INTERLOOP LIMITED

SDGme Report

QUANTUM5
QUANTUM5
Kemp House, 160 City Road, London, United Kingdom, EC1V 2NX
quantum@quantum5.org
Contents

Foreword .................................................................................................................................................................................................................................................................. 4
The business case ................................................................................................................................................................................................................................................. 5
SDGme Framework .................................................................................................................................................................................................................................................. 6
SDGme Assessment Survey and Ambition Baselines .......................................................................................................................................................................................... 6
Methodology ........................................................................................................................................................................................................................................................ 6
Engaging with the SDGs - Key Takeaways. ............................................................................................................................................................................................................ 10
Environment-related SDGs .................................................................................................................................................................................................................................... 16
Governance ........................................................................................................................................................................................................................................................ 17
Energy ................................................................................................................................................................................................................................................................. 19
Procurement....................................................................................................................................................................................................................................................... 23
GHG emissions ................................................................................................................................................................................................................................................... 25
Non-GHG emissions ........................................................................................................................................................................................................................................... 27
Waste.................................................................................................................................................................................................................................................................. 29
Encroachment .................................................................................................................................................................................................................................................... 31
Employee related SDGs .......................................................................................................................................................................................................................................... 33
Wages ................................................................................................................................................................................................................................................................. 34
Health ................................................................................................................................................................................................................................................................. 36
Employment Terms ............................................................................................................................................................................................................................................ 38
Discrimination .................................................................................................................................................................................................................................................... 40
Society related SDGs .............................................................................................................................................................................................................................................. 42
Community ......................................................................................................................................................................................................................................................... 43
Taxes ................................................................................................................................................................................................................................................................... 45
Lobbying ............................................................................................................................................................................................................................................................. 47
Ethics .................................................................................................................................................................................................................................................................. 49

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 Investments ........................................................................................................................................................................................................................................................ 51
Recommendations ................................................................................................................................................................................................................................................. 53
• Balancing Profit with Purpose .................................................................................................................................................................................................................. 53
• Prioritising the SDGs ................................................................................................................................................................................................................................. 53
• Moving from Ambition to Action.............................................................................................................................................................................................................. 54
• Reporting Impact on the SDGs.................................................................................................................................................................................................................. 55
Next Steps .............................................................................................................................................................................................................................................................. 56

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Foreword
The Sustainable Development Goals (SDGs) are the product of extensive multi-stakeholder negotiations involving a wide
range of sectors, including business. They set out a framework of 17 Goals to tackle the world’s most pressing social,
economic, and environmental challenges in the lead-up to 2030.

Endorsed by all 193 United Nations Member States in 2015, the private sector plays a critical role in providing solutions that
can contribute to solving these challenges, while also generating new business opportunities.

Leading businesses have long been engaged in efforts to integrate sustainability at the core of corporate strategy, decision-
making, and governance.

The SDGs provide us with a new lens through which to translate global needs and ambitions into business solutions.

These solutions will enable companies to better manage their risks, anticipate consumer demand, build positions in growth
markets, secure access to needed resources and strengthen their supply chains, while moving the world towards the delivery of the SDGs.

The goals have the potential to unleash innovation, economic growth, and development at an unprecedented scale and could be worth at least $12 trillion a year in market
opportunities and generate up to 380 million new jobs by 2030.

Through this report we highlight the key role that Interloop plays with regard to the realisation of the SDGs, outline how your organisation can engage and recommend key
steps for you to take to continue aligning with this critical societal agenda.

At this time of political and economic uncertainty, strong and visionary leadership is essential to achieving the transformation needed to usher in the inclusive and
sustainable economic growth that the SDGs represent. This foresight and executive focus is clearly evident through Interloop’s leadership team and strategic planning.

Your company has already have embarked on an ambitious sustainability strategy. By regularly reporting your measured progress against the SDGs, you will join this global
movement and by reaching out across sectors and supply chains, you can collectively accelerate this agenda.

At Quantum5, we know that sustainable businesses are more successful. Through addressing the sustainability agenda now and getting ahead of the change curve which
will eventually impact all competitors, Interloop is already leveraging a competitive advantage that aligns the business with future buyer/customer trends and
requirements. We look forward to working with you and your team to drive progress towards 2030 and beyond.

Interloop’s reporting against SDGs and cross referencing against them in its sustainability report
takes it’s ESG message onto an internatiuonal stage and firmly aligns the company with the global
goals… 4
The business case
The SDGs are becoming increasingly important also for investors, as they are ‘an articulation of the world’s most pressing
environmental, social and economic issues and, as such, act as a definitive list of the material ESG (environmental, social and
governance) perspectives that should be considered as part of an investor’s fiduciary duty. There is a strong business case for investing
in opportunities aligned with the SDGs, including helping investors secure stable returns, better represent the values of their clients and
offer sustainable financial products that differentiate them in the marketplace.

o Improve brand value and reputation - It’s becoming increasingly clear that consumers are seeking alternative and more sustainable options when they shop. A
survey by Nielsen found that 75% of millennials (aged 24 to 39) believe that they will change their purchasing habits to reduce their impact on the environment.
Furthermore, 90% of this group said that they would spend more on products if they were made sustainably.
o Staff retention and job attraction - Investing in sustainability is not just about the planet and your customers. Team members increasingly expect to work for a
company that they think is making a difference in the world.
o Increase revenue and reduce expenses - Sustainable practices will help you to keep your energy costs down, reduce waste and monitor supply chains, potentially
increasing your bottom line.

Re-gearing business to reduce Greenhouse Gas emissions, use less water and create less waste requires expertise, time and investments. Some of these investments take
years to show a return yet demand for resources are always competitive within a business.

However, failure to make the business case for these investments will leave some companies stranded when global sentiment and regulation changes. This tipping point
will likely come years before legal enforcements as customers and consumers favour ethical and sustainable brands and products.

Therefore, the time to build the internal momentum and support for change is now. The business base for change can be built around the most significant sustainability-
related contributors to profit, which are:

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SDGme Framework
SDGme Assessment Survey and Ambition Baselines

The SDGme assessment survey and ambition baselines are

grounded on a tool developed by Sustainability Advantage
which is described as the ‘Rosetta Stone’ of sustainability
assessments and is based on questions in B Lab's SDG Action
Manager and the Future-Fit Business Baseline.

There numerous sustainability baselines, some example

baselines are listed below:

• B Lab / SDG Action Manager

• CDP
• The EU Non-Financial Reporting Directive (NFRD)
• The Impact Management Project (IMP)
• The Science-Based Target (SBT) initiative
• The Sustainability Accounting Standards Board (SASB)
• The Global Reporting Initiative (GRI)
• Future-Fit Business Baseline

Throughout this report reference is made to a non-exhaustive list of baselines for the public disclosures using The Global Reporting Initiative (GRI) standards and
recommendations based on the Future-Fit Business Baseline, a strategic management tool that enables companies and investors to set the right ambitions; embed those
ambitions into every day-to-day business decision; and mobilise stakeholders to help achieve those ambitions.

Methodology

The assessment tool uses two types of questions to assess areas of interest to the above stakeholders.

1. Performance questions:

These questions assess an organization's approach to, and progress on, reducing / eliminating its harmful impacts on the environment, its employees, and society.

2. Positive Impacts questions:

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These bonus questions assess if / how the organization is being regenerative on an issue either directly or indirectly through its products, services and donations that
amplify others’ positive impacts or help others cause less harm.

These scores provide a baseline to compare with scores for future reporting periods to track the organization progress.

This tool expresses an organization's sustainability performance in three ways:

Organizations can express their sustainability scores in whichever framework's terminology (ESG, SDG or non-financial capitals) is most appropriate for their purposes.

