LEVI STRAUSS & CO. 2020 CSR REPORT
WHO WE ARE
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LEVI STRAUSS & CO. 2020 CSR REPORT
WHO WE ARE
WHO WE ARE We are fueled by our strong values, creativity and hard work.
CHIP BERGH President & Chief Executive Officer
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We’re building on our heritage to move the company forward, to be as innovative and relevant to today’s consumers—and tomorrow’s—as we were when we invented the blue jean nearly 150 years ago. Millions of people around the world have grown up with Levi’s® blue jeans and Dockers® khakis. I’m one of them. And it’s my privilege to lead this company as we strive to engage consumers with new and familiar products, all while minimizing our impact on the planet. But it takes more than our strong, enduring brands—which also include Signature by Levi Strauss & Co.™ and Denizen®—to succeed. It takes people to bring our product to life every day. I see these talented and creative
folks at our headquarters in San Francisco and in our offices around the world. Ask an employee what makes this company different, and they’ll tell you. It’s our values: empathy, originality, integrity and courage. These guide every decision we make and every action we take. And they fuel our commitment to drive profits through principles. Today’s Levi Strauss & Co. is as relevant as ever, but we’re always looking ahead. From our products to our practices, innovation is integral and sustainability is as essential as fabric and thread. And there’s more on the way. I’m honored to be a part of Levi Strauss & Co. and humbled to have the opportunity to lead this company as it continues an amazing journey.
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LEVI STRAUSS & CO. 2020 CSR REPORT
WHO WE ARE
Profits Through Principles Our longstanding commitment to profits through principles remained the backbone of our success in fiscal 2020. We reaffirmed our commitment to the Paris Agreement to address climate change, pioneered a contextual approach to water use that prioritizes saving water in areas that need it most and encouraged others in our industry to commit to science-based targets on climate. We also reached more than 200,000 workers with our Worker Well-being program, meeting our target half a year early and supporting the financial empowerment, well-being and equality of the people who make our products. This was a pivotal year for LS&Co., one that saw us perform well fiscally, as well as position the company for future growth and enhanced shareholder returns. In February 2020, our Board of Directors authorized
up to $100 million in share buybacks and committed to increase the return of capital to shareholders through an estimated $130 million in dividend payments—a 14% increase over fiscal 2020. LS&Co. has been on a journey of transformation for the past eight years. Today, we have the right people, strategies and initiatives in place to continue our momentum and deliver profitable, sustainable, and positive growth in 2021 and beyond.
Sincerely,
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LEVI STRAUSS & CO. 2020 CSR REPORT
SUSTAINABILITY IN ACTION
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SUSTAINABILITY IN ACTION We adhere to our profits through our principles approach to business.
LEVI STRAUSS & CO. 2020 CSR REPORT
SUSTAINABILITY IN ACTION
We continued to pioneer industry-leading sustainability initiatives and innovate on product in ways that help set our future course. This kept us at the forefront of the ever more urgent discussions around corporate sustainability and the role of business in society more generally. Through our words and actions, we drove the message that announcing plans and setting targets isn’t enough; companies have to execute on those plans and show impact, delivering value to their full range of stakeholders and, in our case, sharing what we know and learn to influence the industry.
We saw momentum towards Science-based Targets on climate build across industries. This past July, we were recognized as one of only 28 companies in the world and one of only two in the U.S. that had set climate targets consistent with limited global temperature rise to 1.5 above pre-industrial levels. By the end of 2019, some 177 companies had set similar targets.
That is what we did in 2019 across our operations, in our four key sustainability focus areas—water, climate, chemicals and people— and increasingly with regard to building the foundation for circular products and a more circular economy. In August 2019, for example, we introduced a new Water Action Strategy for 2025 that shifted us from a “one size fits all” approach to water management in manufacturing to a context-based approach to water use that prioritizes saving water in areas that need it most. LS&Co. will work with key suppliers representing 80 percent of total product volume to set and achieve specific water use targets for factories where our products are made or finished—with more stringent target for facilities located in more highly stressed countries. By 2025, we will halve our water use in manufacturing in areas of high water stress.
