate social responsibility (CSR) report, which focuses on the ESG topics deemed most material to the success of our business. These priority focus areas serve as the “north star” for our sustainability journey, guiding us in our efforts to create a more sustainable future. We believe that our sustainability journey is not only crucial for our stakeholders’ well-being, but also is essential for our long-term business success.

Prioritized focus areas included throughout this report are:

• BUSINESS ETHICS & HUMAN RIGHTS

• LABOR PRACTICES & SUPPLY CHAIN

• COMMUNITY RELATIONS

We recognize that sustainability is not a one-time event but a continuous process, and are committed to continually monitoring our progress, identifying areas for improvement, and implementing innovative solutions to address these challenges. Our commitment to sustainability is unwavering. We are dedicated to making a positive impact on the world while creating long-term value for all of our stakeholders.

Our Values

Our Vision

2022 Perspective: Achieving ambitions through deliberate action

Sustainability remains a top priority at SGC. In 2022, one of our major accomplishments was the formation of our first-ever ESG Council, comprised of a talented group of cross-functional senior business leaders from across our organization. This council will play a critical role in guiding our ESG initiatives and ensuring that we continue to make progress toward fulfilling our sustainability ambitions.

In addition to forming our ESG Council, we announced several new eco-friendly product offerings, which are designed to support sustainability principles and reduce the environmental impact of our products. We also developed new recycled fabrics and expanded our use of recycled materials beyond fabrics and garments. By using recycled materials, we are able to reduce our reliance on virgin resources and minimize the amount of waste generated by our operations.

Looking ahead to 2023, we are excited to continue building on these successes, and expect to achieve even more milestones on our sustainability journey. We remain committed to driving positive change and making a meaningful impact on the environment and the communities we serve.

Commitment to Ethical Business

Our commitment to conducting ethical business practices is integral to our operations. Our policies, procedures, and communications are a reflection of our unwavering dedication to responsible and principled leadership. These policies and principles also dictate the ethical standards that we expect all employees, contractors, and suppliers to follow.

The Corporate Governance, Nominating & Ethics Committee formed by our Board of Directors discusses business ethics, data security, data privacy, and related topics on a quarterly basis. Our daily operations are supported by our CEO and executive team, who consistently set an example of transparency and accountability in their actions and communications through frequent interactions with employees and other stakeholders. Regular engagement includes encouraging direct feedback and persistently working to enhance and strengthen our ethical business practices.

BUSINESS ETHICS

We strive to conduct business with the highest degree of integrity and honesty. Our Code of Business and Ethical Conduct outlines our approach, including compliance with applicable laws, rules, and regulations, conflicts of interest, insider trading, competition and fair dealing, equal employment opportunity, health and safety, confidentiality, protection and proper use of company assets, anti-corruption, anti-bribery, fair labor standards, whistleblower policies, and similar topics. In addition to our Code of Business and Ethical Conduct, we maintain robust policies and procedures on anti-discrimination, anti-harassment, supplier and vendor compliance, and other compliance considerations.

Compliance

Ensuring that all employees are trained on ethical business behavior is crucial to upholding our ethical business practices. We provide regular training to our employees on ethical business behavior, which includes our Code of Business and Ethical Conduct and Anti-Discrimination and Anti-Harassment Policy. Within 90 days of their start date, new employees are required to complete initial training on the Code of Conduct, which is refreshed bi-annually for all employees.

Our Board of Directors, with direction from our legal team as necessary, monitors our compliance with our Code of Conduct. We communicate our approach to complying with the Code of Conduct in great detail, which encompasses a straightforward and comprehensible process for assessing and resolving potential concerns.

We depend on and trust our management, including executive staff, to enforce the Code of Conduct and ensure that our employees maintain ethical business standards. The Code of Conduct is regularly and systematically reviewed to ensure our policies and regulatory compliance meet or exceed the requirements of the countries in which we operate. The revisions are overseen by the Corporate Governance, Nominating & Ethics Committee in conjunction with the Audit Committee and support from our legal team. The revisions are conducted at a higher frequency than what is required by the Corporate Governance, Nominating & Ethics Committee’s charter.

Preventive Action

Taking action to prevent problems is a part of our culture. Our Whistleblower Policy outlines numerous avenues to report concerns, including:

• Contacting our third-party anonymous toll-free whistleblower hotline staffed by a trained operator 24/7/365

• Calling our direct toll-free ethics hotline

• Contacting the chair of our Board’s Audit Committee

DATA SECURITY AND PRIVACY

Keeping our data and our stakeholders’ data secure is of utmost importance in this digital age. We stay proactive in ensuring our data handling processes are safe, lawful, and ethical. SGC and its segments comply with applicable data security and privacy laws, in addition to our company’s, divisions’, and customers’ data privacy policies.