Interloop, as a sector leader, reports on ESGs and SDGs through its annual Sustainability Report and has committed to a 5-year strategy focussing on: ‘ethical and sustainable
business practices; ensuring wellbeing of our people and communities and reducing environmental footprint’. This strong leadership has both set it out as a sector pioneer
Interloop as a sector leader reports on ESGs and SDGs through its annual Sustainability Report
which has both built trust with customers, the wider public and has also driven strong returns.
and has commited to a 5 year strategy focussing on: ‘ethical and sustainable business
Key to these laudable ESG initiatives is theensuring
practices; proposed transition
wellbeingto binding
of our long-term
people targets based on verifiable
and communities andscience-based targets (SBTi) and the commitment to address
reducing environmental
climate responsibility using this framework
footprint’. addsstrong
This rigor and accountability
leadership hastoboth
the process.
set it out as a sector pioneer which has both built
trust with
The combination of Global Reporting customers,
Initiative the widerwith
(GRI) framework public
SBTiand has reporting
and SDG also driven
putsstrong returns.
the company in a strong position to address the coming transition to a Net
Zero economy and garner a robust competitive advantage.
Key to these laudable ESG initiatives is the proposed transition to binding long-term targets
based on verifiable science based targets (SBTi) and the commitment to address climate
responsibility using this framework adds rigor and accountability to the process.
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The combination of Global Reporting Initiative (GRI) framework with SBTi and SDG reporting
puts the company in a strong position to address the coming transition to a Net Zero economy
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 ESG ISSUES à SDGs & CAPITALS
Social
Environment /
Natural Society / Capital
Capital Governance
Community
Energy impacts
Taxes
Water
Ethics
Procurement Lobbying
Investments

Human Natural
Employees / Capital Environment / Capital

Wages GHG emissions

Health & wellbeing
Non-GHG emissions
Employment terms
Waste
Concerns process
Discrimination Encroachment

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Engaging with the SDGs - Key Takeaways.
The SDGs may offer companies both a business opportunity and a framework to manage operational risks. These goals should not be viewed as
another compliance requirement. The issues highlighted by the SDGs have a direct impact on corporate profitability, sustainability, and risk
environment. The Better Business, Better World report estimates that achieving the SDGs creates $12 trillion in market opportunities, including
economic clusters directly relevant to the textile, retail, and apparel industry: food and agriculture, cities, energy, and materials. Companies in the sector have
the potential to tap into this unprecedented opportunity by adopting a cluster-based approach to the SDGs that leverages the industry’s key strengths: developing
sustainably sourced and durable products; building responsible, ethical, and engaged supply chains; and tapping into underexploited markets. This report outlines
industry-specific examples that can serve as building blocks to help companies.

Opportunities range from purely commercial to shared value approaches for companies across the textile, retail, and apparel value chain. Suppliers,
brands, and retailers have unique opportunities to integrate the SDGs into their business planning and operations. For example, suppliers represent
the bulk of the environmental and social footprint of a company with a multitiered supply chain. Brands can leverage market penetration, customer relationships,
and the ability to shape market trends to drive the industry toward a more sustainable future. Yet all companies across the value chain seeking to operate in a
more responsible way face a set of common social and environmental cross-cutting issues: gender equity; climate action; better livelihoods, equitable
employment, human rights, and labour rights. For each of these players, adopting a sustainability strategy with the right mix of foundational considerations, level
of effort, and business value can contribute to the implementation of the SDGs across the supply chain.

The SDGs build on a rich history of sustainability efforts by the industry. Sustainability is not a new issue for the sector, which has in many ways been
at the forefront of corporate sustainability. The sector has helped transform sustainable agriculture systems towards the adoption of more
sustainable fibres and materials. It has formed transformative partnerships such as the Sustainable Apparel Coalition, Textile Exchange, and ZDHC to
address critical environmental and social issues and established effective standards to promote sustainable products. At the same time, challenges such as the
ongoing need to address human rights and labour issues continue across the supply chain. The SDGs can help accelerate and scale existing programs and expand
commitments to further secure the value chain while improving the lives of millions of customers and workers worldwide.

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Collaborating with the right partners can lead to transformative results. Partnerships appear to have and will continue to play an important role in achieving
development impact within the textile, retail, and apparel industry. For companies grappling with the SDGs, it may be useful to leverage existing
initiatives for collaborative action. This report provides a snapshot of leading partnerships, multi-stakeholder initiatives, and resources directly
relevant to companies in the sector. In addition, the report highlights a representative list of key resources to further exemplify SDG opportunities.

The SDGs can help companies engage with governments as they seek to design and implement interventions related to the SDGs. Governments are increasingly
adopting the SDGs as a policy framework for development. However, they cannot do it alone and are looking to the private sector’s scale, resources,
and technical expertise to plug the estimated $2.5 trillion development investment gap to meet the SDGs. The country considerations section of this
report identifies capacity gaps that developed and developing countries are facing with regard to SDG implementation. As companies seek business
models, products, and programs that align with broader business goals, these capacity gaps serve as potential areas for collaboration for companies
looking to create real, lasting social and environmental impact in the communities in which they operate while meeting business goals.

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Your SDG scores:

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Your SDG spider chart:

Interloop’s scoring on the 17 SDGs represents significant progress towards the 2030 goals and we believe that these results should be communicated both internally and
externally. Additionally, these metrics
Spider shouldcan
charts be tracked
help…annually and over time to show how the company is meeting its global responsibilities. Whilst climate and energy
remain key challenges, there is a strong narrative to share of how the company’s varied initiatives contribute to these impressive scores.

Using the SDGs as a primary lens through which to view Interloop’s sustainability journey has the potential to connect the company with the wider global market and
particularly the underlying consumer base.

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Your Non-Financial Capitals:
Natural Capital is any flow of energy and material that produces goods and services. It includes:

Natural capital is the basis not only of production but of life itself.

Human Capital consists of people’s health, knowledge, skills and motivation. All
these things are needed for productive work.
Natural capitals within the garment industry…
Enhancing human capital through education and training is central to a flourishing
economy.

Social Capital concerns the institutions that help us maintain and develop human
capital in partnership with others, e.g. families, communities, businesses, trade
unions, schools and voluntary organisations.

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Your core ESG scores:

Interloop’s ESG ratings are encouraging and a sign of an organisation that takes its corporate responsibilities seriously. Areas that you have already identified as key foci are
energy, GHG emissions, waste and water usage.
Interloop’s ESG ratings are as a whole very encouraging and a sign of an organisation that takes it’s
corporate responsibilities very seriously. Areas that you have already identified as key foci are…
The ability to leverage key sector technological innovations ranging from heat recovery and renewable power to water recovery and novel fibres open a pathway to
improvement in core process areas and should see rapid gains in efficiency and environmental footprint.

It is recommended that dependency matrices are fully explored as part of a full systems analysis exercise to ensure that the ROI on any sustainability investments is fully
realised. This will also avoid unintended process interruptions as legacy systems are replaced.

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Environment-related SDGs
We have taken our natural resources for granted. We ignored both their scarcity and
role in the workings of the ecosystems that provide us with the most valuable resources
that make life possible, clean air, clean water, and rich soil. Protecting the planet from
further exploitation and neglect especially applies to corporations. Industries are key
agents in shifting from the exploitation of natural resources towards restoring the
ecosystems that are the foundation of future prosperity.

This section outlines your SDGme baseline findings that will help to set goals to help
restore our natural capital, reducing fossil fuel emissions and deforestation, evolving
sustainable agriculture and promoting circularity within industry value chains.

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Governance

SDG 16 - Access to justice for all and build effective, accountable and inclusive institutions at all levels.

Governance is a cross-cutting theme across all the SDGme clusters and baselines. Trust in governance is associated
with low levels of corruption, democratic stability and relative economic equality, but there is no shortcut to trust.
Institutions can only accrue trust over time if they are transparent in their decisions, consistently do what they say they
will, and continuously strive to act in the best interests of those they serve. The relationship between trust and good
governance is circular: each fosters the other.

The most senior decision-maker of the organization (such as CEO, chair, or equivalent senior position) should make a statement about the relevance of sustainability to the
organization and its strategy for addressing sustainability. This should include the overall vision and strategy for the short-term, medium-term, and long-term, with respect
to managing the significant economic, environmental, and social impacts that the organization causes, contributes to, or that are directly linked to its activities, products or
services as a result of relationships with others (such as suppliers and persons or organizations in local communities).

Other key topics with respect to sustainability could include observance of internationally-recognized standards and how such standards relate to long-term organizational
strategy and success; broader trends (such as macroeconomic or political) affecting the organization and influencing its sustainability priorities; key events, achievements,
and failures during the reporting period; views on performance with respect to targets; outlook on the organization’s main challenges and targets for the next year and
goals for the coming 3–5 years.

Methodologies to quantify social impacts are maturing rapidly. Exploring how your company can use impact quantification methodologies to present a more sophisticated
and convincing picture of its impact is recommended.

Assurance and why it matters

Any company will instil more confidence among its key stakeholders (from its CEO and CFO to external investors) if it can demonstrate the quality of its data, and the
robustness of the controls which underpin it. This is particularly important if a company wishes to report publicly on its progress toward sustainability, as some companies
may require independent assurance before public disclosure. By having effective, well-documented controls in place, a company can help independent assurers to quickly
understand how the business functions, aiding their ability to provide assurance and/or recommend improvements.

Each company and reporting period is unique, so assurance engagements always vary in any given situation, assurers may seek to evaluate different controls and
documented evidence. You should therefore see the baselines for disclosure and guidance for each goal throughout this report as an illustrative list of what may be
requested, rather than an exhaustive list of what will be required.

