4.

Transforming
with a unique
model

At Inditex we have developed a unique

business model the hallmarks of which
are flexibility and efficiency, ceaseless
innovation, the creativity of our teams and
our focus on sustainability in every process
involved. This model takes form from the
design of our fashion products to their
availability to customers in the over 200
markets where they are sold.

This is the starting point from which we

work to effect through determination and
collaboration, the transformation of the
sector, generating a positive impact on
society, the industry and our environment.

4.1. Our strategy and growth model, the fuel for transformation | 4.2. Sustainability, the basis for transformation |
4.3. Innovation, vital for transformation | 4.4. Collaboration, the essence of transformation

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   |  Statement on Non-Financial Information 2021  |  4. Transforming with a unique model

4.1.
Our strategy and
growth model,
the fuel for
transformation

The Group’s detailed knowledge of the are present in more than 200 markets across five
retail environment and its commitment continents (detailed information for the markets in
to technology facilitates innovation which we operate is included in the Consolidated
and an agile, coordinated and global Directors’ Report). Details of the corporate struc-
ture at 31 January 2022 are provided in Annex I of
transformation throughout the value chain:
the Notes to the Consolidated Annual Accounts of
design, manufacturing, logistics, sales the Inditex Group.
channels and customers.
We have always identified people as the key factor
in our business model, both our customers, who de-
mand our products, and all those people who place
their talent at the service of our customers: our
4.1.1. Business model and employees, supported by our supply chain. There
strategy are 165,042 of us, with 177 nationalities, working
in a committed manner, inspired by values that are
GRI 102-5; 102-12 AND 102-16 part of the Group’s foundational principles: entre-
preneurial spirit, non-conformism, innovation, in-
We conduct our business within a framework of re- clusion and humility.
spect and transparency, in continuous dialogue with
our stakeholders, based on promoting human rights, Fashion, as an element for the expression of individ-
and with the ultimate purpose of having a positive ual and collective identity, is one of the hallmarks
impact on customers, society, the industry and our of communication between people. It is embodied
environment. through multiple products and channels, and is
characterised by the constant evolution of tastes
We strive to combine an efficient, sustainable and over time, influenced by multiple factors, both in-
integrated economic model that generates oppor- herent to the sector itself and outside of it.
tunities for improvement for our entire ecosystem
while minimising resource consumption, thus decou- We are a reference in fashion, having achieved a
pling economic performance from its impact. global presence based on an integrated business
model that sets us apart from the rest of the in-
In this way, and through collaboration, we resolutely dustry. Constant change, and the resulting need
promote the sustainable transformation of the sector. to adapt to trends and volumes, is the factor that
has defined our Group’s business model, which is
unique in the sector, and the key to our Company’s
Integrated business model commercial success.
Our fashion distribution and sales activity is organ-
ised through an international group of companies, Since the outset, we have established a process of
whose parent company is Industria de Diseño Tex- interaction with our customers as the main tool to
til, S.A., which is listed on all four Spanish stock ex- identify the latest trends and create the products
changes and, together with its subsidiaries, makes they want (clothing, footwear, accessories and
up the Inditex Group (hereinafter, the ‘Group’). We household items), maintaining our high standards

| 44 |
through a combination of design, quality and sus- From this starting point, we work to promote in a
tainability, at affordable prices. This constant con- resolute and collaborative manner the transforma-
nection has also enabled us to pinpoint new needs tion of the sector, generating a positive impact on
that we have gradually incorporated in the form of society, the industry and our environment.
new services, technologies or channels.

Over time, this continuous evolution has enabled a) Design

the Group to develop a unique business model,
characterised by its flexibility, integration, sus- The starting point for the Group’s creativity, the
tainability, creativity and innovation. The key to foremost added value of Inditex’s business model, is
our way of operating is the continuous process of the more than 700 designers who drive our brands.
centralised analysis of information concerning the Integrated within the buying teams, their constant
business performance, which enables expedient contact with stores and online teams through the
decision-making suited to the business reality and Product Management department, as well as their
allows constant adaptation to the actual operation- unrivalled capacity to respond, allow them to detect
al circumstances, whether due to changes in trends customer tastes at all times. This information is then
or in the environment. We ensure that these con- interpreted and translated into products that are
tinuous changes are made globally thanks to our aligned with the latest demand in terms of trends
presence throughout the value chain, which en- and quantity. Moreover, our designers are at the
compasses design, manufacturing, logistics, stores forefront of the company’s commitment to sustaina-
and customers. bility, selecting the most appropriate processes and

| 45 |
  |  Statement on Non-Financial Information 2021  |  4. Transforming with a unique model

materials for our products. This effort is embodied c) Logistics and distribution
by collections that constantly incorporate creative
novelties throughout the season, as evidenced by This stage of the value chain continuously adapts to
the windows and interiors of our stores and the dig- commercial decisions, a flexibility that has been in-
ital content that we produce throughout the year, strumental in underpinning our expansion to more
something unique in the fashion world. In addition, than 200 markets. Each brand operates its own
their active search and promotion for more sustain- centralised logistics hubs, where its inventory is
able materials and production processes help to held and distributed to the stores and online ware-
raise quality standards and keep on improving in the houses around the world. This efficient integration
circular economy model. of our store/online operations during the storage,
transport and distribution processes is made pos-
sible thanks to tools such as our own inventory
b) Manufacturing and procurement management system based on radio-frequency
identification (RFID) of each and every garment.
Manufacturing and procurement are based on the so- Accordingly, our customers can ultimately make
cially and environmentally responsible management their decisions in the environment of their choice,
of the supply chain. Thus, decent working conditions online or in-store, and enjoy an integrated shop-
are guaranteed for all workers at our suppliers and ping experience with constant technological inno-
manufacturers with less environmental impact. Our vations that adapt to their needs.
supply chain has a global presence, organised through
12 clusters of suppliers with a highly significant part
of procurement in areas close to the design centres. d) Stores/Online
Accordingly, we have the capacity to adapt our com-
mercial offer to any change of trend that emerges, The Inditex Group comprises eight retail concepts:
immediately adjusting the number of garments to Zara, Zara Home, Pull&Bear, Massimo Dutti, Bersh-
actual demand. We are therefore able to minimise ka, Stradivarius, Oysho and Uterqüe. Each of them
any surpluses that may occur, thereby contributing to has its own personality, style and design team, with
responsible stock management, not only in line with an integrated sales model in physical and online
commercial objectives but also, in particular, with stores managed directly.
our sustainability goal. In this regard, we continue to
innovate and use more durable and environmentally The shopping space, in both stores and online, is
friendly materials, develop more efficient production characterised by the pursuit of quality. The physical
processes and share all of this according to the high- spaces are dedicated to customers enjoying experi-
est standards of communication and transparency. encing the best locations in the world’s most prom-
More information in section 5.5. Collaborating so our inent shopping streets, in carefully architecturally
suppliers grow of this Report. designed settings and with the right technological
tools to ensure they receive the best customer ser-

| 46 |
vice. The online environment of each of our brands proving the shopping experience for our custom-
is aimed at extending this fashion experience to any ers. With this in mind, in addition to technological
occasion and any location via mobile devices, with integration, which allows new functionalities to be
the added convenience that our customers can introduced constantly, we implement a very active
receive their products in the place of their choice. policy of renovations, extensions and relocations.
This eliminates the barriers between the physical
and virtual worlds, and ensures that our designers’ •We continue to deploy digitalisation as a key tool
products reach both environments as efficiently as to grow online sales, both in digital channels and
possible. The process of digital integration, which we through in-store integration. The immediate
have been developing over recent years, has seen availability of business data, obtained thanks to
the strongest growth in these historic times we are our complete integration, further speeds up deci-
experiencing. This only serves to deepen our de- sion-making processes, resulting in more efficient
termined commitment to technological innovation, inventory management and an improvement in the
which is essential at a time in need of flexible solu- standard of customer services.
tions that adapt to continuous change.
•Sustainability, in its various facets, is a fundamen-
tal aspect of the future development of our Group.
A continuously evolving strategy Tangible examples are the challenges and opportu-
This integrated business model gives us a unified nities arising from the search for new materials and
view of our customers and their demands at all times. processes that minimise consumption, while at the
Our strategy harnesses this advantage to evolve our same time increasing the life cycle of products, ei-
model towards economic, sustainable and inclusive ther through greater durability or by making them
improvements. recyclable. Our ambition in this area is clear and
encompasses not only the environmental aspect,
The starting point is to maintain the level of com- but also the creation of opportunities across our
mercial success achieved to date, which is based on entire production ecosystem, from recruitment,
two pillars: training and internal promotion opportunities for
our people, to empowerment and development in-
•The strength of our commercial and design teams itiatives at various stages of our supply chain, with
and the flexibility that proximity sourcing brings to the aim of contributing to the well-being of all our
our supply chain; stakeholders.
More information in section 4.2. Sustainability, the basis for
•We aim to offer the best experience to our custom- transformation of this Report.
ers, whether by maximising potential interaction
possibilities through different channels, facilitating
product availability by means of efficient inventory
management or developing analytical tools to im-
prove proposed services.

Our strategy is driven by the opportunities afford-

ed by digitalisation and our sustainability ambitions.
These pillars are developed through specific initiatives
in the various phases of our business model:

•In order to maintain supply chain flexibility, we con-

+700
tinue to consolidate and strengthen our supplier
base. Cutting-edge technological developments
give us a holistic view of our supplier base, thereby
helping us to integrate sustainability criteria from
DESIGNERS
the start of the design and purchasing process.
Who drive our brands. Integrated within the buying
•We are continuing with the process of differentiat- teams, their constant contact with stores and online
ing our commercial space. Ongoing investment in teams through the Product Management department,
our stores network seeks to enhance the quality of as well as their unrivalled capacity to respond, allow
our sales space, making it more attractive and im- them to detect customer tastes at all times.

| 47 |
  |  Statement on Non-Financial Information 2021  |  4. Transforming with a unique model

Our business model is defined on the basis of our

goal of mitigating the risk derived from operating in
a sector characterised by the dynamically changing
trends our customers require. To achieve this, risk
management is inherent to our business model and
directly responds to the precautionary principle
throughout our value chain, a responsibility of each
and every member of the Group. This precaution-
ary approach applied by the Group across its entire
business model enables it to manage the various
risks identified when planning its operations and
developing and marketing new products. The de-
velopment of our business model is exposed to fi-
nancial, geopolitical, technological, environmental,
social and governance risks. Systematic processes
are in place to identify, assess, record and mon-
itor risk so as to ensure the best possible manage-
ment as we pursue our goals, based on the levels of
tolerance established by Senior Management. Risk
management is a process in continuous evolution,
many of the threats are emerging and we must try
to anticipate their potential impact. The Integrated
Risk Management and Control System, described
in section 5.10. Responsible risk management, ema-
nates from the Board of Directors and is articulated
in the form of regulations aimed at managing the
various scenarios.

Our corporate
governance system is
aimed at promoting
proper, transparent
and sustainable
management of the
Company.

Likewise, at Inditex we have a solid Compliance

System and, in particular, a corporate governance
structure that ensures compliance with the stand-
ards, recommedations and best practices in this
area. Our corporate governance system is aimed
at promoting proper, transparent and sustaina-
ble management of the Company to achieve the
utmost levels of competitiveness and generate
trust among our shareholders, investors and other
stakeholders, from a perspective of maximum in-
tegrity and honesty.

| 48 |
The operation of Inditex’s corporate bodies over
the course of 2021 has been a steady return to
normality. In a context still shaped by the existence
of specific measures restricting mobility in certain
areas of Spain, and in order to guarantee the nor-
mal functioning of the Company and the attain-
ment of its targets, as well as to protect the inter-
ests of its shareholders and other stakeholders,
the Annual General Meeting held on first call on 13
July 2021, with shareholders and their representa-
tives attending again both in person and by remote,
real-time video-conferencing.

Meanwhile, meetings of the Board of Directors and

its delegated Committees have taken a mixed for-
mat, involving both the physical and remote pres-
ence of board members. Furthermore, monitoring
of the unfolding global health crisis and its impact
on Group activity and the key risk indicators con-
tinued to set their agendas, in particular that of the
Audit and Compliance Committee.

The Annual Corporate Governance Report for

2021, available on our corporate website, provides
comprehensive and detailed information on the
Company’s governance structure and practices.

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   |  Statement on Non-Financial Information 2021  |  4. Transforming with a unique model

SUSTAINABLE BUSINESS MODEL

Inditex's business model, The execution of this business model, With them, through transparency
characterised by integration, and the performance of our activity and constant dialogue with our
sustainability, innovation and as a Company, are based on a series stakeholders, we work to promote
collaboration in all phases of the value of action principles validated and human rights, the Sustainable
chain, aims to satisfy our customers’ endorsed by the Board of Directors of Development Goals and, in particular,
expectations and to offer them quality Inditex, as well as on a series of values to create value and generate a positive
fashion in keeping with the highest that define our corporate culture. impact on society.
standards of sustainability.

