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8/11/2019 Jia Hsin GRI Report
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1
Jia Hsin Co., Ltd.
SSuussttaaiinnaabbiilliittyyRReeppoorrtt
YYeeaarr22001111
October 2012
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Table of contentPreface 5
President and General Manager Statement Sustainability in Every Step 6
Footwear Impacts, Risks and Opportunities 7-8
About company and its report 9
Vision and mission 10
About us 11
Business _ Operation 12
Governance 13-15
Transparency and commitment 16
Awards 17
Stakeholders 19
Prioritize stakeholders 20
Case : Puma expectation 21
Stakeholders concerns 22
Business Performance 23
Management Approach 24
Business results 25
Market presence 26
Labor performance : Empower employees 27
Our workforce: Respect, Share and Care 28
Employment aspect 29
Management approach 30
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Total Workforce 31-32
Overview 33
New Employees _ Turnover rate _ Planning for the future 34-35
Occupational Health and Safety 36
Management approach 37
Procedure of accident investigation 38-39
Injury, Occupational Diseases, Lost Days and Absenteeism 39-41
Training and Education 42
Management Approach 43
Risks control and training programs 44
Diversity and Equal Opportunity 45
Ratio of Salary of Women to Men 46
Environment Performance 47
Environment Highlight 48
Energy aspect 49
Management approach 50
Direct and Indirect Energy consumption 51-52
Water aspect 53
Management approach 54
Water withdrawal 55
Emission, Effluents and Waste 56
4R Policy 57
Direct and Indirect Green House Gas Emissions 58
Significant Air Emissions 59-61
Water discharge 62
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Waste and waste disposal 63-64
Initiatives to mitigate impact : What we are changing 65
Social Performance 66
Social performance - Society 66
Monetary Fines and Non-Monetary Sanctions 67
Social performance Human Rights 68
Code of conduct in our business 69
Code of Conduct in procurement and outsourcing 70
Customers Health and Safety 71
Customers Safety through Products Safety
Self Declaration
GRI Performance Indicators
GRI Content Index
72
73
74-76
77-86
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Preface
Sandal is around our lifeSandal is a faithful companion with human
from primitive age to modern times.
Sandal is believed to be the first crafted foot
covering stuff. It was the basic footwear of
ancient civilizations such as Egypt, Greece
and Rome. In the 20th century, the sandal
was reintroduced in North America and
Europe for fashion footwear(*). To the
present days, sandal is kept abreast with
marvelously engineered shoes in worlds
notable fashion shows and in daily wear.
Vietnam Footwear existed for long, however
it was developed to be the Industry from
Vietnams Doi Moiperiod, the Vietnam
opening and reformation period. After 20
years, Vietnam becomes the second largest
footwear exporter in the world.
Coming and building up our sandal business
in Vietnam during the Vietnams Doi Moi, we
contribute to the development of Vietnam
Footwear Industry in general and sandal
production in particular. Having more than
20 years doing business in Vietnam and
witnessing the vigorous change of the
country, we thoroughly aware our
responsibility in contributing to the
socioeconomic development and
sustainability of the country. We
acknowledge the expectation of customers,
community, employees and others
stakeholders about our compliance in
business code of ethics and sustainable
development. We keep working diligently and
tireless to meet this expectation.
(*) Source : Footwearhistory.com
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Sustainability in Every StepAs sandal companion with human step, we
care of sustainability in every step of ourbusiness operation. Sustainability is
integrated into our business strategy. Being
long-term, stable and responsible business
becomes guidance for Jia Hsin operation.
I am pleased with the effort from myself and
my employees in implementing our
sustainability commitments and achieving
certain positive results though year 2011 is
the ever toughest year in our business life.
Indeed, we faced many challenges
throughout the year 2011. External
challenges such as order volume reduction
due to global economic downtime and
European economic fluctuation, price storms
in Vietnam due to inflation problem, strike
waves causing instability in labor force plus
many other problems have impacted to our
business. Internal challenges, such as building
up a new workshop, setting up overalloperation and lean production lines for new
workshops; establishing and implementing
ISO-14001 and OHSAS 18001 Management
Systems; restructuring our organization; and
handling strike from workers have caused a
most difficult year.
We did not give up challenges but faced and
overcame them. We did not get rid of
sustainability commitments in hard time but
implementing them and using them as amotivation.
Achieving customer SAFE Award, Most
Dedicating Social & Environment Affair Team
Award, certified ISO14001 and OHSAS18001
management system, and other sustainabilityawards proves that sustainability is in every
step of our business life.
I keep considering sustainability an
important part of our operation and a cyclical
journey of whole Jia Hsin team. With strong
commitment on leading, supporting, and
together with my team, I team will make our
stakeholders expectations happen.
Wedid not get rid ofsustainability commitments in
hard time but implementing them
and using them as a motivation
CHRIS LEE
GENERAL MANAGER
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7
Footwear:
Impacts, Risks and OpportunitiesToday, the Asian countries take an impressive proportion in footwear manufacturing. While
serving the world with wonderful products, footwear manufacturing creates considerable
impacts to the world. Is there any opportunity for being responsible?
Impacts
Footwear manufacturing
consumes a large amount of
materials and energy then
releases wastes andemission that originally
bring impacts to
sustainability and people
working in manufacturing
environment. There may be
certain non-compliances to
relevant regulations and
standards, too
Jia Hsin acknowledges on
effects of its production to
stakeholders and
sustainability as a whole.
Key impacts from Jia Hsin
business and productions
can be derived from
following activities:
Resources consumption
Waste release and air
emission
Unsatisfied working
conditions for employees
and surrounding
environment for
community
Possible non-compliances
to local legislation and
international standards.
Negative economic
performance.
To identify impacts, we do
the periodical Health and
Safety Risk Assessment,
Significant Environmental
Impact Assessment, andInternal Audits.
During the assessments, we
do scoring to give priority
with significant impacts and
set up relevant corrective
action plans.
We implement Management
Systems to ensure that the
impacts are identified,reviewed and removed
periodically.
We acknowledge
manufacturing impacts
to sustainability and we
create opportunities tomitigate adverse
impacts as much as
possible
-------------------------
Ai Nguyen
Operation Manager
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Risks
While controlling our impacts
to sustainability, we stay
aware on the reverse impacts
from it. Our SWOT analysis
indicates different risks, and
significant challenges and risks
from sustainability trends are
identifies as following:
Need large investment to
comply with the legal
requirements and
international standards.
Need to gain commitment
from investment company
for financial support
Climate change impacts to
sales markets and
operation location, causing
effects to our business
performance
Employees awareness,collaboration and
capability in implementing
sustainability programs.
Opportunities
Not only coming with impacts,
challenges and risks,
sustainability trends bring
great and potentialopportunities. We find out
their hidden benefits,
including:
Being more competitive in
our supply chains because
preference is offered to a
supplier who can
contribute to the overall
performance of the supplychains.
Stable and strong
workforce, thanks to the
compliance in health and
safety, leading to qualified
products, high
productivity and stable
operation.
Support from governmentbodies
Increase company
prestige and image.
Contribute to worlds
action in bringing a better
life of our next generation.
We understand nature of risks
and importance of capturingthe opportunities. We
implement necessary
programs to prevent or
mitigate risks. We seek
commitment from mother
company for investment on
sustainability programs to
contribute into world effort in
reducing impacts from climate
change. We provide trainingto employees and community
to improve their awareness
and collaboration. Most
important, we ensure our
sustainable compliance for
competitiveness and growth.
We focus in building up
management systems for eachaspect. The management
systems allow us to Defines
problems, Plan the corrective
actions, Check the
implementation and Improve
for better.
As for the methodology, we
conduct prevention and
reduce of impacts. Treatment
before releasing is applied forthe remained impacts.
Mr. Joel Warton, Puma SR Head Of
Production and Branch Operations
Far East
Mr. Chris Lee, our General Manager
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About company and its reportIt is a pleasure that we issue our second Global
Reporting Initiative (GRI) Sustainability Report,
Year 2011, reflecting our commitment in
Business Transparency, Social Responsibility
and Sustainable Development.
Our first GRI Sustainability Report was
compiled under GRI coaching and completed by
June 2011.
