Index

LETTERS TO STAKEHOLDERS

6

1 PRADA GROUP

				

9

2 SUSTAINABLE DEVELOPMENT

37

3 RESPONSIBLE MANAGEMENT

57

4 FOR PLANET

68

5 FOR PEOPLE

91

6 FOR CULTURE

112

7 NOTES ON THE METHODOLOGY

122

8 GRI INDEX

134

History
Value Creation
Corporate Governance Model
Risk Management
Code of Ethics
Tax Strategy and Compliance
2021 Highlights							Sustainability Journey
Sustainability Policy
Sustainability Strategy
Stakeholders and Materiality Analysis
Sustainability Risks Management
Sustainable Finance								Industial Strategy
Supply Chain Responsible Management
Trademark Protection
Product Responsibility						Climate Strategy
Responsible Use of Natural Resources		Responsible Waste Management
Circular Thinking
Preservation of the Territory
Partnership: The Fashion Pact					
WorkforceChampion Diversity and Equal Opportunity
Diversity and Inclusion Advisory Council
Prada Academy and Skills Development
Talent Attraction and Retention
Workers' Health and Safety and Respect for Human Rights
Partnership: IMLux						
			Fondazione Prada
SEA BEYOND
Prada Mode
Partnership: Fondazione Bonadonna					
		HONG KONG
STOCK CODE: 1913

Scope and Reporting Standard
GHG Calculation Methodology and Emissions Factors
Focus on Material Aspects						
		Prada Group Purpose

With a thoughtful and pioneering vision,
the Prada Group is a global leader in luxury.
We own some of the world’s most prestigious brands:
Prada, Miu Miu, Church’s, Car Shoe, Marchesi 1824
and Luna Rossa.
By being DRIVERS of CHANGE,
we offer an unconventional dialogue
and interpretation of the contemporary,
as expression of our way of doing businessfor PLANET, PEOPLE and CULTURE.

UNIQUENESSOF TALENTS

RE-THINK
THE RULESBEYOND
BOUNDARIESINNOVATIVETRADITIONSPIRIT OF
EXCELLENCESUSTAINABLE
PATHS

The Prada Group's founding values are
deeply rooted in its three sustainability pillars:
Planet, People and Culture.

index

Paolo Zannoni
Chairman of Prada S.p.A.
Milan, May 3, 2022

2021

2021 was a transformational year for
the Prada Group. Decisive actions
to strengthen the business andnavigate the changing luxury market
produced strong growth and increased
profitability.
The Prada Group delivered against
each of its strategic priorities:
distinctive identity, product excellence,industrial know-how, direct distribution
and sustainability.
The appointment of two new Board
members, both independent withtrack record in structuring andimplement ESG policies, confirms ourcommitment to sustainability.
In 2021, Prada S.p.A. Board of
Directors approved its ESG strategy,

and we are implementing a full range
of initiatives to respect the planet, its
people and the cultural debate. I am
truly confident that Prada will achieve
most of its targets.
We confirm that all our investments arefor the future as the whole organizationis striving for long-term growth and not
short-term gains. Prada is on course
to meet the medium-term objectives
as announced at our Capital Markets
Day in November 2021, and the solid
financial results achieved in 2021 makeme confident we will reach our goals.
However, growing geopolitical tensions
and escalating hostilities are of great
concern and we feel for the people
suffering because of the war.

LETTERS TO STAKEHOLDERS— Letter to
Stakeholders

6

— “I believe that it is crucial
to pursue a more sustainablebusiness model, capableof an agile and coherent
response to the increasingly
complex challenges of theupcoming years, thanks
in part to the fundamental
engagement of our key
stakeholders.”
Lorenzo Bertelli
Prada Group’s Head of Corporate Social
Responsibility2021 was a year of importantmilestones for the Prada Group’s
sustainability journey.
When I joined Prada S.p.A.’s
Board of Directors, discussions of
ESG (Environmental, Social andGovernance) issues reached the highest
levels of the organization, highlighting
once again our commitment to suchmatters, which are becoming more
and more visible for internal andexternal stakeholders. The presenceon the Board of two sustainability
experts from the beginning of 2022
strengthened governance even more,due in part to the establishment
within the Board of a Sustainability
Committee, of which I am a member
and which will be essential to
implementing the Group’s sustainability
strategy.
Throughout 2021, we were engaged
in promoting an internal culture more
focused on social and environmental
topics. The strong awareness,along with the Group’s long-term
investments, enabled to advancequickly on key matters that have had
a strategic role for some time, suchas environmental protection and thefight against climate change. In fact, inNovember 2021, for Capital Markets
Day, we unveiled our sustainability

strategy and an ambitious roadmap to
reduce GHG emissions, approved by
the Science-Based Targets initiative.
We also described our plan forachieving our targets of cutting direct(Scope 1 and 2) emissions by 2026,
and a series of other goals in termsof sustainable raw materials andpackaging.
We reiterated our commitment todiversity, equity and inclusion withthe launch of numerous initiatives andprograms to recruit, cultivate and retain
diverse talents and to create a more
inclusive workplace culture, not only
within our organization but also in theindustry.
Our partnership with UNESCO’s
Intergovernmental Oceanographic
Commission continued for the
SEA BEYOND education project,launched in 2019 and dedicated to thepromotion of ocean literacy and oceanpreservation, with a program enrichedwith new initiatives to involve a growing
community.
These choices demonstrate theconsistency between the Prada Group’s
core values and its commitment tocarrying out concrete projects. I believethat it is crucial to pursue a moresustainable business model, capable ofan agile and coherent response to theincreasingly complex challenges of theupcoming years, thanks in part to thefundamental engagement of our key
stakeholders.