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SDGme baseline survey results:

Responses to the Interloop baseline survey indicate that the company promotes accountability, transparency, efficiency and rule of law at all levels and encourages efficient
management of employees, budgets and resources. The company has set targets embedding ESG consideration and competency into board and directors’ mandates.

We note that further developing the culture of sustainability-related innovation as a priority in your product and service design and delivery will improve this metric.
Additionally having executive compensation formally linked to ESG performance will both drive sustainability performance and show stakeholders that progress in these
areas is hardwired into the company’s DnA.

The Global Reporting Initiative (GRI) sets a number of baselines for the following disclosures:

• Statement from senior decision-maker.

• Executive-level responsibility for economic, environmental, and social topics.
• Identifying and managing economic, environmental, and social impacts.
• Consulting stakeholders on economic, environmental, and social topics.
• Key topics and concerns raised.
Interloop’s ESG ratings are as a whole very encouraging and a sign of an organisation that takes it’s
• Key impacts, risks, and opportunities.
corporate responsibilities very seriously. Areas that you have already identified as key foci are…
• Financial implications and other risks and opportunities due to climate change.

Guidance for this goal

The following points highlight areas for attention with regard to this specific goal.

o The Board of Directors or equivalent governing body should assess the materiality of environmental and social (E&S) global trends,
risks, or issues
o The Board of Directors or equivalent governing body should review the E&S performance on at least an annual basis.
o Leadership should track KPIs for E&S objectives
o Managers should have E&S mission responsibilities in job descriptions.

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Energy

SDG 7 - Ensure access to affordable, reliable, sustainable and modern energy for all.

The backbone of today’s economy is the combustion of fossil fuels, from electricity generation through to global
transportation. Every aspect of modern life in the western world depends to some degree on the combustion of fossil
fuels. The total elimination of fossil fuels in favour of renewable alternatives is a major systemic challenge and should be
an aspiration to inspire stakeholders and guide decision-making. A company should examine the energy inputs used across
its operations to understand when and how it uses energy, as well as identifying its existing energy provision
arrangements. The business can then start to measure and manage its energy mix, from negotiating new energy contracts
through to pursuing its own creation of renewable energy through appropriate means.

Consuming non-renewable fuels is usually the main contributor to direct (Scope 1) GHG emissions and consuming
purchased electricity, heating, cooling, and steam contributes to the organization’s energy indirect (Scope 2) GHG
emissions.

An organization can consume energy in various forms, such as fuel, electricity, heating, cooling or steam. Energy can be
self-generated or purchased from external sources and it can come from renewable sources (such as wind, hydro or solar)
or from non-renewable sources (such as coal, petroleum or natural gas). Using energy more efficiently and opting for
renewable energy sources is essential for combating climate change and for lowering an organization’s overall
environmental footprint.

Energy consumption can also occur throughout the upstream and downstream activities connected with an organization’s
operations. This can include consumers’ use of products the organization sells, and the end-of-life treatment of these
products.

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SDGme baseline survey results:

Responses to the Interloop baseline survey indicate that the company monitors and records and has set and met targets for its energy usage, including renewable energy.

Overall contribution of renewable energy to the mix is low but rising and with the adoption of science-based targets in your strategy, this should accelerate and improve
both this metric and your GHG emissions scores.

The Global Reporting Initiative (GRI) sets a baseline for making the following disclosures:

• Energy consumption within the organization.

• Energy consumption outside of the organization, both upstream and downstream if it is deemed material by stakeholders, such as
• customers, suppliers, investors, or civil society.
• Energy intensity, often called normalized environmental impact data. These ratios express the energy required per unit of activity, output, or any other
organization-specific metric.
• Reduction of energy consumption. Reduction initiatives can include process redesign; conversion and retrofitting of equipment; changes in behaviour and
operational changes. Reductions in energy requirements of products and services. Use-oriented figures can include, for example, the energy requirements of a car
Interloop’s ESG ratings are as a whole very encouraging and a sign of an organisation that takes it’s
or a computer. Consumption patterns can include, for example, 10 percent less energy use per 100 km travelled or per time unit (hour, average working day).
corporate responsibilities very seriously. Areas that you have already identified as key foci are…

Guidance for this goal

The following points highlight areas for attention with regard to this specific goal.

o Document the methods used to ensure that all operational energy usage has been identified. This encompasses electricity drawn from local utilities and self-
generated, as well as fuels (e.g., for heating and company cars). This information can help assurers to assess whether the company’s approach runs the risk of
failing to identify any energy usage, which could in turn cause the indicator calculation to be incorrect.
o Document the methods used and sources referenced to calculate the renewable energy mix from providers, allowing assurers to understand and verify the
inputs to the indicator calculations.
o Check that the classifications used by the company of which energy sources count as renewable for this goal and which sources do not match a selected
Baseline. Assurers may use this information to identify any inconsistencies used in indicator calculations.
o Document any conversion rates used to translate energy units into a common unit of measurement, and record the sources of those rates, allowing assurers to
verify the conversion factors used.

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Water

SDG 6. Ensure access to water and sanitation for all

SDG 14. Conserve and sustainably use the oceans, seas and marine resources
SDG 15. Sustainably manage forests, combat desertification, halt and reverse land degradation, halt
biodiversity loss

Companies should understand the water contexts of the regions in which it operates, in particular by
identifying the degree of water availability, how much water the company consumes and where it comes
from, what water discharges the company causes, and where they end up. The business can then start to
pursue opportunities for improvement by increasing efficiency, adjusting operating procedures and
incorporating technical innovations, as well as collaborating with others across the value web.

Companies may contribute to several SDGs by reducing water consumption and ensuring discharged
water does not degrade the water quality of receiving watersheds, and actively encouraging their suppliers to do the same.
Water will be a key challenge on the road to a Net Zero manufacturing process. Given that
An effective management approach accounts for the local context of water use and acknowledges the importance of stewarding water as a shared resource. An
Pakistan
organization is its
can reduce designated
water withdrawal,as ‘water discharge,
consumption, stressed’ (withdrawal
and associated of more
impacts through efficiencythan 25such
measures, per centrecycling
as water of renewable
and reuse and process
redesign, as well as through collective actions that extend beyond its operations within the catchment. It can improve water quality through better treatment of water
freshwater resources) and the industrial basins are moving toward ‘water scarcity’, urgent
discharge.
technological innovations and intensive R&D required to find water saving and water alternative
Since water is a shared resource, and water-related impacts are localized, organizations are increasingly being encouraged to: (a) minimize and in water-stressed regions
processes.
eventually Although
eliminate its consumption much
of water progress
for industrial has been
and commercial purposes;made withthat‘Nano
and (b) ensure Bubble’
any discharges technology,
do not degrade many
the quality of of water
the receiving
bodies, the health of receiving soils, or in any other way cause harm to ecosystems or people.
the potential future solutions will require substantial capital expenditure to transform production
units to increase recycling and reuse.

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SDGme baseline survey results:

Responses to the Interloop baseline survey indicate that the company monitors and records its water usage which is entirely drawn from stressed-water regions
(unavoidable given the water table challenges in Pakistan’s industrial basins). The company has set targets for water efficiency and utilises technology to monitor the flow
and usage of water. Targets have been stated to have been met for water efficiency for the reporting period.

The challenge that water usage presents the company is substantial and could represent an existential threat to business as usual. Urgent research and development is
required to further reduce usage and reuse supply. Additionally alternatives to water in some parts of the industrial process will need to be explored.

The Global Reporting Initiative (GRI) sets a baseline for making the following disclosures:

• Water discharge by quality and destination

• Water bodies affected by water discharges and/or runoff.
• Interactions with water as a shared resource
• Management of water discharge-related impacts
• Water withdrawal
Interloop’s ESG ratings are as a whole very encouraging and a sign of an organisation that takes it’s
• Water discharge
corporate responsibilities very seriously. Areas that you have already identified as key foci are…
• Water consumption

Guidance for this goal

The following points highlight areas for attention with regard to this specific goal.

o Document the methods used to ensure the company has identified all of the sources of water that it draws on. This information can help assurers to assess
whether the company’s approach runs the risk of failing to identify any water consumption in water-stressed areas, which could in turn cause the indicator
calculation to be incorrect.
o Document the equivalent steps used to ensure the company has identified all of the company’s water discharge points. This information can help assurers to
assess whether the company’s approach runs the risk of failing to identify water discharges.
o Document the methods used to determine whether water sources are in water stressed areas and retain the working notes of these assessments. Assurers may
evaluate the approach used to verify that the company has sufficiently addressed the risk of unknowingly drawing water from stressed regions.
o Document the method used to calculate personal water use by employees. Details of the calculations – including any guidance from third-party sources
referenced – should be retained for assurers who may use this information to ensure that the calculations are reasonable.

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Procurement
SDG 12. Ensure sustainable consumption and production patterns.