The compilation of this report is also a chance
to review our activities and seek opportunities
to improve our performance . In this spirit, we
keep producing GRI Sustainability Report
annually.
This report is compiled in align with GRI
Reporting Framework, under new GRI
Guidelines version G3.1 and with reference to
GRI Technical Protocol plus GRI Indicator
Protocol. For GHG indicator, we refer to2011
Guidelines to Defra / DECC's GHG Conversion
Factors for Company Reporting.We upgrade our
report to Level B. Currently, the company does
not apply external assurance on the report,except the financial data which is audited by
Vietland, an independent auditing company.
The compilation team also thoroughly referred
to GRI Report Boundary Protocol to identify the
boundary and scope of report.
Unless otherwise stated, this report covers all
types of disclosure of our Vietnam facilities,
including Cau Tram Factory and Long Hau
Branch. The materiality is defined to ensurethat we address to the issues which are
prioritized by our stakeholders.
Compared with Sustainability Report Year
2010, this version will disclose more on our
newly built production workshop; business
expansion. This may lead to a gap when data is
compared; our approach to new customers
sustainability standards; and number of
reported indicators. There is no limitation
The information data disclosed in this report is
collected from our daily operation. It reflects
the actual situation. The company has CSR data
monitor system which allows company present
accurate data instead of estimation or
assumption.
This report will be issued in English and
Vietnamese to our prioritized stakeholders by
soft and hard copy for convenience.
SUSTAINABILITY CONTACT IN JIA HSIN
We invite you to give us your comment and
feedback on our Sustainability Report Year
2011. We highly respect and appreciate it.
We would like to express our sincere thanks to
everybody participating, contributing, and
supporting to the compilation of this report.
Without their help, this report will not come
true.
Please feel free to contact:
JIA HSIN CO., LTD.
D1-D5 Cau Tram IP, Can Duoc, Long An, Vietnam
CHRIS LEE - General Manager
AI L.H. NGUYEN - Operation Manager
* Photographs by Jia Hsin staffs
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About us
Jia Hsin Co., Ltd. is a sandal manufacturing company
wholly owned by Jia Cherng Corp. incorporated inRepublic of Mauritius.
To be licensed in 2008, Jia Hsin established its business
in new premises after legal liquidation of old business
under the name Sunkuan JVC. The newly founded
company started its operation from June 2009.
Company location:
D1D5 Cau Tram Industrial Park.
Cau Tram Village, Long Trach Commune,
Can Duoc District, Long An Province, Vietnam
Head quarter location:
No. 162, Pu-Tze Rd, Pt-Tze Village, Chi Tung Hsiang,
Yun Lin Hsien, Taiwan, R.O.C
In 2010, the company started-up a new business
relationship with another top sports brand. The venture
became the most significant change in the year and
prolonged its influences to the year 2011. This business
expansion brought about changes in operations, facilities
and management system. The company has invested for a
new manufacturing building, add it up with 3 production
lines and hired additional 400 employees for this new
customer.
The new customer also put the company in an extremelyhigh pressure when it requires our integration to its
operation and management system. In effort to shorten
the gap between customer system and ours, we find the
worth of changes and a gate for the future.
New and Pretty
Our company name simply
means New and Pretty.It
stems from our dream of a
new and beautiful building
while we was working in
our 18-year-old dark and
old factory in Hochiminh
City. It used to be a great
dream and, like a big family,
together we tirelessly
worked to make it come
true.
Company is the second
home after own home, in
the eyes of most of our
employees.Solidarity and
Loyalty are our Values.
Sincere and Support are
our Culture. Employees
can find here strongly
organized business
operation and strictly
disciplinary management.
They can also find
motivation and respects
We work diligently not only
to keep our building new
and beautiful but also to
maintain our beautifulimage and prestige in the
look of our prioritized
stakeholders.
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Business
Jia Hsin operates its manufacturing in Vietnam but does not
supply its products to local markets. Instead, the company acts as
supplier for various world top brands. All products are registered
for export. Without foreign subsidiary and distribution channel,
the company products are launched through the customers
distribution network.
Jia Hsinscustomers possess the world-wide distribution network
which brings Jia Hsin products around the world. Although the
company does not have its own brand-name, it is proud to serve
the community with beautiful, qualified and safe products. The
top destination of Jia Hsin products is the European markets, and
then followed by the Asia and the USA. African countries are the
smallest markets.
OperationJia Hsin hires 1,808 employees in average of year 2011 for its factory in Can Duoc and Branch in
Long Hau. Since Long Hau Branch make samples only, total mass production capacity is allocated in
Can Duoc main factory. With 8 lines and relevant supplementary equipment, Jia Hsin can offer 6
million pairs a year. It expects that the capacity will be fully occupied and sales volume will be
mostly equal to capacity volume.
In align with stakeholders expectation, the company sets 2015 target of 10 million pairs sales
volume. Route map 2010-2015 and strategic plans were worked out from year 2010 to guide us to
the goal. In order to achieve the target, the company needs a comprehensive change from its old
and stunted mindset and system over the past 20 years.
Manufacturing is the core component in our operation. Our manufacturing objectives include of
converting from traditional to lean production lines, gaining double-pph which mean increase
productivity per person per hour twice, enhancing continuous improvement campaign and
changing management mindset.
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Governance
Step into
Reformation
n year 2011, the company decides to step into
Reformation to save its heavy management
boat from sinking and upgrade itself to the
management level of new customer.
The current governance system composes of a
Chairman as representative of investment company -
but not to be the executive officer and employed
General Manager and Vice General Manager. Daily
operation is handled by these two top managers.
Characteristics of management are central
controlling and several-layer management system.
The top management covers all areas in details
instead of prolonging their arms through senior
management. Proportion of indirect workers ondirect workers is very high. The company feels as if a
fully laden boat.
Under pressure of negative impacts from business
performance and the rush to approach new
customersmanagement system, the company
decides to step into a reformation to save itself from
overall crisis
Key Facts
5layers of from top to
bottom
4/1
Proportion of
indirect/direct workers
3 / 7Additional channels / Total
channels for communication
between top management
and employees
Re-structure organizations chart
Narrow down the management layers
Adjust the proportion of indirect/direct workers
I
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LEGAL AND OPERATIONAL STRUCTURE
Jia Hsin Co., Ltd is registered as a limited
company under Vietnam law, with 100%
investment from Jia Cherng Corp. which is
registered under law of the Republic ofMauritius. The chairman of Board of Directors
of Jia Cherng is Mr. Lin Yin-Piao who owns
13.33% of total shares. Jia Cherng nominates
Mr. Reagan Lin, a member of Jia Cherng Board
of Directors, to be the Chairman of Jia Hsin.
Exhibition 2.8 reflects the Net Sales and CapitalBreakdown of the company in year 2011.
Exhibition 2.8: Net Sales and Capital Breakdown year 2011
There is no Board of Directors in Jia Hsin.
Highest governance body is the Chairman,
acting as representative from investment
company, and Board of Management that
includes one General Manager and one Vice
General Manager. The Chairman is not an
executive officer.
There are 2 committees in company: Trade
Union and Labor Safety Committee. Trade
Union is an independent unit setup by
employees and representing employees in
negotiating with employers. Labor Safety
Committee is setup by the Company under the
local regulation about health and safety
management inside the company.
All the communication between employer and
employees, employees' representative or
committees is handled and decided by Jia Hsin
Board of Management (GM and Vice GM).
Board of Management normally discuss with
employees and committees by following
methods :
1. Weekly meeting for leaders/managers, then
they will re-form workers and staffs on issues
discussed in meeting.
2. Policies, notices, decisions posted on notice
board.
3. Suggestion box.
4. Face to face meeting between Board of
Management and all employees.
The Board of Management shares with all
employees about the company strategies,
policies, business targets/goals, expectation
from customers and board of management, as
well as the requirements on employees'
cooperation and contribution. The Board of
Management does not aim to hide the company
aspects and concerns. The company enhances
the understanding between the partners and
considers it an important factor for thebusiness success and development
Item Year 2011
Net sales (in US$) 18,468,019.40
Sales volume (in pairs) 5,189,406
Item Year 2011
Debt (in US$) 17,477,896.35
Equity (in US$) 744,350.45
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ORGANIZATION STRUCTURE
The organization is structured based on our
operation flow and function, starting from
product development to products delivery.