“I’m thrilled to see the strides we’ve made in enhancing our data security and privacy measures. With a strong foundation in place, we can now focus on continuously improving and adapting to the ever-evolving threat landscape.”

- Dwayne B, Director of Infrastructure Security

We strengthen our practices by promoting a robust internal data security culture backed by privacy policies, data security certifications, and employee training. Supported by third-party resources, our internal data security team closely surveils our security networks to ensure we successfully perform our operations while protecting personal information. We invest in current technologies, perform regular penetration testing, conduct employee training, use a tier-one secured access data center, and follow industry best practices to safeguard against threats.

Under the leadership of our Director of IT Security and Compliance, we have continued to build upon our strong foundation of data security toward a systematic approach to managing sensitive company information. In 2022, we partnered with an independent third party and data consultants to strengthen our internal documentation and processes. We also continued to pursue ISO 27001 and ISO 27701 certifications, which help organizations establish, implement, maintain, and continually improve their information security management system, providing assurance that their data is secure and protected. We are proud to share that our Branded Products and Healthcare Apparel segments achieved these certifications in 2023.

We integrate responsible data security practices at every level of our organization. We achieve this through comprehensive training, certification, and compliance programs. Our employees undergo multiple training sessions each year using a reputable third-party security training platform. These sessions cover various topics related to security and privacy best practices, awareness, prevention, and remediation.

2,489 Employees

5,966 Employees

Data Security

Our teams follow industry best practices and ensure compliance with applicable laws and regulations. We maintain industry certifications and take various steps to safeguard our information and technology assets.

To oversee our data security approach, our Corporate Governance, Nominating & Ethics Committee reviews related topics on a quarterly basis and discusses them with the full Board of Directors at least once per year. Company leaders are responsible for managing data security practices across the company and its segments, emphasizing the importance of conscientious and responsible data security practices at every level of our organization. Our data security practices are integrated throughout our business operations and include secure data encryption, regular system audits, and use of a tier-one secured access data center. We are committed to maintaining the confidentiality, integrity, and availability of our data, as well as the privacy of our customers and stakeholders.

Data Privacy

Our Data Privacy Policy outlines how we collect, process, use, disclose, and store data provided by those who utilize our website, communicate with us, or use our products and services. To help maintain data confidentiality, we use Secure Sockets Layer (SSL) encryption for particularly sensitive data and regularly audit our system for possible vulnerabilities and attacks. Divisions within SGC, including BAMKO, CID Resources/Wink, Fashion Seal Healthcare, and The Office Gurus (TOG), maintain supplemental policies that are specifically tailored to their businesses and industries.

Data Security Certifications for SGC and Company Divisions include:

Supply Chain Management, Labor Practices, and Human Rights

As an international business with locations around the globe, we are dedicated to upholding human rights, promoting equitable labor practices, and ensuring that our suppliers adhere to SGC’s standards. By actively pursuing these initiatives, we aim to be a positive influence on the communities where we operate and serve our customers.

SUPPLY CHAIN MANAGEMENT

The success of our business is influenced by our suppliers and the reliability and quality of their systems, programs, and products. We work to ensure the health and resilience of our supply chain through regular supplier relationship assessments that identify and mitigate potential risks to the company and our customers. To promote and enforce our commitment to sustainability and corporate responsibility, our supplier policies and programs reflect consistent standards to which we hold each of SGC’s segments. We worked relentlessly throughout 2022 to increase the amount of sustainable products we source and to drive our suppliers to implement practices that reduce their carbon impact.

Supplier Accountability

SGC requires all of our suppliers to comply with our Code of Business and Ethical Conduct and support the company’s commitment to health, safety, human rights, environmental protections, and quality.

2022 Auditing

In 2022, all of the CID Resources division’s vendors had thirdparty audits performed by either SGS or Intertek. In addition, the compliance team at one of our major customer completed desktop reviews for four of CID Resource’s vendors in 2022. All four vendors successfully passed the reviews and have been certified as compliant.

The SGC Supplier and Vendor Compliance Manual defines the details of our audit programs and expectations for suppliers to communicate and uphold our requirements with their employees, supply chain partners, and subcontractors. We conduct regular supplier audits to ensure compliance with relevant policies and laws using Worldwide Responsible Accredited Production (WRAP), Business Social Compliance Initiative (BSCI), Sedex Members Ethical Trade Audit (SMETA), and other auditing protocols.