Every company relies to some extent upon goods and services procured from other organizations,
which are collectively referred to as suppliers. Common examples include energy, water, computers,
transport, machinery, furniture, accounting services, and materials required to make products.

All companies are mutually accountable for the environmental and social impacts caused by the
production and delivery of the goods and services they depend upon.

Companies should implement policies and procedures that continuously seek to put emphasis on anticipating, avoiding and addressing issue-specific supply chain hotspots.
All purchases of product inputs, outsourced core functions, and ancillary purchases should be assessed to determine possible negative impacts. Furthermore, policies
should be implemented to avoid those impacts where possible, and steps should be taken to address any that cannot be avoided.

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 SDGme baseline survey results:

Responses to the Interloop baseline survey indicate that 50% of purchasing is made using a sustainable procurement (SP) methodology.

A careful but consistent rolling out your SP framework to all units and buyers can enable cumulative gains over time and spur action from supply chains.

The Global Reporting Initiative (GRI) sets a baseline for making the following disclosures:

• New suppliers screened using environmental criteria.

• Negative environmental impacts in the supply chain and actions taken.
• Other indirect (Scope 3) GHG emissions.
• New suppliers that were screened using social criteria.
• Negative social impacts in the supply chain and actions taken.

oop’s ESGGuidance
ratingsforare
thisas
goal
a whole very encouraging and a sign of an organisation that takes it’s
orate responsibilities very seriously. Areas that you have already identified as key foci are…
The following points highlight areas for attention with regard to this specific goal.

o Document the methods used to ensure that all of the company’s suppliers have been identified. This information can help assurers to assess whether the
company’s approach runs the risk of failing to identify any suppliers, which may result in the company unknowingly purchasing goods or services which
contribute to significant negative social or environmental impacts, leading to incorrect data being reported.
o Document the methods used for grouping vendors for hotspot assessments.
o Document the methods used to assess the company’s supply chain for potential social and environmental hotspots, including the parameters used to distinguish
whether an issue qualifies or not.
o Where potential hotspots have been identified, document the methods used to confirm or disprove the presence of those issues in the company’s suppliers.
o Where the company has taken active steps towards helping a supplier to eliminate a hotspot issue, retain any documentation of these actions.
o Describe the methods used to classify the company’s vendors into one of the three categories - i.e., product inputs, outsourced core functions, ancillary
purchases.

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GHG emissions

SDG 13. Take urgent action to combat climate change and its impacts.

Regardless of sector, all businesses contribute to the increasing concentration of GHG emissions, if
only through their use of energy and reliance on global transport networks which are powered
predominantly by fossil fuels. Companies can start on the journey towards sustainability by
examining their operations to identify all potential sources of GHG emissions across Scope 1 and
Scope 2 and to understand any potential challenges in gathering information. This will enable the
business to start measuring and managing its GHG emissions, from identifying problematic processes
and implementing efficiency improvements, through to off-grid renewable energy generation, GHG
sequestration and avoidance.

The Intergovernmental Panel on Climate Change (IPCC) has identified seven major GHGs that account for the vast majority of human-caused climate change. Countries that
have signed up to the Kyoto Protocol are responsible for reporting on emissions of these gases at a minimum. When starting to assess their operations, companies might
start with these gases as they are the most globally significant and will help companies align with global reporting expectations.

The Kyoto Protocol identifies seven major greenhouse gases: carbon dioxide (CO2), methane (CH4), hydrofluorocarbons (HFCs), nitrous oxide (N2O), perfluorocarbons
(PFCs), sulphur hexafluoride (SF6), nitrogen trifluoride (NF3). These GHGs are called ‘major’ because they make up a large percentage of the total impact on climate caused
by humans.

All such potentially harmful substances must be kept in tight closed loops, or not used in the first place. The context of this goal may vary from local (e.g., soil, rivers) to
global (e.g., air, oceans) depending on the substance and mode of emission.

Companies should aim to emit net zero GHGs as a result of its own operational activities and its energy consumption. Net GHG emissions here means total GHG emissions,
less any emissions that are permanently sequestered or adequately offset. If a company uses offsets as a means through which to reduce emissions, it should choose
schemes whose effectiveness can be thoroughly evidenced. The Gold Standard Carbon Credit Scheme is generally regarded as a credible offset approach.

25
 SDGme baseline survey results:

Responses to the Interloop baseline survey indicate that the company monitors and records its Scope 1 GHG emissions It is noted that the company has committed to
science-based targets.

SBTi methodology and targets will galvanise progress in this area and point to the necessary capital investments required to meet your commitments. The choice pathways
begin with energy choices but eventually point to large investments in renewable power generation or carbon capture and storage.

Additionally, the challenge of addressing Scope 3 emissions will have to be met to meet the science-based targets. It Is recommended that a bespoke reporting system is
developed to build supplier knowledge and capacity in these areas.

The Global Reporting Initiative (GRI) sets a baseline for making the following disclosures:

• Direct (Scope 1) GHG emissions

• Energy indirect (Scope 2) GHG emissions
• Other indirect (Scope 3) GHG emissions
• GHG
re as a whole veryemissions intensity
encouraging and a sign of an organisation that takes it’s
• Reduction of GHG emissions
very seriously. Areas that you have already identified as key foci are…

Guidance for this goal

The following points highlight areas for attention with regard to this specific goal.

o Identify the biggest opportunities to reduce GHG emissions as even minor changes to these activities might result in relatively large improvements
o Document the methods used to ensure the company has identified all sources of harmful emissions at each of its locations. Note that emissions are not limited
to steady or constant outputs but include intermittently or irregularly occurring outputs and spills as well. Describing how these were identified can help
assurers to assess whether the company’s approach runs the risk of failing to identify emission sources.
o Document the methods used to identify the composition of the company’s emissions and classify them as harmful or non-harmful. Assurers may use this
information to understand and verify the approach taken.
o Retain any supporting documentation or calculations used to determine the total amount of emissions for each mode during the year. Assurers may use this
information to understand and verify the approach taken.
o Retain any supporting documents to confirm the level and quality of carbon offsets attributable to the company within the reporting period. Assurers may use
this information to verify the company’s net emissions.

26
Non-GHG emissions

SDG 11. Make cities inclusive, safe, resilient and sustainable.

For many companies today, emissions of some sorts are an

unintended consequence of operational activity. Some emitted
substances are harmful at any amount due to their inherent
toxicity to people or the environment, while others might cause
harm only by contributing to a local or global build-up in concentration as is the case for some common air pollutants such as nitrous oxide. This is a systemic issue that may
require new production approaches and techniques, and zero emissions should be seen as a long-term aspiration to inspire stakeholders and guide innovation towards a
clean, pollution-free society.

Companies can start to address this issue by reviewing their operations to identify the types of emissions being produced, and whether they are treated or contained. Once
this is understood, the business can start to pursue opportunities for improvement, either by adapting operating procedures, integrating technological innovations, or
collaborating with others across the value web

A sustainable company must eliminate harmful substances intentionally or accidentally discharged directly to the environment. Harmful emissions include:

Harmful solid emissions (e.g., scarce metals, excess hazardous pesticides, particulate matter)

Harmful liquid emissions (e.g., spills, liquid toxic waste, chemical fluids).

Harmful gaseous emissions (e.g., VOCs, SOx, NOx, other air pollutants, toxic fumes).

27
SDGme baseline survey results:

Responses to the Interloop baseline survey indicate that the company monitors and records non-GHG solid, liquid and gaseous emissions.

Although mostly not applicable to your business, it is important to fully track and control any significant non-GHG emissions.

The Global Reporting Initiative (GRI) sets a baseline for making the following disclosures:

• Emissions of ozone-depleting substances (ODS)

• Nitrogen oxides (NOX), sulphur oxides (SOX), and other significant air emissions

Interloop’s ESG ratings are as a whole very encouraging and a sign of an organisation that takes it’s
corporate responsibilities very seriously. Areas that you have already identified as key foci are…
Guidance for this goal

The following points highlight areas for attention with regard to this specific goal.

o Document the methods used to identify the composition of the company’s emissions and classify them as harmful or non-harmful.
o Retain any supporting documentation or calculations used to determine the total amount of emissions for each mode during the year. Assurers may use this
information to understand and verify the approach taken.

28
Waste

SDG 12. Ensure sustainable consumption and production patterns.

The world’s resources are finite with many renewable resources being
consumed faster than they can regenerate, and as society’s most accessible
finite resources are used up, extraction methods often become increasingly
disruptive. Few goods are designed with post-use repurposing in mind, and
recycling infrastructure in many parts of the world is far from optimal. Because
of these challenges, the total elimination of product waste requires systemic
change to achieve and should be seen as a long-term endeavour.