There are three main divisions: Development,Production and Operation. Long Hau branch is
an assigned department for handling
development of one of our customer.
Functionally, Long Hau branch is belonging to
Development division.
Development division handles on research and
development of new products for each season.
After the new design is confirmed, the order
will be downloaded and Operation division willarrange the supportive and preparatory
activities for production. After all preparation is
done, Production division can start their
process.
Exhibition 4.1. General organization chart
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Transparency & commitment
The company somehow accepts
outsource from employees or employeesfamily business as a way of supporting
employees. It is un-written law that
supervisor of purchase or higher
management level check for reasonable
price and quality. Top Management
approval is mandatory. Highest
governance body is not an exception from
this practice and Chairman will act as
final approver.
Earnings of highest governance body are
directly proportional to company overall
performance while senior management is
able to get fixed wage plus a performance
bonus.
Company overall performance and Top
Management performance is
interdependent. The investment company
appraises Top Management performance
by reviewing company business resultsand its achievement in social and
environmental aspects. This leverage
enhances their dedication to the company
operation.
In such principle, Top Management and
Senior Management qualification plays
the decisive role in the company
development. Their leadership properties
compose of expertise in the industry,
leadership characteristics and leadership
communication.
Top Management play decisive role in the
success of business. The shareholders
select the top management based on their
trust, experience and management ability.
For senior management, the company
adds in the criterion of expertise to
ensure that they will properly guide the
subordinates
Commitment to external initiatives is
among the ways to adhere ourselves to
internationally agreed standards and
principles.
We engaged in GRI sustainability
report from 2010, EU REACH and from
2010 and zero-hazardous chemicals
from 2011.
CHRIS LEE GENERAL MANAGER
CONFLICT OF INTERESTS
HIGHEST GOVERNANCE
The Top Management operates
business with management
systems founded on local and
international legislations,
stakeholders concerns and
expectations as well as company
vision and mission. Deviationfrom this triangle framework
may lead company to
mismanagement and
noncompliance.
SWOT analysis, assessment,
reporting mechanism and
interactive brainstorming are key
tools to support Top
Management to oversee company
conditions and made proper
treatment or improvement.
OVERSEE ORGANIZATIONS
CONDITIONS
HIGHEST GOVERNANCE SELECTION
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Prioritize stakeholders
Our worker Mr. Phan Van Thanh Xuyen
Firstly, the potential stakeholders were
identified during setting company
business goals and main aspects forreporting. Next, the company analyzed
the "Influence" and "Control" proportion
between itself and its stakeholders.
Prioritized stakeholders are the groups
that possess at least 50% of influence and
control.
The company applies various engagement
methods with consideration on location ofstakeholders; nature of stakeholders
business or nature of the group they
belong; and suitable communication way
to representative of the stakeholders or
stakeholders themselves. Popular ways we
apply are Survey & Interview.
The company also engaged to more
than one sources to ensure the
accuracy of information or better
understanding stakeholders
concerns through different sides of
the issues.
We have done the tests of reporting
principles including Materiality,
Stakeholder Inclusiveness, Sustainability
Context and Completeness to ensure that
our report focuses to material issues. The
indicators are selected based on their
coverage of significant and prioritized
issues, Including of control and influence
entities, reporting on significant events or
impacts, providing sufficient information
relating to stakeholders concerns orcompany impacts .
List of prioritized stakeholders:
1. Shareholders
2. Suppliers/subcontractors
3. Employees
4. Local community
5. Customers
6. Local governmental bodies
DEFINE PROCESS
ENGAGEMENT METHODS
PRIORITIZE STAKEHOLDERS
Company survey on concerns from local community
Ms. Pham Thi Kieu Lives in Phuoc Vinh Village.
DEFINE REPORT REPORT CONTENT
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Puma expectation: We are interested in Management System for
Social Performance Labor Practice and
Decent WorkTo understand concern and expectation from our traditional and biggest customer, PUMA,
we have meet and interview Mr. Carlos Bartolome, our assigned Production Manager, and his
assistant, Mr. Titan Chien. They expressed special concern on Social Performance Labor Practice
and Decent Work category.
Jia Hsin CR Officer, Mr. Carlos and Mr. Titan Chien in the stakeholder engagement meeting
Stakeholders Concerns
Case:Pumaconcerns
1. What do you expect from the Jia Hsins Sustainability
Report 2011 ?
The Aspects of Report must be based on the GRI
requirements so I think that all of them are what we want
or expect to know.
2.
Which aspects are you interested in ?
We are more interested in Buil up Management System ,
specially for the Social Performance Labor Practise and
Decent Work
3.
Why are you interrested in these Aspects ?
I think your factory is doing very well now, especially for
the Economic performance and other activities related to
operation system. The reason why we are more interested
in the Aspects of Environment Performances and Social
Performance-Labor Practices and Decent Work is we want
to know how good you maintain and improve them.
4. Do you have any suggestion beside these Aspects ?
We just have some suggestions related to factory
operation :
- The first is Production control and set the up a stable
quality system to make sure that the factory will get the
tagerts and no delays on shipment. For this, the factory
should give more effective training for the production
team and workers.
- The second point is to maitain the working environment,
health and safety. To reduce the VOC at coumpound room
and dus tat buffing area as well as train workers on PPE,
especially for the new workers.
-
The third one is to develop and do the research onequipment based on existing machines so that the factory
does not have to put more investment on it.
- The last is I hope you can get more customers so that you
can create more revenue for workers during low season or
having less orders from Puma
The second point is to maintain the
working environment, health and safety.
To reduce the VOC at compound room and
dust at buffing area as well as train
workers on PPE, especially for the new
workers
MR. CARLOS BARTOLOME
PUMA PRODUCTION MANAGER
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Employees
750 employees join the survey on employees
expectation.
75% expect the company expand business to
bring more jobs to local community.
86.7% say that company has a good hiring
policy for using local people in operation
31,6% hope that company will collaborate
with local governmental departments in
conducting training to employees.
47.4% want company to comply with local
environmental legislation
33.3% wish the company will have more
policies in supporting living conditions
38,9% recommend company to have more
improvement in hiring local people
78.6% request company to comply with all
local laws and regulation.
Suppliers10/12 suppliers give feedback on their concerns.
Economic aspects: 66% want to read our
economic performance.
Environmental aspects : 55% concern on
Energy consumption
Social aspects : 44.4% are interested in
Employment and same percentage for Health
and Safety, and Investment and ProcurementPractice
55.6% also care of Product Responsibility.
This reflects their willingness in collaboration.Feedback from our Sole Supplier Chang Yang
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22
Business
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Management Approach
Right people for
More Growth
eformation supposes to bring in a better
management structure and locate people to
proper position for more operation efficiency.
With the preference policy for local community
people, Jia Hsin brings all job and promotion
opportunity to Vietnamese, even in Senior
Management positions. The company is aware of the
advantages of local workforce such as smartness,
diligence, and skillfulness. We continue pursuing this
policy and Top Management play the important role
in promoting this policy.
Rightpeople will lead to more growth, Top
Management affirms. Bringing one more excellentlocal senior manager has changed the production
landscape. Together with reformation, it makes out
the rise of productivity and efficiency. We can see the
dramatic growth of business, though it is still
negative in 2011. Improve the economic
performance is not only the job of sales or finance
departments, but also the effort from all others. Such
principle is brought up widely and absorbed by all
employees.
