< Previous3839CUSTOMER FOCUSSustainability Report 2017Customer satisfaction has always been the main goal for the Salva-tore Ferragamo when defi ning its strategies, from the design of the product to the service offered at the stores. Respect is the foun-dation of the relationship with customers. This is why the Group works on several initiatives to de-liver a satisfactory and delightful purchase experience that meets the desires of its customers.A customer-centric strategy has been adopted anticipating the needs of existing and potential customers in order to create long-term value. In 2017, the Group doubled down on this approach by conducting sales and sectors analysis and constantly monitoring market trends to guide the crea-tive teams in the development of “glocal” collections that can better meet the expectations of Ferraga-mo customers. In 2017, the Group also introduced thematic offerings consistent with a Buy Now/ Wear Now approach, which consists in allowing customers to buy an item they can start wearing right away.The partnership with art has al-ways been fundamental in Ferrag-amo's world, and conveying this to customers further strengthens their connection with the Brand. During the 2017 holiday season, the Group asked the Italian artist Simone Massoni to design limited-edition greetings cards for all Sal-vatore Ferragamo customers. In addition, a number of European stores held an event featuring Mr. Massoni, who customized the cards on the spot with drawings requested by the customer.To ensure customer satisfaction, the Group strives to make its sales personnel capable of con-veying the passion for craftsman-ship and quality that character-ized Salvatore Ferragamo. There-fore, retail staff training is key to keeping the Brand exclusive and driving engagement. The goal is to make every employee aware of the Company culture, which is made up of traditions as well as strong and distinctive values. Dur-ing 2017, the sales staff of the Salvatore Ferragamo Group were provided with over 45,000 hours of training and, in order to transmit inspiration and the themes under-pinning the collections, seasonal training sessions were dedicated to Men’s and Women’s collections, tailored depending on the informa-tion relating to the purchases of the different stores. Training ses-sions were offered through the new iLearn digital learning plat-form, available to both retail and wholesale staff. The platform, accessible from PCs, tablets and smartphones, is based on an adap-tive technology allowing it to work perfectly on any device. The con-tents include a general introduc-tion to the history and legacy of Salvatore Ferragamo, information on product storytelling and the selling ceremony, as well as more specifi c and professional contents related to individual product cate-gories. The Group uses the iLearn platform also to distribute expand-ed seasonal training programs, optimizing them in terms of form and usability, as well as contents focusing specifi cally on the key selling points and storytelling. At the end of each training module, employees are given tests whose results are tracked by the digital platform; everyone can download their certifi cate of attendance and digital passport, which includes a record of all digital courses at-tended. Between April 2017, when iLearn was launched, and last December, employees across the 30 countries involved in the project completed over 73,700 courses. The platform is available in 9 languages and Russian, Thai and Arab will be added during 2018 to promote it in all the coun-tries where the Group operates.Besides online training sessions, the Group also offers in-class ses-sions to client advisor teams with the goal of strengthening not only their sales skills and customer ap-proach, but also expanding their knowledge of specifi c topics such as Chinese culture and the pro-cessing and characteristics of leather hides. In addition, in 2017 the Group introduced a new cus-tomer relationship management training format for sales teams: this highly interactive program ex-plains the current interaction strat-egy and includes practical exam-ples and exercises to implement it as best as possible. As for mana-gerial training for store managers, the focus is on the skills required to manage the store, upgrading the skills of employees, sales per-formance coaching and the align-ment with the Company's goals. In 2017, the Group provided more than 13,200 hours of in-class training to over 940 employees. These sessions are crucial to op-timizing customer greeting at the store and conveying the Brand's key values.4041Sustainability Report 2017Concerning the initiatives for the benefi t of customers, the Group uses the “Authenticity Tag” sys-tem, which protects the consumer purchasing a genuine and Made in Italy Ferragamo product, pre-venting and limiting counterfeiting. Said innovative traceability pro-ject consists in the implementation and adoption of an NFC (Near Field Communication) solution to uniquely identify any of the Sal-vatore Ferragamo products. NFC is a radio-frequency technology based on a chip, which stores the data