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					CONTENTS                                          PAGE

Introduction by the Managing Member               1

Mission Statement                                 3

Our History                                       3

Ownership Structure                               5

Management Structure and Governance               5

Our Most Material Issues                          8

Use of Appropriate Technology                     11

World Class Products for World Class Customers    13

The Vimal Team                                    16

Research, Marketing and Procurement               21

Occupational Health & Safety                      22

Environmental Management                          25

Social Responsibility and Community Investments   27

Stakeholder Engagement                            28

DTI Codes Of Good Practice                        28

Human Rights                                      29

Lessons Learned and the Way Forward               29

Request for Feedback                              30

GRI G3 Application Level Requirements             31

GRI Content Index                                 32

Non- Independent Assurance Statement              33
          INTRODUCTION BY THE MANAGING MEMBER

Vimal Clothing Enterprises cc (hereafter, ‘Vimal’) is a privately owned Durban-based clothing manufacturing
company with a 26 year history. With more than R35 million in annual revenues, we are no longer classified
as a SMME, or ‘Small, Medium or Micro Enterprise’, which brings with it both excitement and challenges.
While extending beyond this economic milestone marks a significant and exciting development in our com-
pany, it also heralds a need for Vimal to ensure that the governance and management of the company moves
from our historical ‘family business approach’, to a more structured ‘corporate approach’. This Sustainabil-
ity Report is therefore a demonstration of our efforts to streamline our data management and reporting to
key stakeholders.

Since 1981, our primary manufacturing output has always been apparel, although we
did spend a few years experimenting with furniture making and other initiatives. At
present, our business consists of four business units: Vimal Clothing; Yash Clothing;
Functional Sportswear and Niam Embroidery. Through the acquisition and develop-
ment of these four equally important units, we have been able to diversify our prod-
ucts and services portfolio while identifying and concentrating on products that best
suit our specific core competencies. Each of the business units is unique in its specific
focus, but they ultimately work harmoniously with each other to share in making Vimal
a successful manufacturer of sporting apparel.

As a South African supplier of Puma AG, a world class sports brand, Vimal was invited
to participate in a development programme supported by the German Development
Agency (GTZ) and the Global Reporting Initiative (GRI) that taught us how to produce
a Sustainability Report such as this one.

Prior to the first workshop held in Cape Town in July of 2007, we knew nothing about
Sustainability Reporting and very little about ‘Corporate Responsibility’. We knew
that our success over the past 26 years has been based on our ability to focus on
being ‘a good company’, but we never had occasion to understand that our customer
and employee-centric approaches to surviving in a highly competitive market was of
interest to people other than ourselves. The reporting process has therefore helped
us understand how well we have been doing, while allowing us a unique opportunity to consider whether the
business as a whole, or specific components within it, could be improved. Specifically, our attention has been
drawn to issues such as environmental performance and improved employee engagement.

However, it should be remembered that Vimal is not a large publicly listed company with endless supplies of
cash or, more importantly, time.

 I, as the Managing Member, am but one man, and while I have a small team of dedicated management support
staff, a task such as developing this Report is a monumental challenge when our time is already exhausted on
the day-to-day activities involved in running our business. Thus we need to stress that this is our ‘first effort’ in
producing a Sustainability Report, and while we may not have included all of the information stakeholders might
require, we trust that we have made the best effort possible in our particular circumstances.

Thankfully, the process of reporting was facilitated by Trialogue Assurance Services, a Johannesburg-based
consultancy that offers similar services to companies that tend to be a lot larger than Vimal, with support from
the GTZ, the GRI and Puma.

The primary goal of this Report is to offer our many stakeholders an opportunity to better understand who we
are as a company, as a team of individuals and as a proudly South African manufacturer of clothing. The fol-
lowing pages provide a summary of our ‘Most Material Issues’, including a discussion of how we believe we
have been doing thus far and how we hope to improve in the future.

It is important to note that the reporting period under question is limited to the 2007 Calendar Year (CY 2007),
although we have attempted to include data for 3 years where it has been relatively easy to assemble. Where
possible, trend analyses have been conducted for all available data on a month-by month basis.


                                                       1
Our operations exist only in South Africa, and while our largest clients (Adidas and Puma) are international
companies based in Germany, our sales are all directed to the South African subsidiary of these companies. All
of our other clients are based in South Africa, while our principle suppliers of machinery and fabric are based
overseas (principally Thailand and Taiwan).

The value of this Report may not lie within these pages, but rather within the many lessons we learned while
pulling this information together. Mostly, we learned that we actually possessed information, statistics and
ideas that could support our assumptions about how good a company we are, as well as how we can potentially
improve in the future.

The content of this Report is set out according to the GRI’s G3 Guidelines, and because this is our first attempt
at reporting our objective has been to meet the Application Level C requirements.

At this time, it is my hope that you will find value in the information we have compiled on your behalf, and we
hope that you will contact us should you have any questions or comments about this Report.

Sincerely,




Nayan Kalidas
Managing Member
Vimal Clothing Enterprises




                                                          2
         MISSION STATEMENT

Vimal Clothing Enterprise cc is committed to:

1.   Maintaining and expanding our reputation as a specialised knitted and woven garment supplier

2.   Maintaining a low cost structure and improving our efficiency standards

3.   Moving with changes in manufacturing technology and ensuring that production is in-line with best prac-
     tices

4.   Recognising that our employees are our greatest asset, and accordingly attracting and retaining quality
     people who will identify with our culture of integrity and flexibility

5.   Continuously recognising our commitment to quality in our range of products, as well as in our service to
     customers

6.   Remaining a sound organisation through growth and profitability


         OUR HISTORY

History is said to be the blueprint of the future, and nowhere is this more apparent than at Vimal Clothing
Enterprise cc.

Since 1981, when the Kalidas family first started Vimal Clothing, the company has continuously expanded
its capacity in order to ensure that the company demonstrated a continuous ability to provide client-specific
solutions to challenges presented by a diverse range of customers.

The success of Vimal has been centred on its ability to translate customer challenges into innovative solutions
that break traditional moulds and offer strategic solutions within rigid constraints of time, quality and price.

During the infant stage of the business (the first four years) Vimal operated as a ‘cut, make and trim’ (CMT)
factory which established a comprehensive understanding of the apparel business. However, we quickly learned
that in order to afford maximum value to our clients we had to learn how to specialise in a select range of
key products.

As such, we chose to focus on a product range that incorporates the following garments, and their many
variations within the respective divisions.

          MENS                       LADIES                   GIRLS & BOYS
                Tracksuits                 Tracksuits                  Tracksuits
                  Jackets                       Jackets                  Jackets
                    Pants                        Pants                     Pants
                   Shorts                        Shorts                   Shorts
            Soccer Shorts                                          Soccer Shorts
           Soccer Jerseys                                         Soccer Jerseys



In 1987, during the second phase of our business, we started producing track-
suits for corporate clients and wholesalers targeting the medium price market. By
learning from our past experiences, focusing on products that best suited our core
competencies, and proving that cost effectiveness, on-time deliveries and unques-
tionable quality were at the heart of being a customer-centric company, Vimal was
able to attract Adidas South Africa as our first flagship client in 1989.



                                                          3
                         Through the process of learning how to work to the exacting standards of Adidas South Africa, Vimal has been
                         able to gain an invaluable understanding of what it takes to effectively compete in an industry that is critically
                         affected by the ease in which products can navigate across international boundaries. While price will always be
                         a key success factor in the garment manufacturing industry, it is not the only issue that buyers are interested in,
                         and by learning to meet the quality, labour and environmental expectations of a company such as Adidas, we
                         are in a position to report that our client list proudly includes the likes of Nike, Puma, Reebok and TotalSports
                         (among others).


                                                                                                       Embroidery
                                                                                                                         Functional Sportswear

  Start (20 employees)                                                                                                    Yash Clothing           526

                              Adidas                                     Nike                                    Puma




‘81                        ‘87                                     ‘94                            ‘99          ‘01 ‘02                      ‘07

                                                                                 MILESTONES
                              1981     Start with 20 employees (526 at the end of 2007)
                              1987     Start of supply relationship with Adidas (still the largest customer)
                              1994     Start of supply relationship with Nike (no contracts in 2007)
                              1999     Started Niam Embroidery with 12 employees (24 at the end of 2007)
                              2001     Start of supply relationship with Puma
                              2002     Started Functional Sportswear with 50 employees (103 at the end of 2007)
                                       Started Yash Clothing with 34 employees (95 at the end of 2007)
                              2006     Start of supply relationship with Reebok and TotalSports (Foschini Group)
                              2007     Move into new premises in Mount Edgecombe (Umhlanga)

                         Of course, the growth of our client base has also meant a significant growth in the physical size of our business.
                         Vimal outgrew our first factory in the Phoenix Industrial Park and moved to the Redhill Industrial Park back
                         in 1996. In 2007, 11 years after our first major move, we were pleased to cut the ribbon on our new factory
                         situated in the Mount Edgecombe Industrial Park, adjacent to a beautifully appointed golf estate.

                         Our decision to relocate was predicated by our need to ensure that our employees could be afforded a factory
                         that is easy to access their homes, that is safe, and that demonstrates that their employment is secure, as
                         demonstrated by a factory that is superbly appointed and ready to allow for future growth.

                         In 2002 we noticed an increased demand for soccer jerseys and shorts. This initiated the acquisition of
                         subsidiary corporations which focused their mainline operation on soccer outfits. The knits allowed us to
                         compliment our woven product range. We are currently producing garments for blue chip corporations such as
                         Adidas, Puma, Nike, Reebok and the Foschini Group (TotalSports).




                                                                                            4
          OWNERSHIP STRUCTURE

Vimal Clothing was originally established a closed partner-
ship. However, Mr Nayan Kalidas (‘Kali’ to all who know




                                                                     VIMAL CLOTHING ENTERPRISES CC
him) was given the opportunity to buy the full 100% interest
in Vimal Clothing, creating an opportunity to expand the                                                     Vimal Apparel
business into what is now known as Vimal                                                                    (305 employees)
Clothing Enterprise cc (‘Vimal’), with the Shareholding in
Vimal limited to Kali (70%) and his wife (Naina, 30%).

Under this banner, Vimal now consists of four 100%
wholly owned subsidiaries, including:                                                                    Functional Sportswear
                                                                                                            (103 employees)
•    Vimal Apparel, our primary garment
     manufacturing entity

•    Functional Sportswear
                                                                                                             Yash Clothing
                                                                                                             (95 employees)
•    Yash Clothing

•    Niam Embroidery
                                                                                                     Niam Embroidery (23 employees)

Apparel production is broken into various categories, whereby Functional Sportswear focuses on specialized
garments, particularly with respect to soccer, Yash Clothing focuses on entry level sporting apparel and Vimal
Clothing produces a full range of all sporting and fashion garments. Niam Embroidery offers a value-adding
service to all of the business lines, including embroidery and sublimation printing services.

With the exception of Yash Clothing, all subsidiaries are located at our Mount Edgecombe facilities in Durban,
South Africa. Yash is located in Umzinto, one of Durban’s other non-metro under-developed areas. When,
Yash was started in 2002 the intention was to create additional jobs for machine operators in an area where
access to transport is less of a concern. Based on the success of the initial model, the employee
population has grown from 50 to just over 100 employees, with the higher skilled activities (e.g., design and
cutting) being retained within our centralised Vimal factory.