LETTERS TO STAKEHOLDERS— Message
from the PradaGroup’s Head ofCorporate Social
Responsibility

2021

index

Lorenzo Bertelli
Prada Group’s Head of Corporate
Social Responsibility8index

1 — PRADA GROUP
Highlights 2021

€3.4
Billion

13,1402021 Revenues

at December 31, 2021

Workforce635

23

at December 31, 2021

at December 31, 2021

Directly Operated StoresIndustrial facilities

€3

€217
MillionMillionInvestments in 2021

Donations in 2021

PRADA GROUP

2021

index

The Prada Group is one of the world leaders in
the luxury goods sector where it operates with the
Prada, Miu Miu, Church’s and Car Shoe brands inthe design, production and distribution of luxury
handbags, leather goods, footwear, apparel andaccessories. The Group also operates in the eyewear
and fragrance industries under specific licensing
agreements stipulated with industry leaders, andwith the acquisition of Pasticceria Marchesi 1824, it
has made its entry into the food industry, where it ispositioned at the highest levels of quality. Finally, in

2021, to fully develop its potential, the Luna Rossa
brand also becomes part of the Prada Group following
the acquisition of Luna Rossa Challenge S.r.l..
Prada S.p.A. (the “Company” or “Parent Company”),
together with its subsidiaries (collectively the“Group”), is listed on the Hong Kong Stock Exchange(HKSE code: 1913). At December 31, 2021, theGroup’s products were sold in 70 countries worldwide
through 635 Directly Operated Stores (DOS) anda selected network of luxury department stores,
independent retailers and franchise stores.

10

PRADA GROUP

2021

index

11

index— History

The Prada brand dates back to thebeginning of the last century. In 1913,
Mario Prada opens a luxury store
in the Galleria Vittorio Emanuele II
in Milan, selling leather handbags,
travelling trunks, beauty cases, luxury
accessories, jewels and articles of value.

1919

1977
In 1977, Patrizio Bertelli consolidates
the production resources that he has
built up over the previous ten years in
the leather goods segment and obtains
an exclusive license from Miuccia Prada
to produce and distribute leather goods
bearing the Prada brand name. In thefollowing years, the activities of the two
families are gradually brought together
within a single Group.

PRADA GROUP

2021

1913

Prada, Mario Prada’s granddaughter,launches a partnership with Tuscan
entrepreneur Patrizio Bertelli. Thispartnership combines creativity andbusiness ideas laying the foundationsof the international expansion thatwas to come. Patrizio Bertelli breaks
new ground in the luxury goods sector,
introducing a business model inwhich he keeps direct control over allprocesses, applying excellent quality
criteria across the entire production
cycle. Miuccia Prada’s creative talent
and avant-garde approach attracts theattention of the global fashion industry,
while her ability to look at the worldfrom an unconventional vantage point
allows her not only to anticipate but,quite often, to set new trends.

Thanks to its exclusively designed
goods, handcrafted using fine materials
and sophisticated techniques, Prada
rapidly acquires wide popularity acrossEurope to the point that in 1919, Prada
becomes an official supplier to the
Italian Royal Family. Since then, Prada
has been able to display the House of
Savoy coat of arms and knotted rope
design on its trademark logo.
The Group sees a turning point in thedevelopment of its activities at theend of the Seventies, when Miuccia

12

index

1993

1983

1988
In response to the growing appreciation
for Prada designs, the women’s range is
extended from leather goods to include
the first footwear collection in 1979 andthe first womenswear apparel collectionin 1988. At the same time, a processof internationalization begins with the
openings in New York and Madrid,
followed by London, Paris and Tokyo.

1997

PRADA GROUP

In 1993, Prada makes its debut in the
men’s segment with its first men’s
apparel and footwear collection. Thatsame year, Miuccia Prada’s creative
inspiration leads to the establishment of
a new brand ― Miu Miu ― designed for
women who are trendy, sophisticatedand particularly fashion-forward andaware of avant-garde. Miu Miu now
offers women’s ready-to-wear, bags,
accessories, footwear, eyewear andfragrances. Also in 1993, alongside
their entrepreneurial activity, Miuccia
Prada and Patrizio Bertelli create“Milano Prada Arte”, then become“Fondazione Arte”, to develop theirinterests in art and culture in general.

2021

In 1983, the Prada family opens a second
store in the prestigious Via della Spigain Milan, one of Europe’s key shopping
destinations. The new store showcases
the new brand image as it blends
traditional elements with a modern
architectural setting: a revolution and atrue benchmark for luxury retail.

indexIn 1997, inspired by his passion for
sports, Patrizio Bertelli creates the“Prada Challenge for the America’s
Cup 2000” sailing team. Prada’s leisureproducts, with the distinctive “Linea
Rossa” logo, are also launched in 1997.

2003

2001

In 2003, Prada enters into a licensing
agreement with the Italian eyewear
manufacturer Luxottica, a global leader
in the eyewear industry, which currently
produces and distributes eyewear
under the Prada and Miu Miu brands.
Also in 2003, a new partnership isestablished for the production offragrances, which first release, Amber,is launched in 2004.