and an antenna that sends signals using radio waves. The combination of chip and anten-na is the so-called Tag. A device known as reader is able to decode the radio signals emitted by the RFID (Radio Frequency Identifi ca-tion) Tag. The NFC Tag is embed-ded into the product at the end of the manufacturing process and activated following a quality con-trol check. It cannot be counter-feited, as it is based on a unique identifi er certifi ed and assigned by a manufacturer. It allows to encrypt or protect the data on it with a password as well as read it from a distance of only a few centimeters using new generation smartphones. Industry insiders can also exclusively access an ap-plication that reads some of the data stored in the Tag, such as the serial number, the manufactur-er number and the collection the product is part of. The Group has gradually expanded the scope of the project in recent years and the Tag is currently embedded into all Ferragamo leather products, with the exception of a few models. In addition, the project has entered production for ties and scarfs starting from the PS2018 collection.Over the years, the Salvatore Fer-ragamo Group has implemented a series of offl ine and online anti-counterfeiting measures to pro-tect its customers and the value of its brands. Online monitoring has been delivering remarkable results for years now: in 2017, 35,253 illicit contents and profi les were removed from the main so-cial media platforms and 68,784 listings of counterfeit products were identifi ed, blocked and re-moved from online auction sites. In addition, during 2017, 111 illicit websites were tracked and taken down, and 47 uses of “Ferraga-mo” as a keyword on digital Mar-ketplaces were removed. In 2017, the Group constantly monitored physical marketplaces through several non-judicial and judicial initiatives, focusing its efforts on China, one of the countries most affected by counterfeiting. Dur-ing the year, 62,397 counterfeit goods were seized in China and 268,029 worldwide. The Group's commitment against counterfeit-ing has delivered remarkable re-sults thanks to the relentless ef-forts to safeguard its brands as well as the development of new tools to protect its industrial and intellectual property rights. The Group will double down on these efforts in 2018.42INSTAGRAMPINTERESTLINKEDINTWITTERWECHATWEIBOTUMBLRFACEBOOK+14.2%+22.7%+10.2%+96.6%+11.6%+60.5%+9.0%+50.2%THE SALVATORE FERRAGAMO GROUP ON SOCIAL MEDIAGROWTH IN FOLLOWERS (2016 vs 2017)The Group's strategy is connect-ing the online and offl ine worlds to promote and value the custom-ers’ engagement with Ferragamo. Integrating digital channels of communication completes the Brand experience of the Salvatore Ferragamo Group, offering cus-tomers an hands-on opportunity to learn more about the Brand.To further strengthen the con-nection between customers and the Ferragamo world, in 2017 the Group updated its eCommerce platform, launching the US and Canadian eStores in May and all European ones in November. With the new interface, the website delivers an innovative and intui-tive user experience, highlighting the craftsmanship and world-class quality of Ferragamo prod-ucts. In 2018, the Group plans to launch the new website in Korea and Australia. Since introducing the eCommerce platform in 2009, the Group has been adding more and more functionality to meet the needs of its digital customers: new payment methods, customization options, new product categories, and the introduction of exclusive products. Since 2016, US custom-ers can use the Reserve in Store, Stock Enquiry and Pickup in Store services. All this is part of the ini-tiatives related to the omnichan-nel project, which aims to steer customers from online channels to the physical stores in order to gather information allowing to cus-tomize online offerings and com-munication. In addition, in 2017 the fi ve European eStores as well as those in Australia and Mexico introduced the functionality to re-cover abandoned shopping carts. The launch of the new website in Europe coincided with the activa-tion of the Stock Enquiry service, which allows to identify the stores where the product selected on the site is in stock. In 2018, European stores will introduce the On Behalf Of service, allowing sales staff to buy in store products not currently in stock on behalf of customers using an iPad. The improved func-tionality and services offered by the online channel has caused the number of subscribers to the Fer-ragamo eCommerce newsletter to rise by 32.4% in 2017 compared to the prior year. The digital evolution of the last few years has signifi cantly changed Ferragamo's social strategies. Using social media allows to fur-ther engage customers and de-liver a comprehensive experience through short Brand stories posted in a tailored format for each chan-nel. In 2017, the Group launched several digital campaigns: High Tech High Craft marked the start of the creative season of Paul Andrew, Ferragamo's new crea-tive director of Women's Collec-tions, inspired by cutting-edge technology and the know-how of Italian master craftsmen. The High