SGC or a third-party auditor conducts regular social compliance audits for our manufacturing partners to assess their performance in meeting our standards for labor and wages, health and safety, environmental responsibility, management systems, and ethics and business integrity. These audits evaluate metrics such as suppliers’ compliance with regulatory and testing requirements for adult and children’s apparel and electronics. In addition, we require manufacturers to undergo regular fire inspections by a local authority, perform mandatory fire drills, possess fire-fighting equipment, and have an evacuation plan in place.

Approach To Corrective Action

SGC’s suppliers, manufacturing partners, and their subcontractors are required to rectify any noncompliance issues. Furthermore, we monitor the progress of corrective actions taken to remedy noncompliance and require evidence of those measures within a designated timeframe as part of a formal corrective and preventive action plan. Our Supplier and Vendor Compliance Manual specifies the details of these requirements.

Responsible Sourcing and Conflict Minerals

SGC has a zero-tolerance policy for sourcing raw materials from suppliers whose products contain conflict minerals, and we collaborate closely with our supply chain partners to identify sources of raw materials that meet the standards outlined in our policies. We conduct our own due diligence to ensure that the products and materials we receive from our suppliers do not contain conflict minerals, including surveying targeted suppliers via the Electronic Industry Citizenship Coalition and Global e-Sustainability Initiative (EICC/GeSI) Conflict Minerals Reporting Template. SGC does not make purchases of raw ore or unrefined conflict minerals and makes no purchases in the countries that are the focus of conflict minerals regulations.

Many of our suppliers are dedicating resources toward the development of products that are more sustainable with improved recycling potential. To promote the adoption of sustainable practices, we educate our sales teams about these product offerings to enable them to showcase the benefits to our customers. By doing so, we aim to amplify the positive impacts associated with these sustainable products and materials. Our efforts yielded positive results. For example, the production of sustainable products from our Branded Products segment increased by 238% from 2021 to 2022 and our preferred suppliers continue to increase their sustainable product offerings and have altered many of their production practices to reduce their carbon footprints.

Mapping the Cotton Supply Chain

SGC has mapped our cotton supply chain for all our foreign-made nominated fabrics that contain cotton. By mapping this cotton supply chain, we can verify the sources of the cotton and determine how it was produced to promote our sustainability practices as well as be in compliance with US laws. Thanks to our partnership with Oritain in 2022, we have been able to verify the accuracy of the cotton supply chain map. Oritain is a global leader in applying forensic and data science to verify the origin of products and raw materials.

We also have begun to monitor the impact of our suppliers’ impact on the environment. In 2022, each of our product sourcing divisions tracked which suppliers maintain wastewater permits. We look forward to disclosing year-over-year results in this area in our 2023 corporate social responsibility report. Additionally, our Branded Products segment collaborates with several textile suppliers who have assessed their environmental performance using the Higg Facility Environmental Module (Higg FEM) assessment developed by the Sustainable Apparel Coalition. The Branded Products segment continues to assess suppliers based on sustainability and environmental impacts, with a preference for those who have higher environmental ratings.

HUMAN RIGHTS

Labor Practices And Human Rights

SGC complies with all applicable labor laws and strives to provide a safe, healthy work environment for all employees. We have established regulations and procedures that aim to promote the well-being of our workforce and prevent harm from occurring in the workplace. In addition, we have systems in place to report unsafe conditions or issues that arise in the workplace.

Expectations For Suppliers

We are committed to ensuring that our global manufacturing and supply chain partners uphold human rights and maintain fair working conditions. Our human rights due diligence process evaluates supplier social compliance certifications as well as compliance with our policies. As detailed in the Supply Chain Management section of this report, supply chain partners are required to adhere to our Code of Conduct and the policies outlined in the company’s Supplier and Vendor Compliance Manual. Supply chain partners must also comply with any human rights provisions contained within the policies and procedures of our various segments, as applicable.

Pursuant to our polices, suppliers are required to provide a safe, healthy work environment for their employees and follow appropriate labor practices in compliance with all applicable laws and regulations. These policies include protections against forced labor, human trafficking, child labor, harassment, violence, discrimination, and other unacceptable practices. Suppliers are also required to provide fair wages and benefits that meet or exceed the legally required wages and benefits for their locality, including legally required overtime wages. If no wage or benefits laws exist in the locations where our suppliers operate, we require them to engage with local contacts for guidance on the proper local pay standards for their employees.

We maintain a proactive approach to complying with fair labor and human rights policies by conducting regular trainings, audits, and monitoring activities to ensure continuous progress. If there are any instances of noncompliance within our supply chain, we work together with all relevant parties to find solutions and maintain productive relationships. Please refer to the Supply Chain Management section of this report for additional information.