PRADA GROUP

In 1999, the prestigious Church’s
brand, established in 1873 in
Northampton, becomes part of the
Prada Group; the investment is initiallyshared with a private equity firm, andthen Prada completes the acquisition in2007. The brand, specialized in highend leather footwear, is a worldwide
recognized symbol of top quality British
tradition and sophisticated elegance.

2021

1999

2006

In 2001, the Prada “Epicenter” store,
designed in collaboration with Rem
Koolhaas, opens on Broadway, New
York. This is the first store of the“Epicenters” project whose purpose wasto rethink the shopping concept with a
new approach and to try out innovativeinteractions with customers. A second“Epicenter” store is opened in Aoyama,
Tokyo, followed by a third, on Rodeo
Drive, Beverly Hills in 2004. During thesame year, Prada acquires control of Car
Shoe, a historic Italian brand renowned
for its exclusive car-driving moccasins.

14indexIn 2015, the Prada Group completes
the acquisition of the French Tannerie
Mégisserie Hervy to further strengthen
its know-how along the entire value
chain. That same year, the PradaGroup and Coty Inc. launch the first
Miu Miu fragrance and the commercial
development of the Marchesi
brand begins to take shape with the
opening of the first patisserie in via
Montenapoleone, Milan.

2016
2016 features important manufacturing
investments, all made following asustainable industrial development
and respectful of the environment,
leading to the completion of a new

2021

2015

PRADA GROUP

In 2006, Miu Miu organizes its
first fashion show in Paris to bettercharacterize its own identity. The first
Prada Phone by LG is launched in
2007, the world’s first touch screen cell
phone. The successful partnership isrenewed in 2008 and in 2011 with two
further releases.
On June 24, 2011, Prada S.p.A. is
successfully listed on the Main Board of
the Hong Kong Stock Exchange.
In 2014, Prada S.p.A. announces theacquisition of control of the company
Angelo Marchesi S.r.l., historical
Milanese patisserie founded in 1824,
thus marking the entry into the foodsegment.

indexIn 2019, the Prada Group obtains fullcontrol of the retail network throughthe acquisition of Fratelli Prada
S.p.A., the long-standing franchisee of
Prada monobrand stores in Milan. In
December, Prada S.p.A. and L’Oréal
announce the stipulation of a long-term
licensing agreement, effective fromJanuary 1, 2021, for the creation,
development and distribution of Pradabrand luxury cosmetic products.

2021

2019

PRADA GROUP

leather production site and to therenovation of various factories between
Tuscany and Umbria, in Italy. The first
construction phase of the new logistics
hub for finished products is completed
in Tuscany to end its second phase
two years after. In 2017, a restylingplan of the Prada and Miu Miu storesis coupled with a broad program of
pop-up events to further support retail
activities. Also in 2017, the PradaGroup is admitted to the cooperativecompliance regime with the Italian
Revenue Agency introduced with Italian
Law Decree 128 of 2015.

2020
2018
In 2018, besides the usual Milanand Paris fashion shows, the Grouplaunches two major events for thepresentation of pre-collections: Miu
Miu Croisière at the Hotel Regina in
Paris and the Prada Resort in New York(in Shanghai in 2019). The same year,
Miuccia Prada receives the Outstanding
Achievement Award from the British
Fashion Council for her extraordinary
contribution to creativity and the global
fashion industry.

16

2021

the Prada Group is founding memberof the Aura Blockchain Consortiumwith LVMH and Cartier and purchasesa stake in Filati Biagioli Modesto
S.p.A. with the Zegna Group; it alsobuys out the remaining stakes in theTravel Retail Shop companies dealing
with duty-free store activities, andacquires the ownership of Luna Rossa
Challenge S.r.l. so as to fully develop
the commercial value of the Luna
Rossa brand. In addition, a long-term
licensing agreement with L’Oréal for thecreation, development and distributionof Prada brand luxury cosmetics enters
into effect.

PRADA GROUP

In 2020, the year when the beginningof the Covid-19 pandemic wreaked
havoc across the globe, Raf Simons
become the Creative Co-Director of
Prada and other important managers
join the team, with a view to fostering
long-term growth even with theuncertainties arising from the publichealth emergency. In July of the same
year, Prada S.p.A. obtains “AEO Full”(Authorized Economic Operator)
certification from the Italian Customs
Agency, becoming one of very few
taxpayers in Italy to hold simultaneously
this qualification and participate in the
Cooperative Compliance regime with
the Italian Revenue Agency.

2021

index

In 2021, the 36th edition of America’s
Cup presented by Prada becomes themost viewed one ever, and the Luna
Rossa sailing team wins the Prada Cup
Challenger Selection Series for thesecond time in history. During the year,17index— Value Creation
The success of the Group’s brands isbased on the original business model,
which combines skilled craftsmanshipwith industrial manufacturing
processes.
This integration enables the Group totranslate its innovative fashion concepts
into viable commercial products, while
retaining flexible capacity, technicalcontrol over know-how, quality andsustainability standards, as well as
production costs.

indexCreativity and Innovation

PRADA GROUP— “Close observation andcuriosity about the world areat the very origin of the PradaGroup’s creativity and modern
outlook. In society — andtherefore in fashion, which
in many ways reflects it — theonly constant is change. The
transformation and innovation of
conventions, underlying
all evolution, have led us tointeract with different cultural
spheres both near and apparently
far, helping us capture andanticipate the spirit of the times.
Today this is no longer enough:we must be the drivers of change,
with the flexibility to translate thedemands of the market andsociety into tangible actions thatguide us every day in ourbusiness.”