          MANAGEMENT STRUCTURE AND GOVERNANCE

                                                            Within Vimal, the overall management structure is lim-
                                                            ited to four tiers of control. Ultimately, all decisions are
                                                            taken by the owner of the business, but the day-to-day
                                                            running of the business resides with the managers and
                                                            supervisors.

                                                            Communication, particularly between departments and
                                                            business units, is perhaps our most important critical
                                                            success factor.

                                                            Although Vimal is in essence ‘one company’, the four
                                                            separate business units (Vimal, Functional, Yash and
                                                            Niam) operate as independent entities within the struc-
                                                            ture. However, the success of each business unit, as
                                                            well as Vimal on the whole, is critically dependent upon
                                                            ensuring that the management team from each unit regu-
                                                            larly interacts to ensure smooth and efficient production
                                                            flow.


                                                        5
In order to ensure that the same principle of effective communication cascades down throughout the en-
tire company, employee communication is managed through reporting lines to Floor Supervisors and
Shop Stewards.

Although these are represented as the 4th tier in our management structure, they are as important, if not more
important, than all other tiers, due to our reliance on our production team to ensure that client expectations are
achievable, and that potential challenges are quickly identified and addressed.

                                               Nayan (Kali) Kalidas
                                                Managing Member




          Saras                       Nishel                          Julie                      Solitha
    Production Manager            Soccer Products                Design Manager             Financial Manager



     Sandra/Michelle                   Amit                    Shireeta/Caroline                 Khemie
    Sourcing Department          Trims Department              Design Supervisors        Payroll/HR Department

            Rita
   Bulk Design Production

       Vishnu/Vishal
       Cutting Room

           Priscilla
          Embroidery

    Sandra/Mala/Angie
                                 Floor Supervisors                                           Shop Stewards
    Floor Management



The overall management structure of the company is divided in to the following core elements:

Owners:                     Because Vimal is a privately held family-owned company our ‘Board’ consists of
                            our two owners and ‘Board Meetings’ often equate to ‘dinner at home’, where Mr.
                            and Mrs. Kalidas are Vimal Clothing’s decision makers.

Production Manager:         Saras plans all aspects of our production, including the time frames required to
                            complete orders. She also communicates with all of our customers to address pro-
                            duction queries.

Finance:                    Solitha is responsible for all aspects of our financial management.

Soccer:                     Nishel is responsible for co-coordinating all of our Soccer and Sublimation orders.

Floor Management:           Our Production Managers (Sandra, Mala and Angie) make sure that all production
                            orders are completed on deadline and that all goods are delivered on time to our
                            customers.

Payroll/HR:                 Khemie makes sure that all workers are paid on time and that all of their queries are
                            answered satisfactorily.

Trims Manager:              Amit oversees the Trims Department, including the ordering of all trims to produce
                            our goods as per client expectations of quality, cost and time.


                                                          6
Shop Stewards:              The shop stewards relay all worker queries to Management and initiate meetings to
                            discuss any problems.

Design:                     Julie is responsible for coordinating our product development.

Our financials are audited by an external service provider, as required by law,
and our company registration documentation is kept up to date during our an-
nual audit process.

Policies and procedures are typically established by the relevant business unit
or department manager, and are discussed amongst the management team to
ensure that they are consistent with our vision, mission and values.

The conduct of our employees is guided by our Code of Conduct, which is
signed by each employee when they join Vimal. This Code addresses em-
ployee rights, misconduct, disciplinary counselling, grievance procedures
and sanctions.

Our environmental performance is monitored and measured according to
our environmental policy which addresses the identification and manage-
ment of impacts and emissions, the use of materials and supplies that have
a reduced environmental impact, the reduction of wastes, and increasing
energy efficiency.
                                                                                                                       The canteen is
Our occupational health and safety policy is applied to ensure that the safety and well-being of employees is        often where issues
protected across all of our operations. This policy addresses the identification and management of risks and             of concern or
hazards, the training of all employees, incident and accident reporting procedures, and the management of           interest are debated,
injuries on duty.                                                                                                       discussed and
                                                                                                                        raised with the
It is the responsibility of each employee to identify ways in which our environmental and safety performance         management team.
can be improved.

Employee engagement occurs via Shop Steward Meetings every Monday morning, with an additional meeting
with concerned employees occurring on Monday afternoons.

Anyone wishing to raise specific concerns about the operation of the business, or specific personal or profes-
sional challenges, are invited to use one of these two mechanisms to raise issues of specific interest or concern
to the company.

In special circumstances, an open door policy is maintained by Kali. Anyone wishing to ‘quietly’ discuss a
specific issue is invited to call upon Kali when required.




                                                     7
          OUR MOST MATERIAL ISSUES

At Vimal, we define “material” as those issues that can, or in fact do, have a significant impact on our ability to
remain competitive within the markets we operate.

Given the nature, structure and operating environment of our company, we tend to regard production, product
safety and labour issues as our ‘Most Material’, while environmental issues have, until recently, been of limited
concern to us.

Ultimately, we believe that the long-term viability of our business rests on our ability to manage the following
issues, as identified by our management team through their daily interaction with key customers, suppliers
and employees:

                ISSUE      PERFORMANCE                                      TARGETS


  Production efficiency,   Customer complaints about late deliveries        • Complete the integration of IT systems for
     delivering on-time    are rare but performance can still improve.        automatic order generation with Adidas
                           In 2007 no penalties were levied by any          • Engage other key clients
                           clients.                                           (Puma, TotalSports) to discuss similar
                           Currently working on the installation of a new     possibilities.
                           IT system to capture production data to im-
                           prove efficiency.


     Compliance to the     Vimal is certified as a ‘Compliant Member’       • Maintain certificated compliance to the
    National Bargaining    of the NBC.                                        NBC
      Council (Clothing    As a certificated member, Vimal has been         • Ensure that no employee is treated in
              Industry)    able to prove that we                              a manner that is inconsistent with the
                           • pay correct normal and overtime wages            agreements established by the NBC
                           • pay appropriate end of year bonuses            • Ensure that all employees work towards
                           • pay for appropriate benefits                     targets leading to the payment of bonuses
                           • adhere to appropriate guidelines on normal
                             and overtime hours.

                           To date, no unresolved concerns or com-
                           plaints are outstanding with the NBC, and no
                           complaints have ever led to CCMA arbitra-
                           tion.


       New technology      The implementation of new technology within      • Complete the installation and conversion to
                           Vimal has increased the output per worker,         automated cutting machines.
                           particularly for specialised tasks such as       • Complete the installation and development
                           pocket affixation.                                 of skills to operate the new automated cuff,
                           Quality and sophistication of products has         collar and waistband knitting machines.
                           increased due to the presence of higher          • Investigate possibilities to procure an
                           value-add machinery, ultimately leading to         automated marking system to increase
                           an increase in orders that Vimal otherwise         accuracy and efficiency, and to reduce
                           would not be able to fill.                         material wastage.


          DTI Codes of     The Department of Trade and Industry (DTI)       • Vimal is committed to completing a full
         Good Practice     Codes of Good Practice are a set of govern-        assessment of our Codes status within
                           ment principles in support of Broad Based          the first half of 2008, and we will discuss
                           Black Economic Empowerment (BBBEE) in              this assessment in our 2008 Sustainability
                           South Africa. The Codes come into full effect      Report.
                           at the end of February 2008, and at the time
                           of writing this Report, we are in the process
                           of undergoing a review of our status accord-
                           ing to these Codes.


                                                                8
               ISSUE      PERFORMANCE                                      TARGETS


 Securing adequate        Vimal is proud of our record of never having     • Maintain current clients, and ensure that
orders to ensure the      cause to commit employees to ’short time’,         growth in new orders does not affect
  long-term financial     or to retrench employees due to lack of or-        our ability to meet existing performance
       viability of the   ders.                                              expectations.
            company                                                        • Ensure that increased capacity due to new
                          The quantity of 2007 orders was sufficient to      and more efficient technology is met by
                          merit the increase in staff complement by 79       increased order taking.
                          employees.



Welfare of our team       Vimal is committed to ensuring a policy of       • Maintain a zero ‘short shift’ policy within
                          ‘zero short shifts’, where all employees are       the company
                          guaranteed full weekly wages.                    • Ensure a zero redundancy policy
                                                                           • Ensure that wages are paid in-full, on time
                          Annual performance and zero sick leave             and, where possible, in the presence of
                          bonuses are paid out to workers in                 performance and special gratitude awards
                          exchange for their dedication to performance     • Implement our ‘Qualifying for 2010’ bonus
                          excellence.                                        scheme for awarding employees who
                                                                             reduce their sick leave.
                          Long service awards are given to employees
                          who complete 5 years (or more) service.
                          School fees are payable to employees who
                          meet specific performance criteria, thus re-
                          ducing their financial concerns.
                          All employees are allowed to take the day off
                          on the first day of the school year, to assist
                          their children with school enrolment.



   Workplace safety       Although appropriate safety equipment is         • Complete the installation and conversion
                          used, 3 employees sustained injuries in the        to automated cutting machines, which
                          cutting room.                                      is expected to reduce our exposure to
                                                                             cutting injuries.
                          An Injury on Duty (IOD) Register is main-        • Continue to maintain an up-to-date IOD
                          tained within the factory, and at our off-site     register, and to discuss to discuss ‘near
                          assembly plant in Umzinto (Yash Clothing).         misses’ when they are raised.
                          Supervisors conduct daily inspections to         • Continue to conduct regular workplace
                          manage risks, including ensuring that needle       hazard inspections.
                          guards are not removed and that work spac-       • Continue to adhere to fire prevention,
                          es are free from obstructions.                     evacuation and fighting programme.
                                                                           • Avoid all injuries on duty to reach our
                          Inspections of potential workplace hazards         target of ‘Zero Harm’
                          are conducted on a bi-weekly basis or as/
                          when necessary.

                          6 employees are trained by St. John’s Ambu-
                          lance in First Aid every 3-years.
                          Fire fighting training has been conducted by
                          Chubb Fire.
                          All fire fighting equipment is tested on a
                          monthly basis.
                          Evacuation drills are conducted on a
                          6-monthly basis.




                                                         9
               ISSUE      PERFORMANCE                                      TARGETS


 Theft and unethical      On-site losses are minimal at Vimal premis-      • Continue to monitor potential losses.
          behaviour       es. However, losses can occur both in-transit    • Continue to remind employees of their
                          and in customer warehouses.                        responsibility to avoid theft and unethical
                          On-site monitoring of losses is monitored          behaviour.
                          by comparing cutting stats with packaged
                          orders and defaults.
                          The implementation of on-site CCTV cam-
                          eras has reduced occurrences of theft and/
                          or over-reporting of work performance.
                          One incident of personal property theft was
                          identified and addressed during the course
                          of the year.



      Cost Reduction      Vimal continuously strives to reduce operat-     • Complete the installation of data manage-
                          ing costs and overheads.                           ment system to control inventories of
                          Our 2007 focus was on the implementation           fabric and accessories.
                          of new technology to speed up production,        • Complete the acquisition and installa-
                          reduce labour costs and reduce wastage.            tion of new machinery to further improve
                                                                             production efficiencies.


   Absenteeism and        2007 saw a significant increase in employee      • Complete the implementation of the
        Late Arrival      absenteeism and late arrivals, although            ‘Qualifying for 2010’ bonus scheme to
                          much of the tardiness was directly linked to       reduce absenteeism.
                          the new location and has been addressed.