Key Facts
+1 / -2
Increase 1 local and reduce 2
expatriate Senior Management
99.38%Increase in retained earnings
compared with year 2010
31.42%
Increase in sales volume
Preference hiring policy for local community
Dramatic economic growth compared to year 2010
Positive economic performance in last quarter of the year 2011
R
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Exhibition EC1-1: Economic performance year 2011
Items Total 2011
1. Direct economic value
generated 18,682,293.44
Revenue 18,682,293.44
2. Economic Value distributed 18,693,479.81a) Operating costs 12,633,536.15
-Materials 10,578,611.67
-Leasing fee 120,896.44
-Training 12,957.42
-PPE 3,533.29
-Outsourced services 1,917,537.33
b) Small investment
c) Machinery and equipment 1,110,543.45
-Tooling 378,065.19
-Depreciation 732,478.26
d) Employees Wage and benefits 3,367,321.20
- Direct Labors Wages 2,494,217.88- Indirect Labors Wages 873,103.32
e) Interests 480,000.00
f) Payment to government 4,634.57
- Exercise tax 158.46
- VAT and tariff 4,476.11
g) Community investment 1,399.37
h) Other expenses 1,096,045.07
3. Economic Value Retained (11,186.37)
Exhibition EC1-2 : Monthly Economic performance 2011
Exhibition EC1-3: Economic performance 2011 vs 2010
BUSINESSRESULTS
The year 2010 planned a positive
retained earning in year 2011, but the
company sees the loss of
US$11,186.37. We however satisfiedwith this business results as it reflects
our great effort in debating with the
heavy loss of year 2010.
Revenue increases 75,82% and passes
the target of US$ 14 million said in
year 2010 report. Profit is not able to
meet the target of US$ 0.12 million, but
99.38% higher than year 2010.
Especially, the last quarter of year
2011 witnesses the positive business
result, promising a brighter situation
in early of 2012.
Component contributed to good
performance composes of higher
selling price and higher productivity
Targets for year 2012
5,700,000 Pairs
Sales Volumes
15 percentage
Increase of average unit price
200,000US Dollars
Net Profit
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25
CAREER DEVELOPMENT
First priority is offered to current staffs for
promotion to senior management. The company
also identifies potential staffs through
performance appraisal and implements the career
development plan for such employees. This actionaims to prepare a backup talent team for company
future development.
RESOURCES OF LOCAL TALENTS
The company signed contract with well-known
head-hunterssuch as Vietnamworks.com and
Kiemviec.com for seeking local prominent
applicants. Expats are normally recruited for
technical positions.
MULTI-FUNCTION SUPERVISORS
Supervisors are rotated among divisions and learn
to become multi-function management. The
purpose of this policy is to train supervisors
toward senior management who will supervise
several departments.
DIRECTION OF YEAR 2012
Enhancing career development, rotating
supervisors, and training potential staffs on
complex function is the road that the company will
go in coming year
Our Local Senior Management
Exhibition EC7-1: Proportion of Local vs. Expat
Senior Management, year 2011
Exhibition EC7-2 : Senior Management by
nationality in 2010 & 2011
Nationality 2010 2011
Vietnamese 7 8
Taiwanese 6 6
Philipino 2 2
Chinese 10 7
MARKETPRESENCE
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26
Empower
Employees
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Employment
LA 1 - The size of a workforce provides insight
into the scale of impacts created by labor issues.
Breaking down the workforce by employmenttype, employment contract and region (region
refers to country or geographicalarea)
demonstrates how the organization structures its
human resources to implement its overall
strategy.
.. Breaking down this data by gender enables an
understanding of gender representation across an
organization, and of the optimal use of available
labor and talent.
GRI G3.1 Guidelines
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MANAGEMENT APPROACH
Employment:
Localization and Seniority
While respecting diversity, the company focuses on localization. Majority of employees is from local
community. We break down the workforce by employment type, employment contract and region
in order to structure our human resource in align with operation strategy.
orkforce is ourtreasure. Managing
workforce is
managing talents. Respect,
Share and Care are the
cornerstones of our labor
policy. The company vision
reflects our workforce
management principle.
Human Resource Management
is assigned to handle theworkforce issues. The
company establishes
workforce management policy
and relevant procedures to
guide the Human Resource
Department in workforce
management.
eing aware of theimportance of
workforce
management, the company
decided to setup Human
Resource Management System
(HRMS) since 2010. The
company joined the HRMS
Project and prolonged its
implementation in year 2011.
Together with HR
Reformation, the HRMS makes
the company structure more
reasonable, supports the
operation and improves the
working environment.
Obviously, they will
contribute to the workforce
stability
W B
Managing workforce is to
anage our Talents. It is Jia Hsin
labor concept.
espect, Share and Care It is Jia
Hsin labor policy
NGUYEN THI KIM ANH
Head Of HR Department
64%Female
workers
8%Supervisors
58%1-year labor
contract
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y gender, workforce does not much
fluctuate. The proportion of female
worker maintains from 66% - 69%. The
balance 31% - 34% is male workers. ExhibitionLA1-1 indicates this proportion. Footwear
manufacturing requests manual skills and
female workers are more advantageous than
male workers.
This proportion does not change too much over
these years. Other footwear factories have
similar proportion, it reflects common situation
in the industry. We will not blend this nature by
setting objectives to the indicator but let the
actual requirements lead the gender ratio
Exhibition LA1-1. Total workforce by gender in
year 2011
TOTAL WORKFORCE
Exhibition LA1-2. Workforce broken down by
supervisor and workersy function, the supervisor takesaverage 8% from total workforce in the
year 2011. By gender, we have 53.5%
of female supervisors and 46.5% of male
supervisors. There is not much fluctuation
over the months of the year. Align with the
ratio of female and male employees, the
supervisor ratio indicates more weight on the
female group. Obviously it does not imply the
gender discrimination during recruitment. The
nature of job decides the workforce genderand supervisor gender is a consequence.
B
B
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y type of contract, the Company signs Fixed-Term Written Labor Contract. Under legal
guidance, with 2-year operation, the company can only sign Fix-Term contract with
employees. There are 1-year contract and 3-year contract category. In year 2011, average
58% of employees sign 1-year contract and the remain 42% sign 3-year contract. There is not much
change between genders and contract types since last year. It reflects our workforce stability.
Exhibition LA1-3. Workforce breakdown by gender for 1-year contract and 3-year contract category
y region, we define local or migration employees based on 2 geographical areas: Long An
and Other Provinces. The below exhibition indicates the ratio of local employee and
migration employee, broken down by gender. In general, the local community contributes
63% to our total workforce. Migration workers mainly come from surrounding areas such as
Mekong Delta provinces and Hochiminh City. The company does not have a considerable migration
workforce from the Central or Northern areas of Vietnam. The number of migration workforce has
direct impact to our workforce stabilization, especially in holidays season, and labor disputes,
especially in culture.
For both local and migration employees, the gender ratio has a slight change. By region, type of
contract and function, the gender ratio is basically homogeneous.
Exhibition LA1-4. Workforce by region broken down by gender
B
B
OTAL WORKFORCE
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32
OVERVIEW
The company awares that
hight turnover rate
indicates levels of
uncertainty anddissatisfaction among
employees, or may signal a
fundamental change in the
structure of the
organizations core
operations (GRI G3.1). It
setups the KPI of Turnover
Rate to measure its
performance in this issue.
This indicator is monitor
monthly. For long-term
strategy, the company build
up Human Resource
Management System
(HRMS) with relevant
policies and procedures to
bring more benefits to
employees and develop our
workforce to higher level.
HR Department is the keyassigned section in
handling this indicator. HR
needs to identify current
status against objectives
and targets. Based on gap
identification, HR need to
propose a plan to reducethe resign and improve
retention.
Compare to year 2010
turnover rate, we are only
0.11% lower. However, the
company can meet the
target of maximum 5%
average turnover rate that
we set in year 2010.
For rate of new employee
hires, we start to report this
year. We acknowledge the
report about new employee
hires broken down by age,
gender, region will reflect
our ability in attracting
qualified and diversified
employees. We will start to
monitor this rate and settarget for the coming years.
Our office staffs
Our cutting worker Tran Van Toan
856New employees join in
year 2011
901Employees leave
employment
4%Average yearly turnover
rate
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TURNOVER RATE
Employees leave our company for various reasons.
Main reasons are going back hometown for
working or quit during Tet Holidays. Some quitduring our low season to find another job with
overtime for better earnings.
As reported in year 2010, we have a great change in
our policy that retains all employees in low season
instead of no extension of our labor contract. The
turnover rate goes down dramatically since year
2010.
Total Employees leaving employment in year 2011
are 901 persons. It almost balances with the newemployees hired. Compared to 986 personsleft in
year 2010, the number is slightly less. It results in
0.11% lower than year 2010 rate.
