It goes without saying that it is important to us and everybody at Palace that our products are produced by individuals that enjoy the fundamental rights of being treated with dignity and respect and are not deprived of their liberty through exploitation for the personal or commercial gain of others.
We have close relationships with a number of long-term suppliers and we hope that over the years regular factory visits would have highlighted any human rights abuses within our manufacturing base. However, we are aware that our supply chains are long so we may not have a direct relationship with the producers and manufacturers of the raw materials that are incorporated into our clothing and other products.
We believe in promoting human rights throughout our business and our supply chain. We are very committed to improving our practices and putting in place formal systems to combat modern slavery and human trafficking. Even though we are in the early stages of our work, we have identified that the highest risk of human rights abuses is within our clothing products supply chain. We are making available the time and resources needed to ensure that our zero tolerance of slavery and human trafficking is followed and respected by our partners across the world.
We are a skateboarding brand, designing, developing, and retailing men's clothing, footwear, accessories, skateboards and skateboard accessories. We are the parent company of the other trading subsidiaries within the Palace Skateboards Group (“Group”, being GSLT Holdings Limited and its subsidiaries in the UK, US and Japan).
The Group has over 110 employees worldwide and has operations in the UK, US and Japan.
We sell our products worldwide but currently only have a limited presence in the main Asian economic hubs.
The Group has a global annual turnover of just over £40 million.
Our main operations, design and decision-making processes are based in the UK, specifically in and around London where we have our head office, our very first flagship store and the warehouse that services the rest of the world not covered by our other warehouse facilities in the US and Japan.
We now have retail stores on the East and West Coasts of the US and the Shibuya area of Tokyo in addition to the London store. The US and Japanese stores operate within US and Japanese corporate entities respectively that employ all the staff working in the stores and are 100% subsidiaries of the Group.
In addition, in the US with effect from 1 August 2019, we will have a separate US corporate entity for our US webstore, fulfilment and warehousing.
In Japan, we engage third party companies to undertake our warehousing and fulfilment requirements.
Our employees are a very important part of Palace and its success and we do our utmost to ensure that they are well looked after and fairly treated and paid, no matter where they are based in the world.
We have engaged human resources advisers in each territory that we have employees to ensure that we comply with all local rules and regulations with regard to working hours and environment. As far as possible we operate the same policies and philosophies (based on the UK requirements) for our staff wherever located, always having regard to and respect for local cultures.
The well-being of our employees is important and we endeavour to ensure that our employees have a balanced work/home life.
In the UK, all employees have access to a 24 hour Health Assured helpline that they can contact for confidential advice and support on a range of issues or practical and emotional challenges that they may encounter.
We believe that the right to health care is a fundamental right for any individual so provide health care insurance for our employees in the US and Japan.
Our products are designed in London and manufactured by third parties mainly operating in the Far East (approximately 93%*) and Europe (approximately 4%*). We use between 40 to 50 manufacturing suppliers. When we have co-branded projects, we use our co-brand partners' manufacturing facilities and suppliers.
We appreciate that there are certain materials (such as cotton) and areas of manufacture across the world that have been recognised as higher risk for modern slavery and human trafficking. We bear this in mind when creating new relationships with suppliers and take steps to minimise any risk of such exploitation within our supply chains.
We have sent a questionnaire to current material or manufacturing suppliers that explains the importance to us of building a relationship based on trust, transparency and cooperation so that we ensure that any workers, wherever based in the world, who contribute to the production of our unique products are afforded a high level of respect, dignity and fairness.
We are in the process of evaluating the responses we have received from over 30 suppliers to date, and assessing any potential risks with particular supply lines.
We are pleased to report that 7 of our suppliers manufacture products for other global businesses and are certified by third-party quality and safety management organisations as meeting high standards of care and safety for their employees. A further 4 suppliers have policies in place, but these had not been audited by external third parties; a further 6 suppliers have no formal policies but are aware of the issues.
Our co-branded partners are globally recognised businesses and all have substantial policies in place dealing with modern slavery, human trafficking and sustainability. Therefore, we consider that there is a very low risk of human rights abuse within the supply chain for our co-branded products.
We also have a network of suppliers supporting the operations of our business, including logistics, transport and delivery. We consider that we have minimised any risk of human rights abuses within our warehousing and fulfilment: both the UK and main US warehouses operate within the Group; for Japan and our satellite US warehousing, we use third-party warehouses, but we have visited both locations and found them to be professionally run operations that also service other globally recognised brands. Therefore we believe that there is a low risk of any exploitation within these facilities.
We minimise the risk of abuses in delivery and logistics by using a globally recognised delivery company in the UK and US that has made a Modern Slavery statement and a reputable service in Japan for delivery to our end customers. Our main freight forwarder has issued its second Modern Slavery Statement and has a zero-tolerance approach and is committed to ensure that modern slavery is not taking place in its own business or its supply chains.
* based on the last 12 months expenditure
We are committed to the principle of ensuring that there is no modern slavery or human trafficking in our supply chains or in any part of our business. Our Modern Slavery Policy reflects our commitment to acting ethically and with integrity in all our business relationships and to implementing and enforcing effective systems and controls to ensure slavery and human trafficking is not taking place in our supply chains.
We are adding resources so that we continue to increase our understanding of modern slavery and human trafficking, implement new systems and improve current systems to ensure that our business meets the standards of our policy. This is an ongoing process.
To ensure a high level of understanding of the risks of modern slavery and human trafficking in our supply chains and our business, we intend over the next twelve months to provide both formal and informal training to our staff to raise awareness of these issues. Formal training, in the first instance, will be provided to our staff that regularly visit the factories manufacturing our products.
As part of our initial work to identify and mitigate risks, we will continue to follow up the questionnaires issued and review the adequacy of responses received. We will ask all of our manufacturers to be transparent and open with us about their working practices and the sources of their raw materials. We will work with our regular suppliers where any labour rights issues are flagged up so that these can be resolved to achieve a meaningful improvement in the working conditions of the workers based at the location.
We will look to appoint third party auditors to undertake an audit of our top 5 manufacturing suppliers in terms of value that have not already been subject to third party assessments to identify any risks in our main supply chain and to help us to get the fullest picture of day to day life for our suppliers' workers.
We will continue to regularly visit our factories throughout the world to monitor and assess their behaviour and the environment provided for any workers.
The work undertaken and the findings will be reviewed at regular senior management meetings, recorded and followed up.
The meetings will also direct the next steps to be taken to ensure that we have robust systems in place to:
We have zero tolerance to slavery and human trafficking. Over the course of this current year, we will update our commercial agreements so that any third parties are now required to comply with our Modern Slavery Policy.
In addition, before engaging with any new manufacturing suppliers we will ask them to complete our supplier questionnaire and consider the appropriateness of the responses before placing any bulk orders with them.
We take our duties under the Modern Slavery Act very seriously and will continue to take the measures outlined above, and any others that we identify during the year, that reduces our exposure to modern slavery, human trafficking or other human rights abuses in our supply chains and that widens the awareness of the issue within our business.
We intend to take the following further steps to combat slavery and human trafficking:
This statement is made pursuant to section 54(1) of the Modern Slavery Act 2015 and constitutes the Group's slavery and human trafficking statement for the financial year ending 31 January 2019, and was approved by the board of GSLT Holdings Limited on 31 July 2019.
Gareth Skewis – Managing Director
31 July 2019
Lev Tanju – Creative Director