CONSOLIDATED NON-FINANCIAL
STATEMENT
(LEGISLATIVE DECREE 254/2016)
FY 2023
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Table of contents | |
OVS CIRCULAR OPERATING SYSTEM | 12 |
INTERVIEW WITH SIMONE COLOMBO, HEAD OF CORPORATE SUSTAINABILITY OVS SPA | 13 |
DESIGN FOR CIRCULARITY | 16 |
OUR CONTRIBUTION TO THE SUSTAINABLE DEVELOPMENT GOALS (SDGS) | 16 |
MORE SUSTAINABLE MATERIALS | 17 |
COTTON: THE MOST IMPORTANT FIBRE | 18 |
POLYESTER: TOWARDS ALTERNATIVES | 19 |
BOX: ALTAVIA BY DEBORAH COMPAGNONI: WITH OVS SPORT IS FOR EVERYONE | 19 |
WOOL: REDUCING THE IMPACT | 20 |
VISCOSES: MORE FOREST-FRIENDLY | 20 |
DENIM: CONTINUOUS INNOVATION | 20 |
INTERVIEW WITH ADRIANO GOLDSCHMIED, DENIM FASHION DESIGNER | 22 |
BEING FAIR AND TRANSPARENT | 25 |
OUR CONTRIBUTION TO THE SUSTAINABLE DEVELOPMENT GOALS (SDGS) | 25 |
CODE OF CONDUCT | 26 |
WAGES AND WORKER REPRESENTATION SYSTEMS | 26 |
BANGLADESH, A STRONG AND LASTING PARTNERSHIP | 28 |
TOWARDS A LIVING WAGE IN BANGLADESH | 28 |
EIS EMPLOYEE INJURY SCHEME | 29 |
INTERVIEW WITH ANNE MARIE LA ROSA - HEAD OF ILO - INTERNATIONAL LABOUR ORGANISATION FOR EIS | |
BANGLADESH | 29 |
ENERGY EFFICIENCY PARTNERSHIPS | 30 |
PARTNERSHIP FOR WORKERS' WELFARE | 31 |
OUR PRESENCE IN MYANMAR | 31 |
CONTINUOUS MONITORING | 31 |
WOVO, THE APP THAT GIVES WORKERS A VOICE | 32 |
SECTOR COLLABORATIONS | 33 |
DESIGN A BETTER WORK | 35 |
OUR CONTRIBUTION TO THE SUSTAINABLE DEVELOPMENT GOALS (SDGS) | 35 |
LIFE IN OVS | 35 |
NEW SPACES FOR SOCIALITY AND WELL-BEING | 35 |
FROM JOB SEARCH TO PROFESSIONAL GROWTH | 36 |
#WEARYOURCHANCE | 36 |
OVS ON CAMPUS | 36 |
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OVS INTERNSHIP PROGRAMME | 37 |
THE FIRST STEPS IN OVS | 37 |
STORE EXPERIENCE | 37 |
TRAINING AND SKILLS DEVELOPMENT | 38 |
ASSISTED SALES | 38 |
LEADERSHIP PROGRAMME | 38 |
PRODUCT TRAINING | 39 |
STORE MANAGEMENT SCHOOL | 39 |
OVS PER ME | 40 |
WELFARE | 40 |
WELL-BEING | 40 |
PARENTING | 40 |
THE VALUE OF REMUNERATION | 40 |
NEW WORK ORGANISATION | 41 |
WHAT CAN OVS DO TO IMPROVE ITS IMPACT ON THE PLANET? | 42 |
MAKING FASHION A BETTER CHOICE | 44 |
OUR CONTRIBUTION TO THE SUSTAINABLE DEVELOPMENT GOALS (SDGS) | 44 |
TRANSPARENCY FIRST | 44 |
CUSTOMER AWARENESS | 45 |
ECO VALUE: CLEAR INFORMATION FOR SUSTAINABLE CHOICES | 45 |
IN-STORECOMMUNICATION VIA PANELS | 46 |
SUSTAINABILITY AND CIRCULARITY FOR THE OVS CUSTOMER | 46 |
INTERVIEW WITH FILIPPO PICCIONE - RETAIL DIRECTOR ITALY | 47 |
UNSOLD STOCK MANAGEMENT AND RECONDITIONING MECHANISMS | 49 |
THE NUMBERS OF RECONDITIONING | 49 |
CHOOSING ITEMS FOR RECONDITIONING | 49 |
THE ADVANTAGES | 50 |
RE-UP. THE FUTURE IS NOTHING NEW | 50 |
A SECOND LIFE FOR USED CLOTHES | 52 |
EARTH DAY 2023 | 52 |
CHRISTMAS JUMPER | 52 |
DETAILS | 54 |
OVS GROUP PROFILE | 54 |
GROUP STRUCTURE | 54 |
HISTORY | 54 |
OPERATING MODEL | 56 |
ORGANISATIONAL STRUCTURE | 57 |
MISSION AND VALUES | 57 |
CORPORATE GOVERNANCE | 58 |
SUSTAINABILITY GOVERNANCE | 61 |
REFERENCE FRAMEWORK | 62 |
COLLABORATIONS WITH SECTOR ASSOCIATIONS | 64 |
STAKEHOLDERS AND MATERIALITY | 64 |
STAKEHOLDER MAP | 64 |
