The Luxottica Responsible Sourcing and Manufacturing program
In 2013 the Company created the Luxottica Responsible Sourcing and Manufacturing (LRSM) program to ensure that its principles on business ethics, labor, human rights, safety and the environment are upheld by every supplier of raw materials, components, finished products (including also Oakley’s Apparel, Footwear and Accessories business, AFA) and, from 2019, logistics services. The program also applies to Luxottica’s production and distribution sites and builds upon the Code of Ethics, local laws and regulations and the above-mentioned principles (also known as “LRSM principles” available here).
At the same time, the program mitigates the reputational and business continuity risks of the Company’s supply chain, which is fundamental for guaranteeing the high quality of its products and services.
Given its interdepartmental nature, the program brings together representatives of the Operations Sourcing, Internal Audit, Manufacturing, Quality, Risk Management, Compliance & Asset Protection and Sustainability departments in a Steering Committee which periodically evaluates the status of the program and discusses further steps to take.
The Zero tolerance mechanism in the supplier evaluation
Luxottica applies a “Zero tolerance”1 mechanism during the selection and monitoring phases in order to prevent the risk of major non-compliance with sensitive topics, including child labor, use of forced labor and corruption actions, which can imply the contract termination. This mechanism requires the supplier to implement immediate corrective measures by an agreed deadline, that are verified through follow-up audits.
A third-party oversees suppliers’ compliance with the company's standards and LRSM principles as well as the adoption of corrective actions in the event of non-compliance with the company's Code of Ethics and/or local regulations.
Training and awareness initiatives
To support and strengthen the LRSM program and ensure alignment with its principles and standards, Luxottica has in place training initiatives for its suppliers.
The Company, following the first successful edition in China in 2018, organized in 2019 a second training workshop on responsible sourcing in Italy, including strategic logistics suppliers for the first time. In 2019, additionally, Luxottica introduced an awareness initiative to inform its suppliers from big multinational groups and its logistics suppliers about its sustainability approach and LRSM principles.
For further information see the “LUXOTTICA RESPONSIBLE SOURCING & MANUFACTURING PRINCIPLES” document.
1 The “Zero tolerance” criteria relate to:
- the use of child labor (under 16 years of age);
- conditions that seriously endanger health and safety;
- particularly harmful environmental impact;
- use of forced or undeclared labor or imprisonment;
- access to sites denied to auditors for the second time;
- acts of corruption, money laundering and illicit trade;
- persistence of non-compliance or failure to meet requests to take immediate action to comply with rules.