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© 2012 Textile Exchange p 1 09 Over a century ago, Anvil Knitwear began by selling work clothes during the industrial revolution. Over the years, the company increasingly focused on offering an extensive line of activewear clothing and accessories to wholesale distributors (for the imprintable market) and private label brands such as Disney, with products including t-shirts, polo shirts, shorts, towels, bags and caps. By keeping closely in touch with its customers’ evolving needs, Anvil has remained successful and ahead of its time. Since 2007, the company has been on a journey to make a difference, working on embedding sustainability at all levels of its operations. It started with just one organic cotton t-shirt under the AnvilOrganic® brand and since then Anvil has become the largest buyer of US grown organic cotton; working closely with the farmers in the Texas Organic Cotton Marketing Cooperative (TOCMC). The company always believed that launching an organic cotton program was the right thing to do. But it is also convinced that sustainability makes business sense and gives its brand a competitive advantage. Anvil Not Just a T-shirt Future Shapers A Decade of Innovation in Textile Sustainability (2002-2012)

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© 2012 Textile Exchange

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Over a century ago, Anvil Knitwear began by selling work clothes during the industrial revolution. Over the years, the company increasingly focused on offering an extensive line of activewear clothing and accessories to wholesale distributors (for the imprintable market) and private label brands such as Disney, with products including t-shirts, polo shirts, shorts, towels, bags and caps. By keeping closely in touch with its customers’ evolving needs, Anvil has remained successful and ahead of its time. Since 2007, the company has been on a journey to make a difference, working on embedding sustainability at all levels of its operations. It started with just one organic cotton t-shirt under the AnvilOrganic® brand and since then Anvil has become the largest buyer of US grown organic cotton; working closely with the farmers in the Texas Organic Cotton Marketing Cooperative (TOCMC). The company always believed that launching an organic cotton program was the right thing to do. But it is also convinced that sustainability makes business sense and gives its brand a competitive advantage.

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“What we’d like to see in the future is a strong link between not only how cotton is grown but how the t-shirt is made, exposing the work of an ethical manufacturer where the stories of the people and communities that make our products are showcased. Equally important is empowering the consumer to understand that their purchasing decision can make a difference and when they choose organic, they’re doing their part to support family farmers who prioritize responsible farming methods. More farmers will be inspired to convert to organic farming methods if the demand is there” Anthony Corsano, Senior Vice President, Gildan.

© 2012 Textile Exchange

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Location: Headquarters in New York - Manufacturing in Central America

Type of Business

Anvil is both an intermediary and a private label brand selling activewear products and accessories to brands and retailers

Turnover (2011): US$ 250 million

Number of Employees: Approximately 4,000 worldwide

Began selling organic cotton products

2007

OC Value Chain Partners: Texas Organic Cotton Marketing Cooperative (TOCMC)

Sustainability Collection: Organic cotton, transitional cotton, recycled cotton, recycled polyester

Certification: USDA NOP, Oeko-Tex Standard 100

Targets:

“Double It!” Campaign: Double the number of acres dedicated to organic cotton farming in the US by 2020.

Recent Recognition: • Disney: Most Sustainable Vendor- Global 2010• Disney: Most Sustainable Vendor- North America 2011• Top Leader of Change in Sustainability by the Foundation for Social

ChangeandUnitedNationsOfficeforPartnerships(UNOP)2010

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© 2012 Textile Exchange

The Journey So Far

The company’s commitment to sustainability is part of a bigger Corporate Social Responsibility strategy embedded in the different parts of its business. Anvil is vertically integrated and owns three production sites, located in Central America, where textile manufacturing, cut&sew, and distribution take place. Anvil implemented its AnvilSustainableManufacturing (ASM) program in 2010, with a main goal of increasingefficiencyimprovementsand practices at all Anvil facilities. The company trains its employees with innovative leadership skills and procedures to empower them to make better working decisions, respect one another, reduce energy, maximize raw material utilization and optimize production lines and equipment.

In addition, all three Central American facilitiesareWRAPcertifiedandauditedboth internally and externally on a frequent basis.

© 2012 Textile Exchange

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In the Beginning In its 100 plus years, Anvil has always been a partner of choice for private label brands wanting to buy ready-made t-shirts and other basics. In 2006, Anvil carried out a market review and came to the conclusion that environmental issues would be the next important step for businesses to take into consideration for the future. The company’s corporate responsibility platform formally began the following year with the adoption of company-wide policies and procedures, including Anvil’s Environmental and Social Responsibility Principles, a set of guiding principles that enforce the company’s responsibility to empower both employees and stakeholders to improve the environmental and social impacts of its business activities. In addition, a three-pillar approach to sustainability was implemented focusing on environmental, social and product responsibility.