2021

Creativity is at the heart of the manufacturing processof the Prada Group.
Universally recognized as a reference for the entire
fashion industry, Miuccia Prada has the talent to
combine intellectual curiosity, the pursuit of new andunconventional ideas, and cultural and social interests
with a strong sense of fashion. This has made it
possible to establish a genuine design culture, basedon method and discipline, which guides everyone whoworks in the creative process.

Miuccia Prada and Patrizio Bertelli19indexPrada Group’s defining asset, know-how, creates
continuity and balance between creativity anddiscipline, tradition and technological progress,
craftsmanship and industrial production.
Group’s approach to manufacturing is substantiallybased on two key principles: the vocation forcraftsmanship, which is an essential asset for
production and a unique distinction for every brand,
and the constant quest for innovation, ensuring thecontinuous evolution of skills and expertise.
Raw materials are an essential part of product quality
and are of primary importance for all the Group’s
brands. In many cases the fabrics and leather are
made especially for Prada, according to stringent
technical and style specifications that guarantee
excellence. Constant search for new materials has
always been part of the Prada Group’s DNA since thevery beginning.
The Prada Group’s products are manufactured in
the 23 directly owned production sites (20 in Italy,
1 in England, 1 in France and 1 in Romania), in
addition to a wide network of selected, as well as
closely monitored, industrial manufacturers, which
are supplied with internally made raw materials,
patterns and prototypes. This system, which enables
close oversight of each step of the process andensures high-quality workmanship, emphasizes
the manufacturing excellence of each facility andguarantees significant flexibility in the organization of
production.
Industrial capacity represents a competitive advantage
for the Group, strengthened through the continuous
research and experimentation of materials andproduction techniques, as well as investments infacilities, supply chain and people.
The core of production’s employees have worked
for the Prada Group for around 20 years in average;
this ensures an extremely high level of specialization,
together with an in-depth knowledge and alignment
with the Group’s brands unique concept. In recent
years, through the Prada Academy, Prada hasheavily invested not only in enhancing the skills of its
employees in general, but above all in transmitting
the Group’s values and production know-how to theyounger generations.
The Group employs considerable resources toensure excellence in the quality of its raw materials
and processing of its products, and in such manner

2021

Raw Material Procurement
and Industrial Production

PRADA GROUP

With this unique approach, Prada anticipates
trends and often influences them, while continuallyexperimenting with new designs, fabrics andproduction techniques. Experimentation and ideasharing are the essential components of the design
process throughout the Group. The time spentat the drawing board and in the testing room on
design research and development is fundamental
to formulating each collection so that the clothing,
footwear and accessories complement each other andcreate a well-defined image reflecting the brands.
In 2020, with the appointment of Raf Simons as cocreative director of the Prada brand, in partnershipwith Miuccia Prada, the Group has created a newmodel of creative authorship, underlining therelevance and power of dialogue. This partnership canbe interpreted as a reaction to an epoch with fresh
possibilities, permitting a different point of view andapproach to established methodologies.
In fact, innovation is an inherent facet of the identityof Prada: a willingness to push boundaries, toexperiment, to take opportunities to advance. If thenotion of a partnership is to work jointly, the result ofthat conversation may not only be product but also
the propagation of a thought and a culture. A purevision of creativity, in which the product is a vehicle ofthese concepts.
Prada’s flair and the strong appeal of its traditionand quality standards continue to attract talented
people from all over the world who want to share thecreative experience. This results in teams involved at
all stages of the creative process: from fashion design
to manufacture, from architecture to communicationand photography, from store interior design to all theunique and special projects in which the Prada Groupis involved.
Furthermore, retracing the history of the company,
it becomes very clear how incursions into seemingly
distant worlds, such as cinema, architecture,
literature, sport and art, find a common ground in thecreative processes. Creativity is inexhaustibly linked
to those special projects that over time not only define
images, fashion shows and store settings, but also
outline the collections that are joined together by anextremely fluid relationship.
In 2021, the American WWD awarded Miuccia Pradathe John B. Fairchild Honor for Lifetime Achievement
to celebrate her continuing influence on fashion, whilein 2020 it was the British Fashion Council to award
her the “Fashion Awards 2020” in the Creativity
category.

20

indexalso protects the health and safety of the employees
and consumers. Each industrial division employs
technicians whose responsibility is to ensure theachievement of these goals through strict controls
over incoming and outgoing materials and daily visits
to external production sites. Product and processcontrols not only ensure that standards are being met,
but also contribute to ongoing improvement.
The Industrial Compliance Office ensures that the

production and distribution of its products worldwide
always comply with applicable laws. The Officealso has to grant the compliance with all current
legislation, and the development of standards andprocedures that are often more stringent than thoserequired by law. The ultimate goal is to be proactivewith respect to the entire system, made up of
employees, clients, manufacturers and the outsideenvironment as a whole.