While we take great pride in being a leader in the effort, we know swift, considered action is necessary to meet our targets. That is why, following a successful pilot program with six suppliers in four countries, we have started to expand our work with the International Finance Corporation (IFC) and their Partnership for Cleaner Textiles (PaCT) program, through which the IFC provides expert guidance and low-cost financing to suppliers seeking to improve their water and energy use performance, to 46 of our key suppliers across 10 countries. It is why we are taking other steps as well, such as installing solar panels at our distribution center in Henderson, Nevada, that will offset some 20 percent of energy use at that facility. And it is why we continue to advocate for policies, protections and financial mechanisms that can help mitigate advanced climate risk around the globe.
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LEVI STRAUSS & CO. 2020 CSR REPORT
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SUSTAINABILITY IN ACITON
Climate
↓90%
↓40%
100%
Reduce carbon emissions in owned-&-operated facilities
Reduce carbon emissions across supply chain by 2025
Renewable electricity in owned-&-operated facilities
68%
3.5B liters
50%
Levi's products made with Water<less®
(and counting) saved via Water<Less® since induction
Reduction of water use in high waterstress areas
Water
Worker Well-being
113 factories in 17 countries
219K+
65%
Worker Well-being workers reached
Products made in participating factories
LEVI STRAUSS & CO. 2020 CSR REPORT
SUSTAINABILITY IN ACTION
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LEVI STRAUSS & CO. 2020 CSR REPORT
LIVING OUR VALUES
LIVING OUR VALUES We believe in being a force for positive change in our communities.
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LEVI STRAUSS & CO. 2020 CSR REPORT
LIVING OUR VALUES
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LEVI STRAUSS & CO. 2020 CSR REPORT
LIVING OUR VALUES
After setting ambitious targets, we must execute to meet those targets, innovating to find the best practices and sharing what we learn to influence the industry. That is what we did in 2019, across our operations, and in our four key sustainability focus areas â&#x20AC;&#x201C; water, climate, chemicals, and people â&#x20AC;&#x201C; and increasingly with regard to cotton and materials, as noted in the pages that follow.
In this context, we are exploring how to best execute on our sustainability strategies going forward. But to be clear, the core commitment to this work, on every front, remains as strong as it has ever been.
As we all know, the coronavirus pandemic is impacting communities around the world and forcing businesses to adapt accordingly. At LS&Co., our initial focus has been on responding to the crisis and supporting our people in the moment, which has included grants to partner organizations working in sourcing countries to support apparel supply chain workers.
If anything, the experience of the pandemic reinforces the notion that we must continue innovating to make our products and operations more sustainable across our whole organization, and that building an economically and environmentally resilient business is key to addressing the overlapping challenges we need to confront as an industry, from climate risks to resource stress to consumption to gender inequality. That is how we build a strong business for the long term, while helping the planet and our communities thrive.
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LEVI STRAUSS & CO. 2020 CSR REPORT
LIVING OUR VALUES
PROFITS We are invested in making the world a better place. We have been sharing our profits with the community since Levi Strauss founded the company in 1853. Today, we invest a portion of our annual earnings back into the communities we serve. We make an outsized impact by taking bold stands on social issues that align with our values of empathy, courage, integrity and originality.
Voting Rights & Engagement
Water & Climate
The right to vote is a basic tenet of democracy, and one that is too often ignored. We are actively involved in efforts to increase voter engagement. We work with organizations that register voters, get-out-the-vote during elections and help ensure that all Americans who want to cast a ballot are able to do so. We give employees paid time off to vote and connect them with voter engagement volunteer opportunities.
We embrace responsible environmental practices across the company, and weâ&#x20AC;&#x2122;re dedicated to enabling changemakers both inside and outside the industry who are equally passionate about the environment. Among the actions we take: convening apparel entrepreneurs as part of the LS&Co. Collaboratory, and training our employees to be effective advocates for responsible water stewardship and combatting climate change.