Employee Engagement SGC

At SGC, we believe that our employees are at the heart of delivering exceptional brand experiences to our customers. We are committed to promoting diversity and inclusion, and to retaining a talented and diverse workforce. We value the feedback provided by our employees, and use it to drive positive change within our organization. To support and empower our employees, we invest in training programs and provide competitive benefits. We strive to maintain a positive and caring workplace culture, which encourages growth, creativity, and collaboration. By fostering a strong and supportive work environment, we aim to build a sustainable future for both our employees and our customers. The exceptional work environment at SGC is evidenced by the high number of long-term employees who have chosen to spend the majority of their careers at SGC until retirement.

Demonstrating how much we value our employees and presenting enticing offers to attract new talent is crucial to our continued success. We increased our headcount by 10% throughout 2022 and continued to proactively engage our employees in an effort to bolster staff retention.

To attract and maintain a talented workforce, we allocate resources towards an array of initiatives, such as training, promoting diversity and inclusion, granting bonuses, and fostering a vibrant company culture. We provide employees with a comprehensive benefits package, which includes a 401(k) plan, medical, dental, life, short-term disability insurance, wellness programs, and paid leave for holidays, vacations, personal days, and mental health. Our compensation remains competitive within our industries.

Our Talent Acquisition team attended multiple recruiting events as part of our lead generation and brand awareness efforts. We partner with malls, brands, and key local events that allow us to create grassroots relationships with candidates in a more personal way. These events also help us to increase positive branding for SGC in our communities. For example, our Contract Centers segment sponsored two events at Comic-Con and a Social Media Day in which the Talent Acquisition team interacted with scores of visitors and potential employees.

July 2022 Employee Satisfaction Survey Results

The Office Gurus: Employee Engagement Spotlight

In 2022, our Contract Centers segment (also called The Office Gurus or TOG), which is our largest segment by headcount, conducted two employee surveys across its global locations.

TOG is committed to fostering a positive and supportive workplace culture that prioritizes employee satisfaction and well-being. We are actively analyzing the results of our employee survey to identify areas where we can further improve and inform our decisionmaking processes to develop employee-focused initiatives. To achieve this goal, we regularly collect feedback from employees and provide opportunities for continued professional growth.

December 2022 Employee Satisfaction Survey Results

As part of TOG’s promoting of a healthy work-life balance, we established our Flex Time Policy which offers all staff members 5 additional paid days off per year. We also started hosting wellness sessions after office events, fitness classes, and other special events for employees and implemented a mobility incentive and transportation services for employees who work in our facilities to incentivize easy access to the office so they can collaborate in person with other employees.

To promote a positive work environment and foster strong relationships among our employees, TOG organized and hosted a variety of events throughout the year. Events included holiday celebrations, a talent show, challenge days, and staff parties. These events serve as opportunities for our workforce to come together, interact, and collaborate more effectively in the workplace. By engaging in these events, we aim to create a supportive atmosphere that encourages open communication, cooperation, and innovation. Our commitment to organizing these events reflects our belief in the power of building meaningful connections among our employees, ultimately leading to enhanced productivity, job satisfaction, and overall well-being. We continually strive to provide a platform where our talented individuals can thrive, enabling them to contribute their best toward our sustainability goals and the success of our organization as a whole.

As part of celebrating our talented employees, we launched the Guru Market project aimed at providing Gurus (which is what we affectionately call our TOG employees) with an on-site platform to showcase their creative outlets by selling their products. This initiative enables employees to learn about their coworkers’ imaginative pursuits. In 2022, TOG hosted over 25 Work Can Be Fun Events that were attended by hundreds of Gurus.

TRAINING AND DEVELOPMENT

We recognize the value our employees provide to the company and seek to assist each employee to maximize their knowledge and realize their potential. In addition to the regular training employees receive on a variety of topics, we also offer unique opportunities for them to expand their skill sets in specific focus areas.

Required Training

All employees are required to participate in biannual training that comprehensively covers key topics. The biannual training focuses on providing a detailed understanding of SGC’s business ethics policies, anti-discrimination, anti-harassment, anti-corruption, antibribery, health and safety practices, compliance, and other company-specific topics. We also require the completion of regular data privacy and data security training modules. Our training courses follow a regular cadence to enable employees to consistently make progress against their training goals.