During this time, Anvil launched the AnvilOrganic® t-shirt, made using US grownorganiccottoncertifiedunderthe USDA National Organic Program. The success of the AnvilOrganic® t-shirt, which was well received by distributors and screenprinters alike, lead to the interest of private label brands to inquire about using Anvil as the blank canvas to tell their own sustainability story. Additional products were then added to the Anvil Eco-Collection®, including the AnvilSustainable™ made from transitional cotton and post-consumer P.E.T. recycled polyester. The transitional cotton used for the AnvilSustainable™ was an opportunity for farmers to sell their cotton to market, which was undergoing the three-year period before beingcertifiedundertheUSDANationalOrganic Program. Anvil’s current Eco-Collection® extends to a selection of ten t-shirt styles.

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© 2012 Textile Exchange

Success Factors:

• Being a t-shirt of choice for both wholesale distributors and private label brands who want to embark on a sustainability journey by using an ethically manufactured product

• Having a close relationship with farmers on the ground which enables the company to both extend its support wherever it can and be flexibletoquicklyadaptwhentheharvestislow

• Being able to offer a good price point to customers, as organic cotton does not always have to come with an excessive premium

• Commitment to sustainability comes from the top and is integrated at all levels of the business and is backed up by a comprehensive set of company-wide policies and procedures

• Educatingtheconsumertounderstandthebenefitsoforganicfarmingfor both farmers and the planet by utilizing the t-shirt as an interactive tool with TrackMyT.com

“Anvil’s commitment to organic fiber has set the stage for expansion in the US. Although the demand for US grown organic has increased, that growth has been very slow, because no company would guarantee to buy; the farmer carried all of the risk of an unknown market. But then, Anvil came forward with a guarantee to purchase all US supply before purchasing foreign grown organic cotton. Then in 2010, Anvil instituted a “double it” campaign, offering to buy double our production. This partnership with Anvil assures a bright future for Organic cotton!” Jimmy Wedel, President of the board of directors of TOCMC

© 2012 Textile Exchange

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Value Chain Partners

When Anvil decided to launch its line of organic cotton t-shirts, the company looked for the right partner on the ground who could supply the company with organic cotton yarn. Contact was established with the Texas Organic Cotton Marketing Cooperative (TOCMC) and Anvil began to learn firsthandaboutthelivesandchallengesof farming organically. As an effort to support the US organic cotton farming community, Anvil decided to buy its organic cotton predominantly from domestic farmers as a way to leverage their output to market. Only when the organic cotton supply from the USisexhausted,Anvilwillsourcefiberfrom other countries with ethical and adequate labor and farm management practices. In 2010, Anvil was ranked as the largest buyer of US grown organic and cotton in transition and has been ranked as a Top Ten brand using organic cotton for three consecutive years by the Textile Exchange.

In 2010, Anvil launched the Double It! campaign which aims at doubling the acreage of organic cotton farming in the US through a commitment with organic farmers that Anvil will purchase all of their organic and transitional supply at an agreed upon premium to the price of conventionally grown cotton. Anvil’s close relationship and strong commitment to buying TOCMC’s organic cotton has been essential for new growers as they learnedthatAnvilwouldprovideafixedmarket to sell their yield, no matter what quantity was grown. This proved to be especially valuable when Texas was hit by a severe drought in 2011 and many organic farmers that relied on non-irrigated crops lost up to all of their harvest.

PHOTO(S):(Top)TOCMCfarmerinthefield (Bottom) Double It! Campaign

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© 2012 Textile Exchange

Telling the Story Evolving in the Business-to-Business market, Anvil usually does not have direct contactwithfinalconsumers.Thisfacthas not prevented the company from making tools available to spread its message of sustainability. For example, Anvil has turned the constraint of the Consumer Product Safety Improvement Act, requiring youth products to carry a tracking label with the location of production, into an educational opportunity by developing TrackMyT.com. TrackMyT is an online interactive website that allows the user to discover the journey their t-shirt has taken from farm to store, educating the viewer about the processes a t-shirt goes through starting onthecottonfieldandendingupintheirhands with tips to minimize the carbon footprint of owning a t-shirt. On each module, lesson plans are available for download by educators or parents alike that correlate to the stage that the t-shirt is in. All Anvil youth organic products

have a tracking number sewn into a label on the bottom hem where consumers can enter the unique number on www.TrackMyT.com.

OneofAnvil’smostimportantinfluencesis to work directly with brands and retailers to support them in their use of more sustainable products and offer them adapted solutions. As Christie Fleischer from Disney puts it “this is really a close collaboration which enables both companies to have an open conversation on what can be done in the journey to more sustainable materials.” Anvil also offers its private label customers years of experience in this journey, making the company a resourceful and knowledgeable partner.