Number
of
workers
Percent-
age
Total new employees 856 100%
Total Male hired 337 39.37%
Total Female hired 519 60.63%
Under-30-age employees hired 638 74.53%
30-50-age employees hired 218 25.47%
New local employees hired 599 69.98%
New migration employees hired 257 30.02%
NEW EMPLOYEES
In year 2011, the company hired 856people. Through the exhibition LA2-1, we
can immediately see the diversity of the
new workforce. By gender, it is again align
with other indicator related to workforce
since the female takes more than 60% of
total new employees. Same circumstance
with region criteria. By age, majority is
employees under 30 years old. It implies
that our workforce is quite young
Exhibition LA2-1. New Employees hire by gender,
age and regions
Our Cutting worker Mai Van Ngoan
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If we review by gender, we will not
find the considerable difference in
leaving number. However, there is a
big gap between under-30-age groupand above-30-age group. It implies
that young people prefer to change
job for more opportunities while
above 30-age workers want to stay
with their job to secure stable earning
for family. Similarly, migration
workers have fewer advantages than
local people, their living expenses are
higher, then they will not take risks.
PLANNING FOR THE FUTURE
Workforce stabilization is among the important actions
supporting the implementation and success of 2015
strategy. To achieve the 2015 business target of 10-
million-pair sales and prepare the equivalent production
capacity, manpower must be stable and skillful enough to
gain double pph (productivity per person per hour).
From year 2012 onward, the Board of Management will
focus on building the capacity for Human Resource
Department and setup the Human Resources
Management System.
FLA - Fair wage project is another activity to improve the
wage policy which is a way to keep workers. The
company will also support the communication and
industrial relationships to enhance the mutual
understanding and cooperation between managementand workers.
Target average turnover rate of year 2012 : less than 4%
Number
of
workers
Percentage
Total leave employees 901 100%
Total Male leaves 427 47.39%
Total Female leaves 474 52.61%
Under-30-age employees leaves 696 77.25%
30-50-age employees leaves 205 22.75%
New local employees leaves 580 64.37%
New migration employees leaves 321 35.63%
Exhibition LA2-2. Total number of employees leave
Our workers in company outing trip
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Occupational Health
and Safety
LA 7 - Health and safety performance is a key
measure of an organizations duty of care. Low injury
and absentee rates are generally linked to positive
trends in staff morale and productivity. This Indicator
will show whether health and safety management
practices are resulting in fewer occupational health
and safety incidents. An evaluation of trends and
patterns may also indicate potential workplace
inequity.
GRI G3.1 Guidelines
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MANAGEMENT APPROACH
Footwear production requires
various machineries and
equipment, thus the working
environment exists risks of
incident which may bring
hurt, injury and occupational
disease to employees.
The company setup Health
and Safety Management
System to control, reduce and
remove the adverse impacts
from the risks.
Health and Safety
Management System is
operated by the company
Health & Safety Committee of
which members are
workshops heads, supervisors
and representative workers of
production teams.
The main indicators reflecting
the performance of
Occupational Health and
Safety aspect are Injury,
Occupational Health, Lost
Days and Absenteeism. Target
of year 2011 was set as
following:
- Injury Rate: 20%
- Occupational Disease Rate:
10%
- Lost Days Rate: 0.005%
- Absenteeism Rate: 2%
There is a notice that the year
2010 Report misinterprets the
result of computation and
consequently setup inaccurate
targets. They will be adjusted in
this report.
Health and safety training to all workers
The company setup
Health and Safety
Management System to
control, reduce andremove the adverse
impacts from the risks
NGUYEN QUAN THUY QUYNH
C.R. OFFICER
Head of Labor Safety Team
0.26Major Injuries Rate
2.89Minor Injuries Rate
0Occupational Disease
Rate
7.46Lost Days Rate
825Absenteeism Rate
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WORKFORCE AND SUB-CONTRACTOR BREAKDOWN
The company is liable for the safety of its
workforce and independent subcontractors
working on its site. As results, any policy,
procedure, training and report on Health and
Safety must cover both groups.
There are two independent subcontractors
permanently working in the site of Jia Hsin.
They are meal provider service and planting
service. Exhibition LA7-1 provides the regional
breakdown of our own workforce and
subcontractors workforce.
Exhibition LA7-1. Regional breakdown of workforce and independent contractors
Workforce Canteen PlantingTotal
manpower
Long An 1,142 12 0 1,154
Other provinces 666 4 4 674
Total 1,808 16 4 1,828
REPORTING PRINCIPLES
The company sets certain principles in reporting on this indicator. These principles are basement
for data collecion and computation.
1. The company reports both major and minor
injuries (at first-aid levels). This aims to
completely review the current status for
proper action plan for future.
2. In Lost Days Rate, the unit Day means
schedule work day and it is counted by the
day after incident. This aims to secure a
relevant connection to factor work hours
used to compute the lost days rate.
3. Injuries rate captures fatalities. However,
there is no fatality this year, the Injury
Rate purely covers major and minor
injuries.
4. The factor 200,000 used in computation
formula is derived from 50 working weeks
at 40 hours per 100 employees. By using
this factor, the resulting rate is related to
the number of employees, not the number
of hours (GRI G3.1).
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PROCEDURE OF ACCIDENT INVESTIGATION
The company has issued the Procedure of
Accident Investigation to guide theinvestigating, recording and reporting
accidents. We established the investigation
team who would work with injured workers,
supervisor and involved workers to understand
the injury level and accident root causes.
Investigation Record Sheet will be issued to all
relevant parties. Based on investigation record
sheet, the HR Dept. will arrange insurance andbenefits, the HSE team will do corrective
actions to prevent the accident repition, and CR
team will record in the CSR software, then
report to Long An Department of Labor,
Invalidity and Social Affairs (DOLISA) quarterly.
RATE OF INJURY, OCCUPATIONAL DISEASES, LOST DAYS
AND ABSENTEEISM
Injury is understood as minor and major hurt
to workers during working time, including
traffic accident right before and after working
time, in a proper moving route between home
and factory.
Occupational Diseaseis defined as disease
from working environment and/or activities
and/or results of work-related injury
Lost day is counted when a worker is not
able to perform usual work because of injury
and/or occupational disease.
Absenteeismis workers absence from work
because of any kind of incapacity. Permitted
leave such as holidays, annual leave and
maternity are excluded.
In order to calculate the rate of above factors, we use GRI formula as below
Cases/days of injury/disease/lost/absence
IR/ODR/LDR/ODR = x 200,000
Total working hours/day
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Below Exhibition LA7-2
displays the gerneral IR,
ODR, LDR and ODR in year
2011.
In this year, we also reportthe minor injury rateto
have better understanding
on our performance. For
every 100employees, there
is 0.26employee exposing
to the risk of incidents.
Compare to last year, we
dont have more major
accidents.
For occupational diseaserate, we have zero case,
compare to 4 cases in year
2010. During the
occupational disease check,
there are 11 suspicious
cases. The company doctor
has reviewed the cases and
found side effect from other
diseases causing the
symptom of occupational
disease. Involved workers
were counseled on
treatment of other disease.
Re-check has confirmedthat there is no
occupational disease.
In lost days and
absenteeism, we are not
able to meet the target.
Compared with year 2010,
lost day rate increases
more than 4.5 times and
absenteeism is 1.2 times
higher. This implies that
our accidents seems more
serious because workers
take longer unavailable
work-time. We will focus
more in safety as it will
have serious effects to both
employees and operation.
s
Exhibition LA7-2. Rate of injuries, occupational disease, lost day and absenteeism
UnitNumber
of cases
Total
working
(hours)
Rate
Major injuries Case 6 4,639,526.41 0.26
Monor injuries Case 67 4,639,526.41 2.89
Occupational
DiseasesCase 0 4,639,526.41 0
Lost day Day 173 4,639,526.41 7.46
Absenteeism Day 19,151.5 4,639,526.41 825.58
Accidents with pressing
machine
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Exhibition LA7-3. Rate of injuries, occupational disease, lost day and
absenteeism by regions and gender
By understanding the nature of the indicator, we can easily perform management system. In year
2012, we need to perform better in these aspects. We will try to have at least 5%-10% reduce for
each criterion. We believe that the OHSAS 18001 will support us to achieve this target.