           Skill levels   Although skill levels are not a concern in the   • Need to investigate ways to find new
                          short-term, the lack of interest in garment        machine operators, including the possible
                          manufacturing among the youth of South Af-         need to relocate some of the assembly
                          rica is an ongoing concern for the future.         activities to more rural areas.


 Solid waste sent for     Fabric wastage has been identified as a          • Continue to implement new technology to
  disposal, including     cost-first, environmental second, concern.         ensure that fabric wastage is reduced.
      fabric wastage      The move to new technology has already be-       • Identify ways to sort and recycle solid
                          gun to demonstrate a decrease in the num-          wastes.
                          ber of waste haulage bins being retrieved
                          from our premises.
                          The move to new technology has increased
                          the amount of recyclable materials (specifi-
                          cally plastic) being generated within the fac-
                          tory.


Quality of local fabric   Although Vimal is committed to procuring         • Continue to engage with local suppliers to
             suppliers    fabric from local suppliers, issues of quality     identify ways in which Vimal can increase
                          and on-time delivery continue to be a limit-       purchases from them, without compromis-
                          ing factor.                                        ing on customer quality expectations.




                                                              10
         USE OF APPROPRIATE TECHNOLOGY

As a proudly South African company, we are constantly reminded of the need to
balance the challenges of operating within a globally competitive market with the
socio-economic challenges in our community. Poverty, high unemployment and the
presence of less than scrupulous employers all plague the South African industrial
sector, and we are constantly reminded that Vimal is ‘an employer of choice’ rather
than ‘an only option’. As such, we believe that the delicate balance between com-
petitive pressures toward automation and job creation places Vimal in the unenviable
position of looking for inventive ways to improve efficiencies without compromising on
our commitment to the welfare of our staff.

Over the past 26 years of operation, we have focused mainly on ensuring that
our cutters, machine operators and finishers were all supplied with reliable, safe
and appropriate machines that would allow them to deliver against increasingly
challenging targets.

However, our experience over the past couple of years has indicated that we must
alter our production strategies to rely less on human behaviour and more on the
increased accuracy and efficiency of computers.

Although our design, printing and planning activities have been at least partially au-
tomated for several years, 2007 became our watershed year for the automation of
production activities. Thus far, we have acquired one large automated cutting machine (Lectra VectorFashion-
MH8Cutter) which is expected to reduce cutting time by up to 80%, while improving our ability to make more
efficient use of raw material and reducing cutting errors, thus decreasing the volume of wastages being sent
to landfills.

We have also purchased two automated cuff, collar and waistband knitting machines which will reduce our
concerns over access to reliable sources of knitted cuffs, while allowing us to offer clients more sophisticated
cuff, collar and waistband options. These three machines are expected to be fully operational before the end
of the first quarter of 2008.

                                      CUTTING


                        Basic Cutting Machines     Hand held electric cutter/knife                                 11
                           End Cutter Machines     Hand held straight line end cutter/knife                         6
                Lectra VectorFashionMH8Cutter      Automated fabric cutting machine                                 1


                                     KNITTING


                           Mechanical Knitters     Mechanical knitting machine for collars and cuffs               3
                    Kauo Heng Flat Bed Knitters    Computer-aided knitting machine for collars and cuffs           2


                EMBROIDERY AND PRINTING


       Tajima TMEX – c901 Embroidery Machine       Single head automatic logo embroidery machine                   1
      Tajima TFMX – 2c904 Embroidery Machine       Four head automatic logo embroidery machine                     1
     Tajima TFHX – 2c1208 Embroidery Machine       Eight head automatic logo embroidery machine                    1
         Tajima TMFD – 615 Embroidery Machine      Fifteen head automatic logo embroidery machine                  1
         Tajima TMFD – 620 Embroidery Machine      Twenty head automatic logo embroidery machine                   1
         Tajima TFGN – 920 Embroidery Machine      Twenty head automatic logo embroidery machine                   1
                           Sublimation Machine     Printing machine for creating sublimation heat transfers        1
                        Monti Midi Printer Press   Heat transfer press for sublimation prints                      1
                              Mini Printer Press   Small scale heat transfer press for sublimation prints          3




                                                      11
          ASSEMBLY AND MATERIAL PREP


                                 Flat Machines   Standard operator sewing machine for normal seams                                  112
                           Overlock Machines     Standard operator sewing machine for panel joining                                  92
                      Double Needle Machine      Operator sewing machine for specialised assembly                                    22
                        Multi Needle Machine     Operator sewing machine for lay-down striping                                       15
                         Button Hole Machine     Operator sewing machine for button hole installation                                 5
                              Bartack Machine    Operator sewing machine for seam reinforcement                                       8
                         Coverseam Machine       Operator sewing machine for hemming of knitted fabrics                              12
                Semi Automatic Snap Machine      Operator machine for installing press studs and eyelets                              4
                              Fusing Machines    Operator machine for fusing vylene to fabric                                         3
                         Button Sew Machine      Operator machine for button installation                                             1
                          Blind Stitch Machine   Operator sewing machine for specialised hemming                                      1
                2 Needle Chain Stitch Machine    Operator sewing machine for lay-down striping                                        1
AMF Reece Semiautomatic Jet Pocket Machine       Operator sewing machine for the installation of pockets and jets                     2
  Juki Elastic Semiautomatic Tacking Machine     Operator sewing machine for cutting and tacking elastic                              1


                                   FINISHING


           Viet 4413 Vacuum Pressing Machine     Operator clothes ironing machine                                                     4
     Yiulih YP130H Vacuum Pressing Machine       Operator clothes ironing machine                                                    17
                       Spot Cleaning Machines    Operator machine for removing stains and markings                                    2


                        OTHER EQUIPMENT


                            Air Compressors      Air compressors to supply air to machinery                                           6
                Semi Automatic Strap Machine     Operator machine for strapping boxes                                                 4
                         Crown Stock Pickers     Mobile operator machines for collecting fabric from stores                           4
                               Hyster Forklift   Mobile operator machine for moving pallets                                           1




                                                                                                Unfortunately, the move to automated cutting
                                                                                                machines has already created a concern for our
                                                                                                management staff. Of the six cutting room opera-
                                                                                                tors currently within our employ, we predict that
                                                                                                we will only require two cutter operators once the
                                                                                                new technology is in place. Our hope is that we
                                                                                                will be able to relocate the other four staff mem-
                                                                                                bers, but are worried that we will need to shed
                                                                                                these staff members due to a lack of equal pay
                                                                                                opportunities. Although this is a concern for Vi-
                                                                                                mal, we are confident that these individuals have
                                                                                                obtained a high degree of specialised training and
                                                                                                guidance over their period of employment with us,
                                                                                                and it is our assumption that our industry col-
                                                                                                leagues and competitors will soon be benefitting
                                                                                                from our loss.

                                                                                                Nonetheless, we are pleased to be in a position
                                                                                                where we can now offer our clients an improved
                                                                                                range of products and services, guaranteeing
                                                                                                even better quality control performance than
                                                                                                we’ve grown to be recognised for.




                                                                                           12
         WORLD CLASS PRODUCTS FOR WORLD CLASS CUSTOMERS

At Vimal Clothing Enterprise cc we pride ourselves in our ability to provide brand-conscious companies and
distributors with the services necessary to monetise their goodwill with minimum delay and fuss.

From design and embroidery through to sampling and manufacturing, Vimal is a confident and proven supplier
of all required services. All of our core competencies can be use as part of a suite of services or as a stand-
alone specialised task. Tailoring our offering to each client’s individual needs allows us to ensure that each job
meets highly restricted specifications. Additionally, the strategic outsourcing of specific tasks to leading profes-
sional affiliates within our controlled network enables us to make a wide range of supplementary services avail-
able, whilst ensuring that we maintain high standards of quality assurance over all aspects of the relationship.

Since 1987, we have been a proud supplier of sporting apparel to Adidas, one of the world’s most recognised
and respected companies. We recognise that as a condition of our ongoing relationship with such a well known
company, we must constantly adhere to strict controls over quality, timeliness of deliveries, as well as environ-
mental and health and safety concerns.

In the first few years of our supply agreements, Vimal struggled to fully understand and comply to their contrac-
tor compliance requirements. However, we quickly learned that by raising our production standards to meet
their world class expectations, we could become a world class producer of garments: able to supply any global
brand that is seeking an African partner.

Following on from our partnership with Adidas, Vimal has had the pleasure of developing supply relationships
with the following blue chip clients:

•    Nike

•    Puma

•    Reebok

•    TotalSports (Foschini)

•    Sedsports


As a supplier to the above listed companies, Vimal is subject to regular site inspections. Although we’ve never         Vimal was proud to
considered these visits as a threat to our relationship with our core clients, we have nonetheless found the            manufacture the SA
                                                                                                                       team kit for the 2006
inspections stressful due to our ongoing desire to be externally assured as a ‘Good Corporate Citizen’.
                                                                                                                          Commonwealth
                                                                                                                        Games in Australia
                                             PUMA SAFE SCORES:
                              Weight                   2007                   2005                   2002
             Social            50.00%                49.30%                  46.42%                 48.05%
     Environmental             10.00%                  8.00%                   7.57%                  8.15%
    Health & Safety            35.00%                29.10%                  30.82%                 31.92%
         Additional             5.00%                  4.71%                   3.51%                  5.00%
                              100.00%                91.11%                  88.32%                 93.12%
      Classification                                        B                        B                      B


Both Adidas and Puma have become significant contributors to our ongoing process improvement programme
through their processes of contractor compliance audits.

Results from these audits, including Puma’s SAFE audits (above), have been a helpful benchmark of our per-
formance in Social, Environmental and Safety areas.


                                                      13
                                                                                      On close inspection of our audit results, we have
                                                                                      found that while we continue to excel in the Social
                                                                                      aspects of Puma’s audits, we still have significant
                                                                                      room for improvement in both the Environmental
                                                                                      and Health & Safety areas. These findings are
                                                                                      extremely helpful when comparing our own inter-
                                                                                      nal assumptions and conclusions about our per-
                                                                                      formance with what we consider to be the ‘reality’
                                                                                      of our progress. Moreover, where we believe we
                                                                                      should be classified as an ‘A’ supplier, we are pre-
                                                                                      pared to accept that Puma rates us as a ‘B’ sup-
                                                                                      plier, although with a reasonable level of further
                                                                                      improvements to be addressed.

