SUSTAINABILITY REPORT 2016ICEBUG

PLANET

PEOPLE

PRODUCT

REPORT

ICEBUG VALUES AND GOALS IN SUSTAINABILITY

Welcome to read our first ever sustainability report. For a company our size it’s a big effort to grasp sustainability, let alone reporting about it. We have gotten really good help from many instances on our way to becoming a better company, making everyday choices for a better tomorrow.

Sustainability has been a core value since the birth of the company. We want to enable people to go out and enjoy no matter the conditions.

We started our focused sustainability work in 2015 by partici­pating in a Peak Innovation project for creating a company level strategy to become more sustainable. The whole com­pany participated and our important supply chain partners were included from the very first steps. By creating a strategy we also visioned our position in the industry in 20 years from now, being an industry leader in grip technology with prod­ucts that are manufactured in a sustainable way and where Icebug is part of a circular society. We offer our community products that are safe to use and produce. We also want to create products that are engineered for re­use after initial pur­pose so that all materials eventually come back to circulation with no wasted resources.

Company level commitment:Making a difference in the industry is far more challenging than gaining the trust of our customers. While still tiny in the world of giant brands, we do demand more of our supply partners than the average shoe brand. It is in our DNA to create long lasting products with comfort and durability for challeng­ing conditions. Quality comes without saying, but we need to remind and take care of that in every production phase.

Sustainability is deeply rooted at Icebug. From the smallest of daily actions to future business planning, we consider options and weigh our decisions in respect to becoming a sustainable brand while keeping the business profitable.

We have set our goals together as a company and those are verified by management. Every department has their own sustainability manager while everyone in the company has their own projects to reach the company goals.

PARTNERSSustainable apparel coalitionSustainable Apparel Coalition (SAC) is the industry leading coalition of brands, facilities, NGO’s, governmental organiza­tions and other actors. The common link is the will to unify all efforts for a sustainable future in our industry and being a leader for other industries. To measure the progress SAC has developed a tool called Higg index. It is a self assessment tool for brands and facilities taking in consideration environmental as well as social and labor aspects. A vast tool box of modules also include MSI (material sustainability index) and DDM (design and development module).

Icebug joined SAC’s Higg index program in early 2016 to get a tool for measuring our development in sustainability. With this index we cover multiple areas from materials to transportation and product end of use.

Context of pilot project:In January 2016, SAC in partnership with IDH, the Sustainable Trade Initiative, launched an ambitious pilot project to engage European small and medium­sized enterprises (SME) to utilize the SAC’s Higg Index. The objective of this project is to carve out a common language that can be used from the smallest to the largest brand(s) to measure their sustainability performance and accelerate impact creation. At the same time the project is investigating if this approach could be one of the answers to the European governments’ call for a scalable standardized system with a particular focus on SMEs. By taking into account the political and industry needs, SAC and supporting partners aim to proactively work with all stakeholders towards a scalable and common standard. The project has received a great deal of support from industry stakeholders, including the Association of Swedish Fashion Brands, Danish Fashion Institute, Dansk Fashion & Textile, European Outdoor Group, Modint, Outdoor Sports Valley and 27 SME brands in nine European countries.

The pilot project, which will run until December 2017, gives SME participants the unique opportunity to access the SAC’s Higg tools and training resources to (i) measure their sustain­ability performance at both brand and supplier level and (ii) to collaborate with their peers through the Higg platform. The user feedback from the SME participants will be valuable and critical to fuel future developments and improvements of the Higg suite of tools.