By breaking down the rate into
regions and gender, we see a
significant difference between
them in all four types of rate.
In Injury and occupationaldisease rate, we focus to
gender comparison as
characteristics of each gender
will effect to the rate. Female
workers naturally seem more
careful than Male workers,
therefore the rate for female is
lower. Lost days ratehas the
same nature because it is the
consequence of IR and ODR.Region criterion does not
much effect to the resulted rate
InAbsenteeism,it is not
surprised to see the adverse
trend in both Gender and
Region criteria. Female
workers are often off working
for common reasons such as
child care, normal disease,
family issues. Male workersmore focus on external job
while female has to handle
housewife job.
In region criteria, it is
understandable that migration
workers absent more days
than local as they need more
time for transportation back
home town and spend more
holidays with family.
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Training and
Education
LA 8 - As part of a preventative strategy for managingthe health and safety of its workforce, this Indicator is
relevant for any organization.
... The Indicator helps demonstrate the extent to which
such issues have been addressed in organizational
programs and the degree to which best practices are
applied. Preventing serious diseases contributes to the
health, satisfaction, and stability of the workforce, and
helps maintain the organizations social license to
operate in a community or region
GRI G3.1 Guidelines
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Tuberculosis Searching Program
Tuberculosis is listed in top 5 prioritized serious diseases of Long An Province. In
collaboration with Center of Preventive Health Services of Long An, Jia Hsin
implemented the Tuberculosis Searching Program in July-2011.
The doctors from Center of Preventive Health Services of Long An have done the
tuberculosis check for 294 workers and done straight radiography for 136 workers.
Two suspicious cases were found.
In August-2011, the company doctor conducted the counsel and support the workers
in treatment. The workers have taken the radiography and sputum test again. The
result is negative.
CASE
Preventing serious diseases contributes to the
health, satisfaction, and stability of the
workforce, and helps maintain the
organizations social license to operate in a
community or region (GRI G3.1)
Based on company occupational health and
safety policy, the company assigned Health
and Safety Committee to arrange necessary
training, education and improvement
activities to help prevent the serious
diseases. The training and education were
done with support and collaboration from
local medical agencies because we did not
have sufficient expertise.
This practice has been done in year 2010 and
we are happy to see that we have better
performance in year 2011. We will keep
doing more and better to increase our social
contribution to the local community.
Serious diseases are Occupational or non-
occupational related impairment of health
with serious consequences for employees,
their families, and the communities
(GRI G3.1)
The Center of Preventive Health Services of
Can Duoc District, where we operate, has
defined the top 5 prioritized serious
diseases in year 2011 as following:
1. Petechial fever
2. Avian Influenza Virus A subtype H5N1
3. Neisseria Meningitidis
4. Tuberculosis
5. Hand Foot Mouth Disease
MANAGEMENT APPROACH TOP 5 PRIORITIZED SERIOUS DISEASES
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RISKS CONTROL
The serious disease suffering not only effects to mind and body,
but also causes financial burden to involved families. It is quite
critical to conduct Risk Control to prevent the serious diseases in
our workforce and their families. We define Risksas of theunfortune, damages, lost and danger that directly impact to
health and finance of our workforce and their families. Risk
Controlare the pratices that we do or contribute to practices of
local medical agencies in order to limit the exposure and
transmission of diseases by our workforce and their families.
ASSISTANCE PROGRAMS
Assistance programs are done via propaganda, training,
education, counsel and medical check.
Exhibition LA8-1. Assistance program to workers and families
Education/
Training
Counsel Prevention/
Risk control
Treatment
Program
Recipients
Yes No Yes No Yes No Yes No
Employees 1.808 171 127 736
Employees
familiesX X X X
Community
membersX X X X
Company provides information on serious diseases through its broadcast program. Posters are
affixed at main notice board, workshop notice boards and in clinic room to advise symptom and
preventive actions. Address of closest preventive health services, hospitals and hotlines are posted
around the premises.
Company conducts annual health check and occupational diseases check for workforce in August-
2011. Based on results, we organize the counsel program to workers who are diagnosed with
occupational disease, infected with serious diseases and classified in group of the 4, 5, 6 healthlevel.
Exhibition LA8-1 reports the number of our workers benefiting from our programs. Compare to
year 2010, 100%of our employees are trained, 161 workers were counseled and 736 workers
were treated. There was no treatment in year 2010. We are happy to see improvement. In year
2012, we will try to expand official program to community
It is quite critical to
conduct Risk Control
and Training &
Education to prevent theserious diseases in our
workforce and their
families
Dr. BUI TIET NGHIA
Our company doctor
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Diversity and Equal
Opportunity
LA14 - Many countries have introduced legislation
to enforce the principle of equal pay for work of
equal value. This issue is supported by ILO
Convention 100 on EqualRemuneration for Menand Women Workers for Work of Equal Value.
Equality of remuneration is a factor in retaining
qualified employees in the workforce. Where
imbalances exist, an organization runs a risk to its
reputation and legal challenges on the basis of
discrimination.
GRI G3.1 Guidelines
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Diversity and equal opportunity is an important factor to secure the stability of workforce. Equal opportunity
can be gained by respecting non-discrimination policy. The company has been adhering to the non-
discrimination principle over the years and it is a component of our code of conduct.
While chasing equality concept, we enrich the workforce diversity. We employ workforce from differentnationalities, genders, cultures and sociality. Salary scale is not established based on difference of gender or
nationality. Instead, it reflects the expertise, seniority, education and job responsibility. The Human Resource
Department takes the account of implementing this policy.
WORKFORCE BY CATEGORY AND FUNCTION
Workforce is divided into 6 categories as displayed in exhibition LA14-1. By function, we have 4
divisions as shown in exhibition LA14-2. The breakdown by category and function indicate the
structure of company and diversity of its workforce.
Exhibition LA14-1. Workforce by category and function
BASIC SALARY AND REMUNERATION OF WOMAN TO MEN
There is no difference between female and male workers in salary scale. Below exhibition reflects
the salary gap based on expertise and job responsibility. We did not report this indicator last year
for comparison. We will try to maintain our good performance in this aspect.
Exhibition LA14-2. Basic salary and remuneration by category and function
Position Basic salary Allowances(*) Total
General Managerand Vice GM
22,050,000 0 22,050,000
Manager andAssistant Manager
7,664,167 9,814,000 17,478,167
Expert 11,550,000 0 11,550,000
Junior Manager 5,454,167 4,514,000 9,968,167
Head ofDepartment
4,121,667 2,889,000 7,010,667
Supervisors 3,072,917 1,864,000 4,936,917
Staffs and workers 2,444,881 714,000 3,158,881
Workforce by category Number
General Manager and Vice GM 2
Manager and Assistant Manager 4
Expert 11
Junior Manager 7
Head of Department 21
Supervisor 98
Staff and worker 1664
Total 1808
Workforce by function Number
Development 45
Technical 16
Office 150
Production 1597
Total 1808
ATIO OF SALARY OF WOMEN TO MEN
Our stitching workers
FunctionBasic salary
( vnd)
Total
allowanceTotal
Development 2,564,167 1,011,500 3,575,667
Technical 2,677,500 1,700,000 4,377,500
Office 2,525,863 1,878,500 4,404,363
Production 3,401,250 714,000 4,115,250
(*) Allowance including: Performance, Attendance,
Childcare, Living, Transportation and Environment
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Environment
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Environmental Highlights
Environmental aspects are the
most focused issues in our
sustainability action plan. In
year 2011, we emphasize to
build up management systems
to acquire the stable and long-
term compliance. Following
are our major achievements in
year 2011:
Establish sustainabilityorganization, including
representatives from
Environment Team, Health
and Labor Safety
Committee, and Corporate
Responsibility Dept to
handle company
sustainability.
Assign Sustainability
Manager to manage
company sustainability
Apply and be certified in
Environmental Management
System ISO 14001
Build and apply CSR
Software for data collection
and performance
measurement
Install air emission
treatment system
Install waste watertreatment system.
Successfully organize
Environmental Month to
promote environment
protection in company and
local community.