                                                                                      Closer to our hearts, and almost as important
                                                                                      as supporting global brands, Vimal has had the
                                                                                      distinct pleasure of supplying garments to South
                                                                                      African teams representing our country at major
                                                                                      sporting events around the world, including:

                                                                                      •     Bafana Bafana replica kit for the 2008
                                                                                            African Nations Cup (Adidas)

                                                                                      •     South African team kit for the 2006
                                                                                            Commonwealth Games in Australia
                                                                                            (Sedsports)

                                                                                      •     Springbok team kit for the 2003 Rugby
                                                                                            World Cup (Nike)

                                                                                      •     South African team kit for the 1996
                                                                                            Olympics in Atlanta (Reebok)

                                                                                      •     Replica kit (Puma) for the 2008 Nations
                                                                                            Cup teams from Angola, Botswana,
                                                                                            Cameroon, Egypt, Ghana, Ivory Coast,
                                                                                            Morocco, Mozambique, Namibia, Senegal
                                                                                            and Tunisia

                                                                                      Currently, Vimal is producing PSL team and rep-
                                                                                      lica kit for the following sporting sides:

                                                                                      •     Bloemfontein Celtic

                                                                                      •     Orlando Pirates

                                                                                      •     Ajax Cape Town

                                                                                      •     Santos (Cape Town)

                                                                                      •     Jomo Cosmos

  Vimal is a proud
supplier of soccer kit   In the 2007 Calendar Year (CY), our primary client was once again Adidas, firmly representing over 70% of all
   to players and        orders delivered for the year. However, we noted a significant rise in interest and orders from our friends at
  supporters of the      TotalSport and Mr. Price, both of which are domestic South African retail chains.
 South African PSL



                                                                                 14
                                  100%
        Mr Price
                                   90%
        Reebok                     80%

        TotalSports                70%
                                   60%
        Puma
                                   50%
        Adidas                     40%
                                   30%
                                   20%
                                   10%
                                       0%
                                              January

                                                        February

                                                                        March

                                                                                  April

                                                                                             May

                                                                                                   June

                                                                                                             July

                                                                                                                      August

                                                                                                                                 September

                                                                                                                                             October

                                                                                                                                                         November

                                                                                                                                                                      December

                                                                                                                                                                                  CY 2007
Over the past three years we’ve noted a significant change in the orders we process and fill for our clients.
While we are maintaining a relatively stable number of deliveries to Adidas, our orders to Puma have risen
from less than 1% of our total production to nearly 16%. Meanwhile, we have seen a significant increase in
the quanity of garments that are being produced for our South African clientelle, from less than 2% in 2005 to
over 8% in 2007.

Table 1: Distribution of Units (i.e., garments) to Our Key Clients

                                2007                                            2006                                2005                                            3 Years
       Adidas         696 599           73.5%                 573 341                     81.9%           694 656              92.4%              1 964 596                      81.9%
        Puma          149 112           15.7%                      55 530                  7.9%             5 746               0.8%                   210 388                    8.8%
         Nike              0                0.0%                   21 984                  3.1%            38 404               5.1%                    60 388                    2.5%
     Mr. Price         53 562               5.7%                         0                 0.0%                0                0.0%                    53 562                    2.2%
      Reebok           23 178               2.4%                   29 365                  4.2%               90                0.0%                    52 633                    2.2%
    TotalSport         25 122               2.7%                    4 681                  0.7%                0                0.0%                    29 803                    1.2%
     Sedgars               0                0.0%                    2 413                  0.3%            13 195               1.8%                    15 608                    0.7%
      Falstan              0                0.0%                   11 579                  1.7%                0                0.0%                    11 579                    0.5%
      Ass Ind              0                0.0%                    1 042                  0.1%                0                0.0%                     1 042                    0.0%
         Total        947 573          100.0%                 699 935                     100.0%          752 091              100.0%             2 399 599                      100.0%

Production efficiency improved over the second half
of the 2007 calendar year because the team has
now settled into our new facilities. There is still a
problem with backlogs in dispatch, mostly because
of absenteeism, particularly in summer, but we are
confident that 2008 will be marked with a measured
improvement reduction in absenteeism.

Thankfully, Vimal has been relatively immune to a
common plague among garment manufacturers:
product returns and order rejections. While we are
aware of a few batches of products that were pro-
duced in a manner that was deemed inconsistent
with client expectations, we have not needed to en-
dure a situation where our staff allowed these prod-
ucts to be shipped to clients. As such, we continue
to be proud of our record of ‘zero rejections’, with
only a small handful of returned items.



                                                                   15
                                  THE VIMAL TEAM

                         At the heart of any organisation are its people, and the people within Vimal are definitely the engine that keeps
                         our lifeblood pumping. Vimal does not permit any form of discrimination against employees. We do not toler-
                         ate racism, sexual harassment, or the discrimination of persons with any form of disability. Our remuneration
                         packages, including salary, bonuses and incentives, are above average for our industry, and we are registered
                         with industrial councils and all other statutory bodies.

                         Our team consists of a variety of trained, experienced individuals, and while the clothing manufacturing industry
                         is an industry without high academic requirements, we continue to set high experience standards. Our experts
                         work harmoniously to unlock value in inventive ways that assure that our customers receive a perfect garment
                         on-time, every time. Our team is organised into core operational and administrative areas, where hierarchy is
                         maintained at a limited level, and where access to all members of the management staff is guarded as a right
                         rather than a privilege. Each employee, regardless of whether they are a cutter, designer, assembly machinist
                         or finisher, has the expressed right to take advantage of Kali’s open door policy. Should an issue arise, whether
                         it is a concern or improvement opportunity, each employee is encouraged to raise the issue with the manage-
                         ment team member they feel most comfortable with.

           Vimal Group                 Vimal                Functional                 Niam                        Yash                Admin
  Total    526                   287          54.7%        95        18.1%       23             4.4%     102              19.4%   18           3.4%
 White       0         0%          0            0%          0            0%       0               0%       0                0%     0            0%
 Black     129       24.6%        62          21.6%        39        41.1%        7             30.4%     19              18.6%    2       11.1%
 Indian    396       75.4%       225          78.4%        56        58.9%       16             69.6%     83              81.4%   16       88.9%
  Male      44       8.4%         32          11.1%         0            0%       1             4.3%       8              7.8%     3       16.7%
 White       0         0%          0           0.0%         0            0%       0               0%       0                0%     0            0%
 Black      12       2.3%         11           3.8%         0            0%       0               0%       0                0%     1           5.6%
 Indian     32       6.1%         21           7.3%         0            0%       1             4.3%       8              7.8%     2       11.1%
Female     482       91.6%       256          88.9%        95         100%       22             95.7%     94              92.2%   15       83.3%
 White       0         0%          0            0%          0            0%       0               0%       0                0%     0            0%
 Black     117       22.3%        51          17.8%        39        41.1%        7             30.4%     19              18.6%    1           5.6%
 Indian    365       69.3%       205          71.1%        56        58.9%       15             65.2%     75              73.5%   14       77.8%


                         In many respects, Vimal is somewhat immune to the challenges most companies face in complying to South
                         African Black Economic Empowerment legislation. Based in the Durban area, where the overwhelming major-
                         ity of the population is either Black or Indian, the Vimal team has always been predominantly Indian with some
                         representation from the Black community. At present, 75.4% of our total employee complement is Indian, while
                         the remaining 24.6% is Black. In our experience, women are more reliable, more committed, and more likely
                         to remain within our employ for longer periods than their male counterparts. As such, and as one might expect
                         from a garment manufacturing plant, where sewing machines and clothes irons dominate our factory floor,
                         nearly 92% of our 526 employees are female.

             Vimal Group                    Vimal                Functional                Niam                     Yash               Admin
   17-19     11        2.09%            4           1.4%         0       0.0%          2          8.7%         5           4.9%    0       0.0%

   20-29     79       15.02%           34       11.8%            7       7.4%          6         26.1%     28             27.5%    4      22.2%

   30-39    202       38.40%        101         34.8%           40       42.1%         9         39.1%     43             42.2%    9      50.0%

   40-49    184       34.98%        111         38.3%           40       42.1%         5         21.7%     25             24.5%    3      16.7%

   50-59     48        9.13%           37       12.9%            8       8.4%          1          4.3%         1           1.0%    1       5.6%

     >60         3     0.57%            2           0.7%         0       0.0%          0          0.0%         0           0.0%    1       5.6%

 TOTAL      526                     288                         95                    23                  102                     18
     Min     17                        18                       23                    19                   17                     26
    Max      63                        61                       53                    50                   50                     63
Average      38                        40                       39                    33                   33                     37



                                                                                           16
Unfortunately, we have been subject to another industry trend: the failure to attract younger employees to our
production team.

With an age distribution favouring employees between the age of 30 and 49, the total number of employees
who are younger than 30 is roughly 17% of our workforce. While we don’t believe that this is a particular risk at
this time, it nonetheless reminds us of an ongoing need to consider alternative strategies to attract and retain
employees, particularly in the younger age brackets. We believe that the promotion of our policy of freedom to
communicate is at the core of our ability to attract and retain critical staff members.

                                         2007                      2006                 2005                 2004                    2003
                 New Recruits      229                        94                  146                   83                    132
        Failed Probation Period     28                        11                   42                   12                      24
              Net New Recruits     201                        83                  104                   71                    108
                 Terminations
                     Deceased        1          0.0%           0          0.0%      0          0.0%      1          2.9%         2          5.4%
                   Discharged        4          3.3%           3          4.9%      3          3.9%      0          0.0%         0          0.0%
              Early Retirement       1          1.1%           0          0.0%      0          0.0%      0          0.0%         0          0.0%
               End Of Contract      13          10.9%          3          4.9%     33          42.9%     4          11.4%        3          8.1%
                      Ill Health     6          5.4%           5          8.2%      5          6.5%      1          2.9%         1          2.7%
           Left Without Reason      17          15.2%          3          4.9%      4          5.2%      5          14.3%        7          18.9%
                     Maternity       8          6.5%          13          21.3%     6          7.8%      9          25.7%        7          18.9%
            Normal Retirement        2          2.2%           0          0.0%      0          0.0%      0          0.0%         1          2.7%
                   Resignation      63          47.8%         33          54.1%    20          26.0%    13          37.1%       16          43.2%
                 Retrenchment        4          4.3%           0          0.0%      6          7.8%      0          0.0%         0          0.0%
        Voluntary Retrenchment       3          3.3%           1          1.6%      0          0.0%      2          5.7%         0          0.0%
            Total Terminations     122          23.2%         61          13.6%    77          18.1%    35          8.8%        37          10.2%
                 Net Turnover       79          15.0%         22          4.9%     27          6.4%     36          9.0%        71          19.6%
       Employees at Year End       526                       447                  425                  398                    362
         Accumulated Growth                     55.0%                     39.9%                35.0%                28.7%                   19.6%

In the past 5 years, our employee turnover rate has remained in positive figures, thus leading to the growth                 Having worked with
of our total employee pool. However, we continue to struggle with the number of terminations we must deal                       Kali at another
                                                                                                                               Fabric company
with.
                                                                                                                                  prior to the
                                                                                                                               development of
In 2007, we had a termination rate of 23.2%, with resignations representing 47.8% of our total number of em-                 Vimal, Ramesh left
ployee losses. While this is due in large part to our move to new premises in an area that was not convenient                his job and, having
for some employees, we are nonetheless concerned by the overall trend towards an increase in employee                       faith in Kali, became
terminations.                                                                                                                   one of our first
                                                                                                                                 employees.
Thankfully, our need to discharge employees for poor
performance or behaviour that is inconsistent with our
core values has been limited. In the past five years
we’ve only been forced to terminate the employment
of 10 workers for unsatisfactory behaviour, with four
of these terminations occurring in 2007.

In our 26 year history, only one termination case has
been taken to the National Bargaining Council (Tex-
tiles) for arbitration. Although the termination was
ruled to be merited by Vimal, we nonetheless found
the process useful in confirming that our compensa-
tion procedures adhere to NBC expectations.