Henrik Tuomas, Quality Control

Quote: Icebug has demonstrated through their participation in this pilot project that they are one of the front­running SME brands in Europe. The brand is actively working on improving their corporate sustainability performance through the Higg Index Brand Module and are supporting their supply chain partners to do better by leveraging the Higg Facility Module. Icebug exemplifies how positive impact can be made regardless of company size. It has been my pleasure to work with the lead­ership of Henrik Tuomas and Icebug. Veronique Tjon, SAC, Project Manager Small Medium Enterprise (SME)

Bluesign®

Bluesign® is an effective way to reduce chemical management risk in textile production. Bluesign® certifies manufacturing facilities ensuring that their working methods do not affect end products in negative ways and comply with the latest chemical substance regulations. The bluesign® system is the best available solution for a sustainable textile production. It eliminates harmful substances right from the beginning of the manufacturing process and sets and controls standards for an environmentally friendly and safe production. This not only ensures that the final textile product meets very stringent con­sumer safety requirements worldwide but also provides confi­dence to the consumer to acquire a sustainable product.

Icebug is looking forward to joining Bluesign® as a system partner as soon as the footwear module is ready.

Chemicals Group:A knowledge platform for the benefit of member companies’ efforts to keep up to date with relevant legal requirements in the area of chemicals. It aims to:

• communicate relevant chemical requirements to their subcontractors

• meet the demands and opinions from the media and consumers.

There are over 100 member companies divided into two sub­groups, one in the textile industry and the electronics industry. In the “Chemicals Group Textiles” there are companies mainly in textiles, furniture and retail business. The “Chemicals Group EEE” focuses on chemicals in electronic and electrical products. The groups scope includees:

• Regular meetings to exchange experience and information within the current environmental and chemistry­related issues in products and production.

• Sharing knowledge through invited speakers from e.g. the chemical industry, NGOs, and agencies.

• A forum for open dialogue and contact with others in the industry.

• Access to the chemistry database developed for member companies’ needs. The database is easy to use and covers chemicals used in the textile industry and the electronics industry.

• The Chemicals Group is run by Swerea IVF and is linked to a network of experts such as universities, Chemistry and Environmental Protection Agencies.

Icebug joined the Chemicals Group in late 2016 to gain knowl­edge and get support in chemically related issues.

Swerea We are a long term partner with Swerea in shoe testing for chemicals. Together with specialists, we screen our shoe collec­tion twice a year (spring / summer and fall / winter) for possible chemical hazards and arrange testing in third party facilities. After testing it is important to analyze results according to current restricted substance regulations.

SOG:Scandinavian outdoor group (SOG) has a sustainability group that meets a few times every year and has an active social network. The group shares information on the latest updates and insights within sustainability.Joel Svedlund, Peak Innovation

CSR Västsverige:Icebug joined CSR Västsverige in 2016. CSR Västsverige Is an organization that offers broad knowledge and a strong network in business responsibility issues. CSR Västsverige (CSR West Sweden, Public & Private Social Responsibility Initiative) is a non­profit organization that was formed in 2008. With more than 260 members from both pri­vate, public, non profit sector and academia, the association is today Sweden´s largest CSR­network. With the vision ”a region where all organizations take responsibility and make a difference in the world”, CSR Västsverige helps its members to improve their ability to take responsibility for their actions and encourages positive impact through their activities. In short, making business go hand in hand with increased accountability for the environment and the society. Karin HagbergProjektledareCSR Västsverige

REPORT

PRODUCT

The most important task is to develop shoes that last for a long time. Products wearing out too quickly and being trashed is a heavy load on the environment. We are very care­ful when choosing constructions and materials. We do field testing and laboratory testing to ensure both the durability of the material itself but also how it performs when applied onto the shoe and used in its intended environment.

Starting with the spring / summer 2017 launch of the running shoe Oribi RB9X, we have together with the textile manufac­turer Wu Luen developed the upper textile to be non absorb­ing, durable, flexible, soft and most important: a textile with Bluesign® certificate. Bluesign® is the most extensive system for securing sustainable manufacturing of textiles. Starting with season spring / summer 2018 we are using Bluesign®

PRODUCT STRATEGY

certified textiles only, for upper textiles and lining textiles. We are also using some textiles partly made from recycled PET Polyester. The lining we use for basically the whole SS18 collection is made from 100 % recycled PET polyester.