Corporate values
Flexibility Non-conformity
Pro-activeness Environmental awareness
Diversity Respect for Human Rights
Creativity Contribution to Sustainable Development

Action principles
 olicy on Human Rights
P Occupational Health and Safety Policy
Diversity and Inclusion Policy Sustainability Roadmap
C orporate Citizenship Policy Code of Conduct for Manufacturers and
Procurement Policy Suppliers
T  ax Strategy Policy Code of Conduct and Responsible
Practices
Sustainability Policy
Compliance Policy
Criminal Risk Prevention Policy

Stakeholder groups

Employees Customers Suppliers

Community Environment Shareholders

Customers
Clientes Human Rights
Derechos Humanos Value creation
Creación de valor
Escuchar
Listeningatonuestros clientesises
our customers theelstarting
punto depoint To promote
Para and uphold
la promoción human rights
y el respeto de ElThe commitment
compromiso contolacreating
creación
partida de una actividad
of an essential process toesencial
know whichpara conocer
products in all
los areas of our
Derechos activity,en
Humanos Inditex
todoshas
losa economic,
de social andsocial
valor económico, environmental
y
qué
theyproductos
want anddemandan y ofrecérselos
to offer those en el
products at the strategyde
ámbitos based on the
nuestra Guiding Inditex
actividad, Principles value for all our stakeholders
medioambiental para nuestros
momento
right timeyand
lugar adecuados.
place. Sólo el correcto
Only by properly gearing on Business
cuenta andestrategia
con una Human Rights.basada en los generates
grupos a positive
de interés impact
genera unand
engranaje de este(listening
this mechanism mecanismo (escuchatheir
- identifying - Principios Rectores sobre las Empresas contributes
impacto to the
positivo development of
y contribuye
identificación de necesidades
needs - offering) - oferta)
we can provide puede
them with the y los Derechos Humanos. alwider societydeand
desarrollo to caring yfor
la sociedad al the
brindarle la mejor
best shopping experiencia de compra.
experience. planet. del planeta.
cuidado

| 50 |
 E CREATION
VALU

to sustainable dev
u tion elo
pm
n trib en
C o Flex t
ilit y ibi
a b lity
in
sta DESIGN
u
E
LU

PO
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SIT
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IVE I
ECONO

MPACT
s p a re n c y
Creativity

CUSTOMER PRODUCTION
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-
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In n
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Sustainability Innovation Working together

PILLARS ON WHICH OUR STRATEGY AND

GROWTH MODEL ARE GROUNDED

Value chain Contribution to the SDGs Positive impact

The hallmark of our business model is the Our commitment to the Sustainable Sustainability is the path to a fairer society and
integration of all phases of the value chain, Development Goals of the 2030 one more balanced in respect of the planet’s
which allows for swift decision-making and Agenda is even more important in limits. A context in which, as a responsible
constant adaptation to the operational the current context. The SDGs will company, we work alongside our stakeholders
reality. Accordingly, we manage the be fundamental to rebuilding the to transform the industry and generate a
Company with a low level of inventory. economy and society in the wake of positive impact in the communities where we
the pandemic. operate.

| 51 |
   |  Statement on Non-Financial Information 2021  |  4. Transforming with a unique model

4.2.
Sustainability, the basis
for transformation

Sustainability is one of the cornerstones All our decisions and actions are based on respect
of our business model. Our strategy of for human and labour rights throughout the value
collaboration, transparency and innovation chain and compliance with the most rigorous and
ambitious environmental standards. Based on this
involves all levels of the organisation and
compliance requirement, we have built an ambitious
creates a culture of sustainability that sustainability strategy that places the impact in the
permeates every aspect of our work and centre, as the light that guides our efforts. Our aim
every stage of the value chain. Our aim is is to progress on the path of positive impact.
to progress on the path of positive impact
to guarantee this transformation. Our vision of sustainability stems from an intention
to transcend short-term approaches and trends in
order to create long-term strategies, structures
and action plans. Hence, our perspective is twofold:
to maintain an upright, timeless and organic strate-
gic approach, while at the same time addressing the
most important and urgent tactical challenges fac-
4.2.1. Our approach to ing the planet, society and our industry.
sustainability Our actions are aimed at protecting and positively
GRI 102-12; 103-2; 103-3; 201-2 AND 201-3 impacting three main areas: life as a whole and the
ecosystems; people; and the substrate (compris-
Sustainability is one of the cornerstones of our ing its different elements: water, land, air and
business model. We are committed to creating val- energy). Consequently, we take a systemic, com-
ue for our stakeholders, with the ultimate goal of prehensive and hybrid approach that combines the
helping to generate a positive impact for society social and environmental spheres, with the ultimate
and the planet. goal of prosperity and sustainable development.

2021 MILESTONE
• In November 2021, Inditex also received the
• Inditex has been included in the index Global 100
Terra Carta seal for its contribution to creating a
World’s Most Sustainable Corporations in the
sustainable future.
World 2022 (published in January 2022). The
Group scaled 19 positions to 73 in this annual The Prince of Wales launched this seal as part of
ranking, compiled by Corporate Knights, of the Sustainable Markets Initiative, in recognition
companies’ performance on the basis of economic, of global companies that are driving innovation
environmental, social and governance indicators. and demonstrating their commitment to creating
sustainable markets.

| 52 |
SUSTAINABILITY AT INDITEX: THE IMPACT AT THE CORE

Prosperity for the planet

and for people
VISION

Positive
impact
To be levers of
Progress
towards AMBITION SCOPE transformation, not only of
our value chain, but also of
positive impact
the industry

| 53 |
  |  Statement on Non-Financial Information 2021  |  4. Transforming with a unique model

The commitment to sustainability permeates the the Changemakers programme, aimed at training and
entire Company: from the governance bodies, artic- informing our store staff and creating a community of
ulated through a strong sustainability governance Changemakers who internalise our commitments and
structure, to the entire workforce, including offices, strategy and make them their own.
logistics centers and stores. This has enabled us to More information in section 5.1.2. Talent management of
progress towards our specific goals to generate value. this Report.

We rely on four key elements to implement our sus- In 2021, 15,560 employees were trained on sustain-
tainable strategy: culture, collaboration, transparen- ability (6,960 employees in 2020).
cy and innovation.

Collaboration
Sustainability culture In keeping with our aim of being a driver of transfor-
Sustainability is ingrained in all our processes and mation in the industry, we take a holistic approach
decisions throughout our value chain. From prod- to sustainability, which includes both its integration
uct design to store management, it is a shared throughout our entire value chain and collaboration
principle. To ensure it permeates our entire staff, with each and every one of the related actors.
regardless of their position and function, we carry
out various actions aimed at creating a culture of To address the paradigm shift needed to face the
sustainability throughout the Company. challenges posed by the fight against climate change,
circularity or the sustainable development of com-
This culture begins as soon as our people join us. munities, we have to join forces with all the actors
For example, new recruits at offices receive train- involved. Hence, we take an open approach in which
ing in which sustainability is prominent. After an in- collaboration is a pillar of transformation. Examples
itial overview they receive more thorough training of this are our engagement with entities such as the
in the various Company’s programmes, in accord- United Nations Global Compact, the International
ance with their job position. Labour Organization, UNI Global Union, IndustriALL
Global Union, The Fashion Pact, Ellen MacArthur
This training is especially important for our buy- Foundation, Zero Discharge of Hazardous Chemicals
ing and product teams, since their actions and de- and the Sustainable Apparel Coalition, among others.
cisions have a direct impact on the sustainability More information in section 4.4. Collaboration, the essence
of our products and supply chain. In this regard, of transformation of this Report.
communication and relations between the various
teams is continuous, working together to achieve
the Group’s goals. Furthermore, this year we joined
forces with one of the world’s leading universities We work together to
for textile-related studies to create the Sustaina-
ble Fashion School specialist training programme
transform: we are resolutely
aimed at helping our buying and design teams. and collaboratively
Equally important is the training received by our store
promoting the
staff. In 2021, we launched the first pilot edition of transformation of the sector.

| 54 |
Transparency
In line with our commitment to transparency, we We believe that in order to drive the industry’s
share information with our stakeholders concern- transformation, it is not enough to apply the cur-
ing our sustainability strategy, the programmes on rent paradigms, but rather an innovative approach
which is it structured, our goals and the progress is necessary, one that strives for new solutions both
achieved, among other issues. technologically and in creating new models of for ac-
tion and relation relationship with our environment.
Among the foremost examples of our transparency is More information in section 4.3. Innovation, vital for
our annual accountability through this Integrated Di- transformation of this Report.
rectors’ Report, as well as the information we regularly
publish on our website. We also share a range of de-
tailed and specific information with our various stake- Roadmap and commitments
holders, such as shareholders, suppliers, customers or
the different organisations with which we collaborate.
More information in section 4.4.1. Stakeholder engagement
of this Report. 2021 MILESTONE
New sustainability commitments:
Innovation The Group approves new
sustainability objectives at its Annual
Inditex is unwaveringly committed to innovation in
General Meeting and brings forward
all its areas, including sustainability. The complex-
ity of the global challenges we face and the path its commitment to achieve net zero
towards a positive impact require an increasingly emissions by ten years to 2040.
prominent presence of innovation, science and
technology in our actions.

OUR SUSTAINABILITY ROADMAP

2022 2023 2025 2040

100% of energy 100% of cotton from more 100% Polyester from more Net zero emissions,
consumption from sustainable sources, two sustainable sources. ten years ahead of the
renewable sources in years ahead of the previous previous target of 2050.
all our own facilities target of 2025. 100% Linen from more
(headquarters, logistics sustainable sources.
centres, factories and 100% man-made
cellulosic fibres from more 25% reduction of water
stores), exceeding the 80%
sustainable sources. consumption in the supply
previously planned for
chain.
2025.
Zero waste from our own
More than 50% of articles facilities: headquarters,
featuring the Join Life label. logistics centres, factories
and stores.

100% elimination of single

use plastic for customers.

100% collection of all

packaging materials for
recycling or reuse in the
supply chain (Green to
Pack).

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   |  Statement on Non-Financial Information 2021  |  4. Transforming with a unique model

We have a Sustainability Roadmap that is structured The Sustainability Committee is the delegated body
around two main pillars: a commitment to the cir- of the Board of Directors responsible for supervising
cular economy and decarbonisation – in line with and monitoring sustainability proposals in the social,
the objectives of the Paris Agreement, and a com- environmental and product health and safety areas.
mitment to the Sustainable Development Goals, to It is also responsible for fostering the commitment
which we add the promotion of and respect for hu- to the Sustainable Development Goals and relations
man rights. with the various stakeholders in this regard.

Within the framework of this Roadmap, and con- The Sustainability Committee, along with the Audit
sistent with our sustainable strategy, we have and Compliance Committee, is also responsible for
established a series of ambitious milestones and overseeing the information included in the Statement
objectives. In order to achieve them, we need the on Non-Financial Information and other public docu-
engagement of each and every one of the teams that mentation on matters within its purview. The Audit
make up Inditex, as well as the collaboration of the and Compliance Committee—as the body responsi-
various stakeholders in our industry and in the com- ble for overseeing and controlling the effectiveness
munities in which we operate. of the internal risk control and management systems
—is entrusted with monitoring and assessing the risks
At the Annual General Meeting held on 13 July arising from the Group’s actions in relation to the Sus-
2021, the Group announced that it will bring for- tainability Policy.
ward some objectives and the addition of new ones
to those already set out in our Roadmap, raising the Furthermore, the Group has an Ethics Committee,
level of ambition. These include bringing forward an internal body reporting to the Board of Direc-
our goal of net zero emissions to 2040, ten years tors, which oversees compliance with the stand-
earlier than initially scheduled. ards of conduct, and a Social Advisory Board, an
external sustainability advisory body in operation
Sustainability governance since 2002. The Social Advisory Board is made up
The commitment to sustainability extends to all lev- of independent and external persons and institu-
els of the Company, starting with the governing bod- tions and its mission is to institutionalise dialogue
ies and permeating the entire organisation, based on with key stakeholders from civil society where we
a solid system of governance. develop our business model.

GOVERNANCE AND MANAGEMENT OF SUSTAINABILITY

BOARD OF DIRECTORS ETHICS COMMITTEE

Body responsible for approving Inditex’s sustainability strategy. Delegated body of the Board of Directors
that ensures compliance with the rules of
conduct.

SUSTAINABILITY COMMITTEE SOCIAL ADVISORY BOARD

Body in charge of advising the Board of Directors and overseeing and controlling A collegiate body integrated by external
sustainability proposals in the social, environmental and health and safety of our independent experts, which advises the
products, as well as the relations with the various stakeholders in these matters Company in sustainability issues.

Environmental
CHIEF SUSTAINABILITY OFFICER
The Chief Sustainability Officer belongs to the senior management of Inditex. The
CSO reports to the COO & Head of Digital and Sustainable Transformation and Product Health
to the CEO whenever so required, to the Sustainability Committee and, where and Safety
applicable, to the Audit and Compliance Committee, concerning sustainability,
including social, climate-related and product health and safety aspects.

Social
Corporate Sustainability Heads of
Department Sustainability of the Brands

| 56 |
 POLICIES THAT GUARANTEE INTEGRATION OF
SUSTAINABILITY IN THE OPERATIONS AND DECISION MAKING
AT THE INDITEX GROUP

• Sustainability Policy
• Principles that govern sustainability in
• Policy on Human Rights the Group.
•D
 iversity and Inclusion Policy • It includes the integration of
•C
 ompliance Policy sustainability into the business model
and the cornerstones upon which
• I ntegrity Policy
the organisation’s value generation is
•F
 orest Product Policy established.
•C
 ode of Conduct and Responsible Practices
• Principles governing stakeholder
•P
 roduct Health and Safety Standards: Clear to Wear (CtW), Safe to Wear engagement and the identification of
(StW) Physical Testing Requirements (PTR), and the I+ standards (IPLUS: Inditex key stakeholders.
Precautions and Limits of Users’ Safety)
• Principles upon which the
•G
 reen to Wear environmental standard (GtW) communication of sustainability
•S
 trategy on social management of the supply chain: Workers at the Centre practices is established, strengthening
2019-2022 the ongoing dialogue and transparency
as a cornerstone for relations with
•G
 lobal Water Management Strategy, Global Energy Strategy, and
stakeholders.
Biodiversity Strategy

More information in section 5.9. Good governance, corporate

ethics culture and solid compliance architecture of this Report.

This governance system is based on a number of FOR MORE

policies and strategies that guide our activities and INFORMATION
our decision making, and that lay the groundwork on our Sustainability
Policy.
to ensure that sustainability is integrated through-
out our business model. These include, in particu-
lar, our Sustainability Policy, which comprises the
principles adopted by the Group in relations with

15%
our stakeholders, encouraging integration of sus-
tainability practices within the business model and
ensuring that its business activity is carried out
with full respect for people, the environment and
VARIABLE REMUNERATION OF THE
the community at large, based upon the commit-
ment the company has made to respecting human
GROUP’S CHAIRMAN AND CEO
rights and to sustainable development. This Poli- 15% of the variable annual remuneration of the Group’s
cy, approved by the Board of Directors on 14 De- Executive Chairman and Chief Executive Officer is
cember 2020, builds on and updates the previous linked to the fulfilment of the sustainability policies.
Corporate Social Responsibility Policy and Envi- This progress is measured in accordance with a set of
ronmental Sustainability Policy, consolidating them indicators, such as the increase in the percentage of Join
into a single text. Life products, among others.
The commitment to sustainability by the governing
bodies and the entire Company is crystallised in the
definition of ambitious goals and specific targets, in-
+10%
LONG-TERM INCENTIVE
cluding linking the variable remuneration of different
areas within the Group to sustainability objectives. We have a long-term incentive plan for members
of the management team and other employees for
the 2019-2023 period. This includes sustainability
metrics which, in turn, represent 10% of the
THE VARIABLE REMUNERATION aggregate incentive. In our new long-term incentive
OF ALL OFFICE EMPLOYEES plan for 2021-2024, approved by the Annual General
The variable remuneration of all office Meeting in July 2021, the weighting of sustainability
employees in linked to sustainability metrics. metrics has been increased to 25%.