                                                        17
                            Since 1988, Vimal has recognised those employees who have offered us a commitment to long service through
                            the awarding of milestone rewards. In the 20 years of offering these awards:

                            •        307 employees have received a clock for 5 years of service

                            •        68 have received a microwave for 10 years

                            •        17 have received a freezer for 15 years

                            •        9 have received a television for 20 years, and

                            •        3 have received a home theatre system for 25 years of service


                                   ‘88      ‘89   ‘90   ‘91        ‘92   ‘93   ‘94     ‘95   ‘96      ‘97    ‘98          ‘99   ‘00   ‘01     ‘02   ‘03     ‘04   ‘05    ‘06   ‘07

                5 Year Clocks      23        1           3          8     6     5       2       1      2         2         4    13    11      29       8    32    27     54    76


          10 Year Microwaves                             3          2     5     3       4       1                4                     2               1     3    11      7    22


             15 Year Freezers                                                                   2      2         4               2     1       1       2     1            1     1


           20 Year Televisions                                                                                                         1       2       2     1     2      1


25 Year Home Theatre Systems                                                                                                                                              2     1



                            We attribute the high number of long service awards to our continued commitment to ensuring that our employ-
                            ees are appreciated, respected and rewarded in ways that far exceed standards of NBC compliance. Some of
                            the additional benefits our employees receive include:

                            •        Annual payment of school fees to employees who meet specific performance requirements

                            •        Payment of 6–monthly bonuses to employees who meet production and absenteeism targets

                            •        Permission to be absent on the first day of the school year to grant parents the opportunity to assist their
                                     children in enrolling in their new grade

                            •        Additional holiday days granted to observe recognised cultural holidays, such as Diwali, that is not a
                                     recognised public holiday in South Africa

                                              2007                                                  2006                                                   2005
                                 Cost                   Pupils                        Cost                   Pupils                          Cost                  Pupils


            Vimal            40 535.00                        78                    74 325.00                    166                       62 226.64                    147
        Functional               8 845.00                     18                    23 685.00                        53                    18 905.00                     45
            Niam             15 670.00                        31                    15 185.00                        34                      500.00                       1
             Yash                2 200.00                      5                      400.00                          1                    11 940.00                     34
           TOTAL          R 67 250.00                    132                   R 113 595.00                      254                  R 93 571.64                       227

                            In 2007 we experienced a sharp decline in the number of school fee payments that were awarded to employ-
                            ees: from 254 in 2006 to 132 this year. We attribute a significant portion of this decline to two key issues: our
                            ongoing battle to limit absenteeism, and the high level of employee terminations due, at least in part, to our
                            move to new premises.

                            In order to qualify for the school fees bonus, employees must limit the number of days they are absent from
                            work: a measurement that has become stricter over the past three years. In 2005, employees could receive
                            the bonus as long as they were not absent more than 20 days.. This was reduced to 12 in 2007 (an average
                            of 1 per month).




                                                                                                            18
52 Years of Combined Service

Fatima (top) and Marlene are excellent examples of how mutual respect can translate into a lifetime of shared experi-
ences. Both ladies joined Vimal when the company was merely a fledgling start-up, back in 1981, and both are still
providing leadership within our production team. Although both ladies suffered from injuries and illnesses that kept
them away from work for a good portion of this past year, both are committed to returning to full active duty within the
early days of 2008.

When asked why they have chosen to continue working at Vimal, their answers were unwavering in their support of
Vimal as a company, and Kali as an manager to work for.

F:    In 26 years, I can’t recall a period when we were ever short-shifted (i.e., not given 40
      hours of work in a week). In fact we are most often given opportunities to work over-
      time.

F:    We’ve never been robbed of wages (never underpaid) and have always been paid on
      time.

F:    Other companies have problems paying the full amount of their wages, but Vimal has
      always paid us what we were owed, plus bonuses.

F:    Bonuses are paid twice: one before Christmas and the other in the New Year, 1 week
      before we return to work. Rather than one bonus, the money is split into two portions
      so that we won’t spend it all before we get back to work.

F:    These are the most important things for those of us in production because we need the
      money.

F:    I never worked before coming to Vimal, but a lot of my friends who work in other cloth-
      ing factories tell me that I am lucky to be here.

F:    We worked as a family, and Kali always treated us as part of his family.



                                                                                                                           Fatima

M:    We learned a lot from Kali. We knew nothing when we came here and he taught us
      everything.

M:    In 26 years, we never had any major arguments. We always worked as a team, with
      unity.

M:    Under the union, we always receive NBC rates whereas other companies don’t employ
      union members and don’t pay NBC rates. They also sometimes only let the people
      work 2 or 3 days per week. We always got a full week’s work.

M:    The whole factory gets time off for celebrations such as Diwali, regardless of whether
      you are Christian, Muslim, Hindu, or not religious.

M:    We receive attendance bonuses and long-service awards. No other companies give
      long-service awards like in Vimal.

M:    The school fees for the last 2 of my 5 children were paid by Vimal. This is a new benefit
      that was started about 5 years ago, and this is something that no other boss will do.

M:    We are very happy working here because we grew up working with Kali, and he always
      treated us like part of his family.



                                                                                                                           Marlene




                                                      19
What our employees have told us

In the process of developing this Sustainability Report, our consultant randomly engaged
members of our production team during their lunch break. The following is a summary of the
comments and criticism they shared with us:

Vimal is a good company.

It is good because you can always be guaranteed that your wages (weekly).

We get lots of overtime, including many opportunities to work a half day on Saturday.

We should be so lucky that we are never short-shifted and are offered overtime
and bonuses.

We have First Aid on site and although we don’t have a lot of injuries, if an injury occurs, we
get treated right away.

There’s nothing bad about working here, that’s why I’ve lasted 12 years.

The management doesn’t come in and look over us, we have supervisors that ensure that the
work gets done.

There are lots of rules that we have to obey, like not being able to use the phone except on
breaks, and only being able to smoke on breaks.

You’re not allowed to go outside unless you’re a smoker.

Vimal is a safe place to work.

The air conditioning is either too hot or too cold, but never right. In some places its very
cold.

The money is good. We get our wages on time and we’re never paid less than we’re owed.
We never get short time...always get a full week’s work.

We want a canteen where we can buy lunch. If we forget lunch there’s nothing we can buy
at the factory.

Boss pays our children’s school fees…if you come regularly to work (not if you are often sick
or absent for any reason), and if you are productive.


Sick time is a problem. If you stay away more than 3 days sick, you don’t get your R1000
bonus…but this should be if we don’t stay away the 15 days the union allows.

After 3 warnings there is no bonus.

We are a branded company…we make high quality products…we should be paid more be-
cause we make quality name brand garments.

My neighbour works for another clothing manufacturing company (CMT, which is not union-
ised) and she gets R350 per week, where the NBC wages are at least R560 per week.

When I was injured and getting better, I worked for a CMT company and I had to work to 9 or
10 at night (from 7am), and would only get paid R400 per week, including overtime pay.

Vimal pays you much more, for less hours, in a safe and friendly factory.

Here our boss buys us food if we have to work late.

Kali is a nice boss who doesn’t rob us.




                                      20
                                                                                                                          In 2007, Vimal once again failed to reach our average
7%                                                                                                                        target of 2.6% absenteeism. Granted, our average
                                                                                                                          rate of 3.2% was far less than the industry’s average
6%                                                                                                                        of 6.0%, but we believe that we can still improve to
5%                                                                                                                        below 2.0%.
                                      Industry Average
4%
                                                                                                                          As such, 2008 will herald the introduction of our new
3%                                      Absentee Rate                                                                     bonus scheme to reduce non-illness related absentee-
                                                                                                                          ism. Our plan, called ‘Qualifying for 2010’ will offer a
2%
                                                                                                                          maximum annual bonus of 2,010 Rands to any em-
1%                                                Target                                                                  ployee who maintains a perfect attendance record.
0%
                                                                                                                          We hope that this new programme, which sees the
                                                                                                                          potential for employees to receive an increase in
       January
                 February
                            March
                                    April
                                            May
                                                  June
                                                         July
                                                                August
                                                                         September
                                                                                     October
                                                                                               November
                                                                                                          December        their annual bonus payments of R810, will have
                                                                                                                          a significant impact in our ability to ensure that
                                                                                                                          our production schedules are not hindered by
                                                                                                                          unnecessary absenteeism


          RESEARCH, MARKETING AND PROCUREMENT

As a relatively small manufacturing company, with limited access to professional
research and market analysis, we continue to remain in touch with changing
trends, designs and fabrics by making periodic overseas visits to assess and
alter the future of our products and services.

Granted, we have limited direct control over changing consumer trends due to
our lack of a ‘marketing department’, but we are confident in our reliance on our
clients, and the brand- conscious environment in which they operate, to act as
a mechanism for marketing our products. Where deemed necessary, we are
pleased to assist our customers with brand-specific marketing activities when
called upon.

Our artists and designers utilise the Wilcom Embroidery system and Freehand
CAD for producing finished artwork and Embroideries that can be used to mar-
ket specific teams, competitions and events.

Our marketing is primarily restricted to proving that our services are accurate,
timely and delivered according to costing budgets. While our consistent ability
to deliver according to client expectations is our tried and tested method of prov-
ing ourselves to be a supplier worth choosing, the management of costs is an
ongoing management challenge.

A Lectra system is used in the sample rooms for pattern making, grading, ratings and marker making, resulting
in the accuracy of costing and sourcing of fabric, thus reducing our costs and ensuring that we can continue to
meet client price expectations.

To further our cost-conscious approach to manufacturing garments, we have repeatedly identified and tested
local suppliers of fabric, but have been consistently disappointed with the quality, consistency and/or timeliness
of supplies. Moreover, we are constantly aware of the fact that we do not have access to local suppliers of most
of our manufacturing equipment. As such, the bulk of our annual procurement budgets are directed to foreign
suppliers of fabric and equipment. However, we will always choose a local supplier if they are able to meet our
client-linked quality and pricing requirements.

Thankfully, the majority of our accessories (e.g., print materials and supplies, thread, zippers, etc.) and servic-
ing contracts are procured from local suppliers.



                                                                                                                     21
                                     OCCUPATIONAL HEALTH & SAFETY

                                                                                           While the management and staff at Vimal con-
              Injuries on Duty                                                             sider the company to be a ‘safe’ place in which
                                                                                           to work, we are nevertheless mindful of the risks
6                                                                 Cuts                     and hazards that continue to arise on an almost
                                                                                           daily basis. As such, we have developed and
5                                                                                          implemented an Occupational Health and Safety
                                                                  Sprains
4                                                                                          Policy that sets out our ongoing commitment to
                                                                                           ‘Zero Harm’.
3                                                                 Needle Injuries
                                                                                           For Vimal, ‘Zero Harm’ refers to the creation and
2                                                                                          maintenance of a work environment that is free
                                                                  Burns
                                                                                           from the potential for illness or injury for our em-
1
                                                                                           ployees, our clients, and our neighbours within the
0                                                                                          Mt. Edgecombe community. In our most recent
                                                                                           review Hazard Identification and Risk Assess-
    2003


           2004


                   2005


                              2006


                                          2007




                                                                                           ment (HIRA), we identified the following potential
                                                                                           risks and hazards:


                          1. HIV/AIDS            HIV/AIDS is a massive problem for all of Africa, particularly for those of us living and working in
                                                 Sub-Saharan regions.

                                                 The HIV/AIDS pandemic will remain a sustainability risk factor to be closely monitored and man-
                                                 aged for many years to come, and Vimal is committed to ensuring that our workforce is perpetually
                                                 aware of their role in protecting themselves, and their family members, from the disease.

                                                 To date, we are only aware of three employees who have been infected by HIV/AIDS, including
                                                 one employee who is still on our team, and to the best of our knowledge there have only been two
                                                 HIV/AIDS related deaths among our staff.

                                                 However, the relevant demographics suggest that Vimal remains vulnerable to the disease, and
                                                 therefore must remain committed to addressing the risk.