Although some environmental
targets are not met in year
2011, we are not disappointed
because we trust that the
future performance will be
better after we implement the
management system.
We has set our 2015 targets
and drawn a route map from
2010 to reach our objectives.
Year 2011 performance is the
enhancement for our movingto the goal.
CASE : CORPORATE SOCIALRESPONSIBILITY SOFTWARE
Corporate Social Responsibility
(CSR) Software is the application
written by our IT staffs aiming to
facilitate our CSR management
system. The application covers
aspects in Social, Occupational
Health and Safety, and Environment
The application has 3 modules:
- Key Indicators Monitor (KIM)
possess functions on indicators
data collection, indicators
analysis and indicators
comparison.
- Key Performance Monitor
(KPM) focuses to legal and
other requirement
management, CSR planning and
CSR report.
- Sustainable Compliance and
Development (SCD) helps us
evaluate our performance and
development based on rating
tools.
We started software in 2010 and
currently KIM is well operated and
KPM is in trial operation.
We will develop the SCD in year
2013
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Photo is sourced from
EN 3 -Energy consumption has a direct effect on
operational costs and exposure to fluctuations in
energy supply and prices. The environmental
footprint of the organization is shaped in part by
its choice of energy sources. Changes in the
balance of these sources can indicate the
organizations efforts to minimize its
environmental impacts.
EN4 -The particular effect indirect energy usage
has on climate change depends on the type of
primary energy used to generate intermediate
energy.
GRI G3.1 Guidelines
Energy
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MANAGEMENT APPROACH
Energy is defined among the most concerned
components in Jia Hsin Environment Strategy.
The company has set a long-term target of 25%
reduction of consumption for the period 2010-
2015. The target was cascaded down to all
employees. Sustainability Organization takes the
duty to implement necessary programs to
support the company in meeting the target.
To guide the organization in this aspect, the
company issued the Procedure of Energy
Management. We conduct internal audit to
ensure that the policy is properly implemented.
Company consumes both Direct Energy and
Indirect Energy. The most concern of Direct
Energy is Fuel and most focus of Indirect Energy
is Electricity. Sustainability Team has been doing
various types of training, on Environment
aspects in general and Energy Saving in
particular, to all employees, from Top
Management down to direct workers.
For long-term, we plan to implement cleaner
production and energy management system. Wealso started in year 2010 the strategy of
changing Fuel by another environment friendly
energy resource. With both short-term and long-
term plan, we trust that Jia Hsin will be
successful in this aspect.
Conserv project is a capacity building implemented by
Puma in cooperation with ASSIST and co-financed by DEG.
Conserv stands for Conservation of Environment Resources
in Vietnam. The project aims to support Puma Suppliers in
implementing necessary activities in order to save Vietnam
environment resources in general and meet environmental
objectives and targets set for Puma Supply Chain inparticular.
Jia Hsin decided to participate into this project to build up
capacity for company staffs in order to implement
necessary activities to meet the following company
objectives and targets :
1. Company vision and mission : To become a
responsible supplier
2. Company CR strategy : Sustainable compliance &
development
3. Company 3-year strategy (2012-2015) : Reduce 25%
in energy consumption, water consumption, electricity
consumption and wastes generation.
The project started up from Sep-2011 and plans to finish by
the end of year 2012
Starting from year 2010, we seek alternative F.O oil, the
most concerned Direct Energy in the company. F.O oil is
used to heat boilers which providing steam for
machineries. We plan to replace F.O Oil by rice husk. The
new energy resource is natural and rich in Vietnam. Rice
husk ash can become a secondary resource for farming. It
can be used as fertilizer.
Jia Hsin started to work on it with Natural Resources and
Environment Consulting Center (NREC) of Hochiminh city
College for National Resources and Environment. Ms.
Nguyen Thi Truyen, Deputy Director of NREC, has done the
project analysis. We unfortunately can not proceed further
this project as it needs a large financial investment. We
keep looking for sponsorship.
CASE : CONSERV PROJECT
CASE : ALTERNATIVE FOR F.O OILS
Energy is our
most concern and
we implement
various programs
for energy
efficiency
------ Duong Quoc Hung ----
Head of Maintenance, in
charge of Energy
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Direct Energy Consumption
Company Direct Energy is defined as of fossil fuel distilled from crude oil, including gasoline, liquefied
petroleum gas (LPG), lubricant, F.O and D.O oil. Those are classified as non-renewable energy sources.
No renewable energy source exists in the operation process.
The company monitors the direct energy
consumption periodically. At each energy
consumption process, we assign staff to record
the figures daily, weekly or monthly. Assigned
staff will input the records into K.I.M of CSR
Application for analysis and corrective action
(if needed). The company monitor following
Direct Energy Indexes in CSR Application:
EN003 gasoline for cars and bus
EN004 DO oil for cars and generator
EN005 LPG for canteen
EN013 FO oil for boiler
EN023 Lubricants for machineries
We focus to analysis on LPG and DO oil. Based
on exhibition EN3-1, they are the most
consumption sectors. In down time from April
to August, oil volume goes down as less
production, but LPG keep its leverage as
canteen still need to provide meals to
employees. Reverse situation happens in peak
production time from September to March.
Basically, the consumption volume is stable.
However, the consumption per pair index
widely fluctuates as it depends on production
volume. Referring exhibition EN3-2, we can find
that down time has very high index while peak
is much better. Volume is mostly stable while
divisor, i.e production quantity, sharplychanges between the two periods, making the
index vary.
We have done well in this indicator. The index
of average consumption per pair of year 2011 is
0.05 GJ against 0.277 GJ of year 2010
Exhibition EN3-1: Monthly energy consumption by type (GJ)
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
LPG 50.40 16,800.0 28,000.0 25,200.0 23,100.0 23,100.0 22,400.0 22,400.0 22,400.0 19,600.0 22,400.0 22,400.0
DO oil 2,138.18 821.14 1,625.63 624.57 648.88 748.08 758.52 686.66 1,410.83 1,891.41 838.04 1,591.81
FO oil 13,553.5 7,252.31 7,199.47 4,544.25 4,544.25 5,350.07 5,812.42 9,815.06 9,894.32 8,956.41 10,581.2 10,158.5
Gasoline 1,414.12 1,022.34 1,399.66 1,142.44 1,272.52 1,257.56 1,110.07 1,261.89 1,171.13 1,150.49 1,183.51 1,178.92
Total 17,156.2 25,895.7 38,224.7 31,511.2 29,565.6 30,455.7 30,081.0 34,163.6 34,876.2 31,598.3 35,002.8 35,329.2
Exhibition EN3-2: Monthly Energy consumption per pairs
Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Energy
consumption/pair (kg)
0.0025 0.0021 0.0047 0.0051 0.0073 0.0087 0.0040 0.0038 0.0035 0.0028 0.0027
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Indirect Energy Consumption
Electricity is the key and only Indirect Energy in our facility. Each operation process and point needs
power. Majority consumption is from machineries and lighting. There is also electricity loss due to
leakage and machinerys inefficiency.
Exhibition EN4-1: Monthly consumption 2011
With same nature of direct energy resources,
electricity consumption varies between peakand low production period. With in low
production months, electricity is mostly used
by office, lighting system, and ventilation
system. Although this amount is low, it
significant effect to the index of consumption
per pair as there is almost no production
output. The effect is reflected in below
exhibition EN4-2 Monthly electricity
consumption per pair. It is important to
consider the consumption per pair to
evaluate the efficiency.
In comparison to year 2010, we consume
17,6% more since we increase 44,66% ofproduction volume. It is a reasonable
increase. For index of consumption per pair,
we are not possible to compare as this is the
first year we report on this indicator.
Exhibition EN4-2: Monthly Electricity consumption / pair
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Electricityconsumption
1,015.56
647.28 792.00 489.60 477.00 436.68 392.40 745.92 734.76 853.56 879.48 940.68
Production volume 714,107
534,025 718,819 206,225 192,116 151,636 133,349 431,831 489,493 506,884 663,218 708,915
Electricityconsumption/pair
0.0014 0.0012 0.0011 0.0024 0.0025 0.0029 0.0029 0.0017 0.0015 0.0017 0.0013 0.0013
We are almost half way of
strategic plan and need to be
more active in year 2012 to
achieve our target of 25%
reduction in Energy
Consumption. At least, we
need to save 5% in year 2012.