The quantity, type, and quality of waste generated by an organization is a consequence of the activities involved in the production of its products and services (e.g.,
extraction, processing, procurement of materials, product or service design, production, distribution) and their subsequent consumption. An assessment of how materials
move into, through and out of the organization can help understand where in the organization’s value chain these materials eventually become waste.

An organization can also cause waste-related impacts through activities carried out in its value chain upstream or downstream. For example, through criteria in its
procurement policies that lead to waste generation upstream, or through management decisions that limit the life of its products and therefore contribute to waste
generation downstream.

29
SDGme baseline survey results:

Responses to the Interloop baseline survey indicates that the production units monitor and record their hazardous and non-hazardous waste, and product and packaging
waste. The company has set targets to eliminate waste that have been stated to have been met for the reporting period.

Encouraging and tracking the repurposing and recycling or product and packaging waste is a constant challenge and requires strong 3rd party relationships.

The Global Reporting Initiative (GRI) sets a baseline for making the following disclosures:

• Waste by type and disposal method

• Significant spills
• Transport of hazardous waste
Interloop’s ESG ratings are as a whole very encouraging and a sign of an organisation that takes it’s
corporate responsibilities very seriously. Areas that you have already identified as key foci are…

Guidance for this goal

The following points highlight areas for attention with regard to this specific goal.

o The company should do all it can to ensure that the physical goods it provides to others can be responsibly repurposed at the end of their useful lives including
final products designed for end users, and intermediate goods which are incorporated or processed into final products by other subsidiary companies.
o Document the methods used to ensure the company has identified all of the waste produced at each location during the reporting period.
o Retain evidence of the parameters used by the company to classify business outputs as waste versus emissions. Assurers may use this information to understand
and verify the approach used and ensure it has been consistently applied.
o Document the methods used to measure the amount of waste produced by the company at each location during the period.

30
Encroachment

SDG 14. Conserve and sustainably use the oceans, seas and marine resources.
SDG 15. Sustainably manage forests, combat desertification, halt and reverse land
degradation, halt biodiversity loss.

Growing demand for land is putting pressure on ecosystems, communities and plant and animal species. Companies that do not adequately consider the impacts of their
physical presence may cause irreversible degradation to natural processes and resources that they and others rely on and may undermine the wellbeing of local
communities. The purpose of this goal is to eliminate the negative impacts of business on natural ecosystems and communities.

This includes but is not limited to:

Respecting the land rights of communities (e.g., zero tolerance on land grabbing).

Protecting aquatic ecosystems from degradation (e.g., avoiding coral reefs).

Protecting areas of high biodiversity value (e.g., no clearing of rainforest for farmland).

Not encroaching on areas of cultural importance (e.g., oil pipelines running through regions considered sacred by Indigenous Peoples).

Companies should: (a) protect such areas where it is already present, and (b) take steps to avoid or mitigate negative outcomes when moving into new areas.

31
SDGme baseline survey results:

Responses to the Interloop baseline survey indicates that none of the production or operational units are in encroachment areas. The company protects natural ecosystems
and communities where it is already present and takes steps to avoid or mitigate negative outcomes when moving into new areas.

The Global Reporting Initiative (GRI) sets a baseline for making the following disclosures:

• Operational sites owned, leased, managed in, or adjacent to, protected areas and areas of high biodiversity value outside protected areas
• Significant impacts of activities, products, and services on biodiversity
• Habitats protected or restored.
• IUCN Red List species and national conservation list species with habitats in areas affected by operations.
Interloop’s ESG ratings are as a whole very encouraging and a sign of an organisation that takes it’s
corporate responsibilities very seriously. Areas that you have already identified as key foci are…

Guidance for this goal

The following points highlight areas for attention with regard to this specific goal.

o Ensure that the company has undertaken assessments to identify all areas of high conservation value that might be impacted by its activities and retain any
documentation from these evaluations. This can help assurers to assess whether the company’s approach runs the risk of missing key impact.
o For any identified high conservation value areas, retain documentation of a baseline assessment establishing the characteristics, functions, diversity and state of
preservation of these areas to facilitate future comparisons and to create an evidence trail.

32
Employee related SDGs
A business is economically feasible (sustainable) when it can sustain its financing based
on the perceived value by its stakeholders whether they are customers, shareholders,
sponsors, etc; sustain its access to material resources; sustain its license to operate.
Only if all of the above requirements are met, a company can future proof its business.
This implies that a business has to add value, not only to its stakeholders but also to
the environment and society. It has to avoid wasteful consumption of material
resources and comply with social and environmental regulations.

This section identifies your SDGme baseline findings to promote sustained, inclusive
and sustainable economic growth, full and productive employment and decent work
for all.

33
Wages

SDG 8. Promote inclusive and sustainable economic growth, employment and decent work for
all.
SDG 1. End poverty in all its forms everywhere.
SDG 10. Reduce inequality within and between countries.

A future fit company should ensure all its employees and their families have the means to afford health coverage, to eat a nutritious diet and to be free of concerns about
meeting basic needs.

A living wage affords a decent standard of living for workers and their families. Living wage estimates vary by region and guidance is offered by government agencies,
academics and/or NGOs. In many regions, the living wage is higher than the legal minimum wage or poverty-line wage. Living wage calculations should focus on employee
compensation with respect to standard working hours: figures should exclude overtime pay as well as productivity bonuses and allowances, unless they are guaranteed.

The reality for most employees is that they rely on net or take-home pay, rather than gross amounts which often undergo mandatory deductions such as taxes before
reaching the employee. Moreover, when workers receive benefits that help them meet their basic needs, such as free healthcare or meals, these can be considered as
supplements toward the net pay of workers.

34
 SDGme baseline survey results:

Responses to the Interloop baseline survey indicate that all employees are paid minimum wage based on ILO and local laws and it is assumed that this also meets the
threshold of a living wage. The company has set and monitors targets and has met minimum wage targets for the reporting period.

Where the minimum wage doesn’t constitute a living wage the company should follow a progressive long-term goal of paying 100% of employees at least a living wage.

The Global Reporting Initiative (GRI) sets a baseline for making the following disclosures:

• Ratios of standard entry level wage by gender compared to local minimum wage.
• New employee hires and employee turnover.
• Benefits provided to full-time employees that are not provided to temporary or part-time employees.
oop’s ESG ratings are as a whole very encouraging and a sign of an organisation that takes it’s
• Parental leave.
rate responsibilities very seriously. Areas that you have already identified as key foci are…

Guidance for this goal

The following points highlight areas for attention with regard to this specific goal.

o Document the methods used by the company to determine which sites or regions require unique living cost assessments.
o Document all data sources used to determine living wage thresholds. When information is available from different sources, provide reasoning behind final
choices.
o Document any benefits provided by the company to its employees such as free education for their children, healthcare or meals.
o The Global Living Wage Coalition is a collaboration between a number of organizations, including Fairtrade International, the Forest Stewardship Council and
others. Working within the ISEAL Alliance, these organizations have created a standardized methodology for calculating a living wage.

35
Health

SDG 2. End hunger achieve food security and improved nutrition and promote sustainable agriculture.
SDG 3. Ensure healthy lives and promote well-being for all at all ages.
SDG 8. Promote inclusive and sustainable economic growth, employment and decent work for all.
SDG 16. Promote just, peaceful and inclusive societies.

Companies that do not adequately address workplace health issues may cause serious long-term negative health
problems for their employees. Health in this context extends beyond physical safety to mental and emotional wellness
and must encompass stress management and mitigation. When it comes to physical safety, companies should take
steps to minimize and mitigate the effects of accidents, and strive continuously to reduce work-related injuries,
illnesses, and fatalities to zero.

There are six categories of criteria that we used in the survey to determine the future-fitness of a health policy:
physical safety in the workplace, mental wellbeing, physical activity, nutrition, smoking and support for lost time.

36
 SDGme baseline survey results:

Responses to the Interloop baseline survey indicate that the company monitors and record workplace health and safety issues and has met health- and safety-related
targets, for the reporting period. The company provides paid support for lost time / sick leave, has a good nutrition policy in place for its canteens, operates a no smoking
policy in communal workspaces and encourages physical activity in the workplace.

The company should maintain the goal of zero safety incidents and fatalities and have policies, practices and programs that support a safe and healthy workplace.