                                                 Vimal is especially susceptible to HIV/AIDS related risk factors when considering the fact that
                                                 our employees come from a region of South Africa that is known to have one of the highest HIV-
                                                 infection rates.

                                                 In mitigation of our direct risk, Vimal has instituted an HIV/AIDS programme which comprises of
                                                 the following elements:

                                                 •     Policy guidelines with regard to recruitment, promotion and management of illness in the
                                                       workplace, including explicit mention of non-discrimination within our Code of Conduct;

                                                 •     Access to education and voluntary testing campaigns;

                                                 •     Continuous inclusion of awareness campaigns about HIV/AIDS in weekly staff meetings;

                                                 •     Access to poster campaigns in bathrooms and common areas; and,

                                                 •     Availability of free condoms in our restrooms.


                          2. Knife cuts          Although we insist on the use of appropriate Personal Protective Equipment (PPE) by all of our
                                                 cutting room staff, injuries still continue to occur.

                                                 The use of wire mesh gloves has significantly reduced the number of cuts, yet 3 new incidents
                                                 occurred in 2007.

                                                 Our hope that these injuries will be eliminated in 2008 with our switch to automated
                                                 cutting machines.




                                                                                      22
3. Needle pricks        The greatest risk when operating a sewing machine continues to be the
                        potential to penetrate one’s finger with the needle.

                        In the past 5 years Vimal has only faced two such incidents, with no
                        injuries have been sustained in 2007. We attribute this to our use of
                        needle guards on all of our machines, our concerted effort to educate
                        our staff about the danger, and the role our supervisors play in ensur-
                        ing that guards are not removed.

4. Burns                Heated irons, used for pressing garments during our finishing proc-
                        esses, has always been an obvious risk area, resulting in one burn
                        incident in 2007.

                        This incident was devastating to our team, as all of our staff members
                        were proud of our five-year zero burn performance record leading up to
                        this incident. Although an unpleasant incident, it nonetheless reminded
                        us of constant need to be mindful of the risk of iron burns.

5. Falls from heights   Although most of our employees are never placed at risk of a fall from
                        an unsafe height, we do operate motorized stock pickers that raise
                        warehouse staff to dangerous elevations. To mitigate the risk of falls,
                        our stock picker operators have undergone task-specific safety train-
                        ing, and are required to wear safety harnesses at all times.

                        No such incidents have been recorded at Vimal, yet we continue to
                        monitor employee behaviour to limit the risk of falls.                                                    Having cut his hand
                                                                                                                                   with a mechanised
6. Inhalation of        Vimal uses low harm and environmentally friendly chemicals wherever                                       knife, Ramesh now
   harmful dust and     possible in the various areas of operation in our business.                                                 understands the
   fumes                                                                                                                          need to ‘think safe –
                        Although no cases of fume-related illness have thus far been reported
                        at Vimal, we are mindful of the potential to cause harm where solvents,                                         act safe’.
                        dyes and glues might be used.

                        As such, we have designed our new manufacturing facility with specific
                        attention having been paid to the provision of adequate ventilation and
                        air quality management.

                        Where task-specific higher risks persist, we ensure that face masks
                        and other PPE is used by all employees operating in the risk area.


7. Sprains              The lifting of heavy bundles of fabric, the repetitive nature of specific
                        tasks, and the need of some employees to move about areas that could
                        become cluttered creates a multi-faceted risk of sprain injuries. 2007
                        saw once such incident occurring, but occurred during non-standard
                        operational activities: during the move to our new premises.

                        Supervisors are tasked with ensuring that employees are not operating
                        in an unsafe or unhealthy manner, but we accept that the nature of this
                        risk is more difficult to monitor.

                        As such, we rely on our weekly staff meetings to remind employees of
                        their responsibility to avoid behaviour that could place them in danger of a
                        sprain, as well as to ensure that their work environment remains clean and
                        obstacle-free.


                                                                                                                                  The height of fabric
                                                                                                                                   stock shelves can
8. Inhalation of        Another addition to our working practices that began with the move to our new premises was the
                        installation of an Employee Complaints and Suggestions Box.                                                 exceed 6 metres
   second-hand
                                                                                                                                      and poses a
   smoke
                        Although we have yet to see this tool used to its full potential, one of our staff members did use this     significant risk to
                        mechanism to raise the issue of smoking in common areas as a concern.                                     anyone operating in
                                                                                                                                  an unsafe manner.
                        Irrespective of management’s personal bias against smoking, a policy was developed and imple-
                        mented to ensure that the rights, freedoms and health of all employees, smokers and non-smokers
                        alike, is not hindered. From January 2007, employees are not allowed to smoke anywhere within
                        the building, but must rather exit the building and restrict themselves to a designated smoking area
                        adjacent to the parking lot.




                                                          23
                        9. Collisions with   Each year thousands of pedestrians are killed in unnecessary road accidents in South Africa. Fail-
                                             ure to observe basic traffic rules is a common problem, not just on the roads, but also in factories
                           moving vehicles
                                             such as ours, where moving vehicles are employed to complete specified tasks.

                                             At Vimal, we employ three motorized vehicles and have clearly marked designated travel spaces
                                             to avoid collisions between personnel and vehicles within the factory.

                                             Safe operation of all internal vehicles is controlled though safety-specific training for all operators,
                                             the use of strobe lights and motion sirens to alert other employees of oncoming vehicles, and the
                                             application and supervision of rules to restrict access to areas commonly traversed by our forklift
                                             and stock picking machines.

                                             Another additional risk area was identified when considering the need for taxis to drop-off and
                                             collect employees on a daily basis.

                                             Too many taxis entering a relatively confined space, all operated by individuals interested in quick-
                                             ly moving to other routes, creates a potential hazard for employees who rely on taxis to get to and
  Vimal’s parking lot                        from work, as well as for non-Vimal pedestrians who share the space around our factory.
 could have become
      a risk-laden                           To manage the risk of taxi-related injuries, for Vimal and residents of Mt. Edgecombe, Kali de-
 madhouse if not for                         signed an over-sized parking lot, with an adequate number of parking bays to accommodate the
                                             number of taxis required to drop-off and collect staff members.
the decision to enter
    into contractual                         Kali also entered into service level agreements with taxi operators that include clauses restricting
   agreements with                           taxi drivers to dropping off and collecting employees from the parking lot. By ensuring that taxis
   transport service                         only stop when on Vimal’s property, we are confident that the risk of pedestrian-taxi collisions is
       providers.                            reduced to the limit of our abilities.




                                                                                    24
           ENVIRONMENTAL MANAGEMENT

In terms of South African monitoring and evaluation norms, Vimal’s potential for negative environmental impact
is considered ‘moderate’, even according to the ratings applied by the Socially Responsible Investment (SRI)
Index at the Johannesburg Stock Exchange (JSE Limited). As such, while we are of the belief that our impact
on the environment is limited, we nonetheless need to be perpetually mindful of the fact that we have a respon-
sibility to monitor and manage our environmental impacts, wherever possible.

Through our participation in the contractor audits performed by many of our clients, including Adidas and Puma,
as well as through the process of developing this report, we have consistently increased our level of environ-
mental monitoring over a number of issues.


   1. Electricity          As of late, the South African economy has become critically aware of our need to become more
                           efficient consumers of electricity. Total capacity, as supplied by the national electricity provider
                           (Eskom), has failed to keep pace with demand, and consumers at all levels of the economy are
                           now subject to periods of ‘load shedding’ (i.e., rolling black-outs).

                           On one hand, we believe that this situation will benefit society, and the physical environment, by
                           forcing each of us to find ways to reduce our electricity consumption (e.g., use of more efficient
                           light bulbs, conversion to solar water heaters, etc.). But on the other hand, those of us operating
                           businesses that rely on electricity to operate are being forced to consider alternative strategies
                           to protect our interests in the event of an electricity supply crisis. The process of developing this
                           Report has come at a convenient time for Vimal, as we have now learned the value of evaluating
                           our electricity bills to determine if we are managing our electricity consumption in a manner that is
                           both cost-effective and environmentally sound.

                           Granted, our understanding of the need to monitor our electricity consumption, as well as our
                           understanding of how we might do so, was limited prior to the development of this Report. None-
                           theless, we have used our monthly municipal rates and taxes bills to calculate our total electricity
                           consumption, and to evaluate our average electricity consumption per unit of production.


                              Electricity                  Units of                kWh per unit of                   %
                           Consumed (kWh)                 Production                 production                   Increase
                    2007        1 553 548                   947 573                      1.64                      13.1%

                    2006        1 014 973                   699 935                      1.45                      13.8%

                    2005          958 416                   752 091                      1.27


                           In analysing this data, we have been able to learn that our average electricity consumption per
                           unit of production has increased more than 13% per annum over the past two years. Although we
                           are uncertain of the reasons for this increase, we are committed to attempting to monitor this trend
                           more closely and to attempt to rectify the problem. We will re-visit this issue in next year’s report,
                           and will hope that more positive results can be presented.

   2. Water                South Africa is widely considered to be a ‘Water Scarce Economy’, in that access to reliable sup-
                           plies of potable water is not a given. As such, our water consumption, although relatively limited,
                           is considered to be an ongoing management concern at Vimal.

                           As in the case of electricity (above), our understanding of the need to monitor our water consump-
                           tion, as well as our understanding of how we might do so, was limited prior to the development of
                           this Report. Nonetheless, we have used our monthly municipal rates and taxes bills to calculate
                           our total water consumption, and have evaluated this information relative to our total monthly
                           production figures. Of course, our production is not water-dependent, and therefore trends and
                           anomalies cannot necessarily be correlated to fluctuations in our production efficiencies, but we
                           feel that units of production is the most effective tool that we can use to assess our water con-
                           sumption efficiency.

                                Water                      Units of               Litre per unit of                 %
                           Consumed (litres)              Production                 production                  Increase
                    2007         175 543                    947 573                      1.85                      14.9%

                    2006         112 820                    699 935                      1.61                      (1.1%)

                    2005         122 590                    752 091                      1.63



                                                            25
                 The 14.9% increase in water consumption in 2007 is assumed to be directly related to our move
                 to new premises, including the installed improvements in access to on-site produced coffee and
                 tea, and the installation of better ablution facilities. However, it is our intention, now that we have
                 become aware of this issue, to monitor our average volume of water consumed per unit of produc-
                 tion, and to rectify any water wastage problems if and when they are identified.

3. Non-hazard-   Over the past few years we have noticed a significant increase in the amount of garbage that has
   ous waste     been disposed of in landfills. However, we attribute this informally observed increase in waste
                 disposal as a direct result of our significant increase in total garment production.

                 To-date, we do not have formal systems or processes in place to monitor and measure the volume
                 (by weight) of solid waste sent to landfills via our waste haulage contractors. However, we are
                 committed to measure and monitor this figure throughout 2008, and to identify ways in which we
                 might be able to reduce our impact on landfill over-crowding.

                 As of now, we are already instituting the following mechanisms for reducing our solid waste dis-
                 posal:

                 •     Increasing the pace of our conversion from manual cutting to computer aided design and
                       cutting procedures to maximise fabric usage;

                 •     Collecting reasonably large pieces of scrap materials and distributing them to rural eco-
                       nomic development projects that can make use of the fabric to manufacture clothing and
                       other items; and,

                 •     Collecting and recycling our scrap paper (specifically from patterns and office use) and
                       plastics.

3. Hazardous     Although limited in total volumes consumed and/or disposed of, hazardous materials are often
   waste         used in our manufacturing facilities, particularly in the maintenance and operation of our facilities
                 and equipment.