We expect the technical
support from Conserv. By
effectively implement
Conserv, we believe that the
company can earn a lot of
benefits in general and reduce
energy consumption in
particular.
Another long-term strategy
that we need to pursue is the
alternative of FO oil. More
researches should be done to
seek for approval of
Investment Company and
financial sponsorship for the
project.
YEAR 2012 ACTION PLAN
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WaterEN8 -The total volume withdrawn
provides an indication of the
organizations relative size and
importance as a user of water, andprovides a baseline figure for other
calculations relating to efficiency and use
. Total water use can also indicate the
level of risk posed by disruptions to
water supplies or increases in the cost of
water. Clean freshwater is becoming
increasingly scarce, and can impact
production processes that rely on large
volumes of water.
GRI G3.1 Guidelines
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ANAGEMENT APPROACH
Industrial Park is the key water
source for the facilities operating
inside the park. Disregard disadvantages
coming from monopoly, we can enjoy a rather
good water source.
Water is among the expensive resources. It
becomes a headache problem for any
enterprises with some-thousand workforce.
Jia Hsin put a control system to ensure that
our water is not waste away. The
consumption in year 2011 rises, but analysis
report states that this increase is reasonable.
However, the company supposes that therewill be rooms for improvement. Policies have
been issued to guide the internal usage and
management of water. Domestic water and
production water is measured and analyzed
to ensure a reasonable consumption.
ATA COLLECTION
Meter is used to measure consumption. There is a main meter installed at the connect
point between industrial park pump and company main pump. Meters are also
installed at the beginning points of water pump that lead to each workshop and
department.
Company assigns Administration staff and Mechanic staff to record the figures of water
consumption into Record Book and CSR software. The data later on will be checked byCR officer and reviewed by Operation Manager. There is no measurement for collect
rainwater so far.
M
D
Company installs the rubber
orifice reducer inside the
taps to control the water
flow at reasonable rate but
still meet the demand from
employees
+151%Average use
+113%Average use/head
+151%Total use
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ATER WITHDRAWAL
Total volume of water withdraw from
Industrial Park Source is identified in
below exhibition EN8-1 Monthly water
consumption in 2010 & 2011
As clearly shown in the chart, the water
withdraw volume goes up month by month,
from 1,656m3in January to 4,398 m3in
December, summed up to 33,680m3for the
whole year 2011. It is 151% higher than
withdraw volume of year 2010.
Monthly records noted some key reasons for
the rise in year 2011 and higher consumption
compared to year 2010 as below:
1. Printing workshops use water to clean silk
screens with water-based chemical. They
rarely used water for production in year
2010 because the paint is solvent-based.
2. Company uses water from industrial park
source for plants watering. In year 2010,
we temporarily used the water from a
small pool at the back of company facilities
and this volume was not recorded.
3. Industrial park water is stable and no more
usage from standby deep well. In year2010, we sometimes used it
4. We hire more workers and produce more
pairs in year 2011 leading to more
consumption.
Exhibition EN8-1. Monthly water consumption
ATER INDEX
The company creates and evaluates
the Key Performance Indicator
(KPI) of Water consumption/head.
Exhibition EN8-2. Water consumption per head
Computation for this KPI is to divide total
volume by total workforce. Purpose of
evaluating and managing this KPI is to ensure a
reasonable consumption. If we just compare the
volume between the months and years, we
hardly possible understand if the fluctuation is
reasonable or not.
Compare to year 2010, the Index is much
higher. As explained above, the index of the twoyears is influenced by data collection method.
Some of volume is not recorded in year 2010
such as withdraw from deep well or nature
pool. We recognize the impacts and plan to
remove such influence from year 2012 onwards.
W
W
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Emission,
Effluents, andWaste
EN16 -Greenhouse gas emissions are the main cause
of climate change and are governed by the United
Nations Frame-work Convention on Climate Change
(UNFCC) and the subsequent Kyoto Protocol
EN20This Indicator measures the scale of theorganizations air emissions and can demonstrate the
relative size and importance of these missions
compared to other organizations.
EN21Discharging effluents or process water to a
facility for treatment not only reduces pollution levels,
but can also lower the organizations financial costs
and the risk of regulatory action for non-compliance
with environmental regulation.
EN22Data on waste generation figures over severalyears can indicate the level of progress the
organization has made toward waste reduction efforts.
It can also indicate potential improvements in process
efficiency and productivity.
GRI G3.1 Guidelines
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Emissions, Effluents and Wastes:
Replace, Reduce and Resolve before Release
The company acknowledges its large consumption of energy and other resources. We are also aware
of emissions, effluents and wastes we release to the environment as well as our responsibility in
handling our releases. We follow the 4R policy: Replace, Reduce and Resolve before Release
The company does the
Environmental Major Aspects
Assessment to identify
environmental impacts from
its operation. The corrective
and improvement actions are
set based on the priority of
Replace, Reduce and Resolve.
We set first priority for
Replace actions because it
will remove the risks and
impacts. If it fails or is not
possible, we reduce the
consumption to reduce the
emissions and wastes. Finally,
for remaining, we resolve
them with proper treatment
methods to avoid as muchpollution as possible.
The company issues following
procedures involved in
Emission and Waste aspects:
1. Waste Water Management
2. Hazardous Waste
Management
3. Medical Waste
Management
4. Domestic Waste
Management
Sustainability Organization
takes the task of managing all
the emissions and wastes
occurred from company
operation. Our target for year
2012 is 5% reduction in
emission, effluents and waste.
This will be a part of our2010-2015 target with 25%
reduction in overall.
M
anagementApproach
We follow the 4R policy -
Replace, Reduce and Resolve
before Release with Emissions,
Effluents and Wastes
TRAN THAI
JUNIOR MANAGER
Handling EVA workshop and major
emissions
4,046tonsGHG
emission
-1.64%total air
emission
171m3
production
waste water
+35.5%
Total waste
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Direct and Indirect Green-House Gas Emissions
GRI G3.1 Guideline states that Green-House
Gas (GHG) emissions are the main cause of
climate change and are governed by the
United Nations framework Convention on
Climate Change (UNFCC) and the subsequent
Kyoto Protocol. Vietnam also has its own
program to control the volume and reward
the reduction of GHG emissions. In align with
these international and local regulations, the
company started to monitor the GHG fromyear 2011 onward.
Both Direct and Indirect GHG emissions exist
in company manufacturing process. Direct
Energy sources in the company such as Oil,
LPG, and gasoline emit popular GHG such as
CO2, CH4, N2O when they are burned. Indirect
Energy, including electricity and steam, do
not create GHG emission by themselves, but
they are born from Direct Energy sources that
emit GHG.
The company computes the volume of GHG
based on the volume of Direct and Indirect
Energy consumption reported in Energy
Aspect. The conversion is made in accordance
with2011 Guidelines to Defra / DECC's GHG
Conversion Factors for Company Reporting
Exhibition EN16-1 and EN16-2 below show the monthly Direct and Indirect GHG emissions volume
in year 2011. Total GHG volume for all emission sources is 4,046 tons. We currently are not possible
to find out a standard or common rate for comparison and evaluate our performance in this
indicator. We are also not possible to compare with previous record as this is the first time we
monitor and report on this indicator. We target to reduce 5% of the GHG emissions in year 2012
Exhibition EN16-1. Monthly Emission of Direct GHG Exhibition EN16-2. Monthly Emission of Indirect GHG
METHODOLOGY
Conversion
methodology is
extracted from2011
Guidelines to
Defra/DECC's GHG
Conversion Factors for
Company Reporting
NG. T. HONG NHUNG
C.R OFFICERHandling computation of
GHG
GHG EMISSIONS
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SignificantAir Emissions
The company Major Environmental Aspects Assessment has identified the adverse effects of air
pollution on habitats and human health. Certain air pollution not only limits its impacts on the
employees, but also spreads to the surrounding living environment and community people
IDENTIFY SIGNIFICANT AIR EMISSIONS
Based on the Major En