When it comes to our leather shoes we use gold rated tanneries for our suede and silver rated tanneries for the other leather qualities. Our aim is to use only gold rated tanneries for the fall / winter 2018 season.

We design minimalistic and clean. Our aim is to have nothing on the shoes that is not there for a functional reason. The uppers are clean and by that easy to keep clean. Dirty shoes break faster than a shoe you can take care of. Taking care of the shoes is a very important part of lengthening its life. We have detailed information on our website of how to take the best care of our different types of shoes. To be able to repair the shoes is also very important for its lifetime. We try to design zippers and metalwear in a way so they can be replaced by a shoemaker.

Icebug design is classic and timeless. Our bestsellers five years ago are still our best selling shoes. Creating design and style with this longevity is a big thing when it comes to sustain­ability, we do not promote fast fashion trends, instead focusing on timeless, clean styles that lasts for season after season.

50 % recycled rubber.

Karin Möller, Head Designer & Creative Director

PRODUCT

FACTORY STRATEGY

Icebug factories and partners are at the center of the Icebug sustainability journey. To create the intended products with high quality and long lifetime is a long development process from design to material choices, production process, testing in lab and field. Everything is linked together and impact the quality, performance, lifetime of the products but also the environment and the people.

To be able to be where we are today and where we want to be tomorrow is for Icebug nothing that would be possible without true partnership. We refer to our partnership as “one team”, where we share experiences, knowledge, vision and a will to make things happen.

An example is that Icebug has been working with the same Taiwanese partner since day one to make all midsoles and outsoles. Together we have created the best rubber compound, RB9X, in the world for wet conditions and continuously work

on improving grip and abrasion performance. We have also introduced a 50 % recycled rubber compound for our lifestyle category.

In 2015 we worked closely to develop and implement bluesign® approved upper materials for our 2017 – 2018 collec­tion and produced all our suede leather shoes with 100 % gold rated leather from the “leather working group” approved suppliers. http://www.leatherworkinggroup.com/

Icebug has two manufacturing partners who have produced all Icebug shoes in Vietnam and Indonesia since 2010 and 2013: Chief Vict industries corp. and Haksan Ltd. During 2016, our European staff spent 74 days on site to develop and secure the implementation of the strategies to improve work­ing conditions and reduce environmental impact. One Icebug staff based in Asia was also visiting the factories on regular basis to secure the quality of more than 90 SKU’s and actively control and report on CSR. With Chief Vict industries corp. and Haksan Ltd, we truly believe that we have the correct part­ners to become a leader in footwear sustainability.

SOG SUSTAINABILITY NETWORKThe Scandinavian Outdoor Group (SOG) Sustainability Network is managed by Peak Innovation on behalf of SOG. It gathers sustainability oriented people from the 58 SOG member companies and includes approximately 80 professionals. The

network is focused on knowledge building and information transfer regarding sustainability; trends, innovations, challenges, legal issues and more. Social media, newsletters and physical meetings are the main communication channels for the network.

Jérôme Manceau, Product director

PEOPLE

FOREST FEMMES

With all that is going on in the world, a lot of women feel unsafe to be out in the woods alone at night. Especially during the winter when it is darker outside. So they do most of their running in the gym or on asphalt in the city. We think that is a shame. The woods are not necessarily more dangerous now than they were before, but we do have access to a lot more information now. We can read about every bad thing that happens instantly, and that sometimes creates a feeling of insecurity.

We started Forest Femmes to empower women to spend more time out in the woods, and to take help from each other to do so. To overcome all mental obstacles, together. We do not focus on speed or performance, but simply on enjoying the environment, making new friends and having fun!

Michaela Lindgren, Store Manager

We run together every Monday here in Gothenburg, and our amazing running coaches guide the groups on differ-ent trails each week. We always cheer each other on, and support everyone in the group to do their best. But we do

not push! That is not what the group is about. And I think we need that sometimes, to feel that it is okay not to be the fastest or the strongest. But simply to enjoy the present.