The Global Reporting Initiative (GRI) sets a baseline for making the following disclosures:

• Occupational Health & Safety (OH&S) management system

• Hazard identification, risk assessment, and incident investigation
as a whole very encouraging and a sign of an organisation that takes it’s
• Occupational health services
ery seriously. Areas that you have already identified as key foci are…
• Worker participation and communication on OH&S
• Worker training on OH&S
• Work-related injuries
• Work-related ill health

Guidance for this goal

The following points highlight areas for attention with regard to this specific goal.

o Document the methods and frequency through which the company identifies and assesses hazards at its worksites.
o Document the methods and frequency through which the company assesses the performance of the controls used to assess hazards at its worksites.
o Document the ways in which the company communicates policies regarding bullying and harassment to employees, and any confirmation it gathers from
employees acknowledging that they have reviewed and understood the policies
o Retain any working notes and record sources used in the process of identifying regionally appropriate nutritional guidelines for eating options at each worksite,
and maintain documentation showing how these needs are addressed at each site.
o Document the policies for accommodating and/or financially compensating employees whose ability to work is affected by a work-related health issue or
accident.

37
Employment Terms

SDG 8. Promote inclusive and sustainable economic growth, employment and decent work for all.

Employees who work reasonable hours, who feel secure in their employment, and who are afforded
adequate time off are more likely to thrive physically, emotionally, and mentally – in and outside work.

This means that employees must have the right of association (e.g., the right to join – or refrain from joining
– a union), the right to reasonable working hours, the right to leisure (e.g., holiday entitlements and
overtime pay) and the right to parental leave.

Companies should ensure that employment contracts for all employees include – at a minimum – the
following six elements:

o No child labour
o Fair employment status
o Freedom of association
o Fair working hours
o Holiday
o Maternity, paternity and parental leave Interloop’s maximum score
under employee wages sh
well-being. The wages scor
wage to all employees. If t
living wage (https://wageind
and measured improvermen
38
SDGme baseline survey results:

Responses to the Interloop baseline survey indicate that the company adheres to the minimum working age defined by ILO Convention no. 138.2, part-time employees are
hired on contracts that enable them to perform agreed work with the protections and employment conditions proportionate to comparable full-time workers, employees
have the right to form and join trade unions of their choice (or to choose not to), and the right to bargain collectively, complies with national labour laws or widely adopted
minimum standards re hours of work, overtime compensation, contract hours, notice of work schedule changes, has a formal process to educate employees, temporary
Interloop’s ESG ratings are as a whole very encouraging and a sign of an organisation that takes it’s
and contract workers on the companies Human Rights policy, provides education, training and development opportunities and has a defined provident fund for employees.
corporate responsibilities very seriously. Areas that you have already identified as key foci are…
The Global Reporting Initiative (GRI) sets a baseline for making the following disclosures:

• Collective bargaining agreements

• Operations and suppliers in which the right to freedom of association and collective bargaining may be at risk.
• Operations and suppliers at significant risk for incidents of child labour
• Operations and suppliers at significant risk for incidents of forced or compulsory labour

Guidance for this goal

The following points highlight areas for attention with regard to this specific goal.

o Prepare a comparison between contract terms for part-time and full-time employees, demonstrating to what extent part-time workers’ compensation and
contract terms are proportionately equivalent to those of full-time employees.
o Retain documentation of the national labour laws applicable to worksites regarding weekly hours worked, overtime compensation, work schedule changes, and
maternity/paternity leave. Ensure that the company provides supplementary benefits in cases where these do not meet the fitness criteria.
o Document the method used to determine which of the company’s sites, regions, and job types require unique employment terms assessments.

39
Discrimination

SDG 5. Achieve gender equality and empower all women and girls.

SDG 10. Reduce inequality within and between countries.

SDG 16. Promote just, peaceful and inclusive societies.

Everyone is entitled to equitable treatment and equal opportunity, irrespective of personal characteristics such as age, gender, sexual orientation, ethnicity, country of
origin, or disability. Discrimination in the workplace may take many forms, and discriminatory behaviour can be perpetuated – or at least go unnoticed and unchallenged by
established norms and practices within organizations.

Companies must be proactive in investigating and monitoring key practices such as recruitment, pay structures, hiring, performance assessment and promotions to ensure
that no discrimination occurs, however unintentional it may be.

The company’s anti-discrimination policy and the controls that support it should have a senior company official appointed to be responsible for discrimination and equity
issues. Directive and preventive measures should be actively communicated to employees and referenced or incorporated into recruitment and training practices,
employee performance evaluations, promotion or advancement decisions, and compensation guidelines. Corrective measures should include procedures or mechanisms to
facilitate employees’ ability to confidentially report and seek resolution for potential instances of discrimination or breaches of the anti-discrimination policy.

40
SDGme baseline survey results:

Responses to the Interloop baseline survey indicates that the company has a published anti-discrimination policy and a pay equity policy. The company monitors and
records diversity statistics. The anti-discrimination policy to clearly communicated to all employees and is embedded in the company’s personnel systems. Procedures are in
place to report breaches of the anti-discrimination policy and the effectiveness of anti-discrimination program is regularly assessed.
Interloop’s ESG ratings are as a whole very encouraging and a sign of an organisation that takes it’s
It is recommended thatresponsibilities
corporate pay equity statistics
very areseriously.
formally recorded
Areas and
thatpublished
you have to already
evidence identified
the gender as
parity
key ratio.
foci are…
The Global Reporting Initiative (GRI) sets a baseline for making the following disclosures:

• Diversity of governance bodies and employees

• Ratio of basic salary and remuneration of women to men
• Incidents of discrimination and corrective actions taken.

Guidance for this goal

The following points highlight areas for attention with regard to this specific goal.

o Provide a copy of the company’s policy describing its anti-discrimination commitment. This can help assurers to determine whether the company is complying
with the requirements of the goal.
o Record the steps taken to communicate the company’s anti-discrimination policy to employees, including any ways the policy has been integrated into
recruitment, training, or performance evaluation processes or materials. This can help assurers to understand and evaluate the company’s strategy for
communicating the policy to employees against the criteria.
o Document the procedures or mechanisms in place which facilitate employees’ ability to report cases of discrimination in the workplace and retain any notes and
evidence of actions taken based on employee submissions. Assurers may evaluate the concern-reporting mechanism’s design in terms of its appropriateness in
identifying and resolving discrimination concerns.
o Document the controls used by the company to check that the company’s antidiscrimination controls are working as intended. Assurers may check these
controls to determine whether the company is able to identify and address any problems with the concern-reporting mechanism within a reasonable timeframe.
If not, there is a risk that instances of discrimination could go undetected by the company.

41
Society related SDGs
We have an ethical responsibility to fight injustice and poverty and ensure inclusiveness, yet
we also benefit from developing Social Equity. Talent, skills, and ambition are not distributed
exclusively amongst the most privileged. Companies will benefit when everyone gets an
equal opportunity to develop their skills. It ensures a skilled, healthy and vital workforce.

This section will identify your SDGme baseline findings to support initiatives to promote
peace, inclusiveness, social justice, and economic autonomy, within business networks and
grassroots movements.

42
Community

SDG 3. Ensure healthy lives and promote well-being for all at all ages.
SDG 9. Build resilient infrastructure, promote sustainable industrialization and foster innovation.
SDG 11. Make cities inclusive, safe, resilient and sustainable.
SDG 12. Ensure sustainable consumption and production patterns.

SDG 17. Revitalize the global partnership for sustainable development.

A key element in managing impacts on people in local communities is assessment and planning in order to understand the actual and potential impacts, and strong
engagement with local communities to understand their expectations and needs. There are many elements that can be incorporated into local community engagement,
impact assessments, and development programs.

Where possible, companies should anticipate and avoid negative impacts on local communities. Where this is not possible, or where residual impacts remain, companies
should manage those impacts appropriately, including grievances, and to compensate local communities for negative impacts.

Organizations can utilize a number of useful tools to engage communities, including social and human rights impact assessments, which include a diverse set of approaches
for proper identification of stakeholders and community characteristics.

43
 SDGme baseline survey:

Responses to the Interloop baseline survey indicate that none of the company’s facilities cause impacts that could be of concern to neighbours or surrounding communities.

The company has a formal concerns channel in place that is accessible to all its customers. Customers who use the concerns mechanism are fully informed throughout the
process and concerns are resolved in a timely manner. The company solicits feedback from customers and regularly assess the effectiveness of the concerns process. When
needed,
oop’s ESG stepsare
ratings are as
taken to improve
a whole veryitsencouraging
effectiveness. and a sign of an organisation that takes it’s
rate responsibilities very seriously. Areas that you have already identified as key foci are…

The Global Reporting Initiative (GRI) sets a baseline for making the following disclosures:

• Ratios of standard entry level wage by gender compared to local minimum wage.
• Proportion of senior management hired from the local community.
• Infrastructure investments and services supported.
• Significant indirect economic impacts
• Proportion of spending on local suppliers

Guidance for this goal

The following points highlight areas for attention with regard to this specific goal.

o Community health is safeguarded.

o Product concerns are actively solicited, impartially judged and transparently addressed.
o Products do not harm people or the environment.
o Carry out assessment of environmental footprint of supply chain.
o Carry out Assessment of environmental footprint of products.
o Enable others to safeguard individuals and communities.