SGC University

SGC University is the ultimate education hub for our employees. Employees participating in SGC University can participate in courses on competency-based topics throughout the year to become proficient in various skills. Competency-based courses at SGC University include topics such as training on the Lean Initiatives program covering the “Customer Create,” “Style Master Create,” and “Pricing” functional categories as part of our Lean Six Sigma management approach, emotional intelligence, and on-site safety. Initially created in 2021, we continually seek to enhance its offerings.

Each year, SGC University regularly receives positive feedback from employees on our training offerings. We are proud to provide the necessary tools to help our employees succeed in their professional lives, and we will continue to focus on progressing employee development by leveraging external resources for targeted learnings.

TOG offers an employee and management development program known as TOG University. Participants in TOG University develop key competencies for success in business through a multi-disciplinary business training curriculum. Now in its sixth year, TOG University provides employees with an avenue to continue developing their expertise and advance in their careers.

We continued to see increased growth and participation in TOG University after transitioning the program to a virtual platform during the pandemic. The number of TOG University Graduates in 2022 more than tripled compared to 2021, and the number of hours of training conducted approximately doubled from 2021 to 2022. TOG University was also revamped to incorporate a variety of new programs in 2022, including TOG-College, Strategic Account Manager (SAM) University, and Team Lead University, which establishes an internal progression program to ensure that our talent has a place within TOG as they continue to develop and grow. In addition to the new programs, we continued to add more specialized workshops to improve specific competencies.

In 2022, TOG University participants:

Logged thousands of hours of live training

• 7,200 hours of live, online training (webinars)

• 687 participant

Leveraged external training for special skills

• 450 courses completed

• 247 Gurus enrolled

• 9,335+ hours of external training completed

Completed thousands of TOG University courses via TOG’s online platform

• Graduation rate of 71.3%

• 10,770 courses completed

Continued to grow and expand TOG University offerings

• Revamp of TOG University with new programs

“Hey everyone, my name is Alex and I am currently an Operations Supervisor with TOG. My story started here 2.5 years ago as an agent. Never in my wildest dream did I see myself climbing the ladder of success in such a timeframe, or even climbing it for that matter! One thing I truly appreciate and would love to recommend to you all is our internal TOG University. Our training team goes above and beyond sharing their knowledge and resources so you can properly be equipped to succeed. I would say this particular opportunity allowed me to envision where I want to be in the future. It is a clear opportunity that everyone should consider so you can learn what is coming for you. Trust me, after completing it you will be more comfortable with the upcoming position for you!”

- Alex C.

DIVERSITY

AND INCLUSION WORKFORCE

As a global business, we promote and foster cultural exchange and appreciation among our diverse array of employees, suppliers, and customers. It is essential that we represent the communities we serve in the more than 10 countries our employees and stakeholders call home. We promote and foster cultural appreciation and understanding by encouraging our teams around the world to share their customs and holidays with each other. For example, our Branded Products segment continually honors Juneteenth as a paid holiday for U.S.-based employees.

SGC is committed to creating a diverse, equitable, and inclusive workplace to support our employees. As part of this commitment, we work diligently to cultivate a welcoming and open workplace by continuously improving our approach to recruitment, training, and employee recognition.

We detail all information on the steps we take to ensure a workplace that is free of discrimination in our employee handbook. In addition to the antidiscrimination policies and accommodations that provide an equitable working environment, we are clear and precise in defining harassment of all kinds and describing our reporting, investigation, and non-retaliation policies to promote a discrimination-free workplace.

BOARD OF DIRECTORS DIVERSITY

There always is more work that can be done to promote a diverse and equitable work environment globally. As SGC continues to grow, we continue to seek new opportunities to strengthen our ability to build a work environment in which employees can share their unique perspectives and reach their full potential.

EQUAL OPPORTUNITY EMPLOYER

17% Minority in the board of directors

*As of March

31,

Community Relations

SGC has become the enterprise that it is today because of the communities in which we live and work. Giving back to those communities that have supported us is a core value of SGC. In 2022, we continued to sponsor charitable organizations throughout our communities through donating our time as volunteers, supplying apparel to those in need, and providing financial support to philanthropic causes. We also continued our efforts supporting global disaster relief efforts around the world.

CORPORATE GIVING

AND

EMPLOYEE VOLUNTEERISM

60+ Charitable organizations receiving cash contributions from SGC and its segments

$204,000+ Cash contributions

Each year, SGC and our various segments extend financial contributions to numerous deserving organizations and causes across the globe. In 2022, SGC and its segments raised more than $204,000 in charitable contributions for over 60 organizations.

Charitable Contributions Apparel Donations

In keeping with a well-established and beloved SGC tradition, in 2022 we donated more than 137,000 units of clothing to 10 humanitarian and healthcare organizations serving the states of Arkansas, Illinois, Louisiana, and Florida and various communities throughout Haiti.