PEOPLE

CUSTOMER SERVICE

Jenny Jovén, Director of Supply Chain & Customer Service

We provide guidance to our customers in how to care for their shoes, depending on wear and tear and different materials.

We offer our customers sustainable service options to extend product lifetime by taking care of shoes with replace­ment parts such as new laces, insocks, studs, zippers and leather / textile treatments after cleaning. A good example of after­care is replacement of lost studs. We send out replace­ment studs directly to customers and have a simple and suc­cessful method to attach them. This significantly prolongs the life of the shoes.

We ask customers to visit their local shoemakers to repair shoes with minor defects, which are otherwise in working order, instead of throwing away or replacing the shoes. We offer reimbursement for minor repairs.

Furthermore, we are looking at which and all pieces on a shoe that could be replaceable – e.g. lacing, hooks and insoles, and offer these to our customers. We keep a record of all claims so that carryover styles and new development shoes are improved in terms of materials, comfort and usability.

Our customers should know and feel that they contribute to a sustainable future when we offer to repair shoes instead of throwing out a fully functional shoe with a minor defect.

ICEBUG XPERIENCE

Jonas Svengård, Event Manager

Icebug Xperience is an annual running and walking event that takes place along the Bohuslän coast. During three days we gather hundreds of outdoor enthusiasts from all over the world. Economical, social and environmental sustainability is something we really care about at Icebug Xperience. We want the event to grow organically together with the area, to market

Bohuslän as an all year round­destination. We work with local entrepreneurs and innkeepers, and our vision is that every­thing consumed at Icebug Xperience is made by organic, locally produced ingredients. We also want to take care of the environment in the area. Most of the race therefore follow exist­ing coastal paths and trails, and we place garbage bins during the course. We also inform our participants about the Swedish Right of Public Access and the importance of respecting it.

THE NEW OFFICE IN JONSERED

When throwing ideas around for our new office we were clear on trying to find the intersection between “great workplace”, “professionally friendly”, “fun” and “close to nature”. Looking at what we now have, I would say that we did good on all of those. A great workplace is obviously more about who is at the desk than what the desk looks like. Some things just can’t be faked and that is one of them. In that sense culture plays bigger part than the physical environment. We do, however, think that both are highly important and have paid a lot of attention to the two and how they interact.

Some of the highlights:Fire and warmth. We installed a cast iron wood stove as the centerpiece of the office. It is great for the atmosphere no matter if it is for having a coffee on a chilly January morning or when visitors are greeted welcome. Complete with a sofa in front it has kind of become our reception and waiting room and provides an inviting feeling of familiarity. For those who spend every day here as well as those passing by for a meeting. Our interest in yoga reaches almost two decades back. When having the chance to create a life and work space of our own we also wanted to establish a venue for yoga practice in the front row of the new office. Situated nearby the entrance the yoga studio easily fits about 12 yogis and yoginis on a good Wednesday morning when our office class is run. With its 6,5 meters headroom and original, tilted factory windows still in place it has a fantastic ambience and allows for some space of mind whenever needed.

After yoga, if you somehow did not manage to get your tem­perature worked up during class you can pop into the sauna. Right by the two locker rooms is a large genuine Finnish sauna. The room itself was laid out around the sauna stove which is in the shape of a tower. It’s a pretty big one and could probably fit the whole office although we’ve not made any attempts of the latter so far. Friends, business partners and family have however taken their liking to the space, during workdays and weekends all the same. If thirst comes along there is also local Poppels brewery situated next door provid­ing first class beer or a guided tour if you would like. All furniture in the office has either been bought on auctions and is second hand or made from local pinewood or oak. The local carpenter has done a masterful job in creating the wood­work. The main objects being the showroom meeting table and the four large lunch room tables situated in the open area mid office. The open area is also decorated with a vertical floral garden that brings extra organic life as well as a peaceful view to those enjoying a meal or a meeting in that space. Shared but with opportunity for privacy. An open space such as ours may have some challenges in terms of providing enough quiet space when this is needed. Our solution to this is two freely standing tête á tête cubes where you can talk privately. This in combination with a generous selection of meetings rooms with various profiles and openness has our needs for cooperation and interaction of all sorts covered. Proximity to the forest. Literally just outside the door is woven a large web of fantastic trails. For running or for walking. It is endless. It does not matter if you want to sneak out for some fresh air after lunch or head out for a multiday adventure with pack and all. The call of the wild can be adhered in a split second. Starting at our doorstep all the magic is right there in front of you.

