POLICIES AND COMMITMENTS:

• Our Code of Business Conduct (COBC) requires our employees to act ethically and with integrity. It also includes provisions on salient human rights issues. All employees receive a copy of the COBC when they join Gap Inc., agree in writing to comply with it, and are required to complete an overview training course.
• Our Human Rights Policy is founded on the principles outlined in the United Nations Universal Declaration of Human Rights (UDHR) and the International Labour Organization’s Declaration on Fundamental Principles and Rights at Work (often referred to as the ILO Core Conventions). The policy applies to both our wholly owned operations and our supply chain.
• Our Code of Vendor Conduct (COVC) applies to all facilities and third-party licensees that produce branded goods for Gap Inc. or any of its subsidiaries, divisions, affiliates, or agents, which states that the company prohibits the use of “involuntary labor of any kind, including prison labor, debt bondage, slave labor or forced labor by governments."
  • ​Our COVC has stringent requirements regarding foreign contract workers, who are at risk of exploitation through indentured servitude. We have a “no fees” policy which requires that any fees and costs payable to host governments for the documentation of foreign contract workers be covered by the facility. The policy also restricts payment of any employment or recruitment costs from workers themselves. Our policy must be upheld throughout the entire employment cycle of foreign contract workers. The policy requires suppliers to hold direct employment contracts and agreements with all contract workers. These requirements span recruitment, employment, up to termination of employment, and provide the lens through which our assessors look at policies, practices and conditions in the facility to find indications of forced labor. More information on our policies and procedures regarding foreign contract workers is available online.

​​Gap Inc. is a signatory of the International Accord and a member of the Pakistan Accord, a pivotal agreement aimed at enhancing health and safety standards within factories in Pakistan.

In 2022, we signed the Dindigul Agreement, an agreement between brands, suppliers, and labor groups to address gender-based violence and harassment at an apparel facility in Tamil Nadu, India. Cornell University’s Global Labor Institute released an independent assessment of the agreement, indicating significant progress in eliminating gender- based violence and harassment (GBVH) at the Natchi Apparel Factory.

DUE DILIGENCE PROCESSES:
We have mapped our supply chain through Tier 1 (cut and sew garment factories) and are continuously expanding our mapping of Tier 2 (fabric knitting, weaving, and dyeing mills) locations. For non-merchandise vendors, we typically reserve rights of assessment in our contracts and exercise such rights when appropriate to verify vendor compliance with applicable laws and contractual terms.

Direct Operations: We operate in accordance with our Human Rights Policy, COBC, and local labor laws. Members of our store management team visit our retail stores regularly to ensure that our policies are put into practice and followed, and our Asset Protection and Internal Audit teams carry out annual assessments of our stores. Similar internal audit processes are carried out in respect to practices within our distribution centers. We have a hotline available for employees to report any breaches of policy, as well as an anti-retaliation policy that protects them when doing so. Our employees agree in writing to comply with our COBC, and a breach of the ethical principles contained therein could lead to disciplinary action up to and including dismissal.

Supply Chain: Prior to accepting any order for a Gap Inc. branded product, suppliers are required to sign our Vendor Compliance Agreement (VCA), a legally binding document that is a condition of doing business with Gap Inc. Our vendor approval process requires new suppliers for branded apparel product to undergo a COVC assessment prior to beginning production for Gap Inc. Initial assessments for new facilities are generally coordinated with the requested vendor or facility. After the assessment, the facility either earns approval or is placed in pending status while it addresses outstanding issues.

Gap Inc. staff visit factories in-person several times a year to audit against our COVC and to implement our capability building programs, as outlined in our COVC:

“The facility shall allow Gap Inc. representatives or agents unrestricted access to its facilities, workers for interviews, and the review of relevant records at all times, regardless of whether advance notice is provided.”

The COVC assessment contains provisions related to forced labor, child labor, foreign contract workers, identity document retention, and more. In signing Gap Inc.’s VCA, which incorporates our COVC, Gap Inc. suppliers agree to comply with the following:

“All applicable laws, rules and regulations … these laws include, but are not limited to, laws relating to the employment conditions of their respective employees such as: (1) wage and hour, labor, child labor, and forced labor requirements; (2) health and safety; (3) immigration; (4) discrimination; (5) labor or workers’ rights in general; and (6) environmental laws and regulations.”