Donations included scrubs, gowns, and clinical apparel for healthcare workers at medical centers and nursing homes. We also provided apparel for shelters, community organizations, schools, and day care centers to assist teens, the homeless, and others in need.

In 2022, our donations also extended to education-focused institutions, as, for example, we donated approximately 100 cones of sewing thread to Greenville Schools for use in teaching students how to sew.

The Eudora Distribution Center in Eudora, Arkansas is one of our largest distribution centers. In 2022 it hosted four blood drives to donate blood to the local community and provided flu and COVID-19 vaccines.

Keeping Our Community Healthy Adopt-A-Shore Program

In 2022, SGC continued to host debris and trash clean up events at Madeira Beach on Florida’s western coastline. We adopted the beach in 2009 through the Adopt-A-Shore program, a cooperative partnership between the public/private sector and Pinellas County, Florida, which allows groups to “adopt” a mile-long section of county shoreline. Shore adoptions enhance the ability of community members to enjoy shorelines and are invaluable in helping to reduce debris entering our waterways and polluting habitats. SGC volunteers have collected hundreds of pounds of trash from Madeira Beach since we adopted it in 2009.

Olivia & Friends

Since 2017, TOG has taken great pride in our dog adoption charity, known as Olivia & Friends, in honor of Olivia, the first dog that TOG adopted back in 2017. In 2020, Olivia was joined by Pepe, and together they have brought tremendous joy to our offices and community. We partner with local programs through Olivia & Friends to rescue and adopt puppies while enabling employees to support rescue shelters through fundraising events.

Over the last 5 years Olivia & Friends has assisted our local community in a variety of ways. Through our partnership with ARANI, a local animal shelter that Olivia & Friends aids for adoption days and other volunteer events, we helped find homes for shelter dogs. We also created a coloring book called “The Adventures of Olivia & Pepe”, with illustrations drawn by local artists. The book features six stories, each representing one of TOG’s core values. We donated copies of the books to a children’s hospital in El Salvador and sold others, donating the proceeds to a local organization dedicated to treating childhood cancer.

As part of a new adventure in 2022, Pepe and Olivia launched their own puppy collaboration with the dog apparel brand Osso and Nina. All proceeds from the collaboration are donated to the ARANI Shelter Home to provide care for rescue dogs.

To follow Olivia and Pepe’s adventures and see any new friends that might join them, please visit instagram.com/happygurutails!

Support for the Disabled

TOG is proud of its commitment to supporting disabled El Salvadorians.  Each year since 2016 we have donated 3 call center positions to a local organization that offers rehabilitation treatments to children and adults with physical disabilities.  Our agents manage medical appointments and provide other services.  We also contribute through fundraising, advocacy, and activities, such as assembling wheelchairs.

VOLUNTEERING SPOTLIGHT:

The Gurus are Back Outside

In 2022 our volunteers started to return to in-person volunteering! TOG conducted a survey to establish a new volunteer club that participates in regular volunteer events. The volunteer club currently has 136 members that are excited and ready to give their time to great causes.

VOLUNTEERING SPOTLIGHT: Sustainable Housing

Gente Ayudando Gente is a non-profit organization that works to improve the quality of life for El Salvadorans through constructing houses, donating food, and providing medical services. In 2022, a group of Gurus participated in a mid-day volunteering activity where they assisted with the construction of a sustainable housing project in Nuevo Cuscatlán.

CORPORATE GIVING SPOTLIGHT: TOG Gifts for Grandparents

In December 2022, Gurus in El Salvador sponsored Christmas gifts for 60 grandparents in a local nursing home to improve the spirits of the residents. A group of volunteers visited the home to deliver the gifts, provide snacks, and sing songs to the residents.

Supporting Our Vendors’ Employees

One of SGC’s vendors located in Port-au-Prince, Haiti suddenly closed its factory in January 2022. This left more than 1,100 garment workers unexpectedly without employment, impacting their ability to support themselves and their families. The factory was unable to cover the required severance pay for the workers, leaving many of them unable to pay for basic personal necessities.

SGC and other apparel brands stepped up to cover the severance pay for all of the former factory employees by providing them with the equivalent of over six months’ worth of wages. SGC contributed over $250,000, enabling impacted employees to support their families while searching for new job opportunities.

Breast Cancer Awareness

Breast cancer awareness is a cherished cause to many at SGC. SGC employees participate in an annual Breast Cancer Awareness Campaign by walking, running, and supporting participants to spread awareness for survivors and those currently battling breast cancer. Some participants carry signs with the names of those they have lost to honor them.