METHODOLOGICAL APPROACH | 67 |
INTERNAL ASSESSMENT OF IMPACTS | 68 |
DIALOGUE WITH STAKEHOLDERS | 69 |
VALIDATION OF MATERIAL TOPICS | 69 |
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ENTERPRISE RISK MANAGEMENT AND MANAGEMENT OF NON-FINANCIALRISKS | .......................................77 |
THE INTERNAL CONTROL SYSTEM | 81 |
CODE OF ETHICS | 81 |
ORGANISATION, MANAGEMENT, AND CONTROL MODEL | 82 |
WHISTLEBLOWING | 82 |
CORPORATE SOCIAL AND ENVIRONMENTAL POLICIES | 83 |
AUDIT ACTIVITIES | 83 |
INDICATORS BREAKDOWN | 83 |
ECONOMIC AND FINANCIAL PERFORMANCE | 83 |
APPROACH TO TAXATION | 84 |
SUPPLY CHAIN | 85 |
HUMAN RESOURCES - WORKFORCE | 88 |
HUMAN RESOURCES - TURNOVER | 92 |
HUMAN RESOURCES - PARENTAL LEAVE | 96 |
HUMAN RESOURCES - TRAINING | 97 |
HUMAN RESOURCES - REMUNERATION | 99 |
HUMAN RESOURCES - HEALTH AND SAFETY | 101 |
HUMAN RESOURCES - PERFORMANCE APPRAISAL | 104 |
ENVIRONMENT - ENERGY CONSUMPTION | 105 |
ENVIRONMENT - SCOPE 1 AND 2 CO2 EMISSIONS | 108 |
ENVIRONMENT - BASELINE REVIEW 2019 SCOPE 3 | 110 |
ENVIRONMENT - CO2 EMISSIONS SCOPE 3 | 110 |
OVS APPROACH TO CARBON NEUTRALITY | 113 |
ENVIRONMENT - WATER CONSUMPTION | 113 |
ENVIRONMENT - WASTE | 115 |
PRODUCT AND RAW MATERIALS | 118 |
EUROPEAN TAXONOMY | 121 |
INTRODUCTION TO EU REGULATION NO. 2020/852 ON TAXONOMY | 121 |
THE OVS ELIGIBILITY AND ALIGNMENT ANALYSIS | 121 |
SUBSTANTIAL CONTRIBUTION | 122 |
DO NO SIGNIFICANT HARM | 122 |
MINIMUM SAFEGUARDS | 125 |
KPI CALCULATION METHODOLOGY - ACCOUNTING POLICY | 126 |
DISCLOSURE OF ACTIVITIES RELATED TO NUCLEAR AND FOSSIL GAS | 134 |
METHODOLOGICAL NOTE AND READING GUIDE | 135 |
GRI CONTENT INDEX | 137 |
EXTERNAL ASSURANCE | 146 |
SUSTAINABILITY-LINKEDBOND | 149 |
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VISION
Interview with Stefano Beraldo, CEO OVS Spa
What distinguished the year just ended?
In 2023, our growth continued. We have achieved a market share approaching 10%. For the third year in a row, growth is mainly due to the good performance of existing stores. Despite this, we are in line with our plans to reduce our impact in absolute terms, which leads to an even better result when considered on a like-for-like basis than in previous years.
All this is the result of the changes introduced in recent years. We have improved the quality and stylistic content of the product, and are able to satisfy a wide range of customers with different needs. We dedicate more and more attention to the various lifestyles that characterise the plurality of our customers, to each of which we match a dedicated product type, and often a brand capable of representing it.
Alongside this evolution is the path we started almost ten years ago to limit the negative impacts of our business. Our commitment to decarbonisation, in order to achieve the targets approved by the Science Based Targets initiative, continues and drives the company's strategies on store
energy efficiency and material portfolio evolution.
How is the product offering evolving? What role does sustainability play in the design of collections?