20

Leather Goods

Footwear

Clothing

Arezzo – Italy
Via Gobetti, 82/86
52100 Arezzo (AR)Buresta, Arezzo – Italy
Via Aretina, 552-556
52025 Arezzo (AR)Ancona – Italy
Via Luigi Albertini, 20
60131 Ancona (AN)Figline – Italy
Via Urbinese, 33 Località Matassino
50063 Figline e Incisa V.no (FI)

Civitanova Marche, Macerata – Italy
Via Pertini, 4163812 Civitanova Marche (MC)Città di Castello, Perugia – Italy
Via C. Treves, 13 Loc. Cerbara
06012 Città di Castello (PG)

Figline – Italy
Via J.F. Kennedy, 2150063 Figline e Incisa V.no (FI)Dolo, Venice – Italy
Via Dell’Industria, 1/A
30031 Dolo (VE)

Fucecchio, Florence – Italy
Via F. Magellano, 5/75005 Fucecchio (FI)Limoges – France
65 Route de Périgueux Lieudit Parpaillat,
87170 Isle

Levane, Arezzo – Italy
Via Carducci, 652023 Levane (AR)Levanella, Arezzo – Italy
Via Aretina, 403
52025 Levanella (AR)Milan – Italy
Via Ripamonti, 129
20141 Milan (MI)Montegranaro, Fermo – Italy
Via Alpi, 97 Loc. Villa Luciani
63812 Montegranaro (FM)Piancastagnaio, Siena – Italy
Via Arno, 39
53025 Piancastagnaio (SI)

Northampton – UK
St. James Road
Northampton NN5 5JB

Scandicci, Florence – Italy
Via Pisana, 463
50018 Scandicci (FI)San Giovanni Valdarno, Arezzo – Italy
Via Pruneto, 652017 San Giovanni Valdarno (AR)industrial sites

in Italy

235,000
sqm total area

PRADA GROUP

23

2021

Prada Group's industrial sites
at December 31, 2021

Montone, Perugia – Italy
Via dell’Industria, 10-12
06014 Montone (PG)
Torgiano, Perugia – Italy
Loc. Ferriera, 46
06089 Torgiano (PG)

Sibiu – Romania
Popa Șapcă, 1
550108 Sibiu, Jud. Sibiu
Terranuova, Arezzo – Italy
Via Poggilupi, 992-998
52028 Arezzo (AR)Valvigna, Arezzo – Italy
Strada Lungarno, 1213 – 1261
52028 Valvigna (AR)21Over the years, the Group has expanded its
distribution network to 635 Directly Operated Stores(DOS) in the most prestigious locations of the majorinternational shopping destinations, consistent with
the image, heritage and exclusivity of each brand.
This extensive network, subject of continuous
research and renovation, is a true asset for the Group
as it showcases the new collections and is the fulcrumof the omni-channel strategy. The proprietary
E-commerce sites complete the direct customer
journey by offering a constantly evolving shopping
experience integrated with physical stores. The DOS
serve as more than a primary sales function as they
are also an important means of communication: they
are the true ambassadors of the brand, conveying
the image of each brand consistently. The DOS
are integrated with the E-commerce strategy andallow the Group to monitor in real time the sales
performance of the various markets for each brandand product category.
The wholesale channel (department stores, multibrand stores and franchisees) provides additional
venues selected on the basis of their prestigious
location and enables direct, immediate comparison
with the competition. The Group’s significant
developments in the digital world have allowed toconsolidate important partnerships, including top
online retailers (E-tailers).
As at December 31, 2021, the retail channel
generates 88% of the Prada Group’s consolidated
sales while the wholesale channel accounts for theremaining 12%.

Customer Centricity
and Digital Acceleration
In keeping with the Prada Group’s overall long-term
growth strategy, also in 2021 the implementation ofa customer-centric approach for enriching the retailand omni-channel experiences and the acceleration of
the digital transformation process were the primarystrategic objectives pursued by the Retail Innovation& E-Commerce Department, part of the Marketing
Department.
Focusing on customer centricity and leveraging theluxury market paradigm shift - where human-led
touchpoints still maintain a critical function in amodern digital society, which helps to build loyalty
and elevate a brand’s image and positioning - retailstores and sales personnel continue to play a keyrole in the customer’s journey. The Prada Group has
been investing heavily in “Human Touch” principles tostrengthen its storytelling, deliver unique experiences
and forge close relationships with its customers.
Moreover, the sales staff has been empowered withnew digital technology to reach a customer portfolio
personally and to nurture the brands. The technology
for sales staff has also been assisted by the marketing
ecosystem to drive orchestrated triggered campaigns
designed to reach clients with a personalized offer interms of products, contents and timing.
Concerning the digital channel, particular emphasis
has been put on further enhancing the online
performance and results of the online channel, which
accelerated with solid growth in 2021 in terms ofrevenues and as a share of the Group’s earnings. The
positive results of the online channel were driven
by multiple initiatives launched in 2021 centered on
improving the customer experience and optimizing theoperational and digital performance.
The re-styling of Prada Group websites in line with thebrands’ visual identities, the addition of new featuresand services to the customer, the overall enhancementof the operating and technological infrastructures,
as well as the implementation of an integrated digitalcommunication strategy - including full use of social
media channels – have all provided an additional boost
to the channel performance.
Looking ahead, the Prada Group will focus ondelivering elevated customer experiences by further
blending traditional “channel views” and evolving
towards a seamless and unified ecosystem to enhance
the traditional channels. This will be achieved bypushing the boundaries of customization by providing
real-time personalized experiences, leveraging
artificial intelligence and cutting-edge technology
applications to tailor the value proposition, anddesigning and enriching new customer experiences
to expand the Prada Group’s storytelling andengagement across physical, digital and parallelworlds and ecosystems.