44
Taxes

SDG 1. End poverty in all its forms everywhere.

SDG 8. Promote inclusive and sustainable economic growth, employment and decent work for all.
SDG 10. Reduce inequality within and between countries.
SDG 16. Promote just, peaceful and inclusive societies.

The challenge with defining the ‘right tax’ is that there are often multiple ways for companies to organize
themselves and legally pay taxes, which can result in significantly different payable amounts. Companies must
grapple with discerning which opportunities governments have intentionally created to foster economic activity,
and which are unintentional oversights, if they are to identify how to pay their fair share.

Governments require tax revenue to fund critical services upon which society and business depends. Companies have an obligation to their shareholders to be diligent in
their approach to tax payments. This goal recognizes the fact that through taxation any company must also contribute to the infrastructure it utilizes and relies upon for its
success (e.g., transport networks, legal system, healthcare, education, public utilities) and even its existence, meaning that these outcomes are not at odds with each other.

Companies should: (a) commit publicly to a responsible tax policy; (b) adopt a transparent approach to tax reporting; and (c) not deliberately seek ways to obey the letter
but not the spirit of regional tax laws.

45
 SDGme baseline survey:

Responses to the Interloop baseline survey indicates that the company has a tax policy which is referred to in the financial statements. The company’s tax strategy is to pay
right income taxes and to not use low or no-tax jurisdictions for the primary purpose of minimizing taxes. The company publishes full financial statements and taxes are
paid on time.

The Global
oop’s ESG ratingsReporting
are as aInitiative
whole (GRI)
very sets a baseline for
encouraging andmaking
a signthe
offollowing disclosures:
an organisation that takes it’s
rate responsibilities very seriously. Areas that you have already identified as key foci are…
• Tax governance, control, and risk management
• Stakeholder engagement and management of concerns related to tax.
• Country-by-country reporting

Guidance for this goal

The following points highlight areas for attention with regard to this specific goal.

o Board oversees tax practices and transparency.

o Full disclosures are made regarding tax governance, control, and risk management.

46
Lobbying

SDG 8. Promote inclusive and sustainable economic growth, employment and decent work for all.

Many companies take an active interest in and seek to influence changes in policy and legislation that
affect their business. This influence extends beyond actions normally associated with the word "lobbying"
and includes efforts to shape the public discourse through activities such as advertising, public relations,
social media, and participation in influential forums, including trade associations and advocacy groups.

Lobbying is a complex issue. On the positive side, it can help governments to make more informed policy decisions, by furnishing them with leading knowledge or concrete
data on a given topic. It is also a way for constituents and those who will be impacted by government action to voice their opinions. On the other hand, lobbying is often a
‘pay-to play’ activity, granting wealthy individuals and corporations a disproportionate share of influence, the results of which may not align with the best interests of other
individuals or society as a whole. This imbalance, combined with a lack of transparency around lobbying activities, can degrade trust in both companies and legislative or
regulatory bodies.

Companies should therefore identify and disclose details of their lobbying and advocacy contributions and implement controls to assess the potential impacts of the causes
they support.

47
 SDGme baseline survey:

Responses to the Interloop baseline survey indicates that the company does not engage in lobbying which is deleterious to the public good. If not codified, then it is
important to have a formal lobbying policy.

A formal lobbying policy should consider stating that the company will not campaign for or support those who campaign for policies that establish or preserve conditions
that lead
oop’s ESG to outcomes
ratings are as athat undermine
whole society’s progress
very encouraging andtoward
a signa of
just,
aneconomically
organisationinclusive and environmentally
that takes it’s restorative society.
rate responsibilities very seriously. Areas that you have already identified as key foci are…

The Global Reporting Initiative (GRI) sets a baseline for making the following disclosures:

• Political contributions
• External initiatives
• Membership of associations

Guidance for this goal

The following points highlight areas for attention with regard to this specific goal.

o Document where the company has published its policy regarding lobbying and advocacy.
o Document the methods used to determine whether expenditures, industry group memberships or other advocacy positions held by the company are applicable
for screening against the policy. Describing how these were identified can help assurers to assess whether the company’s approach runs the risk of failing to
identify instances of lobbying or public influence efforts.
o Document the methods and frequency through which the company reviews the details of its stated policy and assesses the corresponding performance of the
control mechanisms for lobbying and advocacy.
o Retain supporting documentation (e.g., invoices, receipts) for documented lobbying contributions and other outlays applicable to the company’s lobbying and
advocacy policy. This can help assurers to verify the accuracy of the company’s disclosures, and facilitate any work needed to confirm that there are no missing
disclosures.

48
Ethics

SDG16. Promote just, peaceful and inclusive societies.

Companies that overlook business ethics to maximize profits may gain a short-term advantage over their
peers, but any such gains generally come at the cost of increased legal, financial and reputational risk, and
are not conducive to long-term value creation. The pressure to find any form of competitive edge means
that companies must remain constantly vigilant, to ensure that its people are encouraged and equipped to
live up to the highest ethical standards.

The kinds of ethical breach that might occur will vary widely across companies, depending on their size,
structure, sector, business model, geographical presence, and so on. No company is immune to ethical
concerns and challenges but can put effective internal control mechanisms to reduce the likelihood of
ethical breaches, to encourage people (employees and third parties) to raise the alarm when one does
occur, and to respond effectively to them.

Examples of potential issues could include anti-competitive practices (e.g., unfair supplier treatment, price fixing); disinformation (e.g., misrepresenting or failing to disclose
information which could influence stakeholder decisions or wellbeing); abuse of trust (e.g., inappropriate use of personal data); wilful ignorance (e.g., neglecting to
investigate supply chains in which human rights abuses are suspected).

Companies should: (a) identify high-risk areas for ethical issues within the business, (b) adopt a public commitment to ethical conduct, and (c) establish internal controls to
ensure it lives up to that commitment.

49
 SDGme baseline survey results:

Responses to the Interloop baseline survey indicate that the company has a policy in place stating its commitment to ensure its employees act in an ethical manner and
provides training to employees about ethical conduct at work

The Global Reporting Initiative (GRI) sets a baseline for making the following disclosures:
oop’s ESG ratings are as a whole very encouraging and a sign of an organisation that takes it’s
• Operations assessed for risks related to corruption.
rate responsibilities very seriously. Areas that you have already identified as key foci are…
• Communication and training about anti-corruption policies and procedures.
• Confirmed incidents of corruption and actions taken.
• Legal actions for anti-competitive behaviour, anti-trust, and monopoly practices.
• Non-compliance with environmental laws and regulations.
• Non-compliance with laws and regulations in the social and economic area.

Guidance for this goal

The following points highlight areas for attention with regard to this specific goal.

o Document the methods used to identify job functions or divisions within the company which are at risk of ethical conflict (the hotspot assessment). Describing
how these were identified can help assurers to assess whether the company’s approach runs the risk of failing to identify ethical risks faced by employees.
o Retain descriptions of the company’s ethics policies, both at the organizational level and with regard to any additional support provided to individual employees
or groups of employees to address ethical risks specific to their roles. This can help assurers to evaluate whether significant ethical risks are being sufficiently
guarded against.
o Document the mechanisms which facilitate employees’ ability to report ethical concerns in the workplace and retain any notes from discussions and evidence of
actions taken based on employee submissions. This can help demonstrate to assurers that the mechanisms are working as intended and that all concerns are
responded to.

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Investments

SDG 8. Promote inclusive and sustainable economic growth, employment and decent
work for all.

Every company is mutually accountable for any impact beyond its own four walls, to the
extent that the impact is a consequence of the company’s existence. In terms of
investment, this means not investing in financial assets which themselves hinder
society’s progress toward sustainability. This goal covers three ownership scenarios:

Financial assets owned by the company.

Financial assets managed by the company on behalf of third-party owners.

Financial assets offered as products to third-parties without any involvement in the management of the investment itself.

When a company invests in a financial asset either on its own behalf or for a third-party owner or offers the investment as a product to third-parties, it effectively chooses
to provide (part of the) financing for the negative impacts associated with that asset. Companies are therefore mutually accountable for the negative impacts of that
Interloop has many philanthropic and socially responsible ventures including some high profi
investment.
health, education and sports initiatives. These projects have impacted the lives of tens
thousands
Understanding the impact of any individual company or project – and therefore of families
any associated financialand
assetgreatly enhanced
– is complex, the company’s
and a company may not even community
know exactlypresence an
where and how its money is being deployed. However, if companies do not work to understand the impacts of their financial decisions, they risk contributing to negative
reputation.
outcomes.
Formal targets such as the 4% of annual profit being designated for social good are a visab
way to anchor the company’s value driven ethos and should be built upon with amibitiou
aims for an complimentary philanthropic foundation.