                 To-date, we do not have formal systems or processes in place to monitor and measure the volume
                 of hazardous materials consumed throughout our operations,. However, we are committed to
                 measure and monitor this figure throughout 2008, and to identify ways in which we might be able
                 to reduce our overall discharge/disposal of these materials.

5. Recycling     The principles of ‘Renew, Re-Use and Recycle’ are at the core of all small and medium-sized busi-
                 nesses throughout South Africa. The issue is not so much an environmental one, although the
                 environmental benefits are clear and potentially significant, but rather one of financial prudence.
                 By sticking to ‘the 3 R’s’, we stand as much to gain environmentally as we do financially, through
                 cost savings and improvements to our overall profitability. As such, Vimal has always attempted to
                 find ways to reduce our waste haulage through redirecting materials to alternative uses.

                 That having been said, the process of developing this report has helped us identify new opportuni-
                 ties for both re-using and recycling materials. Our processes now include:

                 •     The donation of unusable end-cuts and/or out of fashion fabrics to local and/or rural eco-
                       nomic development programmes that include sewing projects.

                 •     The separate collection of paper and plastics to be collected by local recycling service
                       providers; and,

                 •     The collection of larger pieces of material and donating them for use in local and/or rural
                       economic development programmes that include sewing projects.

5. Greenhouse    As the monitoring and management of our environmental impacts has become much more rigor-
   gases         ous with the initiation of our sustainability reporting process, we have had to establish reasonable
                 limits to both the development of new data management systems and improvement processes.
                 Although we are aware of the issue of global warming, as well as the ways in which each company
                 can monitor and manage their contribution to greenhouse gas build-up in the atmosphere, we are
                 not yet in a position to report on our emissions, nor processes to improve our performance.

                 It is our intention to review our greenhouse gas emissions as part of our 2008 reporting process.




                                                        26
         SOCIAL RESPONSIBILITY AND COMMUNITY INVESTMENTS

It has been said that “Charity begins at home,” and we believe that in the context of Vimal, our ‘home’ is in fact
our family of managers, supervisors and production staff. As such, we have prioritised our commitment to the
communities in which we operate in terms of:

1.   Our employees and their families;

2.   Our local communities directly surrounding our operations, and the communities in which our
     employees live;

3.   Our province, particularly the more rural areas where issues of AIDS, poverty and hunger continue to
     threaten lives; and,

4.   Our country, particularly those who participate in activities that are consistent with our products, values
     and mission.

As mentioned above in ‘The Vimal Team’, we annually contribute to the eradication of barriers to educa-
tion among the families of our employees. This programme, which requires employees to demon-
strate their commitment to Vimal’s success through low levels of absenteeism, has annually contrib-
uted to the education of more than 130 children per year, at an annual cost to Vimal in excess of R67
000. At the height of this programme in 2006, we paid the school fees for 254 children at a cost of more
than R113 000.

In 2007, we also donated R8 440 to charitable contributions, in support of their community development and
support initiatives. The recipients of our support included the Divine Life Centre, the Cerebral Palsy Founda-
tion, the Heart Foundation and St. Mary’s Hospital.

Vimal, in accordance with the brand protection commitments we have offered our clients, do not donate sub-
quality garments to employees, charities or local community members. In doing so, Vimal helps our clients
ensure that their brands are linked to garments of extremely high quality.

However, the process of producing this report has allowed us to identify an opportunity to donate our stock
of out of fashion and/or end-cut fabrics and threads to economic development projects in one or more deeply
impoverished communities. It is our hope that through this donation, we will be able to have a ‘material’ impact
on the sustainability of persons who are unable to secure meaningful employment, and we look forward to
providing an update on this initiative in our next Report.




                                                     27
         STAKEHOLDER ENGAGEMENT

Until recently, we were unaware of the term ‘Stakeholder Engagement’. Granted, we have come to understand
that much of what we do to ensure the ongoing productivity and profitability of our company can be construed
as ‘engagement’, but we are fundamentally will to accept that our engagement processes are ad hoc, with
the exception of our customers, suppliers and employees (including their unions and the NBC). Our formal
engagement includes:

•    Our weekly meetings between management and the employees and/or their representatives, to raise and
     discuss issues of importance to our employees. This includes their issues/concerns being presented to
     management, as well as the presentation of production results, safety briefings, and process or policy to
     the employees.

•    Regular meetings with customers to discuss new production trends, fabrics, designs and/or orders, as
     well as any issues or concerns that either party might have with the other.

•    Regular meetings with suppliers to discuss new materials and/or orders, as well as any issues or con-
     cerns that either party might have with the other.

Ultimately, we intend to develop systems that are able to more effectively capture our engagement processes
and outcomes with the following key stakeholders (not exhaustive, nor in order of preference):

•    Employees                        •      Standard Bank               •     YKK Zippers

•    Adidas                           •      Berzacks                    •     Speed Zippers

•    Puma                             •      International Trimmings     •     Bargaining Council for the
                                                                               Clothing Industry
•    Mr. Price                        •      Maxiloads

•    TotalSports (Foschini)           •      Thai Taffeta


         DTI CODES OF GOOD PRACTICE

South Africa’s Department of Trade and Industry (DTI) has launched the DTI Codes of Good Practice: a set
of business principles that are expected to promote and develop corporate behaviour that meets international
best practice standards for corporate responsibility.

The Codes come into full effect at the end of February 2008, and at the time of writing this Report, we are in
the process of undergoing a review of our status according to these Codes.

It is our belief that Vimal is, at bare minimum a Category 4 Supplier, based on our own internal assessment
of our Ownership, Management Control, Employment Equity, Enterprise Development and Socio-Economic
Development practices.

Opportunities for significant improvement may exist within our Skills Development and Preferential Procure-
ment practices, but we are confident that these issues can be reasonably controlled and/or explained due to
the size and nature of our business.

Vimal is committed to completing a full assessment of our Codes status within the first half of 2008, and we will
discuss this assessment in our 2008 Sustainability Report.




                                                            28
         HUMAN RIGHTS

Vimal is a small family-owned business that has not necessarily been called upon to investigate and/or ascribe
to any international conventions regarding Human Rights. However, as a South African company, we are both
obliged and committed to living up to our national Constitution, and to respecting all laws, including those per-
taining to the fair treatment of employees.

Vimal falls under the watchful eye of the National Bargaining Council for the Clothing Industry, as well as SACT-
WU, the South African Clothing and Textile Workers Union, and we actively encourage and support employee
participation in both of these rights bodies. Moreover, we aspire to meet or exceed the Bargaining Council’s
Collective Agreement rules, recognizing that these rules are merely base level guidelines, and that exceeding
them, within reasonable limits, has created a work environment that encourages reciprocal trust, respect and
commitment between management and our employees.

Shop stewards are aware of the rules and they attend Union meetings on behalf of Vimal. If any problems are
raised by our workers, the stewards have the right, and responsibility, to address them with the Bargaining
Council or Union, without being victimized.

Vimal does not hire child and/or forced labour, nor do we allow any of our suppliers or sub-contractors to en-
gage in these practices.

Vimal’s security personnel are contracted through the business park in which we are situated, and we have not
been informed of any incidents of excessive use of force by security personnel, nor would we be willing to allow
such behaviour to persist in the exercising of their duties on behalf of Vimal.


         LESSONS LEARNED AND THE WAY FORWARD

This is the first time Vimal has attempted to produce a Sustainability Report, and if not for the support and
encouragement of Trialogue we highly doubt we would have been able to generate such a comprehensive
overview of our company, our most material issues, and our opportunities to improve our social, safety, envi-
ronmental and economic performance.

One must understand that as a family-owned business, our efforts have always been firmly invested in en-
suring that our customers and employees are ‘happy’, and that our business remains financially strong and
healthy. Although we now recognise that our data management systems were not necessarily giving us all of
the information we might have needed to maximise our efficiencies, we were nonetheless in a position to find,
and analyse, information for the purpose of informing our wide range of stakeholders.

In short, the process of developing this Report has been a lengthy learning exercise, yet we quickly realized
that the process of reporting affords significant benefits in terms of being able to use statistics to evaluate
our performance, including the conducting of comparisons, particularly with respect to issues that are directly
related to our employees.

This process has created an opportunity for us to re-think our bonus structures to encourage full attendance
and to motive the employees to attend work regularly. It has also assisted us with attempting to identify prob-
lems within our business, as well as to find ways to address them.

In speaking to our staff, Trialogue has helped us better understand the issues that they have apparently felt
unable to bring to our attention, and has helped create mechanisms for addressing each of their concerns.

As a direct result of the reporting process, we are now committed to:

•    Reducing the amount of solid waste we send to landfills sites by:

     -     Increasing the pace of our conversion from manual cutting to computer aided design and cutting
           procedures to maximise fabric usage;

                                                    29
     -     Collecting reasonably large pieces of scrap materials and distributing them to rural economic
           development projects that can make use of the fabric to manufacture clothing and other
           items; and,

     -     Collecting and recycling our scrap paper (specifically from patterns and office use) and plastics.

•    Monitoring our electricity and water consumption figures, normalised to units of production, to ensure that
     Vimal uses both of these scarce resources in as efficient a manner as possible.

•    Creating a mechanism for employees to access some form of catering services, most likely in a desig-
     nated section of our parking lot (away from our residential neighbours).

•    Creating an additional (external) mechanism for employees to communicate complaints and/or recom-
     mendations to the management team.

•    Donating up to 50 of our older sewing machines to a fledgling rural economic development centre run by
     Cotlands, a national HIV/AIDS charity, in a community directly affected by rampant unemployment and an
     HIV-infection rate in excess of 60%.

•    Clearing out our warehouse and donating surplus fabric and accessories to economic development
     projects that can produce goods to assist in their own sustainability.

•    Reviewing and updating this Report on an annual basis, using the tools and knowledge we have gained
     this year to improve our data collection, collation and reporting procedures.


         REQUEST FOR FEEDBACK

Because this is our first attempt at producing a Sustainability Report, we are mindful of the possibility that we
have not provided a comprehensive discussion of the information that is important to our many stakeholders.
As such, we are hopeful that you, the reader of this Report, will contact us and offer us your views on the quality
and usefulness of this Report.

Should you have any questions about our company, or comments about anything contained within this report,
please contact Khemie via email to at khemiep@vimal.co.za




                                                          30
                           GRI G3 APPLICATION LEVEL REQUIREMENTS

As a first attempt at applying the GRI G3 guidelines to our Sustainability Report, Vimal has decided to seek a
C+ level of application. The following three tables provide a summary of the GRI’s requirements as well as a
quick reference to our self-assessment of compliance to the C+ level.

For an indicator-by-indicator discussion of our Report’s compliance to all of the required indicators, please
email nayan@vimal.co.za. For details of the process employed by Trialogue Assurance Services to afford
Vimal the required Third Party Assurance over this Report, please email michael@trialogue.co.za.