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  |  Statement on Non-Financial Information 2021  |  4. Transforming with a unique model

4.2.2. Contribution to
sustainable development
GRI 103-2 AND 201-2

At Inditex we aim to
generate value and
foster prosperity in the
communities where we
operate. With this in mind,
since the approval in 2015
of the United Nations 2030
Agenda for Sustainable
Development, we have
aligned our strategy with
the common action plan The roadmap proposed by the SDGs is common to
proposed by the Agenda all parties involved in sustainable development —
including governments, private companies and civil
through its 17 Sustainable society— so it represents an opportunity for our
Development Goals (SDGs) Company to align our contribution to sustainable
development and to maximise our positive impact
and their respective 169 together with our stakeholders.
targets.

INDITEX’S MOST RELEVANT CONTRIBUTION TO THE SDGS

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As a result of aligning our strategy with the SDGs— tion on our contribution to the SDGs, indicating at
facilitated by the already predominant position sus- the start of each chapter those goals impacted by
tainability has in our business model—we have iden- the actions outlined therein. Our contribution to the
tified those goals where our contribution is most global attainment of the 17 goals and their various
significant due to the nature of our business model targets extends throughout the value chain and is
and our activity. carried out from all areas of the business: from man-
ufacturing products to the stores, encompassing all
This does not mean that our commitment and con- the Company’s processes and areas.
tribution is confined only to these goals. They en-
compass all 17 SDGs so as to adapt to the multidi-
mensionality of the challenges they tackle, as they In addition, we include a summary of the key in-
are closely interrelated and therefore cannot be ad- dicators that show our contribution to the SDGs.
dressed independently. Only by achieving all of the These indicators were selected in accordance with
SDGs will we manage to eradicate poverty in all its the guide entitled Business Reporting on the SDGs: An
forms, reduce inequalities and stop climate change. Analysis of Goals and Targets, published by the Action
Platform for Reporting on the Sustainable Develop-
Goal 17 stands out because of its transversality, as it ment Goals (jointly organised by the United Nations
highlights the need for partnership among the vari- Global Compact and the Global Reporting Initiative
ous players in society to achieve this common agen- – GRI) to which Inditex has been adhered since its
da. Consequently, among the actions we implement launch and which concluded its activity in 2020.
to contribute to sustainable development, collabo- Due to our interest in continuing to help attain the
ration with our stakeholders is fundamental, in line SDGs, this year we joined the Business Leadership
with our intention of joining forces to have a positive Forum on the SDGs, a GRI programme spanning two
impact on society and help preserve the planet. years whose purpose is to foster the achievement of
the SDGs by means of business reporting and the
collaboration of various stakeholder groups.
Moreover, we are convinced that transparency and
accountability are essential to attaining the goals, More information in section 6.1.6. Inditex’s contribution to
 SDGs. Main indicators of this Report.
which is why this Report includes detailed informa- the

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   |  Statement on Non-Financial Information 2021  |  4. Transforming with a unique model

INDITEX’S CONTRIBUTION TO THE SDGS

MAIN MILESTONES IN 2021

SDG 3
GOOD HEALTH AND WELL-BEING
Health, safety and well-being are
priorities for us, especially in the
current context still shaped by the
presence of covid-19. Consequently,
we have measures in place throughout
our value chain aimed at both our
employees and supply chain workers.
During 2021, the certification
process of our facilities under the ISO
45001:2018 standard, one of the
most widely recognised standards for
occupational health, safety and well-
being, has been reinforced. In addition,
through our partnerships with
Médecins Sans Frontières, Medicus
Mundi and Every Mother Counts, we
have contributed to improving the
health and well-being of more than 6
million vulnerable people around the
world.

SDG 8 SDG 12 SDG 13

DECENT WORK AND RESPONSIBLE CONSUMPTION CLIMATE
ECONOMIC GROWTH AND PRODUCTION ACTION
At Inditex we encourage the creation Sustainability, as an integrated aspect of our We are strongly committed to
of stimulating, stable and safe working business model, implies promoting responsible fighting against climate change.
environments in which all the people consumption and production practices. We In line with our unwavering
who make up our value chain have equal conduct numerous social and environmental commitment, we have brought
opportunities and where their professional actions that take into account the entire forward our Net Zero Emissions
development is boosted. In this regard, the life cycle of our products. Thus, in 2021 we goal to 2040 (previously 2050).
initiatives aimed at our people are of great continued to promote the production of We have also been involved in
importance, but also our Workers at the articles labelled under our Join Life standard, multiple initiatives focused on the
Centre 2019-2022 strategy, aimed at supply which identifies articles made of the most fight against climate change, such as
chain workers, through which in 2021 we sustainable raw materials and the most Race to Zero, within the framework
reached 1,366,420 workers. We collaborate environmentally friendly production processes of the United Nations Framework
with various organisations to achieve this - reaching 47% of items placed on the market Convention on Climate Change
goal, including IndustriALL Global Union, UNI under this standard. As part of our community (UNFCCC); the We Mean Business
Global Union or the International Labour investment, we are developing projects such Coalition; or the Business Call for
Organization. As part of our investment in as Moda Re- and partnerships such as the one a UN Treaty on Plastic Pollution.
the community, we promote the employment initiated in 2020 with UNHCR, with the aim of Also notable is our participation in
of people at risk or in a situation of social extending the life cycle of textile products and 2021 in the review of the objectives
exclusion through initiatives such as for&from, reducing the generation of waste. of the Fashion Industry Charter for
SALTA or the employment programme with Climate Action (FICCA).
Caritas.

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 OTHER NOTABLE CONTRIBUTIONS

This year we joined Alianza País Pobreza Infantil Cero (Country Partnership
for Zero Child Poverty), an initiative by the Spanish Government’s High
Commissioner against Child Poverty. In addition to this initiative, we have
continued our work in projects with different non-profit organisations such
as Entreculturas. As a result of this alliance, more than 1.3 million vulnerable
people in 27 countries have had access to more and better opportunities to
transform their lives and their environment.

SDG 5 This year we have worked very closely with a number of entities such as
the Spanish Federation of Food Banks (Spain), La Mie de Pain (France) or
GENDER EQUALITY
Entreculturas (Paraguay) on 9 projects focused on the eradication of hunger as
Gender equality and women part of our community investment programme.
empowerment are at the very
essence of Inditex, where women At Inditex we promote the professional development of our employees
account for 76% of the workforce. through training and internal promotion. In 2021, 50% of the Group’s
In this regard, we nurture vacancies were filled internally. We have also continued our efforts with
diverse and inclusive working NGOs that promote access to primary and secondary education, such as
environments that guarantee Entreculturas, as well as university education in collaboration with entities
fair access to opportunities for such as Tsinghua University, University of Dhaka or Universidade da Coruña,
professional development, with among others.
wage parity between men and
women. Furthermore, within the
framework of the Workers at the In 2021 we committed to a 25% reduction in water consumption in our
Centre 2019-2022 strategy, we supply chain by 2025. We also continue to collaborate with organisations
implement numerous initiatives such as Water.org to improve access to drinking water and sanitation in
to protect and empower women several countries. As a result, more than 2.3 million people in Bangladesh,
in our supply chain. Promoting India and Cambodia have improved their access to water and sanitation.
women’s empowerment is also
a key pillar of our community
investment programme, through
This year we have ramped up our ambition and set the goal of consuming
partnerships with organisations
100% renewable energy in our facilities by 2022. In 2021, we have achieved
such as Every Mother Counts,
91% of energy consumption in our facilities from renewable sources,
Water.org and Medicus Mundi.
avoiding the emission of 493,723 tonnes of greenhouse gases.

Over the course of 2021, we commenced a number of innovation

projects in various areas of our value chain. Boston Consulting Group
included us in their ranking of Most Innovative Companies 2021.

In 2021 we broadened our collaboration with UNHCR to help refugees.

Furthermore, we have promoted numerous community investment
SDG 17 programmes to reduce inequalities, investing a total of 19.9 million euros in
PARTNERSHIPS 2021 to initiatives linked to SDG 10.
FOR THE GOALS
Throughout 2021 we have developed 18 projects, in collaboration with
At Inditex we believe organisations such as Teatro Real and Museo Nacional de Arte Reina Sofía
partnerships are a fundamental (Spain), Fundação de Serralves (Portugal) or US Green Building Council
tool for achieving the Sustainable (United States) that contribute to this objective.
Development Goals and
generating a lasting impact on
This year Inditex joined the Board of the ZDHC (Zero Discharge of
communities and the industry.
Hazardous Chemicals), with whom we have been working for some time and
That is why our initiatives
whose objective is to achieve zero discharge of hazardous chemicals in the
always involve a significant
textile industry. Consistent with this goal, we invest in programmes aimed at
component of collaboration,
protecting aquatic life.
be it with organisations like the
United Nations Global Compact,
the International Labour In 2021 we joined the LEAF coalition, which focuses on protecting tropical
Organization, IndustriALL Global forests. We also continued our commitment to preserve ecosystems through
Union, Médecins Sans Frontières, a number of projects and by consuming raw materials from more sustainable
or through industry partnerships sources, which account already for a 42% of the total.
as in the Fashion Pact, Make
Fashion Circular, or ACT (Action,
Collaboration, Transformation). Inditex has a robust corporate governance and compliance system aimed
at showing our firm commitment to good governance and social and
environmental sustainability, and conveying that corporate ethical culture to
all our stakeholders.

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4.2.3. Human Rights

GRI 102-12; 102-13; 103-2; 412-2; 412-3;
AF1; AF7; AF24 AND 407-1
Our Human Rights strategy is aligned with the UN promoting and respecting human rights, but our
Guiding Principles on Business and Human Rights track record has been especially notable since 2016,
and covers all the Group’s operations. Inditex has when we approved our Policy on Human Rights and
always tethered its development as a business to structured our work within a strategic framework.

Human Rights Strategy Journey

2016 Approval of the Policy on Human Rights

FOR MORE 2017 Training the social sustainability team in due diligence processes
INFORMATION
on our initiatives
in relation with 2018 Development of the impact matrix on supply chain
human rights,
see the report 2019 Launch of the social sustainability strategy Workers at the Centre 2019-2022
Human Rights
2021, available
on the Inditex 2020 Analysis of the impact of the health crisis on human rights
corporate
website.
2021 Ongoing development of the due diligence process in human rights in the value chain

Our human rights strategy is structured on the fol-

lowing three pillars:

INDITEX’S HUMAN RIGHTS STRATEGY

INTEGRATING THE PROMOTION OF AND RESPECT FOR HUMAN RIGHTS
THROUGHOUT OUR VALUE CHAIN

Due Diligence
I dentifying potential impacts
arising from operations and
Policy on relationships. Grievance
Human Rights mechanisms
Prioritising impacts.
Approved by the Board of I ntegration of the results in Support on the
Directors in 2016. identification of
processes.
It applies to the entire potential impacts
Group. and help to reinforce
aspects of the due
diligence process.

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For this report, we used the Reporting and Assur- Rights. This organisation also coordinates and or-
ance Frameworks Initiative (RAFI) as a reference. ganises the Business Learning Program, a space
RAFI is the first comprehensive guide for compa- in which to share best practices and learnings in
nies to report their progress on human rights, de- connection to the responsibility to respect human
veloped by Shift the leading center of expertise on rights at companies in various sectors, in which In-
the UN Guiding Principles on Business and Human ditex also takes part.

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   |  Statement on Non-Financial Information 2021  |  4. Transforming with a unique model

Governance of respect for human

rights
Policy commitment

Inditex advocates respect for human rights in all For comprehensive integration of respect for human
its operations, a principle that is ingrained in its rights throughout the Company, we consider that
business strategy and fully integrated throughout collaboration and communication are key. Every
the business model. department implements its own specific actions in
this regard, bonded together by the corporate hu-
A clear example of this is the Policy on Human Rights, man rights strategy. This integration permeates the
approved by the Board of Directors in 2016, which entire Company.
represents the first pillar of our strategy. This Policy is
binding upon the entire Group and its employees and The Board of Directors is the body responsible for
extends to any legal person having a relationship with approving the Policy on Human Rights. The Board
the Company. It is based on the Universal Declaration has a Sustainability Committee, an informative and
of Human Rights, and on the main conventions of the consultative body, responsible for promoting the
International Labour Organization and on the UN commitment to human rights, among other matters.
Guiding Principles on Business and Human Rights,
among others, and embodies Inditex’s commitment The Group also has a Social Advisory Board, a col-
FOR MORE to the values that these frameworks represent. legiate body integrated by external independent ex-
INFORMATION
perts, which advises on human rights, among other
on our Policy on
Human Rights For prioritisation purposes, the Policy also identifies the issues linked to sustainability.
rights most directly related with the business model. More information in section 5.9.3. Good corporate
governance of this Report.

POLICY ON HUMAN RIGHTS

RESPECT FOR ALL UNIVERSALLY

RECOGNISED HUMAN RIGHTS

PRIORITISATION OF RIGHTS MOST CLOSELY LINKED

TO THE BUSINESS MODEL

Non-labour human rights Labour human rights

• Respect for the rights of minorities and communities. • Forced or compulsory labour is rejected.
• Right to privacy. • Child labour is rejected.
• Right to health. • Discrimination is rejected and diversity is promoted.
• Right to freedom of opinion, information and expression. • Respect for freedom of association and collective
• Right to security of the person. bargaining.
• Contribute to the fight against corruption. • Protecting workers’ health and safety.
• Right to environment and water. • Fair, just and favourable working conditions.

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Awareness

Awareness is the cornerstone for a human rights

culture to flourish throughout the organisation.
This culture is communicated both internally to
the Company’s employees, and externally to sup-
pliers, manufacturers and other stakeholders.
Particularly in the supply chain, training is com-
plemented by our work on responsible purchas-
ing practices, with the aim of aligning commercial
teams with our with our performance in sustaina-
bility and human rights.

Parallel to the supply chain focus, the work we

carry out to cover the rest of our activities and
value chain is highly significant. In the last few
years, training has been provided in business ar-
eas such as distribution, as well as fostering the
work developed in the areas of diversity and in-
clusion transversally throughout the value chain.

Defining the approach Our aim is to integrate

Our approach is based on developing the relevant responsible and ethical
due diligence processes to detect the potential
impacts of our activities on human rights. By means
practices into everything we
of continuous interaction with our stakeholders do, both internally and in our
and sustainability teams on the ground, these pro-
cesses are kept permanently up to date. The due
relations with third parties, for
diligence processes that are part of the human the promotion of and respect
rights strategy involve two main focus areas:
for human rights of all our
employees and anyone with
Supply chain
whom we stablish a relation
Considering our business model, our supply chain within the course of our
is one of the priority areas of our overall value
chain, in which we place a special focus on the pro-
business.
motion of and respect for workers’ human rights.
Based on the due diligence process developed in
collaboration with the organisation Shift, we have
drawn up a social sustainability strategy entitled
Workers at the Centre 2019-2022. The due dili- in 2021 we performed 27 labour and social as-
gence process identified the seven priority impact sessments at distribution centres.
areas into which the strategy is structured.
Another ongoing line of work is the updating and
More information in section 5.5.2. Workers at the Centre of monitoring of suppliers in all operations through-
this Report.
out the value chain, in order to analyse their po-
tential impact even before they commence their
Value chain relationship with Inditex.