We are moving into new product segments. These include the world of sport. An important milestone this year was the launch of Altavia, the ski collection designed in collaboration with Deborah Compagnoni. We want to reach all athletes who are looking for garments that combine quality and surprisingly affordable prices, always with an eye on product sustainability features. The padding of Altavia jackets and trousers are 100% recycled polyester, as are the sweatshirts and thermal underwear, and the next fall-winter collection will see a further increase in the use of recycled materials, also in the fabrics of the jackets and trousers.
The collaboration with Adriano Goldschmied is also a step in the long-term project on product sustainability. The denim strategy includes experiments with low-impact dyes and materials and the introduction of an increasing percentage of recycled fibres.
What role can OVS play in the business transition towards more circularity?
Thanks to the capillarity of the sales network, OVS can address the awareness of millions of people. The path towards transparency is well established. This year for the third time we came first in the Fashion Transparency Index compiled by Fashion Revolution. With the Eco Value indicators, we provide our customers with all the information they need to make informed purchases.
Fashion is, by its very nature, change and the life cycle of products is to a large extent linked to market dynamics. Now the challenge is to continue to improve the durability of the garments we sell. With this objective, and thanks to more efficient purchasing and production processes, we are working to propose an offer characterised by greater quality and style that will last over time, while maintaining affordable prices. It is also necessary to involve the customer in this process by offering in-store services that can help extend the life cycle of garments: recycling, reuse, tools for repairing and customising used products.
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What goals does OVS have in the short and medium term?
I am a great believer in experimenting with more sustainable business models that, although limited, are strategic. I am thinking of the financing of cotton cultivation in Sicily, but also of all the potential innovations in the field of textile fibre recycling and the reuse of clothes. During 2023, activities continued to develop the technological innovation and logistics hub in Apulia. It is the place where projects dealing with circular economy issues and potential applications of artificial intelligence will be channelled.
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Our brands
OVS
Leading Italian brand in the clothing market. It offers a selection of contemporary and essential style, with excellent value for money and great attention to sustainability in the choice of materials and production processes.
The brand has increasingly evolved from a vertical retailer model towards a platform logic, both physical and virtual, with the introduction of a curated selection of iconic brands and innovative propositions, each catering to a specific lifestyle.
With around 1,300 stores, OVS is present in Italy and abroad, in major city centres, shopping centres and residential areas.
OVS KIDS
Brand leader in the Italian children's clothing market, with a double-digit market share.
Its target audience are children, 0 to 15 years old, with a competitive, high-quality offer that pays great attention to the selection of certified raw materials and the creation of garments that are both stylish and practical.
It is present in Italy and abroad with direct and franchise stores.
PIOMBO
Contemporary brand of clothing for men, women and children, designed by Massimo Piombo. The collections express the taste and talent of the well-known Italian designer in the research of fabrics and care for details and combinations of shapes and colours.
It is present in Italy with shop-in-shop in over 500 OVS stores and with a flagship store in Cortina d'Ampezzo. From 2023, it started an international expansion project, opening new stores in New York, Madrid and Paris.
UPIM
Italian family department store, a benchmark for a shopping service that is convenient, accessible and targeting the actual needs of families. It offers a service that is close to the community, with a wide and varied offer ranging from clothing for the whole family, to beauty and home.
It is present in Italy and abroad with more than 300 full-format stores, most of them direct, in city centres, shopping areas and residential areas, and with a shop-in-shop formula inside the hypermarkets of major retail groups.
BLUKIDS
Blukids is a brand specialising in clothing for children aged 0 to 15. It proposes garments that are certified and of high quality, always at a competitive price.
Blukids is present with 350 stores in Italy and abroad and with more than 300 corners in Upim stores.
LES COPAINS
Iconic Italian brand, acquired by OVS S.p.A. in 2022, which stands out for its versatile and refined style, aimed at a contemporary woman who chooses to express herself with elegance at different times of the day.
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Les Copains is present on the market with stand-alone stores and corners inside Upim stores.
CROFF
Italian brand for home decoration dedicated to those who love easy, informal contemporary design, to be experienced and lived in every day. Italian design products, with unique style and excellent value for money. The collections, with their unique style and excellent value for money, are the result of a careful selection of European and international manufacturers.
CROFF is present in Italy with stand-alone,shop-in-shop formats in Upim stores, city centres, shopping areas and residential areas.
STEFANEL
Italian contemporary clothing brand dedicated to women, famous for the design and quality of its knitwear. Founded in 1959, it has been part of the OVS Group since 2021.
Acquired by the OVS Group in 2021, it is present with more than 100 stores in Italy and abroad, with direct and franchised stand-alone formats, and with corners inside department stores.