TOG’s breast cancer awareness efforts also have involved engagement with our local communities. In October 2022, we sponsored the annual Pink Gala for a local El Salvador newspaper, as a tribute to life and those who have survived breast cancer. We had the opportunity to meet incredible survivors and listen to their stories at the Pink Gala while also raising funds to provide access to mammograms and ultrasounds. TOG also created a special phone line to raise funds for an organization that works to educate people on cancer and human rights and provide cancer screenings at a low cost. Our Contact Center employees also donated their own money, which was matched by TOG.

Committee For Economic Development

The Committee for Economic Development (CED) is a non-profit organization that has helped to shape the future of various issues ranging from the Marshall Plan to education, campaign finance reform and, most recently, infrastructure modernization. In December 2022, our CEO Michael Benstock joined the CED as a Trustee. He will join a group of peers to help develop solutions to critical issues facing the United States, while championing causes that SGC is passionate about.

Environmental Management

Effectively managing our environmental impact is critical to our operations and is an established practice at SGC. In 2022, we continued to strengthen our sustainability and stewardship practices with new approaches to upcycling end of life materials, reducing material consumption, and developing new eco-friendly products. In pursuit of a sustainable future for our business and planet, we will continue our mission to find new opportunities to mitigate our environmental impacts and foster more sustainable practices.

SGC has been implementing eco-friendly practices into our operations through product designs, manufacturing, and materials sourcing. These efforts have helped us reduce our environmental footprint and create new sustainable product lines. We incorporate eco-friendly practices into production processes by reducing waste and material use, upcycling end-of-life fabrics and products, and redesigning source materials to be less resource intensive. Since 2019, we have created fabrics from used plastics. We mainly utilize recycled plastic bottles to create uniforms and other products, which removes plastic from the environment, generates less carbon emissions compared to virgin fabric materials, and reduces the raw materials needed for production.

Throughout 2022, we witnessed the continued success of our bottle recycling program. We recycled approximately 19.32 million plastic bottles, yielding a 31% year over year Increase. We used those recycled bottles to produce approximately 2.48 million yards of fabric in 2022. Our bottle recycling program has grown significantly over the last 4 years with more bottles being recycled each year and the annual number of bottles recycled increasing by 147% since 2019. As we increase the production of recycled fabrics in the future, we will continue to see an increase in the number of plastic bottle recycled.

SGC Plastic Bottles Recycled

*Customer garment requirements and specifications impact the number of recycled plastic bottles used per garment

SGC Plastic Bottles Recycled

Recycled Plastic Content: Innovations and Impacts

In 2022 we launched CORE, our first eco-friendly Carhartt™ healthcare apparel fabric. CORE is made of 50% recycled polyester to reduce the amount of raw material needed.

As part of our commitment to provide more sustainable uniform solutions, we continued to invest in the expansion of our WonderWink Renew™ and WonderWink Thrive™ collections. WonderWink Thrive™ is a healthcare apparel line that we launched in 2022 that is eco-friendly and made of 100% recycled polyester fabric. After a roaring success since their launch, our WonderWink Renew™ and WonderWink Thrive™ products have continued to see high demand from customers in 2022.

We are exploring even more new sustainable material solutions to better care for our planet. We are looking to expand our eco-friendly fabrics beyond recycled plastics by developing new fabrics produced from a variety of materials with different applications. One project utilizes technology that aims to reduce microplastic pollution. Another explores the use of all-natural, plant-based dyes and finishing chemicals. We are excited to experiment with more common items, including coffee waste and old recycled garments, as we work to repurpose existing materials into new items.

As part of a waste reduction initiative, we have started an end-of-life product management program to find new uses for old, worn-out products and fabric scraps. Our program includes a variety of options that can provide solutions for different challenges, such as upcycling clothing to create new apparel, converting apparel waste that cannot be donated into energy, recycling mostly pure materials, and donating worn products. We also have started donating remnants of fabrics from testing labs and other fabric cutting waste that would otherwise become garbage. In 2022, we were able to donate 362 pounds of fabric remnants to philanthropic organizations and schools to be used for new apparel or other creative projects.