                           Report Application Level                          C                                                 C+                            B                            B+                            A                            A+
                                                                   Report on:                                                           Report on all criteria                                 Same as requirement for
    Standard Disclosures




                                                                                                                                                                  Report Externally Assured




                                                                                                                                                                                                                             Report Externally Assured
                                                                                  Report Assured by Trialogue Assurance Services
                                                                          1.1                                                        listed for Level C plus:                                                 Level B
                             G3 Profile                            2.1 – 2.10                                                                             1.2
                             Disclosures               3.1 – 3.8, 3.10 – 3.12                                                                       3.9, 3.13
                                                       4.1 – 4.4, 4.14 – 4.15                                                        4.5 – 4.13, 4.16 – 4.17

                                                                Not Required                                                        Management Approach                                         Management Approach
                             G3                                                                                                       Disclosures for each                                        Disclosures for each
                             Managment                                                                                                  Indicator Category                                          Indicator Category
                             Approach
                             Disclosures


                                                        Report on a minimum                                                            Report on a minimum                                      Respond on each core
                             G3
                                                           of 10 Performance                                                               of 20 Performance                                    G3 and Sector Supple-
                             Performance
                                                       Indicators, including at                                                       Indicators, at least one                                 ment* indicator with due
                             Indicators &
                                                      least one from each of:                                                       from each of: economic,                                    regard to the Materiality
                             Sector
                                                        social, economic, and                                                            environment, human                                        Principal by either: a)
                             Supplement
                                                                  environment                                                          rights, labour, society,                                 reporting on the indica-
                             Performance
                                                                                                                                        product responsibility                                   tor or b) explaining the
                             Indicators
                                                                                                                                                                                                 reason for its omission


*               Sector Supplement in final version


                                                                                                                                                                                                                  Mechanised
                                                                                                                                                                                                               embroidery is an
                                                                                                                                                                                                                important value-
                                                                                                                                                                                                               adding service for
                                                                                                                                                                                                                  our clients.




                                                                      31
                                               GRI CONTENT INDEX

                                      For our complete GRI G3 responses table, including a map of our content, please email
                                      khemiep@vimal.co.za.

         VISION & STRATEGY                                            ECONOMIC                                                                SOCIAL

                                                 Core                                      Additional                       Core                                  Additional
         Strategy and Analysis
                                                               Economic Performance                                                         Employment
1.1                                    EC1                                                                         LA1                                LA3
1.2                                    EC2                                                                         LA2
                                       EC3                                                                                         Labour/Management Relations
          Organisational Profile
                                       EC4                    N/A                                                  LA4
2.1                                                                 Market Presence                                LA5
2.2                                    EC6                                    EC5                                                        Health and Safety
2.3                                    EC7                                                                         LA7                                LA6
2.4                                                           Indirect Economic Impacts                            LA8                                LA9
2.5                                    EC8                    N/A             EC9                                                     Training and Education
2.6                                                                                                                LA10                               LA11
                                                                 ENVIRONMENTAL
2.7                                                                                                                                                   LA12
2.8                                                                    Materials                                                     Diversity and Opportunity
2.9                                    EN1                                                                         LA13
2.10                           N/A     EN2                                                                         LA14
              Report Profile                                            Energy                                                       Strategy and Management
3.1                                    EN3                                    EN5                       N/A        HR1                                HR3
3.2                                    EN4                                    EN6                                  HR2
3.3                                                                           EN7
3.4                                                                     Water                                                           Non-discrimination
                                       EN8                                    EN9                       N/A        HR4
       Report Scope and Boundary
                                                                              EN10                      N/A
                                                                                                                          Freedom of Association and Collective Bargaining
3.5                                                                   Biodiversity
3.6                                    EN11                                   EN13                      N/A        HR5
3.7                            N/A     EN12                   N/A             EN14                      N/A                                 Child Labour
3.8                            N/A                                            EN15                      N/A        HR6
3.9                                                       Emissions, Effluents and Waste                                           Forced and Compulsory Labour
3.10                           N/A     EN16                                   EN18                                 HR7
3.11                           N/A     EN17                                   EN24                      N/A                              Security Practices
           GRI Content Index           EN19                                   EN25                      N/A                                           HR8
3.12                                   EN20             N/A                                                                              Indigenous Rights
               Assurance               EN21             N/A                                                                                           HR9                      N/A
       3.13                            EN22                                                                                                 Community
                                       EN23             N/A                                                        SO1
  Governance, Commitm ents and
                                                                Products and services                                                        Corruption
          Engagement
                                       EN26                                                                        SO2
4.1                                    EN27                                                                        SO3
4.2                                                                   Compliance                                   SO4                N/A
4.3                                    EN28                   N/A                                                                           Public Policy
4.4                                                                    Transport                                   SO5                                SO6                      N/A
4.5                            N/A                                            EN29                                                   Anti-competitive Behaviour
4.6                            N/A                                      Overall                                                                       SO7                      N/A
4.7                            N/A                                            EN30                                                          Compliance
4.8                                                                                                                SO8                N/A
4.9                                                                                                                                 Customer Health and Safety
4.10                           N/A                                                                                 PR1                                PR2               N/A
                                                                                                                                       Products and Services
 Commitment to External Initiatives
                                                                                                                   PR3                N/A             PR4                      N/A
4.11                           N/A                                                                                                                    PR5
4.12                                          Included                                                                               Marketing Communication
4.13                                                                                                               PR6                N/A             PR7                      N/A

        Stakeholder Engagement                Not included, potential improvement area                                                   Customer Privacy
                                                                                                                                                      PR8                      N/A
4.14                                                                                                                                        Compliance
4.15
                                              Included, but requires future improvement                            PR9                N/A
4.16
4.17                                  N/A     Not applicable


                                                                                                              32
         NON-INDEPENDENT ASSURANCE STATEMENT

To the Owners and Management of Vimal Clothing cc (hereafter, ‘Vimal’):

Trialogue Assurance Services (hereafter, ‘TAS’) was engaged by the Global Reporting Initiative (GRI) to assist
Vimal, and two other South African suppliers of Puma AG, with the development of this Sustainability Report.
This project, entitled “Transparency in the Supply Chain,” required that TAS assist the three participating com-
panies develop an understanding of Sustainability Reporting, and help to facilitate the development of this
report.

Because of our involvement in the development of this report, TAS is not in a position to provide ‘Independent
Third Party Assurance’ over the contents herein. However, it has been duly noted that the data presented
neither belongs to TAS, nor was supplied by TAS, and therefore our review of this information still positions us
to provide Vimal, and its many stakeholders, with this ‘Non-Independent Assurance Statement’ over the content
of this 2007 Sustainability Report, ‘the Report’.

The Report presents Vimal’s sustainability performance over the period 1 January to 31 December 2007, in-
cluding, where available, sustainability trend data for previous years. This statement represents our assurance
opinion. TAS’s responsibility in performing its assurance activities is to the management of Vimal alone and in
accordance with the terms of reference agreed with them.

Assurance objective
The objective of the assurance process is to provide stakeholders of Vimal with a ‘Limited Assurance’ opinion
on general accuracy and completeness of the information presented in this Report. This is confirmed through
multiple reviews of the data submitted by Vimal and the underlying systems, processes and competencies that
support the Report.

Scope of work performed
Review of quantitative content of the Report
Among other duties, TAS was engaged to assist Vimal with assessing the completeness, accuracy and consist-
ency of the data contained within this report, and to test that assertions made within the report can be deemed
both ‘reasonable’ and ‘supportable’ by the relevant sustainability data presented herein. Moreover, TAS was
charged with testing drafts of the Report to determine the degree to which it was consistent with the reporting
requirements of the GRI G3 Guidelines.

TAS limited the scope of the assurance process to a ‘limited assurance’ review of the quantitative data submit-
ted by the management team at Vimal, for collation and reporting herein, as well as the Reports alignment to
the GRI’s G3 reporting guidelines

Assurance methodology
The process used in arriving at this assurance statement is based on the GRI’s G3 guidance and other best
practices in sustainability reporting assurance. Our approach to assurance included the following:

•    a review of Vimal’s sustainability measurement and reporting procedures, background documentation
     and data collection procedures;

•    a review of the data submitted for inclusion in the Report for any significant anomalies; and,

•    an examination of the aggregation and/or derivation of, and underlying evidence for, data and statements
     included in this Report.

In determining the GRI G3 application level of the Report, we performed the following exercises:

•    Assisting in the drafting of the Report to ensure that the content of the Report, including discussions
     regarding the determination of sustainability context and coverage of material issues, was duly aligned
     with GRI G3;


                                                    33
•    A review of the approach of management to addressing topics discussed in the Report; and

•    A confirmation that at the requisite number of performance indicators had been covered in the Report.

Independence
Because TAS was engaged to provide report development assistance to Vimal, through the engagement of
TAS by the GRI as the South African consultants on the ‘Transparency in the Supply Chain’ project, ours is
not an ‘Independent’ assessment of this Report. Our involvement with Vimal significantly hinders our ability
to remain fully independent, but does not necessarily preclude us from offering some form of assurance to
stakeholders.

Because Vimal is a relatively small organisation, it was determined that Vimal cannot afford to seek external/
independent third party assurance. However, the involvement of TAS is reviewing Vimal’s data allows us a
unique insight into the content of this Report, and permits us an opportunity to make comment over the ac-
curacy, consistency and completeness of the data contained herein.

Findings
In general, Vimal’s sustainability reporting processes are adequate to meet the GRI’s G3 ‘Application Level C’.
However, it was found that:

•    Vimal’s process to identify its ‘Most Material Issues’ was informal in nature, albeit improved through this
     reporting process, and the company still requires a formal process to actively engage stakeholders on a
     ranged of ‘sustainability-specific issues’;

•    Although significant steps have already been taken to improve the quantity and quality of meaningful data
     (particularly production efficiency and environmental data), more work needs to be undertaken to ensure
     that Vimal sets and achieves specific sustainability performance targets;

•    Vimal has not yet undertaken to complete an assessment of its compliance to the DTI Codes of Good
     Practice (fully implemented as of the end of February 2008).

Recommendations
•    Vimal should ensure that stakeholders (internal and external) are adequately engaged to comment on this
     Report and/or to inform the content of the next Report.

•    Vimal should actively engage its key stakeholders to ensure that the company is effectively addressing
     stakeholder-specific concerns, and that any ‘new’ issues are incorporated into Vimal’s ongoing sustain-
     ability strategy.

•    Vimal should undertake to complete its compliance to the DTI Codes of Good Practice within the 2008
     calendar year, in order to enhance the quality and/or relevance of this report relative to local stakeholder
     expectations.

•    Vimal should ensure that future reports include improvements in the quality of data, particularly those
     pertaining to the DTI Codes of Good Practice and the environment.

Opinion
For all data under review, errors identified during our assessment were addressed by Vimal prior to finalising
this Report, and nothing came to our attention to lead us to believe that the final data is not reliable. As a result,
we believe that the sustainability data in this Report gives a fair representation of Vimal’s sustainability perform-
ance, and that this report adequately represents a GRI G3 C level report.




Trialogue Assurance Services
29 February 2008

                                                            34
           CONTACT DETAILS

Vimal Clothing Enterprise C.C.

Tel:                  +27 31 538 2400

Fax:                  +27 31 539 6874

Address:              Fairways Park
                      4 Fairways Avenue
                      Mount Edgecombe
                      Durban
                      South Africa
                      4300

Contact Person:       Miss Khemie Prithipal
                      Khemiep@vimal.co.za




The graphic design and layout of this Report was
completed by Candice Ekermans, our Johan-
nesburg-based independent design consultant.
We are very pleased to support Candice with this
project, as she is a living testament that cour-
age and tenacity can overcome all challenges.
Although one might not notice it when reviewing this
Report, Candice is legally blind, which for others might
have suggested no future in the field of marketing
materials development.

We hereby wish to compliment and thank Candice
for her excellent work. Candice can be contacted at
minxgraphics@gmail.com.

				
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