Our Sustainability Strategy

Our Sustainability Strategy Moving from new approaches to widespread change

When our founders, Doris and Don Fisher, started Gap Inc. in 1969, a key part of their vision of success was creating opportunities for the people and communities touched by our business throughout the world. In the decades since, we have been on a journey to live this vision. We have expanded our efforts to ensure that the people who make our products work in safe, fair conditions. We have started addressing our environmental footprint, taking steps to save energy, reduce our greenhouse gas emissions and mitigate other effects of making our clothes. And we have become more strategic in our work in the community, addressing social challenges through programs that leverage our company’s core strengths.

Now we find ourselves at an important turning point.

Gap Inc. leaders visiting factory

We’re working to integrate the work of creating social and environmental change more deeply into our business to unlock possibilities for Gap Inc. as well as people and communities.

We recognize that to create even greater change, the work of sustainability must become a seamless part of running our company. This business integration is a critical step that will unlock possibilities – for our company as well as for others.

We feel an urgency about moving to this next phase in our evolution. Global challenges such as climate change and inequality demand action – by all of us. We share an environment that must be protected by everyone. Likewise, none of us can reach our fullest potential if any one of us lacks the opportunity to do the same. Our futures are tied together – and we must act together.

At at glance strategy story
Strategy in store image

Throughout our journey, the connections between us have meant that when we work to positively change people’s lives, they change us too. When the people who make our clothes work in safe, fair conditions, they can become more productive and help us create better products. When women garment workers enhance their life skills through our P.A.C.E. program, they bring newfound confidence and abilities to their jobs and lives. When we keep chemicals out of local waterways and help prevent the negative effects of climate change, communities become stronger, in turn creating an environment in which our business can thrive. When our employees feel empowered to be their best, they enable us to be the same. One act builds on another.

Now, we aim to amplify these positive benefits by embedding the work of creating social and environmental change more deeply into our business. This change goes far beyond expanding programs, but represents a shift in mindset. Typically, our sustainability efforts have started off with dedicated teams inside Gap Inc. As we move forward, this work will start to belong to everyone, becoming part of how we run our business day-to-day. Because of our reach as a global company, we believe that this shift will enable us to create sustainable impact on a much larger scale.

Our strategy is comprised of three major stages: creation, integration and impact. Creation is when we first act or develop an innovative approach to creating social or environmental change. Once we demonstrate that our efforts bring benefits both to the people and communities we serve, as well as to our business, we move on to integration. Integration leads us away from a model in which sustainability is a separate function – and toward one in which a much broader group of actors drives change. The result of this strategy is impact – on a bigger scale and in a way that is sustainable for the long term.

A prime example of how business integration can help us move forward involves our efforts to improve working conditions for the people who make our clothes. We have been expanding these efforts for more than two decades and have played a leading role in multi-stakeholder innovations such as the Better Work program, a collaborative approach to monitoring factories. While we have made significant progress through the work of our sustainability team, we recognize that to create lasting, widespread change, our sourcing team and brands also need to play active roles. These teams are finding new ways to collaborate every day, including the setting of shared sustainability goals. They are also taking an integrated approach to measuring the performance of our suppliers across all dimensions that are important to us, from working conditions to environmental performance.

"Sustainability is evolving to a new phase within many companies, with a larger number of employees feeling real ownership and accountability for the work. It's this deeper integration into the business that will unlock greater progress and impact.” 

- Dan Henkle, Senior Vice President, Global Sustainability and President, Gap Foundation

Throughout our journey, the connections between us have meant that when we work to positively change people’s lives, they change us too. 

To support this work, we created a sustainability forum at Gap Inc. that brought together some of our most senior leaders across the company to explore new ways of collaborating. The forum established a new way of working across our teams – from infrequent, formal gatherings to day-to-day partnership across a wide variety of issues. We’re now exploring how to take this collaboration to the next level, including joint ownership of long-term, ambitious goals that are approved and owned by leaders throughout the business.

Another example in which business integration can drive change on a larger scale centers on our efforts to create greater equality. We engaged a third party and became the first Fortune 500 company to disclose that we pay female and male employees equally for equal work around the world – whether dollar for dollar, pound for pound, yen for yen, or euro for euro. In the U.S., for example, a woman makes 78 cents for every dollar a man earns. National Equal Pay Day represents how far into the current year many women must work in order to close the gap from their previous year’s earnings. In 2015, the date fell on April 14.

Committing to equal pay for equal work has its roots in our culture. Our co-founder Doris Fisher established early on that women would play a key role at Gap Inc. Today, with over 70 percent of our senior leadership team comprised of women, our commitment to their advancement is thoroughly integrated into our business. As a result, we can work to create impact on a larger scale. Beyond shaping our own culture, we seek to influence the culture at large – by making a statement about equal pay for women, we hope to inspire other companies to follow suit.

A final example of how business integration can spur our progress involves our efforts to unleash the potential of youth through the transformative power of work. Through our signature program This Way Ahead, we provide job readiness training and paid internships for underserved youth in major cities such as New York and San Francisco. To date, 75 percent of This Way Ahead interns have been hired as permanent store associates, and their average tenure is almost twice as long as that of their peers.

In other words, as youth have learned valuable skills and gotten jobs, we have benefited by gaining access to a strong pipeline of talent. Now, given the benefits to our business and young people in our communities, our brands are eager to play a greater role in This Way Ahead, taking it beyond the realm of Gap Foundation, which launched the program in 2007. We are also setting goals to hire many more store associates from the program, thereby creating change on a larger scale.

Youth in This Way Ahead Program

An example in which business integration can drive change on a larger scale centers on our efforts to create greater equality.

Business integration goes hand-in-hand with focusing in on the key issues we need to prioritize in order to create the greatest impact. To identify these priorities, we recently conducted an in-depth materiality assessment, weighing which issues matter most to our business and the people and communities we touch. We broke these issues into three main categories: governance and operating context; human rights and social impacts; and resource use, scarcity and impacts.

Some of our findings reaffirmed our current direction. For example, we have long considered human capital and development – the ability of people to reach their potential and work at their best – to be critical to our success. Our conclusions also underscored that water stewardship is essential for our business, as well as for people and communities, and we are deepening our work in this area. Other issues that emerged in our materiality assessment will demand more of our attention in the future. A prime example is radical transparency, which is changing the business environment, as consumers and stakeholders seek greater openness about products and services. We are asking how this new reality can become a tool for continuous improvement, so that radical transparency can be an advantage for our business.

In some of the areas we are focused on, we are still at the early, creation stage of our strategy, while in others we have gone much further. And we are determined to continue on the journey. In September 2015, for example, we announced a commitment to educate one million women worldwide through our P.A.C.E. program, a scale that was barely imaginable when we first launched P.A.C.E. in 2007. Over time, we see enormous potential to bring our strategy to life in other areas, from fighting climate change to further supporting equality. And we believe that our efforts will help us become not just a more sustainable company, but a better company, one that unlocks new possibilities for all of us.

Business integration goes hand-in-hand with focusing in on the key issues we need to prioritize in order to create the greatest impact.