At the same time, we carry out a range of activ- In addition, the various policies and procedures
ities to identify, prevent and mitigate potential governing the Group’s actions are under con-
impacts, by means of integrating responsible stant review and are consistent with respect for
practices for respecting human rights. An exam- human rights. For example, in 2021 the proce-
ple of this is the work carried out in the Distribu- dures related with security personnel’s actions
tion department. Human rights training was pro- and compliance management in connection with
vided to the various teams, working together to personal data protection and privacy were up-
establish due diligence processes. In this regard, dated, among others.

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   |  Statement on Non-Financial Information 2021  |  4. Transforming with a unique model

RIGHTS LINKED TO PRIORITY

IMPACT AREAS

Worker
participation

Protection of
labour rights in Living
the production of wages
raw materials

Social
protection
WORKERS
Gender,
AT THE CENTRE diversity
2019-2022 and inclusion

Protection of
migrants and
refugees Occupational
health and
safety

This list is not exhaustive. The main human rights most directly related to each of the priority
impact areas have been identified.

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 PRIORITY IMPACT AREAS

Gender, Protection of
diversity Occupational Protection of labour rights in the
Worker Living and health and migrants and Social production of
participation wages inclusion safety refugees protection raw materials

Fair and favourable

working conditions
Non-discrimination

Adequate standard of
living
Education

Health

Life

Not being subject to

degrading treatment
Not having to endure
harassment
Equal pay

Freedom of movement

Freedom and security

of the person
Engagement in
public life
Rights of employees
with disabilities
Reproductive
rights
Freedom of association

Healthy environment

Ban on forced labour

Collective bargaining

Collective rights of
communities
Social protection

Freedom of thought,
conscience and religion
Privacy

Protection against
violence
Healthcare

Freedom of opinion and

expression
Property

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  |  Statement on Non-Financial Information 2021  |  4. Transforming with a unique model

Management of key aspects

related to human rights
The Policy on Human Rights is complemented by
other Group codes and policies and mandatory
standards for our employees, suppliers and other
stakeholders. Some of these significant policies and
codes include the Sustainability Policy, the Diver-
sity and Inclusion Policy, the Code of Conduct and
Responsible Practices and the Code of Conduct for
Manufacturers and Suppliers.

Collaboration

Communication and cooperation with stakehold-

ers feeds our due diligence process. In this regard,
there is no overstating the importance of the rela-
tionships we forge with international organisations
and NGOs, among other experts in the field and
who support us in developing specific projects,
training and creating and implementing our strat-
egies. Clear examples of this are our partnerships
with the International Labour Organization, UNI
Global Union, IndustriALL Global Union, the UN
Global Compact and Shift.
More information in section 4.4.2. Partnerships of this
Report.

Grievance mechanisms

Grievance mechanisms, the third pillar of the Hu-

man Rights strategy, are key to improving the due
diligence process, as their information helps identi-
fy potential negative impacts, and allows the Com-
pany to react and mitigate any risk in advance. Our
main grievance mechanism is the Ethics Line, which
is available both to Inditex staff and to third parties
with a legitimate interest.
More information in section 5.9.2. Compliance and
criminal risk prevention systems of this Report.

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   |  Statement on Non-Financial Information 2021  |  4. Transforming with a unique model

4.3.
Innovation,
vital for
transformation
Innovation, a linchpin for Our innovation activity is aimed at improving the
transformation, is built into Inditex’s customer experience and strengthening cus-
tomers’ trust every time they choose us. This trust
DNA. Ongoing improvement
is based on the efficiency of our processes and the
stems from our ambition to satisfy quality of our products. But we are mindful that it
our customers in every aspect also stems increasingly from such important intangi-
of their relationship with us. The bles as sustainability, health and care of our people,
convergence of technology and the community and the planet.
our open innovation model, which
Innovation is crucial to achieving a sustainable trans-
fosters the recruitment of talent and
formation of the industry. Accordingly, our innovation
the attraction of ideas, enables us to model is cross-cutting, flexible, collaborative and
ensure the success at every stage of open, not only to all the Company’s areas and people,
the shopping experience. but to any organisation, entity or person with a differ-
ent idea or disruptive proposal that helps build a bet-
ter and more sustainable present and future.

Inditex’s capacity for innovation and transforma-

4.3.1. Collaborative and tion is evidenced by the numerous projects that the
transformative innovation Group has underway, some of them as a continuation
of processes initiated in previous years, others entire-
GRI 103-2 AND 103-3 ly new. These initiatives permeate all the Company’s
Innovation is the transversal cornerstone upon areas and levels and every stage of our value chain
which all the Company’s actions are based. Collab- (design, manufacturing, transport, logistics, distribu-
orative and transformative innovation designed by tion, sales, product use, circularity and end- of-life),
and for people, with which we aim to be more cre- each of which has its own part to play.
ative, agile, efficient, respectful and sustainable
both in our relationship with customers and with our
the environment.
4.3.2. Innovation to improve
our customer experience
GRI 103-2 AND 103-3
Our customers are at the heart of our innovation
2021 MILESTONE activity. Harnessing technology and talent, we
design, create and connect people, processes and
The constant thread of innovation throughout our spaces to ensure customers are fully satisfied with
their experience when they choose us, regardless
history has led international consultant Boston
of which channel they opt to use. With this goal in
Consulting Group to rank Inditex among the 50 mind, our efforts are always aimed at guaranteeing
most innovative companies in the world in its Most three aspects: full availability of our articles, ease
Innovative Companies 2021 report. and efficiency of all our processes and services,
and real and satisfactory integration of our sales
channels.

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  |  Statement on Non-Financial Information 2021  |  4. Transforming with a unique model

To achieve this, we are committed to a flexible, ad-

aptable and dynamic innovation model based on
agile methodologies and principles, to maximise 2021 MILESTONE
the value of our innovation at every stage of our ac-
tivity. A good example of this is the technological Massimo Dutti launches the new Shop&Go
development of our store management systems.
service, which allows customers to use
Our latest upgrades in this sphere have enabled us
their own mobile phones to make in-store
to improve day-to-day operations at our stores in purchases, thus offering customers new
such important areas as stock management, distri- ways of shopping and enhancing in-store
bution, transport, labelling, etc. In this regard, nov- experience.
el technological solutions such as RFID alarm tags
or the Pay&Go payment system make for a speed-
ier and more efficient experience for the stores
and for our customers, who require increasingly
demand greater personalisation. The coordination and synchronisation of these
processes is grounded upon advanced analytical
tools and cutting-edge technologies such as ma-
Full availability chine learning and IoT. These tools enable us to pin-
Our goal is to ensure that our articles are always point customers’ needs and propose the measures
available wherever and whenever customers need needed to fulfil them, from the start of the distribu-
them. To achieve this, we are constantly redefining tion chain to the commercial and operational man-
all the processes that make up our business model agement of the stores.
(design, manufacturing, purchasing, transport, logis-
tics, distribution and sales) in order to adapt them For example, to ensure that customers find the
and evolve them in accordance with the needs our items they are looking for, we have developed mod-
customers and the environment are demanding. els to identify in which stores they are most likely to

| 72 |
find them. We can then estimate the volume of ini- IOP (INDITEX OPEN
tial shipments required for each store, forecast the PLATFORM)
demand curve and thus determine the necessary enables us to respond to
stock to guarantee availability. In this respect, this the Group’s requirements
year the Company has developed a new model to
of flexibility, speed and
calculate the number of units to be included in the
first shipment to optimise the success of the initial
performance.
shipment and prevent stock-outs.

Also, another model has been developed in col-

laboration with MIT (the Massachusetts Institute At the same time, as early adopters of any tech-
of Technology), which has consisted of developing nology that can help improve our customers’ end
a ‘dynamic coverage’ model to ensure the service experience, we have launched the Automated
level for customers, reducing the safety stock nec- Sorter Induction project, the Company’s first pilot
essary at each store. automated induction initiative for folded garments
in package sorters.
Related to sales management in stores, our retail
tool enables us to adapt in-store product exposure This is state-of-the-art technology that identifies
to our customers’ demand, by means of notifica- and sorts the garments that will subsequently be
tions and through the use of information on com- entered into the system, which has required ad-
parable articles and stores. Another application vanced artificial intelligence systems underpinned
of this technology to our integrated management by research at some of the world’s leading techno-
model is in the movement of units not in demand logical centres.
in physical stores but very likely to be sold online.

In addition to applying the latest technology for Integration: all in a click

store management, in 2021 we have also made We want our customers’ shopping experience to
considerable strides in its application to warehouse be easy and efficient, and, therefore, satisfactory
management. Specifically, we have started devel- throughout. Customers should find what they want,
oping an empirical IoT model to comprehensively when and where they want it.
control logistics and distribution in the supply
chain, with a particular focus on the process for In the current context of transformation, shaped by
warehouse management control, crucial to guaran- the unstoppable advance of technology and by the
teeing the availability of our articles. socio-economic circumstances resulting from the
covid-19 pandemic, the integration of the physical
Over the course of this year, another two projects and digital worlds has been pivotal for Inditex. We
have been key to ensuring customers enjoy full see this integration from a holistic standpoint that
availability of our articles and services: Autono- encompasses strategy, processes, data, structure
mous Mobile Robots (AMR/AGVs) and automat- and people, and rests on our technological platform,
ed sorter induction. Inditex Open Platform (IOP).

We used AMRs to automate Zara.com e-commerce IOP is a living platform that is constantly being
stock at the Marchamalo centre. Through the de- evolved, continually adding new functionalities that
sign and roll-out of a Goods to Person (GTP) solu- enable us to offer an integrated experience so that
tion based on AMR technology, 500 autonomous our customers can shop as they choose: in-store,
robots support the operators in tasks linked to the online or easily and transparently combining the two
receipt, storage, picking and auditing of the cen- with a simple click.
tre’s stock. The robots move 13,500 shelves stor-
ing a total of 4.5 million units. While operating, they Its open and modular design enables all the Com-
reliably bring the shelf chosen by the Warehouse pany’s areas to adapt their processes to customers’
Management System (WMS) to the operators, with needs in real time and to respond to their prefer-
the articles required in each case. Thus, the oper- ences, contributing to our aim of improving their
ators need to cover less distance to perform their experience. In fact, IOP enables us to respond to
work, boosting productivity and enhancing the the Group’s requirements of flexibility, speed and
quality and experience of their role. performance by constantly adopting new technol-
ogies, work practices and organisation.

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  |  Statement on Non-Financial Information 2021  |  4. Transforming with a unique model

From a technological standpoint, its architecture develop or adapt it to suit our business objectives
of independent but interconnected micro-services and place it at the service of our customers and our
can be integrated with next-generation business people. In fact, technology is the link in the chain
modules to make applications easier to scale and that enables us to complete the circle of collabora-
faster to develop. tive innovation. In other words, to materialise the
ideas that emerge in all the Company’s areas.
When it comes to work practices, the application
programming interface (API) and the adoption of A reflection of our constant commitment to the
internal, open-source code boost collaboration search for the latest innovations and technological
between Inditex teams and make for a more seam- applications is the launch at the end of 2021 of our
less collaboration with third parties, be they major Open Innovation Logistics Hub. With this initiative
software organisations or individuals with singular we pursue the creation of a structured model of
knowledge of specific applications. open innovation in relation to the latest technolo-
gies and innovative solutions in the logistics area.
Moreover, they enable us to offer a friendlier cul- Through the Hub, relationships are established
ture for our developers, giving them greater insight with all the actors in the ecosystem - such as start-
into the value they provide to our customers and ups, research centers and universities, entrepre-
increasing our capacity to attract talent. neurs, technology companies and even other com-
panies - to enhance the innovative capacity of the
Some examples of how the Inditex Open Platform industry and collaborative development in a sus-
improves integration that can be seen directly by tained manner in the long term.
our customers are the Store Mode, Pay&Go and
Shop&Go functionalities. Flexibility, agility, scalability, resilience, integra-
tion, security and learning are the terms that best
Throughout the year, we have launched and re- define our day-to-day reality on the technological
fined numerous projects to offer a more agile front and lend meaning to our purpose. The latest
shopping experience. In this sense, Massimo Dut- developments in systems in the Operations area
ti’s new Shop&Go service stands out, which allows are evidence of this. In 2021 Inditex launched a
customers to make purchases from their mobile transformation process which, based on data pro-
phone without going through the checkout, also vided by the various tools and systems of which the
choosing where and how to receive their garments. Company’s technological ecosystem is comprised,
In addition, we have also made a mobile point of improves the experience of both application devel-
sale available to our customers in stores to provide opers and customers in stores. Examples include
a complete shopping service for the launch of new creating applications to control the number of
spaces such as Zara Beauty or new collections such people inside stores and oversee virtual queuing
as Zara Origins. so that customers do not have to wait in person, or
improving the operating efficiency of the store de-
vices to prevent waiting times.