Tech Botanical event for the reopening of the historic Canton Road fl agship store in Hong Kong was covered on social media us-ing the hashtag #FerragamoHK. Another key focus of Ferragamo's digital campaigns in 2017 was the partnership with young interna-tional infl uencers, which resulted in fresh and spontaneous contents allowing to deliver the Brand's message to a younger audience. Meanwhile, the FW17 campaign, created by the photographer Walter Pfi ffer, was centered on the emotions the product elicits in the customer, emphasizing the creativity and elegance of the Brand's key products while plac-ing special emphasis on shoes and bags. Bearing witness to the success of the campaigns under-taken and the strong commitment which the Group places on digital communication, 2017 was marked by a solid increase in the number of followers on the main social channels. Specifi cally, the number of followers on the Chinese so-cial media platforms WeChat and Weibo increased by a signifi cant 96.6% and 60.5%, respectively, compared to the previous year.4445Diversity and equal opportunityAttracting and developing talentWellbeing of peopleA SHARED HISTORY4647Sustainability Report 2017A SHARED HISTORYEMPLOYEES WORLDWIDE1,2783,913HEADQUARTER EMPLOYEES2,905RETAIL EMPLOYEES1,163EMPLOYEES UNDER 30EMPLOYEES ON PERMANENT CONTRACTS≈ 70%WOMEN EMPLOYEES4,183THE SALVATORE FERRAGAMO GROUP IN 2017Expertise, passion and dedication to work are the characteristics of the people that every day deliver exclusive products and experiences to the Salvatore Ferragamo Group's customers all around the world, based on the heritage and values passed on by the Founder. The Group consid-ers its human capital to be crucial and is committed to maximizing the potential of its people at each step of the production chain, investing in the professional growth of its employees and attracting new talents while complying with occupational health and safety standards. For years now, the Salvatore Ferragamo has been formalizing its care and attention for its people inside the Company Regulation that set out the principles underly-ing the employment relationship as well as the main rights of Ferragamo employees, summarized in the section on employee rules of conduct. The Regulation is available and freely accessible to all employees through the company Intranet.In December 2017, the Group reaffi rmed its position by publishing the Sustainability Policy, which sets out the principles and values governing the social protection of its people. This document consolidates the Group's commitment to fully respecting human rights and the rights of its employ-ees as recognized by national and international conventions and declara-tions as part of its operations, as well as rejecting any form of child labor, forced labor and discrimination based on personal characteristics irrele-vant to a person’s work. In addition, the Group wants to promote the well-being of its employees and is committed to initiatives aiming to improve their work-life balance.As of 31 December 2017, the Group had 4,183 employees, up 3.6% from the previous year. There were also other 340 individuals working at the Group in various capacities. The age range between 30 and 50 is that with the highest number of employees (62.1% of the total workforce).4849Sustainability Report 2017DIVERSITY AND EQUAL OPPORTUNITYEMPLOYEES OF THE SALVATORE FERRAGAMO GROUP - 31 DECEMBER 2017NORTH AMERICACENTRAL AND SOUTH AMERICAASIA PACIFICJAPANTOTALEUROPEPARENT COMPANYNO. OF PEOPLEMENWOMENTOT6393303092011001011,5661,271295433351824,1832,8561,327393255138951549402The Salvatore Ferragamo Group manages and develops its human capital by integrating and respect-ing diversity. Employee relation-ships are based on the principles of fairness, integrity and respect, preventing any discrimination based on age, race, ethnicity, nationality, political views, trade union mem-bership, religious beliefs, sexual orientation, gender identity, physi-cal and mental disabilities and any other personal characteristics, in line with the Group Code of Ethics. Special emphasis is placed also on providing equal opportunity, en-suring the same work conditions for male and female employees and promoting initiatives to help balance family and professional life through different types of em-ployment agreements.As of 31 December 2017, among the employees on open-ended con-tracts, 51 men and 231 women had chosen to work part-time.Women play a key role in the Sal-vatore Ferragamo Group: they ac-count for 68.3% of its employees and hold more than 65.0% of sen-ior management positions. In addi-tion, women make up a signifi cant 30.8% of the Parent Company Board of Directors, in accordance with applicable laws.The Group adopts remuneration policies that recognize the per-sonal contribution of each em-ployee according to the principles of gender equality and merit. For several years now, the Group has been implementing a remuneration system differentiated for employ-ee category, including economic incentives contingent on individual and company performance goals aimed at promoting a sense of be-longing