PRADA GROUP

Distribution

2021

index

22

index— Corporate
Governance ModelindexThe Company has adopted a “traditional” governanceand control system, in compliance with the Italian Civil
Code, consisting of a management body, the Board of
Directors, a supervisory body, the Board of Statutory
Auditors, and an auditing and accounting control body,the Audit Firm.
The Board of Directors is the Company’s highest
decision-making body vested with all the ordinaryand extraordinary management powers. The Board of
Directors can also discharge its responsibilities throughdelegation; to this respect, the Company has adopted
a system of delegated powers and powers of attorneys
aimed at ensuring the segregation of duties and theefficient and regular performance of the activities
in accordance with the procedures adopted by theCompany itself.

The current Board of Directors was appointed by the
Shareholders’ Meeting of the Company held on May 27,
2021 for a term of three financial years (2021-2023).
Initially made up of nine Directors, as of January 28,
2022 this number was increased to eleven with theappointment of two additional Independent NonExecutive Directors. Therefore, the Board is currently
made up of five Executive Directors, one Non-Executive
Director and five Independent Non-Executive Directors.
All Directors have distinguished themselves in theirrespective areas of expertise and provided valid
support to the Board of Directors in their respectivefunctions.
The Board of Directors is responsible for the ordinaryand extraordinary management of the Company anddischarges its duties by carrying out all acts it deems
necessary or useful to implement and attain the
Company’s corporate purpose, except for those acts
specifically reserved for approval by the shareholders’general meeting by relevant laws or the By-laws.

2021

The corporate governance model adopted by
the Company complies with the applicable laws
and regulations in Italy, where the Company isincorporated, as well as with the principles set out
in the Corporate Governance Code (the “Code”)
contained in Appendix 14 of the Listing Rules of theHong Kong Stock Exchange.

With a view to achieving a sustainable and balanced
development, the Company views diversity at the Board
level as an essential element to attain its strategic
objectives and its development. All Board appointments
are based on merit and candidates are proposed andselected based on objective criteria, with due regard
for diversity within the Board. Diversity encompasses
a wide range of factors, including but not limited togender, age, cultural and educational background,professional experience, skills, knowledge andnationality.

PRADA GROUP

The corporate governance model adopted by theCompany consists of a set of rules and standards
aimed at establishing efficient and transparent
operations within the Group, to protect the rights of
the Company’s shareholders, to enhance shareholder
value and to uphold the Group’s credibility andreputation. The Company maintains therefore thehighest standards of corporate governance to create
long-lasting sustainable value for shareholders and forall stakeholders.

25index
In particular, the Board of Directors is responsible forsetting the overall strategy, as well as reviewing theoperational and financial performance of the Company
and the Group. Therefore, the Board considers andresolves on all matters concerning the overall Groupstrategy, the Group’s strategic objectives, the annual
budget, annual and interim results, approval ofmajor transactions, connected transactions and anyother significant operational and financial matters.
In addition, the Board of Directors has the overall
responsibility for setting and monitoring the Group’s
sustainability strategy and for ensuring that appropriate
and effective internal control and risk management
system is in place.

Board of Directors
Role

GenderAgeChairmanM> 50

Miuccia Prada Bianchi

Chief Executive Officer

W

> 50

Patrizio Bertelli

Chief Executive Officer

M

> 50

Alessandra Cozzani

Chief Financial Officer

W

> 50

M

30 - 50

M> 50

Marina Sylvia CaprottiW

30 - 50

Maurizio Cereda

M

> 50

Yoël Zaoui

M

> 50

Pamela Yvonne Culpepper

W

> 50

Anna Maria RugarliW

30 - 50

Lorenzo Bertelli

PRADA GROUP

Paolo Zannoni

2021

Executive Directors

Non-Executive Directors
Stefano Simontacchi

Independent Non-Executive Directors

26

indexThe Board of Directors’ discharge of duties is
supported by the consulting and advisory activity
carried out by the committees it has set up, namely
the Audit Committee, the Nomination Committee,
the Remuneration Committee and the Sustainability
Committee. Each Committee is chaired by, and madeof, a majority of Independent Non-Executive Directors.

The Audit Committee advises and makes
recommendations to the Board on financial statements
and reports to ensure the Company’s accounting
methods are appropriate and reliable. It also checks
the adequacy and effectiveness of the internal control
and risk management system. It recommends theappointment of the Company’s external audit firm andassesses its independence.

Role

GenderAgeChairmanM> 50

Marina Sylvia CaprottiW

30 - 50

Maurizio Cereda

M

> 50

Role

GenderAgeChairmanM> 50

Lorenzo BertelliM

30 - 50

Marina Sylvia CaprottiW

30 - 50Yoël Zaoui

PRADA GROUP

The Nomination Committee advises and makes
recommendations to the Board on its compositionand on the appointment and succession plans of
Directors. It also assesses Directors’ independence
based on criteria set by the Code.

2021

Audit Commitee

Nomination Commitee

Maurizio Cereda27indexThe Remuneration Committee advises and makes
recommendation to the Board on the remuneration
policy for Company’s Directors and Executives.

GenderAgeChairwomanW

30 - 50

Paolo Zannoni

M

> 50

Yoël Zaoui

M

> 50

Marina Sylvia Caprotti

The Sustainability Committee assists and supports
the Board of Directors with proposing and advisory
functions in its assessments and decisions onsustainability related issues, overseeing theCompany’s commitment to sustainable development
along the value chain.

It supports the Board defining strategic sustainability
guidelines and the relevant policies, as well as drafting
and reviewing reports and documents, including theannual reviewing of the Sustainability Report, andall communications concerning sustainability to besubmitted to the Board of Directors for approval.