4.3.3. Technology for But our technological advances have not focused
solely on the Operations area. The latest devel-
boosting the efficiency of opments in data management systems, consist-
our operations ing of the technological transformation, evolution
and creation of tools and disruptive data collection
GRI 103-2 AND 103-3
systems, and data management and analysis, which
Our capacity for change has a great deal to do with help us to make smart decisions based on data that
technology. The digital transformation we have been is updated daily at the global level.
undertaking in the last few years, and in particular in
2020 and 2021—despite the covid-19 pandemic— In this regard, our Data Processing Centre (DPC)
enables us to develop initiatives and projects that is an unrivalled benchmark of our capacity to inno-
place us at the forefront of the industry in purely vate for ourselves, our customers and the environ-
technological aspects such as channel integration, ment. The technology deployed at the new DPC
anticipation of demand and stock management. It also reduces energy consumption and, therefore,
also gives us the edge in other, more intangible are- boosts energy efficiency.
as, such as the well-being of our people and commu-
nities and care for the planet. The new DPC extracts the very best performance
and stores all the data handled by the Company in
To achieve this we harness state-of-the-art technol- keeping with the most stringent security standards.
ogy: artificial intelligence, machine learning, cloud The building is certified to Uptime TIER IV Design
computing, IoT, Business Analytics, and so on. We

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and Build standards, ensuring maximum reliability ments so as to know their real-time location and
and availability, and an infrastructure that is fully make the process of receiving them in stores more
outage-tolerant, with duplicate electric power and agile and accurate using mobile scanning.
climate control systems. Furthermore, as part of
Inditex’s commitment to the environment, the DPC With a view to optimising processes, we have de-
uses green technology with a Power Usage Effec- veloped a comprehensive advanced facility man-
tiveness (PUE) score of under 1.3 (1.0 indicates agement system which, by integrating our current
100% efficiency), thanks to the deployment of best tools for managing incidents, maintaining infra-
practices and the optimisation of infrastructure. structure and using Inergy, expedites the operat-
ing, administrative and financial management of
Also equipped with state-of-the-art and sustain-
able technology, the new Zara.com building rep-
resents a milestone in terms of architecture and
advanced communications. 5G and wifi 6 coverage
make communications up to 10 times faster and 2021 MILESTONE
more reliable than using LTE (Long-Term Evolu-
tion). Thanks to wifi 6, scope and coverage are very The new Zara.com building was inaugurated in 2021.
high, optimising the performance of alldevices con-
These facilities, spanning more than 67,000 m2 and
nected to the network.
featuring the latest advances in technology and
Automation is one of the goals of implementing sustainability, house the new Zara.com studios and
technology. Over the course of 2021, we continued the Design Centre for Zara Man. The new building is
or launched projects to significantly improve our a milestone for advanced communications, with 5G
operating processes. The automatic restocking of and wifi 6 coverage to achieve communications up to
material in stores is one such initiative. The new
10 times faster and more reliable than using LTE (Long
model will replace requests that are currently han-
dled manually by stores with a refined algorithm to Term Evolution). Thanks to wifi 6, scope and coverage
calculate the stores’ requirements. This will reduce are very high, optimising the performance of all devices
the administrative burden in stores and central ser- connected to the network.
vices alike. At the same time, we have enhanced the
traceability and receipt process for material ship-

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  |  Statement on Non-Financial Information 2021  |  4. Transforming with a unique model

store facilities. Accordingly, incident management defined aspects: improving the real-time availabil-
uses a parametrised traffic light system incorpo- ity and accessibility of information; and securing
rating automatisms to swiftly identify and resolve 100% effective integration of our applications, also
incidents based on their criticality. It also affords making them mobile.
us the capacity to anticipate incidents in certain as-
sets; in other words, predictive maintenance. With this in mind, over the course of this year, we
have migrated our information systems to the
Our commitment to technology also encompasses cloud, moving from a segregated repository to
our relations with suppliers, control of raw mate- one that is centralised, much more effective and
rials and of energy, and even the development of in keeping with business needs. This migration
new messaging and communications technologies, also enabled us to evolve the system, allowing us
such as the Inline project to eliminate the use of to provide each area of the Company with the data
telephones, freesets and walkie-talkies in stores. it needs in real time, thereby facilitating decision
making. The new system encompasses more than
The Group’s constant efforts to achieve full digital- 100 collaborative cloud workspaces.
isation have led us to focus strongly on two clearly

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The availability of real-time data has also enabled of on- boarding and digital contract signing, the
us to launch another two projects: ONE, for re- former implemented in stores in Spain, and the lat-
al-time sales tracking, and the integrated store ter in Spain, the Netherlands and Germany.
management tool, to show stores the sales indica-
tors most relevant for them in real time. In the realm of training, our commitment to digitali-
sation paved the way for the international launch of
the Tra!n learning platform, a virtual, modern and
agile space to which our teams worldwide can con-
4.3.4. Projects and tools for nect. There they can access a broad range of train-
our people ing content such as product and fashion, culture and
values, health and safety or sustainability, among
GRI 103-2 AND 103-3 others. The content is produced both internally, har-
Innovation is a crucial value at Inditex that helps us nessing and sharing the know-how of our staff, and
to strengthen the trust that both customers and in partnership with leading educational institutions.
the people who work directly or indirectly with the More information in section 5.1. We are collaborating with
Company have placed in us. Innovation enables us our people, the engine of that transformation of this Report.
to research, develop and realise a multitude of pro-
jects with which, ultimately, we aim to improve the Furthermore, to improve our people’s health and er-
quality of life of our people and the communities gonomics and to optimise their time, we have imple-
Inditex relates to. mented an automatic rotation system in logistics
tasks which, based on our Orquest staff scheduling
We put a premium on fostering values as important tool and on artificial intelligence, switches the duties
for us as sustainability, diversity, responsibility and performed by operators at distribution centres.
transparency, harnessing technology and the know-
how of our human capital for this purpose.
Well-being at our headquarters
Innovation enables us to boost well-being at our
Our people headquarters in the broadest sense: comfort, effi-
The people who work at the Group are key to plac- ciency, sustainability, architecture and occupation-
ing all of our innovative skill at the service of cus- al health, among others, and we have implemented
tomers, but also to keep learning, progressing and a number of projects at all of them in 2021. Exam-
growing. Accordingly, in 2021 we have devised sev- ples include the latest construction techniques
eral initiatives linked to unlocking their potential and and architectural concepts aimed at achieving
nurturing their talent in a wide range of spheres. maximum environmental efficiency in buildings
One example of this is the launch of the Inditex Ca- and headquarters, while at the same time boosting
reers chatbot in Instagram. This recruitment chatbot the comfort and, as a result, the quality of life of the
helps candidates to register for our job vacancies people using them.
and set up their profile in Inditex Careers in a simple,
fast and friendly way. Likewise, the Company has undertaken research
into new building solutions for developing smart,
sustainable and efficient offices. On this basis,
People are crucial we have refurbished the Bershka headquarters,
for achieving applying wholly innovative proposals for employ-
ee comfort and for optimising their daily activity,
our innovation while at the same time meeting strict efficiency
potential. and sustainability requirements. The building re-
quired a series of technological updates, such as
the specific design of structural components to en-
Also in connection with recruitment, this year we sure top-quality acoustic properties, or the design
have opted to digitalise interviews via Team Plays, of a highly energy-efficient lighting system. Both
online interviewing and the VideoAsk extension of these signalled a key scientific and technical im-
for external candidates, as well as the processes provement for the Company.

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  |  Statement on Non-Financial Information 2021  |  4. Transforming with a unique model

We are a community
Social innovation is a part of who we are. Our goal Lastly, in 2021 we undertook two initiatives of sig-
is to develop and apply solutions to satisfy social nificance for the Company linked to people in our
needs in an efficient and sustainable way. In this supply chain and, therefore, in the field of social sus-
regard, our community investment programme is tainability: arranging the use of a tool to measure
structured around three main axes: identifying new projects’ social impact and, as a result, to stand-
social needs, developing solutions to help respond ardise project management in the supply chain.
to them, assessing their efficacy and extending
those initiatives that have proven to be effective.

Our work for the community would not be possi- 4.3.5. Projects for the planet
ble without the direct engagement of stakeholders
GRI 103-2 AND 103-3
such as local and international organisations, gov-
ernments, trade unions, academic institutions and For Inditex, it is a non-negotiable pre-requisite that
representatives of civil society. Consequently, we our innovation must positively impact the planet for
establish partnerships with each of them that enable the present and future. We are convinced we must in-
us to join forces and launch innovative initiatives in novate not only in aspects directly linked to our Com-
fields as varied as research into new diseases, im- pany, but taking a 360º approach aimed at developing
provement in the provision of water and sanitation solutions to allow us to help preserve the planet for
in developing countries, and research programmes generations to come.
in the field of education and the social economy.
In this context, a key aspect for us is to be able to im-
The Zara Tribute project represents a social initi- plement our environmental solutions throughout our
ative aligned with our commercial activity, based supply chain, for which purpose, again, we establish
on the launch of limited edition collections linked strategic partnerships with our collaborators.
to social causes. Zara’s first Tribute collection,
called “Icons by Peter Lindbergh”, is a project that Our actions in innovation to minimise our impact on
features iconic photographs by legendary pho- the planet encompass a broad range of goals: reduc-
tographer Peter Lindbergh and curated by crea- ing polluting emissions, water and textile consump-
tive director Fabien Baron. 100% of the proceeds tion and cutting the carbon footprint. We structure
from this collection go to the Franca Sozzani Fund these actions upon two main axes: circularity, and
for Preventive Genomics, with the aim of financing safe and sustainable products.
the Global Babyseq initiative, a human genome se-
quencing project that seeks to support research
and innovation in predictive medicine in collabora- Circularity
tion with Brigham and Women’s Hospital and Har- The circular economy drives us. We are constantly
vard Medical School. seeking tools and solutions that help us minimise the
negative impacts of our activity throughout the life
And in the medical field, our alliance with Doc- cycle of our products: fibres, processes, use and end
tors Without Borders is also framed. We invest of life. With this in mind we set up the Sustainabili-
in research projects for the response to new dis- ty Innovation Hub, our open innovation platform, a
eases and the development of new care protocols fundamental reference underpinning our respectful
that contribute to the improvement of community approach to the planet. Through this platform we
well-being. During 2021, projects such as POCUS tirelessly seek and develop new and more sustain-
(point-of-care ultrasound), Patient Multimedia able raw materials and fibres and, in many cases,
Engagement toolkit or the Mobile Outbreak Lab, we do so through collaborations with cutting-edge
among others, have stood out for their innovation. start-ups involved in multiple aspects of textile pro-
More information in section 5.7. We are collaborating to duction: materials, processes, end of life, micro-plas-
generate value in the community of this Report. tics, traceability, etc. In fact, some of the most disrup-

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Our commitment to innovation throughout the value chain
and life cycle of our products is aimed at fostering and
supporting the achievement of our sustainability objectives.

tive projects to have emerged in 2021 were a result bility projects in the sector; and our partnership
of such collaborations. For example, LanzaTech, an with Quantis to build on its experience in life cycle
initiative in the field of research into raw materials. analysis and use its impact measurements with the
M ore information in section 5.4. Collaborating to startups we partner.
transform through sustainable management of our products
of this Report.
Safe and sustainable
We have also reached a number of agreements re- manufacturing
sulting in collaborations, such as the one with the
accelerator Plug and Play to identify those start- Making our products in a safe and sustainable man-
ups that best contribute to our main objectives and ner is non-negotiable for Inditex. Products must be
organise work with them; the agreement with the safe for both the people who make them and those
innovation platform called Fashion for Good, in who receive them, our customers, and must also
which we work with other major players in the fash- be environmentally sustainable. To achieve this,
ion business to foster the acceleration of sustaina- the Company works with leading technology and

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  |  Statement on Non-Financial Information 2021  |  4. Transforming with a unique model

science companies, and internationally renowned (dyeing and printing); the joint exploration of sustain-
technological experts, to better understand the able materials and fibres, alternatives to the existing
properties of the substances that may be pres- ones; and the design of a joint R&D agenda in recy-
ent in the processes and of the chemicals used cling technologies (mechanic, chemic and biologic) as
throughout the manufacturing chain, and to take a reference solution for the industry.
any appropriate action. More information in section 5.4.5. Use and end-of-life of
products of this Report.
Within this framework of cooperation, in 2021 we
commenced industrial partnerships with leading EPSON-Inditex. Throughout 2021, the collabora-
companies in the industry enabling us to fast-track tion with this multinational has allowed to jointly pre-
the incorporation of disruptive solutions. Specif- pare and validate, as a proof of concept, the techno-
ically, global research partnerships were estab- logical and scientific bases necessary for the design
lished in science with BASF and in technology with and development of the R&D and innovation agenda
EPSON, both grounded on their commitment to in technologies of digitalization of wet processes as a
sustainability, leadership, multi-sector know-how reference solution in the Industry.
and their R&D capacity.
In the field of chemical safety, the Company, in part-
BASF-Inditex. The understanding and establishment nership with Universitat Pompeu-Fabra and the Uni-
of synergies between both companies has allowed us versity of Santiago, launched a joint action known
to work together in a sustainable technology for do- for the development of computational methods and
mestic laundering aimed at mitigating microfibres; tools to characterise chemicalsafety in the com-
obtaining sustainable solutions in wet processes pounds used in the textileand leather industry. This is

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 4.3.6. Secure information,
safe privacy
GRI 103-2 AND 103-3
In the current framework of digital transforma-
tion, in which changes ensue quickly and con-
stantly, information is the fuel that drives the
machinery of any industry. Mindful of its impor-
tance and of the pre-eminent role of data securi-
ty, at Inditex we are committed to the continuous
improvement of our security management model
and we invest in harnessing the latest technolo-
gies and cutting-edge controls to keep our own
and our customers’ data safe.

Consequently, in 2021 we have further strength-

ened our plans, systems and controls for remote
working, and the associated risks, derived from
the global covid-19 pandemic, and we have also
finalised the Next Generation Cybersecurity
strategic plan to optimise the maturity of our In-
formation Security programme and, at the same
time, identify the Company’s needs and challeng-
es for the coming years.

With regard to the sharp increase in cyber-attacks

worldwide, which have not had an impact on our
Company, new working groups were set up under
the supervision of the Information Security Com-
mittee to continue designing and implementing
fresh initiatives such as the Supply Chain – Third-
Party Risk Management programme, focusing
on the impact of cybersecurity in the supply chain.

The increase in global cybersecurity incidents

against supply chains has underscored the need
to establish controls in this regard. According-
ly, Inditex has bolstered its control programmes,
an extraordinarily innovative project because, for the including a specific review regarding the method
first time, a database was built to facilitate access to of access, use and management of Inditex suppli-
all the available information on this topic. ers’ information. Mindful, furthermore, that the
human factor is one of the weakest links in terms
Improving the health and safety of our products is of information security, we have implemented a
also the aim of another three projects launched in number of training and skill-building initiatives to
2021 as a result of our RD&i: the latest update of gauge their performance in security.
our Clear to Wear (CTW) standard, which involved
evaluating more than 1,800 substances with particu- Moreover, the change in the traditional, on-premis-
lar attention to their impact on the environment and es technological model to the new cloud focus has
human health; the rollout of a guide to best manu- required new approaches to ensure maximum infor-
facturing practices for products in contact with mation security and, at the same time, to enhance
food, to ensure that any product or item that will the user experience. These are precisely the two pil-
enter into direct or indirect contact with food is safe lars on which our Zero Trust-Road to passwordless
enough to prevent the transfer of harmful substanc- programme rests, paving the way for passwordless
es that might endanger human health; and, lastly, the connection to services.
creation, in conjunction with the University of Lleida,
of a method to detect volatile perfluorinated com-
pounds (PFCs) in textiles and chemicals to comply
with the most stringent limits.
More information in section 5.4.4. Health and safety aspects
of products of this Report.

