Statement on the Comments from Gisela Burckhardt

May 20, 2016 - We would like to respond as follows to the comments made by Dr. Burckhardt concerning manufacturing in India:

Ms. Burckhardt mentions that HUGO BOSS only has audits conducted for 30% of the companies manufacturing for the Group. This is, however, not correct. The number of 617 companies mentioned in the 2014 Sustainability Report does not only refer to our manufacturers. It also includes our direct suppliers for raw materials and finished goods, where we have anchored our Code of Conduct and social employment requirements contractually. Moreover this number incorporates all of the creditors registered in the system. This means that individual production companies may be listed, and therefore counted, multiple times through our various product divisions. Adjusted accordingly, the actual auditing rate for our producers is 94%. To prevent any further confusion, we will try to find a different way of explaining our auditing rate in 2016.

Nor is it true that HUGO BOSS AG has goods manufactured by the companies cited, namely Arvind and TRIO Apparel. HUGO BOSS has no direct working or contractual relations with either of these two companies. It is, however, true that HUGO BOSS suppliers derive woven goods from Arvind. This similarly applies to TRIO Apparel. Here too no direct contractual agreement exists. For this reason, these companies are not listed by HUGO BOSS.

Naturally, these two companies are nonetheless known to us, and they were also reviewed. We were particularly surprised at the criticism of Arvind. We would therefore like to provide further information on this company here:

Arvind is a leader in the realm of sustainability in India. It is a founding member of the Sustainable Apparel Coalition (SAC), where it is working to improve standards through the Social and Labor Convergence Project. Arvind is also certified in accordance with the Global Organic Textile Standard (GOTS) and a partner of Social Accountability International (SAI) as well as numerous other initiatives.

Arvind is further certified in line with standards such as the Social Accountability Management System (SA 8000), and pays employees in excess of the minimum wage requirements. Working times are properly regulated and overtime, which is voluntary, is remunerated according to clear regulations. The employees are local and therefore live in their own accommodation. The company offers crèche facilities for its women staff; moreover, it enforces clear-cut guidelines against sexual harassment and discrimination, and operates centers that employees can approach for help at any time. Additionally, employees enjoy freedom of association within the existing trade unions.

In view of this verified information, we must assume that Ms. Burckhardt's allegations refer to the textile industry in India generally, rather than to the companies she has linked with HUGO BOSS. The Group is happy to engage in further discussions on this important issue.

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