Value Chain | Ferragamo Sustainability

LEADING A RESPONSIBLE VALUE CHAIN

Ferragamo’s procurement strategy is anchored in Made In Italy’s exceptional technical expertise and enduring partnerships with time-honored companies. This approach reflects the brand’s dedication to Italian craftsmanship, with 97% of supplier turnover in 2024 sourced from Italian companies. Demonstrating a profound commitment to its roots, Ferragamo partners closely with Tuscan manufacturers, who represent 52.4% of turnover in finished product processing—embodying the brand’s passion for excellence and local heritage. With respect to direct manufacturers, the Group works exclusively with highly specialized manufacturing companies that meet the most demanding quality standards. The selection and retention of their manufacturers is key to the Brand, mainly for the purposes of protecting Ferragamo's extensive know-how developed over many years. Approximately 43% of manufacturers have worked with Salvatore Ferragamo S.p.A. for over 11 years. The retention of external workshops has been traditionally guaranteed by ongoing partnerships, the frequent exchange of information and skills between the Group and the direct manufacturers, and the specialized products and production processes involved.

VALUE CHAIN MONITORING

Ferragamo takes every possible measure to ensure compliance with its ethical and regulatory standards, recognising that third-party compliance is an ongoing process of development and continuous improvement. Any isolated breaches, which are always a possibility, are dealt with in the strictest possible terms if detected and are carefully considered as part of our policy of continuous improvement. Assessment is made of risks with respect to human rights, child labor, forced and compulsory labor, non-discrimination, freedom of association and collective bargaining, occupational health and safety, working time, remuneration and regularity of working conditions and applied disciplinary practices. Ferragamo requires its direct suppliers (Tier 1) not to exceed the first level of subcontracting (Tier 2) and directly manages the product development and industrialization phases, including the selection processes and quality and safety controls throughout the production process. In fact, the direct supplier qualification process focuses on technical evaluation, verification of documentation and compliance with various standards to assess whether the supplier can meet the brand’s requirements in terms of quality, capacity, financial stability, adherence to ethical principles, compliance with behavioral standards and applicable regulations. To streamline the supplier qualification process, the brand uses the Ferragamo Link tool to manage information and documents with suppliers. This platform makes it easier to register new suppliers and streamlines the monitoring of the supply chain. Direct suppliers are also required to sign a package of documents that includes, in addition to the Supplier Code of Conduct, the General Terms and Conditions of Purchase, Self-Certification of Compliance with Contractual Regulations and Applicable Laws, the Animal Welfare Policy, the Group's Restricted Substances List (RSL) and the Technical Performance Requirements, depending on the area of activity. Suppliers are also required to sign agreements guaranteeing brand protection and compliance and to provide a list of their sub-suppliers.

To monitor compliance with the ethical and social standards that characterise its supply chain, to promote adherence to these principles over time, and to minimise as far as possible the risk of legal and ethical breaches, even isolated ones, the brand carries out regular audits, even unannounced, of its direct suppliers and sub-suppliers, assessing their actual compliance with the principles set out in its Code of Conduct and generally with applicable laws and regulations. To this end, a risk-based approach is used to prioritize audits based on criteria that consider the level of potential risk. The following specific criteria for Tier 1 and for Tier 2 suppliers have been identified:

Tier 1 audit criteria, in order of relevance

Supply typology;
Order amount in relation to supplier's total turnover;
Audits performed or to be performed;
Number of employees;
Relationship start date;
Geographical area (risk assessment based on the percentage of irregularities found in inspections carried out by the labor inspectorate).

Tier 2 audit criteria, in order of relevance

Type of processing;
Risk inherited from prevailing Tier 1;
Audit activities performed or to be performed;
Number of employees;
Relationship start date;
Geographical area (risk assessment based on the percentage of irregularities found in inspections carried out by the labor inspectorate).

SUPPLIER SCREENING	FISCAL YEAR 2025
Number of Tier 1 suppliers	432
Number of Tier 2 suppliers	762
Number of significant suppliers¹	487
of which Tier 1 significant suppliers	113
of which T2 significant suppliers	374
Value of orders with significant suppliers (excluding non-Tier 1 suppliers) on total value of orders (%)	61,76 %
Number of suppliers subject to assessment of ethical, social and environmental aspects	258
Number of significant suppliers audited which resulted to be not in line with the highest social and environmental standards applied by the Group	37
of which significant suppliers with whom collaboration was terminated	28
of which significant suppliers supported in the implementation of a corrective action plan	9

Suppliers carrying out labor-intensive processes

Criteria – both for Tier 1 and Tier 2 suppliers - are subject to change in priority findings reported by the Operations Department (e.g., following inspections, visits to suppliers, or production capacity analyses). Ferragamo continuously updates the control system on the supply chain.During audits, interviews are conducted with both workers and management, and site inspections are conducted to ensure compliance with the required standards. In the event of non-compliance, suppliers are required to implement the necessary actions to prevent, mitigate or solve the identified issues within agreed time frames. In the event of serious violations of the Code, or in the event of lack of collaboration or failure to implement improvement plans, Ferragamo immediately terminates its business relationship with the suppliers involved. The effective implementation of corrective actions is monitored through follow-up activities, which can be conducted on-site or remotely, to verify that the agreed upon times and methods are being followed. 258 audits were carried out during 2025 on both direct suppliers and sub-suppliers, prioritizing Tier 1 and Tier 2 suppliers carrying out labor-intensive processes (significant suppliers). The non-conformities found were also followed up in order to verify their accomplishment. . In 28 cases, serious violations of the Code by sub-suppliers led to requests to terminate business relations with them.