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   |  Statement on Non-Financial Information 2021  |  4. Transforming with a unique model

4.4.

Collaboration,
the essence of
transformation

At Inditex, we design multiple The principles governing

strategies that involve permanent
dialogue and transparency with our our relationship with
stakeholders, as we believe that stakeholders are
constant collaboration is crucial to transparency and
building and achieving our common
permanent dialogue, which
goals and to contributing to the
transformation of our sector. are necessary levers to
promote joint collaboration
on the path towards
sustainable development.
4.4.1. Stakeholder
engagement How and with whom we
GRI 102-21; 102-33; 102-40; 102-42; 102-43; collaborate
103-2 AND 103-3
We consider stakeholders to be those groups or enti-
At Inditex, we are committed to generating a pos- ties that may be related to our Group throughout our
itive impact and creating value in a sustainable value chain and in the environment in which we carry
manner for our stakeholders, as well as for society out our activity and which, simultaneously, have the
as a whole. Accordingly, we believe working togeth- capacity to influence Inditex with their decisions and
er with them is key to both making progress on our opinions. Based on our business model—and their rela-
Sustainability Roadmap and decisively driving the tionship to it—we classify our stakeholders as follows:
sustainable transformation of our sector. customers, employees, suppliers, shareholders, the
community as a whole and the environment (repre-
We are aware that maintaining a continuous dia- sented by various environmental organisations).
logue, listening and taking into account the de-
mands and needs of our stakeholders and joining The principles guiding our relationship with all our
forces with them is essential to making headway in stakeholders are transparency and permanent di-
common and shared goals. Circularity, preserving alogue, as stated in our Sustainability Policy. These
the planet and its resources, and promoting hu- common principles are embodied in specific strat-
man and labour rights are some of the common and egies, objectives and communication and dialogue
shared goals that pursue the necessary transforma- channels, which are constantly reviewed and updat-
tion, so that in the future sustainability will be a pres- ed. Thus, we have policies that define the principles
ent and fully integrated maxim in all areas of society. of the relationship with each stakeholder group, such
as our Code of Conduct and Responsible Practices,
our Code of Conduct for Manufacturers and Suppli-
ers or the Policy on Human Rights, among others.

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 COLLABORATION FOR A SUSTAINABLE TRANSFORMATION

To meet
our customers’ To promote
needs

To be circular To innovate
We collaborate...

For the sustainability

of the industry and
the supply chain To preserve the
planet

To generate
value

DEFINING THE STRATEGY FOR ENGAGING WITH

STAKEHOLDERS

Identification Prioritisation Definition of the strategy

Identification of all the stakeholders who Classification and determination of A specific strategy is defined for each
may be linked to Inditex throughout our priority stakeholders based on our stakeholder based on their characteristics and
value chain and in the environment in which business model and value chain. needs. Specific objectives, commitments and
we operate. Taking into account both their dialogue tools are defined.
engagement and the possible impacts
that this model may have on them.

COMMON ELEMENTS OF ALL THE STRATEGIES: PERMANENT DIALOGUE AND TRANSPARENCY

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  |  Statement on Non-Financial Information 2021  |  4. Transforming with a unique model

INDITEX’S MAIN STAKEHOLDERS AND ENGAGEMENT

AND DIALOGUE TOOLS

INDITEX’S MAIN EXAMPLES OF

STAKEHOLDERS STAKEHOLDERS

Employees
Store employees
Any person who works at Office employees
Inditex, whether in stores,
Logistics centres employees
offices or logistics centres.
Union representatives

Customers
Physical store customers
Any person who purchases any
Online store customers
product sold by any of the Inditex
Group’s brands. Potential customers

Suppliers Direct suppliers

Companies that are part of Manufacturers
Inditex’s supply chain as well as Workers
their respective employees. Trade union organisations
International organisations

NGOs
Community Governments and public
All those persons or entities that administrations
form part of the environment Academic institutions
in which Inditex carries out its Civil society
activity.
Media

Environment
Environmental protection
Set of natural elements present in
organisations
the environment in which Inditex
develops its business model. Governments

Shareholders
Institutional investors
Any person or entity who
owns shares of the Inditex Individual investors
Group.

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ENGAGEMENT AND DIALOGUE TOOLS
OUR
Constant dialogue Biannual Annual On demand COMMITMENTS

COMMON SPECIFIC COMMON SPECIFIC

Ethics Committee
Respect for Human and Labour Rights
UNI Global Union Agreement
Fair and decent treatment
Training and internal promotion
R
 espect for privacy and personal data
Internal communications
protection
Volunteer programmes
C
 ommitment to information security
Sustainability Information Security and Data
Committee Protection and Privacy Departments

Specialised customer service teams Clear and transparent communication

Physical and online stores Integration throughout the business model
Social media Responsible design and manufacturing
I nformation Security and Data R
 espect for privacy and personal data
Protection and Privacy Privacy protection
Materiality
Analysis Departments C
 ommitment to information security

Supplier clusters P
 romotion and protection of fundamental
Ethics Committee human and labour rights and international
Buying and sustainability teams standards
 lobal Framework Agreement with
G P
 romotion of sustainable production
Social IndustriALL Global Union environments
Advisory
Board Data Protection and Privacy Department R
 espect for privacy and personal data
protection in the provision of services

Social Advisory Board C

 ontribution to social and
Cooperation with NGOs economic development
Strategic  Sponsorships and Patronage C
 ommitment to improving
Alliances Committee global welfare

Social Advisory Board Respect for the environment

Commitments with NGOs Conservation of biodiversity
Corporate
Environmental sustainability teams S
 ustainable management of resources
Website
Fighting against climate change

Annual General Meeting S

 ocial interest and ommon interest of
Sustainability indexes all shareholders
Integrated
report Investor relations F
 ostering informed participation

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   |  Statement on Non-Financial Information 2021  |  4. Transforming with a unique model

GENERATION OF VALUE FOR STAKEHOLDERS

Customers
Our commitment to CUSTOMERS involves
maintaining their trust and sustainably producing
fashion products that meet their needs and
expectations.

Employees Suppliers
Our EMPLOYEES are our driving force. We seek to strengthen all our
We want to positively impact on their SUPPLIERS and benefit their
professional and personal development. workers. It would not be possible to
manufacture our products without
our supply chain.

ing for the plane

Car t

Customers
Employees

a n s p a re n cy
Tr

SUSTAINABLE
VALUE DEVELOPMENT
CREATION OF
Community Suppliers
COMMUNITIES
Pe

ue

m
og
r

an
e nt dial

Environment Shareholders

Tr
an ia
sfo
rma u str
ción de la ind

Community Shareholders
We want to have a positive impact on We ensure that SHAREHOLDERS have
the economic, social and environmental access to the necessary information
development of the COMMUNITY. A key to ensure inclusive, participatory and
aspect is our investment programmes representative decision-making that
in social initiatives aligned with our respond to their needs.
business.

Environment
We are committed to the development of a circular
economy model that mitigates the impact of our activity
on the ENVIRONMENT and where efficiency in the use
of resources is paramount.

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Featured collaboration tools 4.4.2. Partnerships
Since 2019 we have a Sustainability Committee,
GRI 103-12 AND 103-13
a delegate committee of the Board of Directors,
whose responsibilities include the supervision of At Inditex, we maintain a close, multi-directional
the Company’s stakeholders engagement in the and constant cooperative relationship with vari-
sustainability field. Furthermore, since 2002 we ous organisations and institutions, both locally and
have a Social Advisory Board which acts as an advi- internationally. Establishing partnerships based on
sory body on sustainability matters, and comprises working together is pivotal for us, as we are aware
independent external members, whose responsi- that only by joining forces with key actors can we
bilities include arranging and institutionalising dia- move towards the sustainable transformation of
logue with key stakeholders in civil society. our sector in particular, and of society and the plan-
More information in section 4.2.1. Our vision of et in general.
sustainability of this Report.
Thus, we maintain partnerships with governments,
We establish various strategic partnerships for trade unions, academic institutions, local and inter-
collaboration with stakeholders to foster sustain- national organisations and representatives of civil
able development throughout our value chain and society, among others, to progress towards sustain-
in the communities where we operate. This ena- able development. We also work with other compa-
bles us to maximise our contribution to the Sus- nies in our sector through different platforms and
tainable Development Goals and advance in our partnerships, as we face common challenges and
Sustainability Roadmap. opportunities that require the collaboration of all
More information in section 4.4.2. Partnerships of this actors involved. Accordingly, we maximise our con-
Report. tribution to the SDGs and foster economic, social
and environmental value creation.
In order to identify and respond to those issues
that are most relevant to our stakeholders, we
yearly perform a materiality analysis involving
both internal and external stakeholders. The find-
ings of this analysis are a very valuable source of
We work together with
information, as they enable us not only to discover various organisations to
our stakeholders’ needs and expectations, but at
the same time serve as a guide to define our pri-
advance in the sustainable
orities as we progress in the creation of economic, transformation of our sector
social and environmental value.
in particular, and of society
More information in section 4.4.3. Materiality analysis of
this Report. and the planet in general.

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Partnerships

POSITIVE IMPACT ON THE PEOPLE OF OUR VALUE CHAIN AND ON THE COMMUNITY

ENVIRONMENT PROTECTION AND FIGHT AGAINST CLIMATE CHANGE

CROSS-CUTTING ALLIANCES WITH SOCIAL, ENVIRONMENTAL AND GOOD GOVERNANCE IMPACT

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ACCELERATING CIRCULARITY
A collaborative initiative within the garment indus- COUNTRY PARTNERSHIP FOR ZERO CHILD
try that brings together the endeavours of various POVERTY (Alianza País por la Pobreza Infantil Cero)
operators, from areas encompassing waste collec- This initiative, fostered by the Spanish Govern-
tion, recycling, fibre production and textile distri- ment’s High Commissioner against Child Poverty,
bution, to promote circularity. With the support of is aimed at encouraging the engagement in and the
Textile Exchange, Euratex, Wrap, Circle Economy, creation of partnerships between all social actors to
Fashion for Good, ReFashion or Apparel Impact In- work towards a common mission: a Spain in which all
stitute among others, Inditex is a founding partner children and adolescents have the same opportuni-
and member of the Steering Committee of the initi- ties for the future, regardless of the conditions into
ative in Europe, together with other members rep- which they are born. Inditex joined the Partnership
resenting fibre manufacturers, and experts in tex- in January 2021.
tile waste and supply chains, as well as brands and
retailers. We also belong to the initiative’s Brand &
Retailer Working Group in the US.

PARTNERSHIP FOR SUSTAINABLE ECONOMIC

RECOVERY (Alianza por una recuperación económica
UNITED NATIONS HIGH COMMISSIONER FOR sostenible)
REFUGEES (UNHCR) A partnership promoted by ECODES and the Span-
Inditex and UNHCR have been working together ish Group for Green Growth (Grupo de Crecimiento
since 2020 with the common goal of meeting the Verde), among others, to advocate for economically
clothing needs of refugees and internally displaced and socially effective stimulus policies and, in turn, to
people. Through this strategic partnership, Inditex, ensure they are aligned with sustainability and biodi-
in collaboration with its suppliers, supports UN- versity policies.
HCR in its task of sheltering refugees who have
been forced to abandon their homes and helping
to restore their dignity. Thanks to this partnership,
Inditex has provided more than three million prod-
ucts from its collections to refugees and internally
displaced people. ARBORUS
Inditex collaborates with the Arborus Endowment
Fund, created by the Arborus association and large
international corporations, with the support of the
ACT (ACTION, COLLABORATION, European Economic and Social Council. Its goal is to
TRANSFORMATION) promote equality between women and men in the
A collaboration initiative between retail brands, world, in particular through the dissemination of a Eu-
suppliers and trade unions to transform the textile ropean and global standard: the European and inter-
industry and achieve living wages in the sector, by national label GEEIS (Gender Equality European and
means of collective bargaining and responsible pur- International Standard), which is a tool that fosters
chasing practices. Inditex has been an active partici- diversity and inclusion in enterprises and with which
pant in ACT and its work groups since 2015. Inditex has certified several of its subsidiaries.

ISTANBUL TEXTILE AND APPAREL EXPORTER

ASSOCIATIONS – ITKIB
AFIRM GROUP In Turkey, we have established a long and fruitful col-
A working forum comprising leading companies in laboration with ITKIB (Istanbul Textile and Apparel
the fashion, footwear and sport goods sector that Exporter Associations) and EKOTEKS (the customs
share the common goal of reducing the use and im- surveillance laboratory), to develop new techniques
pact of substances of health and environmental con- for the analysis of cosmetics and sustainable fibres.
cern in the textile and leather supply chain.

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BETTER COTTON BSR (BUSSINESS FOR SOCIAL RESPONSIBILITY)
At Inditex, we belong to the Better Cotton initiative, A global non-profit organisation working with a net-
which develops and promotes best practices in tra- work of over 200 members to build a fair and sus-
ditional cotton cultivation to benefit the farmers and tainable world. As a member of BSR since 2019, we
the environment, and to ensure the future of the are involved in several of the organisation’s initiatives,
sector. such as the HER women empowerment programme
or projects in relation to the social impact of the tran-
sition to a circular economy.

BETTER THAN CASH ALLIANCE

Based on the UN, this is a partnership of governments,
companies and different international organisations, BUSINESS AMBITION FOR 1.5º BY UNITED
whose objective is to globally promote the transition NATIONS
towards a digital economy. We focus our collaboration An urgent call to action by a global coalition of Unit-
with this alliance on the financial education and digitali- ed Nations agencies, business and industry leaders
sation of the supply chain. to commit to setting ambitious science-based emis-
sion reduction targets.

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BUSINESS FOR SOCIETAL IMPACT (B4SI) CÁRITAS

A global standard, formerly known as LBG, to meas- We have been working with the non-profit organisation
ure corporate social impact. Inditex belongs to the Cáritas since 2007 to help improve well-being in the
global B4SI network which currently comprises community. Within the frame of our strategic partner-
more than 150 companies. ship with Cáritas, we are currently developing a number
of projects such as the circular economy project Moda
Re- or the programme to boost employment in Spain.

CANOPY PLANET INITIATIVE

As founders of the Canopy Style initiative, we col-
laborate with Canopy Planet to protect primary high
conservation-value (HCV) forests through the tex- FASHION INDUSTRY CHARTER FOR CLIMATE
tile chain. This is a commitment to protecting these ACTION (UNFCCC)
forests, and in particular to ensuring that no cellu- We have committed to implementing this Charter,
lose originating in this type of forests will be used in launched by United Nations Climate Change, and
man-made fibres (viscose, modal, lyocell). aligned with the Paris Agreement goals. The aim is for
the industry to achieve net zero emissions by 2050.