and teamwork. Over the next few years, the Group will up-date the existing system through the Job Grading project, which will allow to analyze the work of all employees in depth and therefore ensure gender equality in remuner-ation policies.Concerning the employees be-longing to protected categories (74 employees at 31 December 2017), the Group complies with applicable laws in the countries in which it operates.Finally, as for industrial relations, 35.9% of the Group's employees are covered by collective bargain-ing agreements, as required by ap-plicable laws and regulations in the countries in which it operates.5051Sustainability Report 2017ATTRACTING AND DEVELOPING TALENTAttracting new talents is key to the relentless innovation that char-acterizes the Group as well as the Brand's success. Confi rming this commitment, in 2017 1,637 em-ployees joined the Salvatore Fer-ragamo Group, of whom around 54.7% were under 30 and 68.7% women, thus recording a staff turnover of 39.1%. These turno-ver rates account for the industry the Group operates in and mostly refer to retail staff.Offering a stable and long-lasting employment relationship as nec-essary to foster the Company's growth, as well as an important motivational factor. The high pro-portion of employees on perma-nent contracts, accounting for 93.5% of the total in 2017, is evi-dence of the Group's commitment in this sense. During the year, the Group improved the process dedi-cated to the professional growth of employees with the Internal Job Posting project: this allows to constantly update open positions, informing employees in a timely manner. The Group will continue developing the project in the up-coming years to promote a closer integration between all the areas in which the Salvatore Ferragamo Group operates.In Italy, the Salvatore Ferragamo has an Induction program for all new recruits aimed at transmitting the Brand’s values right from the start and creating a strong sense of belonging. The three-day Clas-sic Induction course consists in a training session to introduce new hires to the Brand, the history of the Founder and the Group's val-ues, as well as guided tours of the Museum and the Historical Archive in partnership with the Ferragamo Foundation and the Salvatore Fer-ragamo Museum. The Customized Induction, which is reserved to ex-ecutives and managers, is insteadtailored to the role that the incom-ing manager is required to fi ll. In addition, to celebrate the 90th anniversary of Salvatore Ferraga-mo's return to Italy, the Group held an Induction session to convey the Archive's importance and moderni-ty to Creative and Product teams. The event “Our fi rst 90 years. An archive to be touched” allowed participants to view and touch im-ages, products, videos and mate-rials of the prestigious Historical Archive, entering into contact with the Founder's modern creativity that has always been the hallmark of Ferragamo's collections.To select and attract top talents, the Parent Company has partner-ships with several Italian Universi-ties, Business Schools and Design Academies, organizing presenta-tions, career days and fi eld pro-jects. During 2017, 11 Employer Branding sessions were held dur-ing which Salvatore Ferragamo met 869 students, 16 of whom started working with the Compa-ny. In 2018, the Company plans to strengthen its partnership with leading Design Schools to offer anadvanced training program to young creative talents in the fi eld of design and accessories.The Group pays special attention to the families of its employees: in 2017, it launched the Store Internship for Employees’ Sons and Daughters program, offer-ing the children of its employees the opportunity to work at the Brand's stores and live a work ex-perience in the Ferragamo world. In 2018, the program will be ex-tended also to the siblings of the Group's employees. In addition, for a few years now Salvatore Ferragamo has been the offi cial partner of SDA Bocconi School of Management's Master in Fashion, Experience & Design Management (MAFED), an international pro-gram for those who want a mana-gerial career in the fashion, luxury and design industries.Training its employees is a key pri-ority for the Salvatore Ferragamo Group, as it is a precondition for individual growth and the devel-opment of the competencies that make up the heritage at the core of its success. Specifi cally, in 2017the Group provided approximately 54,550 hours of training to its em-ployees, nearly 17% at its head-quarters and more than 83% in the retail segment. Maximizing the potential of its employees is just as important to the Group, which in 2017 continued providing train-ing and development opportuni-ties to the talents identifi ed at the corporate level in the previ-ous year and launched a project to design a global Talent Manage-ment system. As part of its own Ferragamo Excellence model, the Parent Company identifi es nine essential competencies divided into Core and Managerial Compe-tencies, to be enhanced in each employee. Core Competencies are key for all employees and enable them to achieve high levels of performance and quality as