Over the last several years we have taken steps to reduce waste in our operations. Many of our facilities are fully paperless and printing, which is done on paper that is Forest Stewardship Council-certified when possible, is only used for required carrier labels and documents that accompany customer shipments. We look to reuse and recycle materials where possible, including reusing storage and shipping cartons, recycling 100% of unusable corrugated and other paper waste, using only fully recyclable packaging materials when we distribute our products, printing on, and not packing with any filling materials, such as styrene peanuts. In 2022, we continued to move forward with eliminating operational waste by reducing the quantity of single-use polyethylene bags used for garment packaging, often replacing them with ones composed of natural fabrics. When we do have a requirement for garment packaging, we use bags made from recycled materials. In addition to these waste mitigation practices, our main distribution center recycled more than 1,700 pounds of obsolete electronics in 2022. As we look forward, we continue to build relationships with reputable suppliers that offer additional sustainable options.

FACILITY OPTIMIZATION

Energy Efficient Buildings, Led Lights, Policies/Practices, Etc.

Our shared distribution facilities endeavor to reduce the environmental footprint of their operations by improving internal processes and implementing facility optimization practices. Several facilities have optimized efficiency and reduced waste by investing in lighting upgrades. Through these efforts, we continue to divert waste from landfills, reduce our energy consumption, and increase overall efficiency.

As our older facilities begin to need repairs, we have taken steps to retrofit them with energy efficient technology and other upgrades to optimize operations. Aging facilities have been updated with modern LED lighting with motion detectors, new heating and air systems, and conveyor and box retrieval cranes with low voltage controls, replacing outdated equipment. We implemented automated robots that pick products in order to enhance our employees’ production efficiency and reduce distribution costs. We also implemented modern sustainability practices and technologies into all our new facilities to maximize energy efficiency and reduce waste and cost. For example, in 2022 we completed construction of a new distribution center at our Eudora, Arkansas campus that is built to current energy-efficiency standards.

Our facilities must also meet certain strenuous client requirements. With the production of our new sustainable Carhartt™ collection, two of our new production plants were approved for use in 2022. In addition, all our CID Resources vendors renewed their Worldwide Responsible Accredited Production (WRAP) Gold Certificates in 2022.

PRODUCT QUALITY MANAGEMENT

To manage our environmental impact beyond our day-to-day operations, we have expanded our environmental sustainability efforts to encompass our supply chain. All nominated textile mills used by SGC are Oeko-Tex® certified and continue to purchase only Oeko-Tex® certified fabric for all apparel manufacturing, which means we can ensure our products are manufactured using fabrics that are free of harmful levels of toxic substances. To further engage our supply chain, we have extended the Oeko-Tex® certification requirement to all of our trim suppliers. Many of our products also bear the Oeko-Tex® “Standard 100” label, verifying that every component of a garment — including thread, buttons, and other accessories — is free of harmful substances.

In 2022, we progressed in our continued partnership with HeiQ®, a company that invests in sustainable applications for apparel fabrics. HeiQ® designs numerous innovative products, such as HyProTecht®, an antimicrobial and antiviral technology fabric initially developed in response to COVID-19. HyProTecht® is EU REACH- and US FIFRA-compliant, Oeko-Tex® certified, and ZDHC- and BlueSign-homologized. HyProTecht® also is certified as safe and sustainable as its ingredients are cosmetic-grade and the material is entirely biobased. SGC has licensed the rights to use HeiQ® fabrics in our products to develop unique apparel for use in hospitals, clinics, and other similar environments. In 2022, SGC received more than 367,000 units and distributed more than 125,000 units of HeiQ® apparel.

PFAS per- and polyfluoroalkyl substances

PFAS Spotlight:

There has been growing concern over the last several years related to better understanding and managing the impacts of per-and poly-fluoroalkyl substances (PFAS). These human-made chemicals have been used to make a variety of household and commercial products with a variety of applications since the 1960s and can now be found throughout the environment in soil and water. SGC is taking steps to address PFAS in our products by working with a European chemical manufacturer and a Korean fabric supplier to substitute a common PFAS containing fabric finishing chemical with a PFAS-free formula. Our efforts also extend into the broader apparel industry as well. We stay current on the latest state and federal PFAS regulations through our membership in the American Apparel and Footwear Association, and are working with members of the Textile Rental Services Association of America and American Reusable Textile Association to create a PFAS tool kit for laundries.

Closing

As a global corporation with a strong team of over 6,500 employees, we are keenly aware of the impact our actions have on various stakeholders. We understand that our continued success depends on the well-being, health, and support of people and the environment, whether in the households of our employees, through the business success of our customers who entrust us with their brands, the suppliers who partner with us, or the communities where we live and operate.

To ensure our mutual success and continue celebrating our accomplishments together, we must invest in both individuals and the environment. As we collectively look toward a brighter future, SGC remains steadfast in our commitment to uphold our company values and to be a positive force for change. We are proud of the progress we have achieved thus far and look forward to sharing updates as our sustainability journey continues to evolve.