Sustainability Committee
Role

GenderAgeChairwoman

W

> 50

Anna Maria RugarliW

30 - 50

Lorenzo BertelliM

30 - 50

Pamela Yvonne Culpepper

The recommendations made by the Board of
Directors’ committees are regularly put forward to theBoard itself for discussion and approval.
The Board of Statutory Auditors is the supervisory
body of the Company and oversees the compliancewith the By-laws and all the applicable laws and theobservance of the principles of proper management.
It also checks the adequacy of the Company’sorganizational, administrative and accounting

PRADA GROUP

Role

2021

Remuneration Commitee

structure, as well as the adequacy of its internal
control system and the effectiveness of the auditingof the accounts, and the autonomy of the external
auditor.
The Shareholders’ Meeting held on May 27, 2021
appointed the current Board of Statutory Auditors,
consisting of three Statutory Auditors and two
Alternate Statutory Auditors for a term of threefinancial years (2021-2023).

28

indexGenderAgeChairmanM> 50

Roberto Spada

M

> 50

David Terracina

M

> 50

Antonino Parisi

In compliance with the Italian Legislative Decree
no. 231 of June 8, 2001 (“Decree”), the Company
has established an “Organismo di Vigilanza”,
whose primary duty is to ensure the functioning,
effectiveness and enforcement of the Company’s

Organization, Management and Control Model,
adopted by the Company pursuant to the Decree. The
Supervisory Body has three members appointed by
the Board of Directors and selected among qualified
and experienced individuals.

Supervisory Body
Role

GenderAgeChairwoman

W

> 50

Yoël Zaoui

M

> 50

Gianluca AndrianiM

30 - 50

Stefania Chiaruttini

PRADA GROUP

Role

2021

Board of Statutory Auditors

The Company is devoted to developing an effective
two-way communication with shareholders, investors
and equity analysts to enhance the transparency of
the Company’s activity. During the financial year
ended December 31, 2021, the Company continued tofacilitate an effective communication through multiple
channels including investor conferences, one-on-one
and group meetings, teleconferences, the Company’s
corporate website (www.pradagroup.com), social
media and press releases.
More detailed information on corporate governanceis provided in the Corporate Governance section
contained in the 2021 Annual Report.

29

indexThe CSR Department supplies all the tools necessary
to the decision-making and advisory bodies so thatthey may make informed decisions consistent with theGroup’s strategies and take on the actual operational
needs and complexities of the Group and of theindividual brands; the Department is also responsiblefor implementing strategic decisions, supporting
the organizational divisions and management that
integrate long-term sustainable growth objectives.
The CSR Department prepares the Sustainability
Report and disseminates a sustainability culture
within the Company through projects dedicated tointernal communication and training. The Department
guarantees a constant dialogue and cooperation withmultiple stakeholders and, together with the Investor
Relations function, satisfies the demands of thefinancial community, which has expressed a growinginterest in the Prada Group’s sustainability initiatives
and practices.

Given the complex regulatory environment, the PradaGroup assigns various departments and hires external
specialists to keep abreast of changing laws andregulations so that it can adapt its procedures in atimely manner and reduce non-compliance risks to aminimum levels.
The Group has structured the internal control system
as a process carried out by the governing bodies of
the Group’s subsidiaries, by management and by
the corporation in general, with a view to providing
reasonable certainty that control objectives will be met.
More specifically, the Board of Directors of Prada
S.p.A., referring to internationally recognized models
such as the CoSO Report (Committee of Sponsoring
Organizations of the Treadway Commission international best practices), is engaged in thecontinuous refinement of the Internal Control and
Risk Management systems by checking the operationof its main components consisting of:control environment;risk assessment;
control activities;
information and communication;

2021— Risk Management

PRADA GROUP

In 2021, the Prada Group’s sustainability governance
was bolstered with, among other things, theappointment of Lorenzo Bertelli ― Group’s Headof Corporate Social Responsibility since 2020 ― asa member of PRADA S.p.A.’s Board of Directors
and with the decision to set up an internal Board
Committee dedicated to sustainability matters. At
the time this Report was published, Prada S.p.A.’s
Shareholders Meeting of January 28, 2022 had
appointed two new Independent Non-Executive
Directors, Pamela Culpepper and Anna Maria Rugarli,experienced professionals of Environmental, Socialand Governance (ESG) issues, who will preside over
the work of the Sustainability Committee alongside
Lorenzo Bertelli.
The Committee is tasked with providing assistanceand support to the Board of Directors’ environmental
and social sustainability assessments and decisions,honing in on the Group’s three strategic areas ofaction: Planet, People and Culture. The Committee
also has the relevant function of proposing andevaluating the adoption of policies to ensure constantcommitment and the strategic and growth guidelines
at a Group level, and the adherence to the individual
and shared values on which the Group builds its
business. The Prada Group’s Corporate Social
Responsibility (CSR) Department will have an essential
role in tying in the Sustainability Committee with theCompany’s most operational applications.

control system.
The internal control system helps ensure protection of
the Company’s assets, the efficiency and effectivenessof its processes, the reliability of the information
provided to its governing bodies and the market, andcompliance with laws and regulations as well as bylaws and internal procedures.
The bodies involved in internal control and risk
management are the Board of Directors, the Audit
Committee, the Board of Statutory Auditors and theSupervisory Body, as well as the entire management,
which has the primary task of implementing all thenecessary processes and procedures to achieve
the Company’s goals minimizing the risks for theorganization through an appropriate system ofcontrols.
Moreover, the Internal Audit & Risk Management
Department works in close collaboration withthe aforementioned bodies, which, in addition
to the typical assurance activities, assists the30