well as promptly address issues and problems as they arise by working in teams and exploring new ideas and solutions. The Group has iden-tifi ed additional competencies for middle and senior managers fo-cusing on knowledge that is crucial in order to create value and im-prove competitiveness over time, inspiring enthusiasm and a passion for work and excellence in other people.Over the next few years, the Group will gradually expand the Talent Management system to all employees, regardless of the ge-ography in which they operate, maximizing the potential of key resources across the entire Salva-tore Ferragamo Group.5253Sustainability Report 2017In 2017 the Development Assess-ment program continued, which involved two different types of workers: High Potential staff and Senior Leaders. For both groups training programs were developed in order to reinforce specifi c com-petencies such as emotional intel-ligence and the development of collaborators. Specifi cally, the ses-sions for High-Potential individuals focused on the ability to make de-cisions and deliver impactful com-munication through individual and group coaching. Meanwhile, the training programs for Senior Lead-ers concerned coaching, leader-ship, or topics relevant to each one's area of expertise.The Group also enhances retail employees and the store staff who constantly exceed their sales targets by providing an exception-al service and forging unique rela-tionships with customers. In this sense, in 2017 the Group designed and launched a specifi c retail staff development program establishing structured career paths and for-malizing the opportunities that the Group offers to the employees of its boutiques. These career paths clearly and objectively defi ne the opportunities for professional growth within the boutique, moving through positions with increasing responsibilities and different levels of management skills, including the possibility of eventually manag-ing a store or the relevant team. The Company has also been pro-moting mobility within the Retail world by offering opportunities to hold senior positions in differ-ent stores in the same country or abroad, focusing on internal rather than external recruiting for vacant positions.Recognizing the top sales per-formers is key to constantly im-proving the in-store customer ex-perience and represents a way to show gratitude to the individuals that have been able to convey the craftsmanship and passion of Salvatore Ferragamo the most. Therefore, the Group offered the 2017 top sales assistants of China, Japan and Mexico the op-portunity to participate in a train-ing program aimed at conveying the values of the “Made in Italy” tradition through cultural and ed-ucational initiatives. Specifi cally, the top sales assistants from the Chinese market received a tour of the Uffi zi Gallery and participated in a cooking class dedicated to traditional Italian cuisine.To facilitate the development of their staff, the Group implemented, in continuity with previous years, some performance assessment programs, including the Perfor-mance Appraisal System, in or-der to identify the strengths and any areas for improvement of each employee. The system is conceived not only as a monetary incentive system but also as an instrument for development: the performance appraisal is connect-ed to a position profi le and the specifi c technical skills required. The Salvatore Ferragamo Group regularly reviews the performance of its employees: in 2017, 100% of the Parent Company's managers received a performance review, and so did 81.3% of their peers inCentral and South America, 100% of managers in Europe, 94.1% of managers in Japan, and 95.9% of managers in North America.A necessary precondition for the company's development and growth is teamwork, and the vari-ous organizations of the Ferraga-mo world do their best to allow the development of soft skills such as trusting other people and havingrespect for roles. As part of one of these initiatives, Italian employ-ees worked together to create Parco delle Idee (Park of Ideas), an urban forest inside the Scien-tifi c Hub of Sesto Fiorentino. The project allowed employees to help plant 230 native trees, participat-ing in brief training sessions on the trees they planted. All volunteers also had the opportunity to put a sign on each tree they planted, dedicating it to their team or leav-ing a short message to thank their colleagues and strengthen the sense of being part of a team. In 2017, the Group also held a team-building event designed specifi cal-ly for the members of the Green Team, the cross-functional group that designs and implements sus-tainability projects. As part of the Green Building event, the Team participated in training sessions on the development of the skills required to improve their integra-tion, as well as brainstorming ses-sions in which they discussed and mapped the sustainability goals for the next few years.5455Sustainability Report 2017WELLBEING OF PEOPLEThe Salvatore Ferragamo Group considers the wellbeing of its em-ployees and the internal environ-ment to be key drivers of its suc-cess: therefore, it implements sev-eral company welfare initiatives to ensure the wellbeing of its workers.Since 2014, a Flexible Benefi t Plan has been in force in Italy, the purpose of which is to support workers and their families in so-cial and cultural activities, in their development and in school fees and costs for their children. The plan consists of the possibility to replace or complement part of the variable pay with benefi ts in the form of services, to address per-sonal and family needs. Specifi cal-ly, employees can select their own type of benefi t from a vast selec-tion, including fi ve areas: educa-tion, gym and other sports, culture and leisure, travel and supplemen-tary pensions. In 2017, the Group broadened the range of benefi ts it offers by introducing additional services for the families of its em-ployees, such as care for depend-ents and baby-sitting services.The Salvatore Ferragamo has signed a series of special offers through conventions with compa-nies operating in other sectors, such as for example health and wellbeing, banks, insurance, tour-ism and sport. In this context, the collaboration with Orto del Borro continues. The agreement allows employees of the Salvatore Fer-ragamo offi ces in Florence to buy at a discounted price boxes with certifi ed organic fruit and vegetables.The benefi ts and advantages for full-time employees of the Group's companies vary according to local laws and practices: they include, but are not limited to, health and life insurance policies, discounts at the Brand's stores, pension con-tributions, and reimbursements of company canteen services or ben-efi ts in lieu thereof.The wellbeing of employees, col-laborators, suppliers, and consult-ants has always been a core part of the Group's DNA. Over the years, the Company has made sig-nifi cant investments in safeguard-ing the wellbeing of its employ-ees, developing an Occupational Health and Safety Management System to reduce or minimize the risks employees or other parties may be exposed to for different reasons as part of the Company's operations. In late 2017, this sys-tem received the coveted OH-SAS 18001 certifi cation, which is valid for all the Company's Ital-ian offi ces and stores. This result strengthens the effectiveness of the existing administrative liability system pursuant to the 231/2001 Model, ensuring the principles of the relevant policy are properly implemented in all work environ-ments. In addition, this regulation has an international validity, which will allow to extend the certifi ca-tion to the sales offi ces located abroad over the next few years, thus consolidating the Group's reputation.The continuous commitment is based on the participation, in-volvement in and dissemination of the culture of safety at all levels of the Company, in order to guar-antee for each worker a good level of awareness of their role and re-sponsibilities. The Group, through involvement, training and prepa-ration activities, aims at continu-ous improvement in performance in terms of workers’ health and safety, with particular attention to preventing accidents and workre-lated illnesses.The attention to Ferragamo peo-ple is refl ected also in the crea-tion of workspaces that are both functional and pleasant. Since 2016, the Ferragamo Foundation has been working together with the Company on the renovation, decoration and embellishment of workspaces by researching and creating new fi xtures and fi ttings as well as enhancing spaces and their design.The communication to all the Group’s collaborators of activities, shared values, projects, strate-gic guidelines, corporate policies, goals achieved and future ambi-tions, is considered of primary im-portance to consolidate a sense of belonging.In February 2017, following the Investor Day and in order to pro-mote a relationship with employ-ees based on the principles of sharing and transparency, the Group organized a specifi c ses-sion for the employees of the Os-mannoro headquarter, during which the CEO recalled the core values that have characterized the Brand since 1927 as well as stressed the importance of working together to achieve the goals expressed in the development plan for the Group.In addition, the internal circulation of the Company magazine Inter-nos allows to keep all functions worldwide up to date with corpo-rate news, thus fostering engage-ment and stimulating the interest of employees in activities leadingthem to learn more about the Group. In May 2017, the maga-zine dedicated an entire issue to corporate social responsibility in order to raise awareness about the Group's initiatives and goals related to sustainability.As evidence of its commitment to embed sustainability into its inter-nal communication platforms, the Group has set up a corporate re-sponsibility section on the Compa-ny Intranet, as well as a dedicated e-mail address through which em-ployees can directly engage with sustainability topics and submit sustainability-related ideas and projects to the Green Team.5657CULTURE AND PARTICIPATIONLink with the community and the local territorySalvatore Ferragamo MuseumFerragamo FoundationNext >