Equality
Gun Violence Prevention
LS&Co. has long been, and will continue to be, vocal supporters of equality and non-discrimination. We were the first Fortune 500 company to extend health benefits to domestic partners and have continued to use our voice to advocate for an equitable society for all people.
LS&Co. has pledged ongoing support for gun violence prevention by rallying the business community and advocating for gun safety measures. We also established the Safer Tomorrow Fund to support nonprofits and youth activists working to end gun violence in the U.S.
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LEVI STRAUSS & CO. 2020 CSR REPORT
WHO WEOUR LIVING AREVALUES
PEOPLE Our company culture empowers employees to use their voice and volunteer their time to make a difference on the issues that matter most to them. People
Service Corps
Our company culture empowers employees to take an active role in their communities and become agents of positive change, using their voices and volunteering their time to make a difference on the issues that matter most to them. We seek to inform and engage employees on important issues, and connect them with opportunities to get involved and work toward solutions.
We create opportunities for employees to better understand the realities of our global supply chain—both the challenges and the opportunities. Employees are encouraged to apply for the L&SCo. Service Corps, a week-long volunteer immersion program that visits a factory for a week to learn about our Worker Well-being programs and participate in community service projects.
Community Engagement
Voices for Change
We help our employees connect with the causes they care about through our annual Community Day of service, matching charitable giving and volunteer time up to $2,000 per year and providing paid time off to be active citizens in their communities.
We train our employeees to be effective advocates for the causes they care about— whether it’s responsible water stewardship, women’s rights and equality, refugees or climate change.
Education and Speaker Events
Understanding Unconscious Bias
Creating an inclusive workforce means connecting our employees to the issues that matter—and to each other. Our diversity events bring together leading speakers with learning opportunities that strengthen our understanding of the world around us.
Required for all leaders, this training helps increase our leadership team’s awareness of how the shortcuts in our brain work – and how different backgrounds, personal experiences and cultural context can affect our actions without our ever realizing it.
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LEVI STRAUSS & CO. 2020 CSR REPORT
LIVING OUR VALUES
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LEVI STRAUSS & CO. 2020 CSR REPORT
LIVING OUR VALUES
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LEVI STRAUSS & CO. 2020 CSR REPORT
LIVING OUR VALUES
Serge Gay uses his art to fight for black and gay rights. Serge Gay is a painter. Art director. Fashion designer. He works as a creative director and in post-production art in film and in music videos. Through it all, he’s a Black, gay immigrant from Haiti who sees his art as a tool of liberation for his communities. Recently, that culminated in this beautiful custom Trucker Jacket, which Serge named ‘Black Movement.’ We caught up with Serge to talk about how he designed ‘Black Movement,’ the meaning of All Black Lives Matter and giving a voice to the voiceless.
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LEVI STRAUSS & CO. 2020 CSR REPORT
LIVING OUR VALUES
"This Trucker Jacket is called Black Movement. It deals with a lot of movements within the Black community and the gay community. It covers protests and rallies through history from the Civil Rights Era to Stonewall to the first Pride to whatâ&#x20AC;&#x2122;s going on today. Recent events made me target those movements and protesting in the Black and gay communities."
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LEVI STRAUSS & CO. 2020 CSR REPORT
LIVING OUR VALUES
"I really wanted to do original Civil-Rights pins and patches. I wanted them to be historically accurate, but also create my own version. The first patch I wanted to do was the raised fist. Then I added pins based on the Black Lives Matter movement, like â&#x20AC;&#x153;Enough is Enough.â&#x20AC;? I added pins representing the LA Riots and the Detroit Riots, too. I grew up in Miami, but went to Detroit for art school. The Detroit Riots were in 1967, and parts of Detroit are still burned today. I was shocked: Whoa, this is still like this? So I wanted my Trucker to shine a light and show that some things still are not resolved."
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