Tom Nilsson, COO

PLANET

PLANET

THE NEW SHOE BOXThe shoe industry is a global business, today a main challenge is to improve the logistics. In 2016 we took the strategic deci­sion that our packaging was to be seen first as an environmen­tal burden and second as a functional marketing tool. Therefore we redesigned our shoe boxes completely with implementation as of spring / summer 2017. The new boxes, with smarter con­struction, allow us to save 12 % in weight and also reducing the volumes which have direct results in a C0² emission reduction.

Paper materials are made from 100 % recycled material according to the FSC (www.fsc.org) and are 100 % recyclable. Ink used is 100 % made from soya beans and we only use black color. We also managed to reduce the filling materials inside the shoes to save further weight and implement our “one hang tag only” policy, instead information about the shoes can be found digitally instead of on paper. Finally to inspire people to go outside and feel great we have included an extract of Markus Torgeby fantastic book Löparens hjärta. Göteborg: Offside Press AB, 2015.

Measuring emissions from greenhouse gas is important when determining our footprint on nature. We have measured the emissions from our inbound freights from our production partners in Asia since Icebug does not own production facili­ties. This does not stop us from raising demands and encour­aging partners to lower emissions, but at this point we have chosen to start with inbound freights, which we have more control over.

We have production partners in Vietnam and Indonesia, which is far away from where most of the consumption of the products is (Scandinavia). We however choose sea freight in almost all cases which makes the emissions low, even though the distance travelled is high. We only choose air transport if there is no other option as this emits around 20 times more emissions than transportation by sea.

EMISSIONS REPORTING

Sea transports SS15 FW15 SS16 FW16TEU: Total Containers (20ft equiv) 14 142 13 101

Total emissions CO² kg 14 641 138 817 20 580 92 923

Total amount of shoes 35 925 291 392 31 597 205 762

TEU Travelled km 230 890 2 503 373 319 870 1 838 043

Air transports SS15 FW15 SS16 FW16TEU: Total Containers (20ft equiv) 0 0 1 0

Total emissions CO² kg 0 0 6 150 0

total amount of shoes 0 0 655 0

TEU Travelled km 0 0 4 622 0

TEU means equivalent to 20 ft container. TEU travelled means how many kilometers (km) we have transported a TEU.

Greenhouse gas emissions kg CO² /shoe pair

0,41

SS15

0,48

FW15

0,65

SS16

0,45

FW16

James Varkey, CFO

FUTURISTIC LOOK

Though we have always had the ambition to steer our actions to do the least harm possible to nature, it is not until the last two years that we have worked in a really structured way with sustainability. It has been a lot of work and we have learned a lot. Though results are not immediate, we have progressed fast and along the way we have seen that a lot of our colleagues that we believed where way ahead of us in fact were not.

On one side this is sad, on the other it is encouraging. If a small company like Icebug can manage to progress fast, with commitment, there are many others who can too. And there is a big passion for the outdoor in this industry! And at Icebug we aim big. We intend to become a leader and catalyst in transforming the footwear industry towards becoming fully sustainable. So look out for more from us!

David Ekelund, CEO

PLANET

Icebug HQ in Jonsered, Sweden.

Trails outside the Icebug HQ in Jonsered.

ICEBUG AB HeadquarterFabriksstråket 35,

433 76 Jonsered, SWEDEN

Office Phone +46 (0) 31 817 090info@icebug.se

www.icebug.com