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 COVID-19: ACTION IN THE GLOBAL GARMENT
INDUSTRY
An initiative aimed at spurring action in the global
CEOE (Spain’s Employers’ Association) textile sector to help the industry tackle the eco-
We cooperate actively with Spain’s Employers’ As- nomic impact of the covid-19, while protecting the
sociation (CEOE), which is the main spokesperson incomes, health and employment of workers in the
between companies in Spain and the Government industry. This call to action was agreed in 2020 by
and international institutions. At Inditex, we belong the International Organisation of Employers (IOE),
to several working groups linked to various aspects the International Trade Union Confederation (ITUC)
related with sustainability and circularity. and IndustriALL Global Union together with other in-
ternational brands, with the technical support of the
International Labour Organization (ILO). Inditex be-
longs to the international working group created for
its implementation.
CEO WATER MANDATE
We have signed up to this United Nations initiative
that aims to support companies in the development,
implementation and disclosure of their water-relat-
ed strategies and policies. COZEV (CARGO OWNERS FOR ZERO EMISSION
VESSELS)
CoZEV is an initiative led by the Aspen Institute as
part of its Shipping Decarbonization Initiative (SDI).
This initiative has brought together a number of
CIQ SHANGHAI shippers to accelerate the transition to zero-emis-
We participate in the Pre-Testing Programme with sions vessels and to establish a commitment to only
CIQ Shanghai, which belongs to the China Customs use this kind of vessel by 2040.
Inspection and Quarantine Department, reserved
for companies with a very high level of compliance
with health regulations on imported goods.
RED CROSS
We have been collaborating with the Red Cross
since 2004 in a number of emergency relief pro-
grammes linked to natural disasters and similar cri-
ses. Over the course of the last seventeen years we
CLEAN CARGO WORKING GROUP have cooperated to tackle emergency situations in
We joined this initiative in 2020 with the aim of reduc- countries like India, China, Japan, Mexico, Australia,
ing the environmental impacts of worldwide freight Italy and Spain, among others. We also have a sta-
transport and to promote responsible ocean freight. At ble arrangement with the Red Cross through pro-
the Clean Cargo Working Group, there is collaboration grammes such as SALTA and Closing the Loop.
between companies dedicated to integrating environ-
mental and socially responsible business principles into
transport management. Its CO2 emission calculation
methodology is the shipping standard used by other
initiatives, such as the US Environmental Protection
Agency (EPA) SmartWay programme and the Global ELLEN MACARTHUR FOUNDATION
Logistics Emissions Council (GLEC). Ten years after the Ellen MacArthur Foundation
was launched, Inditex has strengthened its collabo-
ration with the organisation by becoming a Partner.

This year we renewed our involvement as a member

of the Advisory Board for its Make Fashion Circular
COTTON CAMPAIGN initiative.
Cotton Campaign is an initiative led by companies
and tertiary sector organisations to improve working Furthermore, we ramped up our ambition on plas-
conditions and defend human rights with regard to tics reduction by signing a new commitment to
cotton production and supply. the New Plastics Economy promoted by the Ellen
MacArthur Foundation in partnership with United
Nations Environment to 2025. The commitment en-
ables all plastics used in our business to be reused

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or recycled, in order to be reintroduced into the cir- equality, solidarity and well-being for all and where
cuit, while cutting the amount of unnecessary plastic discrimination against people based on their skin
packaging and increasing the percentage of recycled colour, religion, culture, nationality or origin is not
content in such materials. tolerated. In 2021, the ENAR Foundation granted
the Holistic Diversity Management Certificate to
This year we also signed a manifesto with the Ellen the Inditex network of 34 Champions of Diversity
MacArthur Foundation, emphasising the Business in Europe, developed in conjunction with experts in
Call for a UN Treaty on Plastic Pollution, calling on D&I management.
governments to ensure that the new treaty on plas-
tic pollution includes measures and instruments
that affect the entire life cycle of plastics, not just
addressing the challenges associated with managing
plastic waste. EVERY MOTHER COUNTS
A charitable organisation dedicated to helping wom-
en receive quality health care to prevent infant and
maternal mortality. Our partnership with Every
ENTRECULTURAS Mother Counts, which commenced in 2015, has
Since 2001 we have been collaborating with the Jes- developed (among others) a number of maternal
uit-sponsored NGO with the goal of generating so- health projects in countries such as Bangladesh and
cial change through education. Thanks to this part- the United States.
nership, over the last 20 years we have developed
a number of educational programmes that have
directly benefited more than 1.3 million vulnerable
people in Africa, America and Asia.
FASHION FOR GOOD
Fashion for Good is a global innovation accelerator
specialising in the textile sector. Through this platform,
ETHICAL TRADING INITIATIVE (ETI) brands, producers suppliers, non-profit organisations
A dialogue platform to improve working conditions and innovators work together to scale sustainable
of supply chain workers, comprising companies, in- solutions.
ternational trade unions and non-governmental or-
ganisations. Inditex has been a member of ETI since At Inditex we participated in a study on the actual ty-
2005 and is an active participant of its programmes pology of post-consumer textile waste according to
in different countries. their characteristics and compositions. The aim is to
gauge textile waste sorting capacities in Europe.

EUROCOMMERCE THE FASHION PACT

We are actively involved with EuroCommerce, the We are co-founding partners of this agreement
largest representative body of the retail industry in among leading companies in the fashion sector to
Europe, comprising 6 million retail and wholesale com- set specific goals to handle the challenges of the in-
panies from various sectors. dustry in terms of fighting climate change, caring for
oceans and conservation of biodiversity.
We are also members of its environmental commit-
tee and founding members of its representative body
TEFRIG, made up of companies form the textile sector.

FORO SOCIAL DE LA MODA

Launched in 2018 as a joint initiative between ter-
tiary sector organisations, local trade unions affiliat-
EUROPEAN NETWORK AGAINST RACISM ed with IndustriALL Global Union (CCOO and UGT)
Like the ENAR Foundation (“European Network and a number of Spanish textile brands, including
Against Racism”, which advocates racial equali- Inditex. It aims to promote a forum for multi- stake-
ty), Inditex envisions a society where there is full holder dialogue on global supply chains.

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FUR FREE ALLIANCE INDUSTRIALL GLOBAL UNION
Fur Free Alliance is an international coalition of an- An international federation of trade unions represent-
imal welfare protection organisations working to ing more than 50 million industrial workers belonging
bring an end to the exploitation and killing of animals to more than 600 trade unions in 140 countries. The
for their fur. Inditex is a member of the Fur Free Alli- collaboration with IndustriALL Global Union is em-
ance’s Fur Free Retailer Program. bodied through the Global Framework Agreement,
signed in 2007, the first to cover the entire supply
chain of a textile company. The agreement, renewed
in 2019, highlights the essential role of respect for
freedom of association and collective bargaining
rights. In this regard, the two organisations agreed to
GLOBAL FASHION AGENDA (GFA) work together to ensure a more effective implemen-
At the Company we continue to strive to improve tation of the International Labour Conventions.
and afford continuity to circularity commitments
made to the GFA and fulfilled in 2020. 100% of our
stores continue to offer the used garment collection
programme, we continue to train our design teams
in circularity and we have accelerated our efforts to INTERNATIONAL ACCORD
scale up textile-to-textile recycling. This is the agreement signed in 2021 between brands
and international trade unions, with non-governmen-
In addition, Inditex is a founding partner, through its tal organisations acting as witnesses for its fulfilment.
brands Pull and Bear and Bershka, in the Circular It encompasses the commitment to continue and ex-
Fashion Partnership project, which supports the de- pand the efforts, initiated in Bangladesh in 2013, for
velopment of the recycling industry in Bangladesh. a safe and healthy textile industry. The International
Accord recognises the RMG Sustainability Council
(RSC) as the independent organisation that contin-
ues these efforts in Bangladesh. Inditex is a founding
member and sits on the Steering Committee.

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CHINESE INSTITUTE OF PUBLIC AND LEAF COALITION

ENVIRONMENTAL AFFAIRS (IPE) This year we have signed up to the LEAF Coalition,
We work with the Chinese Institute of Public and coordinated by Emergent and combining public and
Environmental Affairs (IPE) to improve the envi- private involvement. It focuses on protecting trop-
ronmental management of our supply chain in Chi- ical forests from deforestation and on supporting
na and to disseminate the results of wastewater sustainable development in the countries where
analyses. We continue to work together to prepare they are located.
a map to monitor the performance of textile com-
panies in China.

MASSACHUSETTS INSTITUTE OF TECHNOLOGY

(MIT)
Within the framework of our Closing the Loop Pro-
gramme, we collaborate with the Massachusetts
LBG (LONDON BENCHMARKING GROUP) ESPAÑA Institute of Technology (MIT) in the MIT Interna-
Methodology to measure business contributions to tional Science and Technology Initiatives (MISTI)
the community. Inditex is a member of LBG España, to research the development of recycling process-
which currently comprises 19 companies. es and the creation of textile fibres through new
non-polluting methods or from waste, as well as any
other sustainable initiative related to the circular
economy in the textile industry.

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We have endowed the Inditex Materials Science and
Engineering Fellowship Fund Chair at MIT’s Depart-
ment of Materials Science and Engineering. This
lifelong chair focuses on promoting research into OPEN FOR BUSINESS
sustainability. Coalition of leading global companies dedicated to
LGBT+ inclusion and the rights of the LGBT+ commu-
nity (lesbian, gay, bisexual and transgender) to prove
that inclusive societies are better for business and
MEDICUS MUNDI that companies that promote LGBT+ inclusion are
Since 2015, we have been working with this interna- more dynamic, productive and innovative.
tional NGO founded in 1963 towards the common
goal of promoting the right to health. Through this
partnership, we contribute to improving the social
and health situation for workers in the garment in- OPEN TO ALL
dustry in Morocco. Inditex is a supporter of Open to All, a campaign led
by retailers in the US to combat discrimination and
make everyone entering our establishments feel
welcome, regardless of their race, ethnicity, origin,
gender, sexual orientation, gender identity and ex-
MÉDECINS SANS FRONTIÈRES (MSF) pression, religion or disability.
Since 2008 we have been cooperating with the med-
ical-humanitarian endeavours of Médecins Sans Fron- This coalition brings together businesses and more
tières/Doctors Without Borders (MSF) to help people than 200 non-profit organisations.
threatened by armed conflict, epidemics, natural dis-
asters or exclusion from medical care. As a result of
this strategic partnership in community investment,
we have rolled out projects in 52 countries that have ORGANIC COTTON ACCELERATOR (OCA
benefited more than six million people. FOUNDATION)
We are a founding member and sit on the Investor
Committee of Organic Cotton Accelerator (OCA).
This initiative seeks the commitment to help develop
MIT CLIMATE AND SUSTAINABILITY a responsible and healthy market of organic cotton
CONSORTIUM for all parties involved.
Inditex belongs to a group of founding companies
of the MIT Climate and Sustainability Consortium
(MCSC), created to accelerate the development of
large- scale solutions to stop climate change. The
initiative brings together leading multinationals of
various industries to work with the Massachusetts INTERNATIONAL LABOUR ORGANIZATION (ILO)
Institute of Technology (MIT) to pool environmental The International Labour Organization (ILO) is a
innovation processes and strategies. specialist UN body focusing on all matters relating
to work and labour relations.

We collaborate closely in various spheres such

as, for example, the Better Work programme, the
NAACP LEGAL DEFENSE AND EDUCATIONAL SCORE programme, the Workplace Adaptation
FUND Programme and the covid-19 initiative: Call to Ac-
NAACP Legal Defense and Educational Fund is the tion in the Global Garment Industry.
foremost US legal organisation advocating for racial
justice. Inditex collaborates with this organisation to In 2017 we entered in a three-year public–private
finance projects primarily in the area of education partnership with the ILO aimed at jointly promot-
that seek to improve access for African- American ing core principles and labour rights in the cotton
students, bringing about structural changes in soci- supply chain.
ety to eliminate disparities and achieve racial equali-
ty. NAACP LDF works for civil rights and to improve
the quality of education.

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UNITED NATIONS GLOBAL COMPACT

A United Nations initiative that encourages social di- in organisations in which talent is appreciated, re-
alogue between companies and civil society. Inditex gardless of sexual identity, gender expression and
signed up in October 2001 and actively participates sexual orientation.
in various working platforms alongside other stake-
holder groups, such as the Action Platform on De- EURATEX REHUBS
cent Work in Global Supply Chains. As a founding partner, in 2021 Inditex joined the
Business Council of the ReHubs initiative developed
by Euratex to set up five recycling centres in Europe
with the aim of collecting, processing and recovering
RACE TO ZERO textile waste.
Race to Zero is a campaign under the umbrella of the
United Nations Framework Convention on Climate
Change (UNFCCC) aimed at driving the change to a
decarbonised economy. RMG SUSTAINABILITY COUNCIL (RSC)
As the heir of the Accord on Fire and Building Safe-
ty since 2020, the RMG Sustainability Council (RSC)
delivers building safety inspection and remediation
programmes in production facilities in Bangladesh.
REDI (BUSINESS NETWORK FOR LGTB+ Textile brands, trade union federations and employ-
DIVERSITY AND INCLUSION) ers’ associations in the country are represented
Inditex is a member of REDI, Spain’s first in- equally on its Board. Inditex works actively with its
ter-company and expert network for diversity and suppliers and manufacturers in the aforementioned
inclusion of LGBTI employees and allies. REDI aims programmes, and serves on the Board of Directors.
to nurture an inclusive and respectful environment

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SHIFT THE BUSINESS CALL FOR A UN TREATY
A non-profit organisation specialising in human ON PLASTIC POLLUTION
rights. Since 2019, Inditex takes part in its Business An open call ahead of the fifth session of the United
Learning Programme, a programme for leadership in Nations Environment Assembly, which seeks to en-
human rights that involves companies from all sec- courage talks among UN member states to create an
tors in efforts to implement the Guiding Principles. international treaty on plastic pollution to help drive
the transition to a circular economy for plastics.

SMART FREIGHT CENTRE

It is a non-profit organisation dedicated to sustaina-
ble transport. Its vision is to achieve an efficient global THE POLICY HUB
logistics sector and zero emissions, that contributes to We are actively involved with Policy Hub, which brings
the goals of the Paris Agreement and the Sustainable together the textile industry and its stakeholders in or-
Development Goals. To achieve this vision, they bring der to accelerate the sector’s circular transformation.
together the global logistics community through their
Global Logistics Emissions Council (GLEC).

