Modern Slavery Statement 2023 - 2024

1. Introduction
2. Organisational Structure And Supply Chain
3. Countries Of Operation And Supply
4. Responsibility
5. Due Diligence
6. Performance Indicators
7. Training

This statement sets out Lounge Underwear’s actions to understand all potential modern slavery risks related to its business and to put in place steps that are aimed at ensuring that there is no slavery or human trafficking in its own business and its supply chains. This statement relates to actions and activities during the financial year [1 July 2023 to 30 June 2024].

As part of the E-commerce retail sector, the organisation recognises that it has a responsibility to take a robust approach to slavery and human trafficking.

The organisation and its Board of Directors is absolutely committed to preventing slavery and human trafficking in its corporate activities, and to ensuring that its supply chains are free from slavery and human trafficking.

This statement covers the activities of Lounge Underwear Ltd: Lounge Underwear Ltd has seen exponential growth since its launch in 2016 and continues to see revenue, customers and orders increase year on year, the company is under the control of a board of 3 Directors and has subsequently started to grow out a management team to ensure that the company can easily be scaled to deal with the demand. Lounge’s supply chain team is currently going through a remodel and new internal training will need to be carried out, we can and will rely on non-biased 3rd party experts in this matter as and when required. Lounge was established in the UK and sells its own-branded products through its D2C model via lounge.com to its core market of 16-30 year olds in the UK and internationally through it’s 8 online stores. The brand currently has 4 arms to its offering including Apparel, Swimwear, Intimates and its main focus, Underwear.

Product Design

All products are designed in house at the Lounge HQ by a dedicated team of designers and merchandisers, based in the UK.

Manufacturing

Lounge currently carries out no in house manufacturing, all manufacturing is outsourced to international partners who work closely with the Lounge design team to turn designs into reality.

Distribution

All goods are shipped directly into one of Lounges warehouses, it currently operates two, one in the United Kingdom and one in Belgium.

• Lounge Underwear currently only has direct operations within the UK, however works closely with its international supply chain partners in China, Cambodia, Sri Lanka, Mauritius, Bangladesh and Turkey.

• Lounge ensures through internal and 3rd party risk assessments that all employees and partners pay close attention to anti-slavery and human trafficking guidelines - Lounge has set out improvement plans to increase its employees knowledge on this subject.

Responsibility for the organisation’s anti-slavery initiatives is as follows:

Policies

Lounge’s Board of Directors review policies on a regular basis and ensure that they are suitable for our activities.

Risk assessments, investigations and due diligence

Lounge’s Board of Directors approve all suppliers before any business is commenced. In house designers, merchandisers and procurement teams carry out required due diligence on proposed new suppliers and feed this back to the required persons. On going due diligence is also carried out.

Training

Lounge Underwear’s board of Directors are committed to stopping Modern Slavery and Human Trafficking, therefore Lounge is putting in more robust training programmes to ensure all partners and employees are better aware of the issues and operational needs in regards to stamping out this on going international issue. More training is required company wide and this is due to be ongoing into 2023 and 2024.

The organisation undertakes due diligence when considering taking on new suppliers, and regularly reviews its existing suppliers. The organisation’s due diligence and reviews include:

• Mapping the supply chain broadly to assess particular product or geographical risks of modern slavery and human trafficking;
• Evaluating the modern slavery and human trafficking risks of each new supplier;
• Reviewing on a regular basis all aspects of the supply chain based on the supply chain mapping;
• We will begin to conduct and review suppliers audits and assessments in 2023/24
• Taking steps to improve substandard suppliers’ practices, including providing advice to suppliers;
• Invoking sanctions against suppliers that fail to improve their performance in line with an action plan or seriously violate our supplier code of conduct, including the termination of the business relationship.

The organisation has reviewed its key performance indicators (KPIs) in light of the introduction of the Modern Slavery Act 2015. As a result, the organisation is:

• Re-training staff within specific roles to have completed training on modern slavery.
• Introducing new audits and hiring 3rd party supply chain auditors to ensure that the correct reports and audits are carried out and reviewed.
• Constantly reviewing its existing supply chain.

• Our business’s purchasing practices, which influence supply chain conditions and which should therefore be designed to prevent purchases at unrealistically low prices, the use of labour engaged on unrealistically low wages or wages below a country’s national minimum wage, or the provision of products by an unrealistic deadline;
• How to assess the risk of slavery and human trafficking in relation to various aspects of the business, including resources and support available;
• How to identify the signs of slavery and human trafficking;
• What initial steps should be taken if slavery or human trafficking is suspected;
• How to escalate potential slavery or human trafficking issues to the relevant parties within the organisation;
• What external help is available, for example through the Modern Slavery Helpline, Gangmasters Licensing Authority and “Stronger together” initiative;
• What messages, business incentives or guidance can be given to suppliers and other business partners and contractors to implement anti-slavery policies; and
• What steps the organisation should take if suppliers or contractors do not implement anti-slavery policies in high-risk scenarios, including their removal from the organisation’s supply chains.