Moncler Group | Annual Report 2024 Board of Directors’ Report 262 | ’
[S2 SBM–3] Material impacts, risks and opportunities
and their interaction with strategy and business model
The value chain of the Moncler Group includes, in the upstream
phase, the workers of the supplier companies (including those
involved in the production of raw materials, façon manufacturers,
f inished product suppliers, and service providers) and, in the
downstream phase, the workers of the business partners of the
wholesale channel. As part of the double materiality process,
potential negative impacts and risks (the assessments did not take
into account the mitigation actions implemented by the Group)
have been identif ied mainly among workers in the upstream phases,
namely those within the supply chain.
The Moncler and Stone Island supply chains ref lect the
complexity typical of the fashion industry and are characterised
by a network of suppliers with whom the Group maintains direct
contractual relationships (Tier 1) which, in turn, collaborate
with
other operators (Tier n). During 2024, the number of Tier 1 suppliers
amounted to 5891, showing a slight decrease compared
with
the previous year due to increasing synergies and the partial
internalisation of production.
Suppliers (Tier 1 and Tier n) are divided into four main
categories: raw materials, façon manufacturers, f inished products
and services.
Raw material suppliers primarily provide fabrics, yarns, down,
leather and production accessories (buttons, zippers, ribbons,
elastics, etc.). Fabrics mainly come from Italy, Japan, South Korea,
China and France. Suppliers of yarn and production accessories
are mainly Italian, while the down suppliers are European, North
American and Asian.
Façon manufacturers are suppliers that employ workers with
strong technical expertise to which the Group entrusts the
production of f inished products or intermediate phases of processing
(dying, embroidery, etc.), while providing them with all the raw
materials needed. This category includes dye houses that perform
garment-dyeing, to which Stone Island directly entrusts this
process in Italy. The entire manufacturing process is carefully
monitored by Group technicians who verify its compliance
with the required standards through rigorous, ongoing f ield audits.
In particular through this process outerwear trousers skirts
dresses all tricot knitwear and some cutandsewn knitwear
are produced Façon manufacturers are mainly located in Italy
and Eastern Europe areas where long manufacturing tradition
guarantees very strong technical expertise and adequate production
capacity In particular Italy is characterised by a strong expertise
in very complex and unusual processes
Finished products suppliers are suppliers whose workers
having received the technical design of the products are responsible
for the creation of the garment including the raw materials
sourcing phase according to the Group standards in addition
Moncler directly provides its f inished products suppliers with some
key raw materials such as down, nylon and logoed materials.
During garment production there is constant interaction between
the supplier and the Group experts, who make on-site visits and
scrupulously supervise the process, to ensure that the f inal
product
meets the expected high level of quality. Some cut-and-sewn
knitwear (mainly t-shirts and polo shirts), some soft accessories
(such as hats and gloves), shoes and bags, and small leather
goods are mainly produced in this way. In particular, suppliers
of cut-and-sewn knitwear are based in Europe and Türkiye;
shoes are made by suppliers in Asia and bags and small leather
goods are made by European suppliers, mainly Italian.
Service providers support the Moncler Group in its pattern
making, prototyping and quality control processes and are mainly
based near its corporate sites.
As for indirect suppliers, they are partners that provide goods
and services not directly related to product manufacturing. This
category includes construction companies and security,
cleaning,
porterage and maintenance, logistics and consulting services.
The heterogeneity of suppliers, their geographical distribution,
the nature of certain processing and services, and the seasonal
variability of production could lead to potential negative impacts
on workers in the supply chain on issues related to human rights
(such as forced or child labour, the right to collective bargaining, etc.),
inadequate labour standards (management of contracts and working
hours, wages, occupational health and safety systems, etc.) and
employment stability. These impacts could translate into potential
reputational risks for the Group.
To address these challenges, the Group has been dedicating
signif icant resources for years to the prevention and monitoring
of potential violations of applicable laws, as well as its own standards,
along the supply chain. In this context, the traceability process
has been important enabling an increasingly detailed understanding
of the supply chain while simultaneously establishing a structured
due diligence system, with a particular focus on those who might
be in situations of greater vulnerability.
1
Excluding suppliers with sales order of
less than 1000 Euros per year
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