Key Numbers
- Stores worldwide: 2,245
- Employees worldwide: 8,280
- Revenue: Euro 1,535.6 million
- Group Market Share: 9.6%
- OVS brand global awareness: 94%
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Our Path
In recent years, we have been witnessing a paradigm shift in the fashion industry driven also by increasing regulatory and media attention to the social and environmental impacts generated by clothing production. At European level, emerging regulations reflect this growing awareness, incentivising companies to review their practices and business models. Concepts such as "carbon footprint", "circularity" and "biodiversity" have become central to corporate strategies. Regulatory and social pressures have also led companies to review their supply chain management, adopting stricter due diligence practices to ensure product traceability and respect for workers' rights throughout the supply chain. Companies in the fashion industry today face a crucial challenge that requires a strong adaptation to the new context.
In this scenario, consumers also play a key role: although awareness and attention are high, only effective and transparent communication by companies can guide them towards more sustainable, intentional and conscious choices. Consumer confidence depends on the ability of brands to demonstrate a genuine commitment to sustainability and provide clear information on the origin of materials, working conditions and the environmental impact of their products.
One of the founding values of OVS has always been transparency, that distinguishes our way of thinking, acting and telling. We decided to embark on our sustainability journey several years ago: this has allowed us to learn from our mistakes and also to achieve ambitious goals, thus paving the way for a successful current paradigm shift.
In a rapidly changing landscape, we are aware that adapting to new environmental and social requirements is no longer a choice, but a pressing necessity for companies in our industry that aspire to thrive in the market of the future.
Towards carbon neutrality
In 2023, we continued the decarbonisation plan according to scientific parameters approved by the Science Based Targets initiative. We are on track with our plan to reduce emissions (by 46.2% by 2030 compared to the 2019 baseline) and thanks to all the activities we have carried out in recent years, we have thoroughly understood the structure of our carbon footprint and identified more and more precisely the elements that influence it.
In the course of 2024, the year in which the Sustainability-linked bond cycle will end, we will report on the objectives achieved and at the same time define new targets, setting a new baseline to bring it more in line with the changed company organisation, which sees a growth in third-party brands, an increase in the incidence of e-commerce and more space for previously more marginal sectors such as cosmetics and perfumery.
As far as direct impacts are concerned, we will continue with our strategy of investing in the creation of new renewable energy sources, rather than purchasing certified renewable energy produced by third parties. We will continue our programme of installing photovoltaic systems throughout Italy, which has led us to have more than 50 systems by 2023, with the goal of fully covering 40% of our electricity needs through photovoltaics. We will achieve this through the
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installation of self-generation plants with on-site exchange and through investment in larger photovoltaic parks and simultaneous activation of PPA.
ESG Risk Rating: OVS in first place in the Fashion segment
The correct identification of the areas of action and the quality of the results achieved have been confirmed by in-depth studies with investment funds that are shareholders in OVS and independent assessments by sector analysts. In January 2024, the OVS ESG Risk Rating is 9.1 in the "Negligible" category, placing the company in 1st place out of 208 (where 1st place is the company with the lowest risk rating) in the "Textile & Apparels" sector assessed by Sustainalytics.
New Strategic Sustainability Plan
The coming years will be crucial to achieving climate neutrality goals and avoiding irreversible consequences on the ecosystems in which we operate. According to scientific evidence (IPCC report), 2025 is the year by which emissions will have to peak and then fall rapidly and steadily. By 2030, in addition to achieving the 17 Sustainable Development Goals, Europe has set itself the target of reducing greenhouse gas emissions by at least 55% compared to 1990, in order to achieve climate neutrality by 2050.
With the awareness that, in order to have tangible results by these dates, it is necessary to set even more challenging targets, in 2023, the Group worked hard and in a structured manner to define a new Strategic Sustainability Plan for the 2024-2026 time horizon. With the new Plan, the Group also intends to consolidate its efforts in all priority impact areas, going beyond commitments on emissions reduction, giving centrality to social impacts along the value chain and defining the basis for a new production and operational paradigm, centred on circularity.
The 4 key pillars of Group sustainability are outlined below:
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Design for circularity
We support the transition to a more sustainable fashion industry by designing and producing garments characterised by low-impact raw material choices and production processes, and by engaging in a constant search for innovative solutions that protect and preserve natural resources. - Being fair and transparent
We activate our suppliers and the entire business ecosystem in sustainable development programs, accompanying them in their evolution towards innovative practices and leveraging transparency as the key to change.
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OVS S.p.A. published this content on 10 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 10 May 2024 09:17:09 UTC.