SUSTAINABLE APPAREL COALITION (SAC) TSINGHUA UNIVERSTY

We are active members of the Sustainable Apparel Through our partnership with Tsinghua University,
Coalition (SAC), a textile sector initiative to develop since 2016 we have been involved in a number of
a common sustainability index to assess the perfor- academic programmes related to our community in-
mance of retailers, suppliers and products. vestment model. Notable among these are the Sus-
tainable Development Fund, the Oversea Student
Scholarship and Teaching Fund or the collaboration
programme with this university’s School of Econom-
SUSTAINABLE FIBRE ALLIANCE ics and Management, among others.
Sustainable Fibre Alliance (SFA) is an internation-
al non-profit organisation working with cashmere
supply chains, from herders to retailers. Its pur-
pose is to promote a global sustainability standard
in cashmere production so as to preserve and re-
store pastureland, ensure animal welfare and guar- UNI GLOBAL UNION
antee livelihood. In 2019, Inditex and the trade union federation UNI
Global Union, which represents 20 million workers
in more than 150 countries, celebrated the 10th an-
niversary of the Global Agreement reached by both
entities in 2009 to foster respect for and promotion
TENT PARTNERSHIP FOR REFUGEES of labour rights and decent work across the com-
Founded by Tent Foundation, a non-profit organisa- mercial and distribution network.
tion, this is a global network of more than 200 compa-
nies that seeks to mobilise the private sector to create
partnerships to improve the lives of refugees.
UNITING BUSINESS AND GOVERNMENTS TO
RECOVER BETTER BY THE UNITED NATIONS
Inditex is one of over 150 companies involved in Sci-
ence Based Targets that have signed a declaration in
TEXTILE EXCHANGE 2020 urging governments worldwide to align their
As members of the Textile Exchange, we partner recovery efforts to combat the crisis caused by cov-
with this independent and non-profit organisation id-19 and work on economic aid, using cutting-edge
that is an international benchmark in the sector. It climate-related scientific developments.
is a platform to promote organic grown cotton, and
global sustainability within the textile sector.

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UNIVERSITY OF A CORUÑA POLYTECHNIC UNIVERSITY OF CATALONIA

Pursuant to our strategic partnership with the Uni- Inditex carries out research in conjunction with the
versity of A Coruña (UDC), we have implemented Polytechnic University of Catalonia on the microplas-
a range of programmes such as Intalent, the Indi- tics present in marine ecosystems as a result of waste
tex-UDC Sustainability Chair, the Inditex Chair of water from washing clothes. The project focuses on
Spanish language and culture in Bangladesh, or the minimising the detachment of these particles (meas-
Inditex- UDC Predoctoral Residency Grant Pro- uring less than 5mm) from garments, with the aim of
gramme, among others. preventing them from ending up in the sea.

UNIVERSITY DE SANTIAGO DE COMPOSTELA

As part of our community investment efforts, we have UNIVERSITY OF DHAKA
been cooperating with the University of Santiago de Since 2010 we have been collaborating with the
Compostela since 2010 to develop the Inditex Chair of University of Dhaka in developing the Inditex Chair
Spanish language and culture in Bangladesh. of Spanish language and culture. This Chair, located
at the University of Dhaka’s Institute of Modern
Languages, promotes Spanish language and culture
in Bangladesh through various academic and cultur-
al dissemination initiatives, notably including annual
MIGUEL HERNÁNDEZ UNIVERSITY courses in Spanish language and culture, the student
We collaborate with Miguel Hernández University mobility grants programme and the hosting of espe-
in Elche in offering the TEMPE- APSA Chair of Dis- cially significant artistic events.
ability and Employability, as part of our community
investment initiatives.

WATER.ORG
We have been working since 2015 with the
non-profit organisation Water.org to improve ac-
COMILLAS PONTIFICAL UNIVERSITY cess to drinking water and sanitation for low income
We work with Comillas Pontifical University to run families in Bangladesh, Cambodia and India. As a
the Inditex Chair of Refugees and Forced Migrants result of our strategic partnership with Water.org,
within the framework of our community investment. more than two million three hundred thousand peo-
ple have improved their access to drinking water and
sanitation through the granting of microloans.

UNIVERSITY OF LLEIDA. A3 LEATHER

INNOVATION CENTER IN IGUALADA
The development of the best leather tanning and fin-
ishing technologies, as well as sensitive and versatile ZERO DISCHARGE OF HAZARDOUS CHEMICALS
methods for the analysis of key substances such as (ZDHC)
formaldehyde and chromium (VI), are the focus of In this organisation, we join forces with the rest of the
our cooperation with A3 Center. industry in order to move forward together in fulfill-
ing our commitment to Zero Discharge of Hazardous
Chemicals, a pledge to restrict and eliminate certain
chemicals in the product manufacturing process.

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4.4.3. Materiality analysis A double approach to materiality is adopted in the
process of determining material topics and their rel-
GRI 102-29; 102-43; 102-44; 102-46; 102-47;
evance, which is reviewed annually. Hence, atten-
102-49 AND 103-1
tion is paid not only to the impact these issues have
In 2021, for the eleventh consecutive year, we per- on our Group’s strategy, but also to the impact the
formed a materiality analysis to understand the Company has on the environment. Accordingly, in
needs and expectations of our stakeholders. This the process of determining the materiality matrix,
exercise enables us to identify and prioritise the is- the Global Reporting Initiative recommendations
sues that are most relevant, both to internal stake- are followed, most specifically GRI 101: Founda-
holders, i.e., our employees, and external stake- tion 2016 standard, in addition to other relevant
holders, i.e., international bodies, trade unions, methodologies and recommendations in connec-
NGOs, universities, media, local communities and tion with reporting. This year we have introduced
suppliers, among others. The matters identified the financial perspective when it comes to assess-
through this process are known as material topics. ing the impact of material topics relating to sustain-
ability (including environmental, social and govern-
The materiality analysis has a dual purpose. On the ance aspects). This considers the impact of each
one hand, it enables us to identify the priorities we topic on Inditex’s capacity to generate revenues,
need to focus on in order to make progress in cre- reduce costs or make the business more efficient
ating value for our stakeholders and thus ensure and mitigate risks. Furthermore, an assessment of
that our sustainability strategy is aligned with their the relevance of the topics over time has also been
needs. On the other, it helps us to determine the taken into account, assessing whether the impact
content to be included in this Report. occurs in the short, medium or long term.

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ELABORATION PROCESS OF INDITEX’S

MATERIALITY MATRIX

 nalysis and identification of relevant topics.

A
Identification Assessment of the scope of each relevant topic.

Presentation of the material topics to internal stakeholders to assess their relevance

due to their impact on Inditex’s strategy and business model.
Presentation of the material topics to external stakeholders to assess their relevance
Prioritisation regarding economic, social and environmental impacts of the company and the
influence of the topics on stakeholders’ decisions and expectations.
Stakeholders’ assessment of the time relevance of the topics.

 alidation of the materiality matrix results to ensure that they provide a reasonable
V
and balanced representation of the relevant topics for the organisation.
Validation Internal validation by Inditex management and external validation through its Social
Advisory Board.

The conclusions of the internal and external revision of the materiality matrix of the
preceding financial year were applied during the materiality exercise.
Review

For the process of identifying material topics, a range the company, as well as the influence of the topics
of relevant information sources are used, including: on their decisions and expectations (x-axis of the
analysis of industry and global trends, public opinion matrix). Both internal and external stakeholders
(through the analysis of social and digital media), lern- assess the temporal relevance of all the topics.
ings and contributions from the various stakeholder
with whom the Company has relations, findings of To ensure equal representation of all the stake-
internal working groups specifically created for this holder groups involved (employees, international
purpose, in which both managers and technical ex- bodies, trade unions, NGOs, universities, media,
perts from key areas take part, among others. local communities and suppliers, among others),
they are grouped according to the broad spheres to
Once the material topics are identified, they are which each of them relate and their responses are
presented to the internal and external stakehold- weighted so that no sphere is over-represented.
ers for prioritisation. This process is conducted
through online surveys in which internal stakehold- In this year’s exercise, representatives from more
ers assess the relevance of the material topics on than 70 organisations of a different nature took
the basis of their impact on Inditex’s strategy and part16, as well as internal employees. It is worth noting
business model (y-axis of the matrix), and external the participation of our Social Advisory Board, as a
stakeholders assess their relevance on the basis of collegiate body made up of external independent ex-
the economic, social and environmental impacts of perts that advise our Group on sustainability issues.

16. The participant organisations include, among others: Inditex Social Advisory Board, Accelerating Circularity, Asociación Española de Contabilidad y Administración de
Empresas (AECA), AFIRM Group, Canopy, Cáritas, Centre for Business and Public Sector Ethics of Cambridge, Red Cross Spain (Cruz Roja), Ethical Trading Initiative,
Eurocommerce, Fashion for Good, Entreculturas Foundation, Seres Foundation, United Nations Global Compact Spanish Network, Greenpeace, Humane Society of the
United States (HSUS), IndustriALL Global Union, Medicus Mundi, Organic Cotton Accelerator (OCA), Social & Labour Convergence Programme (SLCP), University of
A Coruña, Comillas Pontifical University, Oxford University, University of Santiago de Compostela, Tsinghua University and the United Nations High Commissioner for
Refugees (UNHCR).

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After prioritising the topics the results are checked
internally by the Company’s management and ex-
ternally by the Social Advisory Board. In addition,
the findings of the previous year’s review are ap-
plied during the materiality process in order to im-
plement any conclusions drawn during the matrix
ellaboration exercise.

The result is a materiality matrix showing 20 top-

ics based on their relevance to stakeholders and
for developing the Company’s business model. In
+70
2021, for the first time the matrix also shows the ORGANISATIONS
temporal relevance of each topic. The matrix is In this year’s exercise,
complemented with the Balance of Material Topics, representatives from more than
which includes an analysis of the scope or bound- 70 organisations of a different
ary of each material topic and the involvement of nature took part, as well as internal
Inditex in the potential impact. employees.
More information in section 6.2.2. Balance of material topics
of this Report.

MATERIALITY MATRIX Long-term Medium-term Short-term

100% 5 12 1

9
8 16
17
95% 14
Relevance for the company

19
6
2
10 20
90% 15
11

85% 4 7
13
18
3

80%

75%

75% 80% 85% 90% 95% 100%

Relevance for stakeholders

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   |  Statement on Non-Financial Information 2021  |  4. Transforming with a unique model

MATERIAL TOPICS
NUMBER MATERIAL TOPIC SUBTOPICS

Good governance Anti-corruption

Ethical behaviour Corporate ethics Grievance mechanisms
1
and governance Compliance and responsible Public policy
practices

 inancial risk management and

F Non-financial risk management and
Risk management control systems control systems
2
and control systems Cybersecurity Management of climate change risks
and opportunities

Stakeholder Stakeholder commitments

Transparency and continuous
3 dialogue
engagement Alliances and partnerships

 esponsible communication
R
Responsible Product information and
4 and marketing labelling
Communication
Brand management

Value chain Process traceability

Raw material traceability
5 transparency and
T
 ransparency
traceability

Responsible purchasing
6 Suppliers relations Responsible purchasing training
practices and commitments

Tax contribution and tax

Value Financial performance
transparency
7  ocio-economic impact
S
creation Community investment
on society Contribution to the SDGs

8 Innovation
D
 igitalisation Process innovation
Innovation in sustainability

Customer
9
orientation Sales practices Shopping experience

Diversity, equality Diversity I nclusion

10
and inclusion Equality

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NUMBER MATERIAL TOPIC SUBTOPICS

Employment Labour relations

11 Quality of employment
Remuneration

Due diligence processes

12 Human Rights Human Rights strategy

 ealth and Safety

H  ealth and safety training
H
Safe and healthy management systems Implemented measures derived
13
environments  ealth and well-being
H from covid-19
promotion

Talent attraction Talent development

14 Talent management
Talent retention

Socially-sustainable Employee well-being  omen empowerment

W
15 production Industrial relations Social assessment and supply
environments Living wages chain improvement

Energy Management D
 ecarbonisation
16 Climate change E
 missions Energy efficiency

Water usage  aste management

W
17 Environmental  anagement of chemical
M Environmental assessment and
footprint minimisation substances and sustainable supply chain improvement
processes in manufacturing

Protection of natural
18 resources
B
 iodiversity Animal welfare

Product Sustainable raw materials Product quality, health and safety

19 sustainability

Eco-design R
 ecycling
Circularity
20 Packaging

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   |  Statement on Non-Financial Information 2021  |  4. Transforming with a unique model

Moreover, based on our materiality analysis and the most impacted through our value creation model
alignment of our strategy with the United Nations have been identified.
2030 Agenda, the Sus tainable Development Goals

MATERIALITY
RELATED VALUE CREATION, MATERIAL TOPICS AND SDGS

MATERIAL TOPICS SDGS

Responsible risk
2. Risk management and control systems management
16. Climate change

MATERIAL TOPICS SDGS

Good
1. Ethical behaviour and governance governance,
3. Stakeholder engagement corporate ethics
culture and solid
compliance
architecture

MATERIAL TOPICS SDGS

7. Value creation Fiscal responsibility

and transparency

MATERIAL TOPICS SDGS

3. Stakeholder engagement
7. Value creation
Collaborating to
generate value in
the community

MATERIAL TOPICS SDGS

Collaborating
3. Stakeholder engagement to safeguard the planet
8. Innovation
16. Climate change
17. Environmental footprint minimisation
18. Protection of natural resources

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 MATERIAL TOPICS SDGS

3. Stakeholder engagement
Collaborating with our people, 8. Innovation
10. Diversity, equality and inclusion
the engine of that
11. Employment quality
transformation
12. Human Rights
13. Safe and healthy environments
14. Talent management

MATERIAL TOPICS SDGS

Collaborating with 4. Responsible communication

our customers, 8. Innovation
the force driving 9. Customer orientation
transformation

MATERIAL TOPICS SDGS

3. Stakeholder engagement
Collaborating
with our
shareholders,
allies in
transformation

MATERIAL TOPICS SDGS

Collaborating 3. Stakeholder engagement

to transform 8. Innovation
through 17. Environmental footprint minimisation
sustainable 18. Protection of natural resources
management 19. Product sustainability
of our 20. Circularity
products

MATERIAL TOPICS SDGS

Collaborating so our
suppliers grow
3. Stakeholder engagement
5. Value chain transparency and traceability
6. Responsible purchasing practices
8. Innovation
10. Diversity, equality and inclusion
12. Human Rights
15. Socially-sustainable production
environments
17. Environmental footprint minimisation

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