Partnership working and building stronger networks with civil society can be a force multipli
in these endevours. Additionally, creating joint projects with customers and corporate partne
gives maximum visability in the global market.

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 SDGme baseline survey:

Responses to the Interloop baseline survey indicates that the company has significant investments but does not have a formal impact / sustainable investment policy.
Investments are listed in the company’s Annual Financial Statements Report.

The Global Reporting Initiative (GRI) sets a baseline for making the following disclosures:
oop’s ESG ratings are as a whole very encouraging and a sign of an organisation that takes it’s
• Infrastructure investments and services supported.
rate responsibilities very seriously. Areas that you have already identified as key foci are…
• Significant indirect economic impacts.

Guidance for this goal

The following points highlight areas for attention with regard to this specific goal.

o Document the methods and frequency through which the company assesses its investments. This can help to identify all hotspots and reporting of E&S
performance in their portfolio companies.
o In cases where the company has decided to continue holding financial assets categorized as having a high-intensity hotspot, document the methods used by the
company to engage with the manager of the financial asset it has invested in, or the underlying investee itself, to encourage them to increase their fitness over
time. This can help assurers to verify that the approach taken by the company is in line with the requirements of the goal.

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 Recommendations
Why invest in sustainability?
• Balancing Profit with Purpose

To ensure long-term benefits for the company, Interloop should further align its SDG agenda into its Corporate Strategy.
Increasingly, we are seeing the SDGs reflecting stakeholder expectations as well as future policy direction at the international,
national and regional levels. Aligning priorities with the SDGs will strengthen engagement with customers, employees, and other
stakeholders, while companies that don’t will be exposed to growing legal and reputational risks.

A key step will be to engage with your key stakeholders to gain diverse perspectives for positive SDG actions, leading to greater
and deeper impact.

SDGme baseline finding:

The Interloop baseline results indicate that the company and senior leadership team is making good progress on sustainability
initiatives and is consistently looking to improve its performance in this area.

Ambition:

More can be done to integrate sustainable business practises at a strategic/board level and engage internally with staff, suppliers
and shareholders (where relevant)

Action:

We recommend identifying the materiality and impact opportunity clusters across relevant SDGs to integrate the SDGs into your core business and value chain. By doing so,
a company can generate confidence that its SDG activity is well planned and both relevant to, and aligned with, its business strategy.

• Prioritising the SDGs

Not all the SDGs and their underlying targets are of equal relevance to every company, sector or geography. Each SDG is important and interconnected with others,
however, it is likely that some SDGs will resonate more strongly with your business risks and opportunities than others. We encourage the company to define the priority
SDGs according to your business plan, materiality, and stakeholder expectations and to focus your action on the goals on which you can have the greatest actual and
potential impact.

Focusing on specific SDG targets will help the company to define its SDG-related business priorities more clearly and to implement more effective action. It can also help the
company identify new business and innovation opportunities that may not be immediately apparent when looking only at the 17 SDGs.
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SDGme baseline finding:

The Interloop baseline results indicate that the nearly all of the SDGs resonate strongly with your business risks and opportunities.

Ambition:

We recommend that the senior leadership team gets acquainted with all 17 Goals, their associated targets, and indicators and identify impact opportunity clusters across
relevant SDGs to integrate the SDGs into your core business and value chain.

Action:

We recommend that the method or process used to identify the most relevant SDGs and prioritize them for action should be disclosed. This should include disclosures of
which of the UN’s 169 targets that underlie the SDGs are relevant to the business. Doing this provides all stakeholders with a window into how comprehensively and
credibly the company has evaluated the goals and on what basis it has selected those on which it will act.

• Moving from Ambition to Action

Companies with mature sustainability strategies have the advantage when it comes to setting priorities and measuring SDG outcomes and impacts. Credible sustainability
standards provide a pathway for business to deliver to the SDGs. Business leaders across the textile sector understand the business case and are using the SDGs to drive
innovation. They know success will be through collaboration not competition and is an important area of opportunity.

The next critical step for Interloop is to move past the goal level and work at the target-level. Setting and tracking key performance indicators and measuring outcomes and
impacts. This is another reason to integrate the SDGs into the company’s business models.

SDGme baseline finding:

During our interview with the sustainability team leadership, we noted that the SBTi commitment will revolutionise the way the company addresses its GHG emissions.
Using a standardised scientific data collection tool across the business will provide a useful baseline for the company to assess and reduce its emissions over a set period of
time and provide invaluable insights on emissions and help set SMART reduction strategies.

Ambition:

We recommend that the senior leadership team reviews the SDGs at the target and indicator levels to identify which goals the company can directly impact through
commercial, shared value and corporate responsibility activities and strategies. Relevant SDGs can be integrated into business-as-usual and the company can set targets
and Key Performance Indicators (KPI’s) in the same way as it sets all goals and measures performance.

Action:

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We recommend that SDG performance goals are SMART, i.e., specific, measurable, achievable, relevant, and time-bound (all the SDG targets set by the UN are time-
bound). By putting SMART goals in place, the business can measure, monitor, and communicate its contribution to achieving the SDGs in a convincing and compelling way.

• Reporting Impact on the SDGs

Reporting should clearly communicate the positive and negative impacts a company has on the SDGs, showing how the company is both contributing to global problems, as
well as helping to solve them. Transparency leads to trust - if a company does not demonstrate that it fully understands its impacts, its efforts to address those impacts can
lack credibility.

It is critical that everyone in the company understands what the SDGs are, why the company supports them and what their personal role and accountability is in delivering
on the company’s SDG commitment.

Rules around reporting continue to tighten, especially for publicly listed companies. SDG reporting should include quantitative data such as progress against targets and
also share financial contributions made by the company to sustainability initiatives. SBTi, GRI and the UN Global Compact offer helpful reporting frameworks, especially for
larger companies. Not only will reporting contribute to accountability, but it will also help Interloop share good practices and inspire action across the sector, enhancing its
reputation as a sustainable business.

SDGme baseline finding:

Through our interactions with the sustainability team leadership, we observed passion about sustainability and a commitment to keep themselves abreast on the latest
sustainability sector trends, analysing and innovating to ensure the companies market position.

Ambition:

We recommend that the company identifies other possible ambassadors and champions internally, and in keeping with SDG17, enters into external partnerships or
memberships that will enhance the projection and support the implementation of the SDGs within the company to amplify its sustainability journey.

Action:

We recommend that leadership should demonstrate commitment to the SDGs as part of the company’s long-term strategy. Discussing the SDGs in the CEO or Chair’s
message not only setting out the company’s direction in relation to critical global issues but also give a clear signal that the company’s action on the SDGs is driven from the
very top of the organization.

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Next Steps
At this time of political and economic uncertainty, strong and visionary leadership is essential to achieving the
transformation needed to usher in the inclusive and sustainable economic growth that the SDGs represent.

Interloop has already embarked on its sustainability journey. By reporting your progress against the SDGs,
you will join this global movement and by reaching out across sectors and supply chains, you can collectively
accelerate this agenda.

Sustainable businesses are more successful. Through addressing the sustainability agenda now and getting
ahead of the change curve which will eventually impact all your competitors and can leverage a competitive
advantage through proactive business transformation that aligns the business with future buyer and
customer trends and requirements.

You can use this baseline to start internal discussions to determine your company’s roadmap and next steps, such as:

This tool can also be used to bring in your suppliers, contractors and shareholders onto the SDGs journey to improve confidence in your supply chains to become robust and
responsible. We are able to tailor the SDGme Rapid Assessment Baseline to build your company’s Sustainability Ecosystem.

As a tangible report that charts progress and enables making public commitments to advancing the SDGs, the scores from your report can also be used as part of any
Annual Report, saving time and effort in doing a traditional assessment to contribute to a larger report.

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About us
Quantum 5 are global sustainability advisors. We specialise in designing rapid and meaningful
sustainability change programmes for companies that need to adapt now.

Get in touch with us if you would like to discuss the scores from your SDGme Report or want some
friendly advice or support in transforming your approach to sustainability and alignment with the
UN Sustainable Development Goals.

SDGme can be tailored as a bespoke in-house reporting tool with questions and metrics aligned with your sustainability priorities or that of your supply chain.

We'll bring simplicity to complexity and jointly, we’ll work towards accelerating your sustainability ambitions and actions.

This report is based on proprietary information provided by Interloop Ltd employees. Unless provided with express prior written consent, no part of this report should be
reproduced, distributed or communicated to any third party. We do not accept any liability if this report is used for an alternative purpose from which it is intended, nor to
any third party in respect of this report.

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