© 2012 Textile Exchange

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Partnership with private labels: the Disney example Three years ago, Disney decided to move towards developing t-shirts made of organic cotton. They turned to their suppliers to explore who could help them in this journey. Having worked hard in the previous years to expand its offer of organic and sustainable products, Anvil was one of the few suppliers who immediately took up the challenge and even encouraged Disney to produce all its t-shirts from organic cotton, advice that Disney ultimately decided to follow. Besides Anvil’s strong commitment and track record in sustainability, Disney was particularly interested in the “TrackMyT” tool. TrackMyT.com is an educational website that allows users to input a unique tracking number printed on the bottom hem of their t-shirt, then explore cotton farms, a gin and spinners, as well as Anvil’s textile mill, cut and sew plants, and distribution facility, where it was shipped from. It also

features surprise pop-up messages and real photographs, alongside fun facts that focus on the historical and social aspects of manufacturing, buying and owning a t-shirt. At the end of the journey, users come to what’s called the “You” module, where they can gather information on how to minimize the impact of owning a t-shirt. Disney customers love it. Disney receives hundreds of visitors per week on the “TrackMyT” site and gets positive feedback from appreciative customers. This tool perfectly serves Disney in its efforts to build a strong relationship with its customers.

Disney decided not to pass any additional costs associated with organic cotton on to their customers in stores because they believed that turning to organic cotton was the right thing to do and they did not want to force their customers into having to make a choice. Instead, they forecast thatsaleswouldincreasesignificantlyand they did. Disney is continuing its commitment to organic cotton with the openingofthefirstDisneyBabyStorewhere 70% of the apparel and footwear products will be available in organic cotton.

PHOTO(S): Organic Farm (left) and Cotton Gin (right) stills from “TrackMyT” tool online.

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© 2012 Textile Exchange

“Since the start of our transition to organic cotton in 2009, we have found Anvil to be a dedicated and inspiring partner. Anvil invited us to visit the farmers from whom they buy their cotton, and this has further inspired us to move Disney Stores to a 100% organic cotton T-Shirt collection. We continue to expand our use of organic cotton, now in our baby clothes line” Christie Fleischer, Director, Merchandise - Softlines, Disney Stores

© 2012 Textile Exchange

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Advocacy and Leadership As Anvil’s sustainability programs grew and its Eco Collection® expanded with Anvil becoming the US’s largest buyer of organic cotton, the company saw the need to educate the future generation on the importance of organic farming. Anvil’s organic education campaign focuses on the social and environmental benefitsorganicfarmingandempowersconsumers to make a difference through their purchasing decision. In partnership with Earth Day New York, Anvil donated over 120 indoor organic gardens to the Solar1 network of schools in the New York City Department of Education system in 2011, as well as two indoor organic gardens to classrooms in Dillon, South Carolina (where our distribution center is) and one in Kansas City (continuing local efforts to support message of Farm Aid). Kits included organic soil, organic seeds, and a guide to leverage the garden as a teaching tool and lesson plans from TrackMyT.

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© 2012 Textile Exchange

Where to Next?

In May 2012, Anvil was acquired by Gildan Activewear Inc., a large Canadian apparel company that is in the same market segment as Anvil. Gildan has a proven track record of sustainable practices and programs and together, both brands will evolve in the sustainability realm of responsible manufacturing, environmental protection, and product innovation. Anvil sees the trend of using organic cottonandothersustainablefibresonthe upswing, with more demand coming from customers in the future. Anvil’s corporate social responsibility programs will continue to grow under their new parent company, Gildan. Both brands see sustainability not only as a strong advantage point in the apparel market, but more importantly as the right thing to do.

By creating a brand based on a strong foundation of integrity, quality and affordability, along with joining forces with a fellow ethical apparel manufacturer, Anvil will be able to sustain itself into the future.

“Over the years, we have developed mutual trust and a very close relationship with Anvil Knitwear who has become a key partner for TOCMC. Anvil’s long-term commitment, flexibility and ongoing support both in good and challenging times have been a key driver for our continued production of organic cotton.” Carl Pepper, Vice President of the TOCMC

Textile Exchange inspires and equips people to accelerate sustainable practices in the textile value chain. We focus on minimizing the harmful impacts and maximizing the positive effects of the global textile industry.

Our signature program focuses on organic cotton value chains; improving lives for farmers, stimulating markets, and supporting best practice.

Website: farmhub.textileexchange.org/

Copyright © 2012 Textile Exchange. All rights reserved.

For more information on Anvil Knitwear, please visit: www.anvilknitwear.com

www.anvilknitwearcsr.com