We recognize that policies and expectations alone are not a sufficient safeguard against forced labor within our supply chain. Our statements lay the foundation for our comprehensive approach to engaging and collaborating with our suppliers to monitor, remediate and continuously improve their performance regarding responsible labor. Our expectations for foreign contract workers and recruitment are available online.

Gap Inc.’s Vendor Compliance team is responsible for the implementation and monitoring of our COVC policies and standards relevant to forced labor, child labor, and human trafficking at all Tier 1 branded apparel supplier facilities, and a growing number of Tier 2 strategic mill facilities. Our Vendor Compliance team members – who are locally hired in the countries from which we source and who speak local languages – assess and validate that suppliers are meeting the expectations outlined in our COVC. We also interview workers as part of our due diligence and verification processes.

An increasing number of facilities producing our branded apparel also participate in either the Social Labor Convergence Program (SLCP) or the Better Work program, a collaborative facility monitoring and capability building initiative led by the International Labour Organization (ILO). Facilities participating in Better Work are assessed by specialists employed by the ILO. These assessments are 100% unannounced and assessed against national labor laws and ILO Conventions, which includes instruments that directly cover forced labor. As of end of fiscal year 2024, 100% of in-scope Tier 1 facilities and 82% of Tier 2 strategic mills are participating in SLCP (Social and Labor Convergence Program) or Better Work. We expect 100% of Tier 2 strategic mills to participate by fiscal year end 2025.

Franchisees and Licensees: Gap Inc. also does due diligence periodically with respect to our franchisees and third-party distributors. Such due diligence includes various actions including research into franchisee supply chains and working conditions.

For our Licensing business that launched in 2021, we require all factories considered for producing licensed products to submit a recent third-party audit report from an approved auditing firm before they are approved to begin production. Our teams review these audits and will reject the factory for production if forced labor is found. In 2024, we conducted our first licensee audit.

IDENTIFYING AND MANAGING RISKS:
Gap Inc. works with governments, NGOs, and trade unions, and monitors resources – such as the U.S. Department of State’s Trafficking in Persons Annual Report and the Global Slavery Index – to identify high-risk areas in our supply chain. We have identified risks to the best of our knowledge and will continue to strive to identify emerging risks. We assess risks to especially vulnerable groups, including migrants, children and adolescents, and women. Our COVC specifies our management approach towards ensuring free and voluntary labor for all workers. In addition, we conduct desktop reviews of key supplier and worker documents to assess forced labor risks.

We also understand that there are human rights risks in our raw materials supply chain and are working diligently to manage these risks, which can include country of origin declarations from suppliers, using fiber-tracing technologies, and collecting documents that provide visibility into the flow of cotton and other materials that may enter our supply chain. We are using several technologies and partnerships to help us evolve and mature our approach to enforcing our standards on cotton.

The definitions of forced labor and child labor used by Gap Inc. align with international norms but may differ in detail from the definitions of these terms used in the Modern Slavery Act or Bill S-211. While Gap Inc. does not believe that these differences result in any material difference in outcome, we do intend to review the definitions used in our various policies and procedures to further align the technical aspects of these definitions going forward.

Foreign Contract Workers: We identified areas of high risk for foreign contract workers and enacted measures accordingly. For example, we have previously communicated responsible recruitment requirements to Tier 2 mills in Taiwan and South Korea where there is elevated risk to foreign contract workers. Based on the results of our risk analysis, we also performed desk assessments on our Tier 2 mill facilities in South Korea and validated that their employment practices comply with our COVC and local legal requirements. We audited all Tier 2 mill facilities in Taiwan hiring foreign contract workers, developed improvement plans where non-compliances were found, and continue to follow up to validate resolution of non- compliance. More details are available on our website.

