0. The Making of a Green Shirt
– Sustainable Manufacturing through A Vertically-Integrated Supply Chain
Dr. John Cheh
Vice Chairman & CEO, Esquel Group
Oct 19, 2011
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1. The Making of a Green Shirt
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2. Esquel’s Vertically-Integrated Set Up
The Making of a Green Shirt
Esquel’s Vertically-Integrated Set Up
Cotton Farming
Spinning
Weaving/Knitting
Garment
Manufacturing
Trims
& Packaging
Retail and Direct Distribution
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3. Sustainability is at the Heart of Our Corporate Culture
The Making of a Green Shirt
Sustainability is at the Heart of Our Corporate Culture
Esquel was accorded with the Caring Company Award by the Hong Kong Council of Social Service, in recognition of Esquel’s community involvement and our commitment of being a good corporate citizen in the past year.
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4. The Making of a Green Shirt
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5. The Making of a Green Shirt
Common misconceptions about sustainable production:
Add to the costs
For public relations reasons
Needs to be forced upon (by media, customer or government)
For large companies only
Successful companies are successful because they practise sustainable production
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6. Embrace Technology & Modern management
The Making of a Green Shirt
Embrace Technology & Modern management
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7. The Making of a Green Shirt
Sustainable Farming
Sustainable farming
methods and technologies result in increase in cotton
yields and higher income and quality of life for farmers
Growing Organic
Cotton in Xinjiang,
Certified by Ecocert
Natural Pest
Control,
breeding
cotton pests’ enemy
to reduce pesticide
consumption
Drip Irrigation,
reduces water
consumption and
usage of chemical
fertilizer
Handpicking
Cotton,
eliminates
use of chemical
defoliant
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8. The Making of a Green Shirt
Sustainable Farming
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9. The Making of a Green Shirt
Water Consumption of Cotton Shirt
Energy Consumption of Cotton Shirt
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10. The Making of a Green Shirt
Energy Saving
Annual energy consumption fell by 40% from 2005 to 2010, equivalent to 160 M kwh of electricity and 242,000 tons of greenhouse gas emission
Installation of
Frequency Inverters to all Machinery
reduces energy
consumption by 40%
Installation of
Water Curtains,
better ventilation
and cooling save up to 80% electricity
Energy Efficient
Lighting: replaced light bulbs with high
efficiency fluorescent light
tubes and reflectors
Installation of
Skylights: makes use of natural light to reduce energy consumption
Steam Powered
Air-conditioning
System:
reduces heat and saves
electricity
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11. The Making of a Green Shirt
Energy Saving
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12. The Making of a Green Shirt
Water Conservation
Reduction of water consumption by 50% from 2005 to 2010, equivalent to 6.8 M tons of water
Waste Water Treatment
Plant
neutralizes
waste water from mills and
factories
Patented Pulse Dyeing
Technology
consumes less water, electricity and chemicals
Cold Pad
Batch Pre-
treatment
Technology
saves water and energy
Recycling
Condensed
and Cooling
Water saves
water & steam
Green Washing
uses ecologically
biodegradable
products for
treatment and
finishing
Wet
Processing
Centre
recycles water in garment
washing
process
Reuses
Soap Water
reuses up to 300 tons of water every day
Heat
Exchange
System
saves 137 tons of steam
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13. The Making of a Green Shirt
Water Conservation
Traditional Dyeing
Pulse Dyeing
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14. The Making of a Green Shirt
Emission Control
Desulfurization of Waste Lye reduces
sulfur dioxide
emissions
Uses Only Clean Low Sulfur Coal
which is cleaner source of power
Thermal Power
Plant
supplies own
electricity and steam to enhance energy efficiency and reduces carbon dioxide emissions
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15. The Making of a Green Shirt
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16. The Making of a Green Shirt
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17. Competitiveness of Suppliers
The Making of a Green Shirt
Competitiveness of Suppliers
Suppliers need to upgrade and innovate
Consolidation
Cost containment (“It’s All About Productivity”)
Creativity and innovation
Conservation
Corporate social responsibility
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18. Winning As The Industry Consolidates
Drivers of industry consolidation
Abolishment of quota
Stretched material & labor supply with surging costs
Buyers’ desire to simplify and optimize their sourcing operations
Flight to quality and stability
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19. Consolidation of Major Exporting Countries to US (by Value of Total Apparel)
Source: US Office for Textile and Apparel
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20. Compete through State-of-the-Art Equipment to
Improve Quality & Productivity
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21. Compete through State-of-the-Art Equipment to
Improve Quality & Productivity
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22. Creativity and Innovations
It’s the 10th anniversary of Esquel’s Research & Development Center. Esquel’s annual R&D spending has amounted to US$ ### . Our R&D team has worked relentlessly to develop value-added products and research on process and product innovation as well as invented a wide range of green products and production methods to enhance the Group’s competitiveness. We have also be accredited as national High-tech Enterprises since Well-appointed facilities for product development and process innovation that enhances Esquel competitive advantage
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23. Creativity and Value Adding Services
創新和增值服務
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24. Caring for People and Local Communities
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25. Caring for People and Local Communities
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26. Caring for People and Local Communities
Through Esquel — Y.L. Yang Education Foundation, Esquel is actively involved in projects that encourage education for the underprivileged because we believed that education is an effective way to help them rise out of poverty and improve their future livelihoods.
Rebuilt 19 schools in some of China’s most impoverished areas such as Akesu, Hotan, Kashi etc.
Donated 330,000 books to more than 1,000 schools
Organized Esquel summer camp program to encourage learning in a fun and relaxed setting for more than 250 primary students
Supported more than 40 outstanding students covering their yearly tuition fee and living expenses
Provided financial support to more than 1,000 underprivileged children, including some from aids-affected families
Provided live broadcast training to almost 50,000 primary and intermediate school teachers in 16 districts in Xinjiang
Launched Esquel Eco-mobile, a classroom-on-the-wheel laboratory in 2004 and 2007 in Xinjiang and Guangdong to educate children on how to protect our environment and raise the awareness.
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27. Caring for People and Local Communities
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28. “We Must Become The Change We Want To See”
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29. THANK YOU
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