Since 2015, based on a thorough risk assessment, we have strengthened our Foreign Contract Worker Requirements by providing additional detailed guidance on recruitment, fees, employment contracts, and onsite policies and practices, including equal treatment and non-discrimination. Our Foreign Contract Worker Requirements are a sub-section of our COVC (page 15-19), COVC Assessment Manual, and are subject to regular review and annual revision, whenever we feel enhancement and updates are needed.

Unauthorized Subcontracting (UAS): We identify UAS as a risk because suppliers may outsource production to facilities that we have not approved and that do not uphold our requirements for safe, fair labor practices and working conditions.

Smaller, unauthorized units may have labor practices that put workers at risk and are beyond the view of our assessment and remediation team. We address UAS issues through collaboration between our sustainability and sourcing teams, including knowledge sharing on how to detect subcontracting during the periodic facility assessments conducted by our sustainability field team. In countries with high risk of UAS, we take extra precautions by offering specialized awareness training for suppliers and facility management, and by conducting site visits to ensure our product is being manufactured in the appropriate designated facility. When unauthorized subcontracting is detected, our Vendor Compliance team will assess the unapproved facility for forced labor and other critical issues, as described more fully in the “Remediation” section below.

Refugee Workers: Risk-mapping helps identify the risks that refugee workers may face. We are committed to partnering with a broad set of stakeholders to confirm that our suppliers have the appropriate capabilities and infrastructure to make opportunities for employment and fair, decent working conditions available to refugees.

Forced Labor and Child Labor: We have engaged stakeholders to address the risk of forced labor in the supply chain. When it comes to the raw materials used for our products, we recognize that forced labor and child labor are risks, particularly within cotton cultivation. Cotton supply chains are often opaque, complex, and can involve traders and agents that facilitate the exchange of cotton and yarn between the different stages of production. Considering the historical evidence on forced labor and child labor in Uzbekistan’s cotton industry, we currently do not source any cotton there. We also recognize that Uzbekistan has made significant strides in eradicating forced labor and child labor, and we will continue to monitor the conditions there based on expert organizations’ findings such as those from the International Labour Organization and the Cotton Campaign. In 2018, based on evidence of forced child labor and/or forced labor within the cotton fields of Turkmenistan, we expanded our policy to make it clear that we will not accept any clothing manufactured with fabrics that were knowingly made from Turkmen cotton, aligned with the Turkmen Cotton Pledge led by the Responsible Sourcing Network.

REMEDIATION:
We take remediation measures and will continue to identify and address any gaps in our response.

Forced Labor: We consider the following within our forced labor standards: forced labor, free egress, restrictions to voluntarily ending employment and restrictions on worker movement. In the event our assessments reveal a facility in violation of these standards, our Vendor Compliance team works with factory management, local stakeholders, and worker-representative organizations to create a corrective action plan, conducts follow-up visits to validate remediation is completed and educates workers on their right to free movement. Our policies and action plans for forced labor incidents are described further online.

In 2024, Gap Inc. joined the Harvesting the Future – Cotton in India initiative to work collaboratively with other brands and manufacturers to improve conditions for cotton producers, harvesters, and their families in Madhya Pradesh, India.

Through the American Apparel and Footwear Association, we are also working with a coalition of brands to assess and remediate issues related to foreign contract workers in Taiwan.

Unauthorized Subcontracting (UAS): Our Vendor Compliance, Quality Assurance, and Merchandising teams seek to prevent and detect UAS. If a UAS case is found, we investigate, require remediation, and shall impose financial chargebacks, or, in severe or repeat cases, we will terminate our business with the supplier.

We immediately escalate UAS incidents, and take the following steps:

• Require the unauthorized facility to immediately stop production of any Gap Inc. branded apparel.
• Require all goods (finished or unfinished) be returned to a facility approved by Gap Inc., segregated and held until the issue is resolved.
• Lead an investigation to look for and address any critical issues in the unauthorized facility.
• Require the approved facility to register for management systems training as a preventative measure and ensure that the facility invests in systems to prevent future violations.

We found six cases of UAS in 2024 and in response, fully enforced our policies, which involved imposing financial chargebacks and business termination.