PRADA GROUP

2021

index

Board of Directors and the Audit Committee inrisk management activities among others and theSupervisory Body in control activities pursuant toDecree n. 231 of June 8, 2001.
With particular reference to production and logistics
issues, the Industrial Compliance Office sets guidelines
for implementing laws and regulations that affect theimporting and exporting of raw materials and finishedgoods, while providing various forms of industrial
compliance assistance to the manufacturing divisions.
Furthermore, with the aim of better integrating thecontrol activities carried out along the supply chain, in
addition to having formalized a dedicated procedure,
the supplier audits are carried out by an internal
working group, which involves various company

functions, to ensure the protection of human rights,
fair working conditions and health and safety.
In compliance with Legislative Decree n. 231 of June
8, 2001, the Company has established a Supervisory
Body, endowed with autonomous powers of initiativeand control, whose primary task is to ensure thefunctioning, effectiveness, implementation andupdating of the Organizational, Management andControl Model adopted by the Company pursuant tothe aforementioned legislative decree for the controlof risks and the prevention of predicate crimes ofvarious kinds and in different areas - including bribery
and money laundering - by persons who exercise(by law or de facto) functions of representation,
administration or management of the Company.

31

indexrisks relating to the international luxury goods
market or related to the general state of theeconomy, the protection of intellectual property
rights, image and brand recognition, and theability to anticipate trends and respond to thechanging tastes of consumers;
risks specific to the Prada Group relating to
the importance of key personnel, strategy
implementation, outsourcing, legal and regulatorycompliance and processing of data andinformation;
financial risks specific to the Prada Grouprelating to exchange rate fluctuations, interest
rate fluctuations, credit risk and liquidity risk.

Further information is provided in the financial review
and corporate governance sections of the 2021
Annual Report.
More information is also to be found in the 2021
Annual Report - Note 28 “Provisions for risks andcharges” - specifically for updates on investigations
and disputes with third parties or authorities thatinvolved the Prada Group in the period.

— Code of Ethics
The Prada Group considers respect for ethicalprinciples to be a basic pillar of its values and success.
The Group believes in and operates with:compliance with legislative and regulatory
provisions in all countries in which it operates;

respect for privacy;

2021

legitimacy, loyalty, correctness and transparency;

respect for the value of human beings;
respect for competition, as a crucial instrumentin the development of the economic system;
respect for the environment and awarenessabout environmental protection.

PRADA GROUP

The aforementioned report, as well as through a
dedicated e-mail address, can be transmitted through anelectronic internal communication channel available on
the Company’s Intranet that guarantees electronicallythe confidentiality of the identity of the whistleblower.
All the employees can report anonymously to theSupervisory Body through a dedicated e-mail address
events or behaviors that do not meet Group’s
standards. All the employees of the Group’s Italiansubsidiaries can also report to the Supervisory Body,
anonymously through a whistleblowing platform,
any illicit conduct and irregularities regarding theLegislative Decree 231/2001, in violation of theOrganization, Management and Control Model or in
violation of ethical principles, internal procedures orlaws, of which they became aware in the employment
relationship. In 2021, there were no reports, as well as
any records of material instances of non-compliancewith the applicable laws and regulations regarding
bribery, extortion, fraud and money laundering in theperformance of the activities of the Prada Group.
Risk assessment consists of identifying and analyzing
factors that could compromise the proper conduct ofcompany activities and must also extend to the analysisof the process that determines how those risks should
be avoided or mitigated. The fact that economic,
regulatory and operating environments are in constantflux raises the need for mechanisms that help identify
and deal with the risks posed by such changes.
For the Prada Group, risks can be broken down as follows:

Since 2007, these principles have been given formal
expression in the Prada Group’s Code of Ethics.
The Code contains the guiding principles of theOrganization, being one of the main pillars of theGroup’s governance model and shared with all theemployees, collaborators and suppliers, and is
supported by a set of procedures in order to turnthese values into daily actions.
The adoption and application of the Code of Ethics
is essential for the achievement of the Company’s
primary objective, consisting in the creation of longterm value for shareholders, employees, customers
and for the community as a whole.
The Group promotes knowledge of the Code throughvarious means such as online publications, directcommunications and, by procedure, as part of the
supply or commercial agreement with most of thepartners, as it is considered a prerequisite for theestablishment of all contractual relationships.

32indexThe Group’s tax strategy, defined and periodically
updated by the Prada S.p.A. Board of Directors,
is managed and monitored by the Group’s Tax
Department, which is made of experienced andqualified tax professionals, owing all the knowledge andskills needed to manage risks related to both Italian andinternational taxation issues and cases. Tax Department
relies on a series of internal procedures to ensure that
all the tax compliance and reporting filings are subject
to suitable review and prepared in a transparent, timely
and punctual way; coordinating with the other Group’sfunctions, Tax Department is also responsible for
granting that policies and procedures that support tax
strategy are implemented and managed consistently.
Finally, the Group’s Tax Department constantlyinteracts with industry associations, governments
and other external bodies, such as the Organization
for Economic Cooperation and Development (OECD)or the European Union, in order to share in advancefuture tax legislation trends and rules. When necessary,
the Group’s Tax Department is supported by external
advisors with reference to specific tax issues withuncertain interpretation.
For the correct and effective implementation of its tax
strategy, Prada S.p.A. has adopted the Tax Control
Framework (TCF), which also illustrates the tools for
identifying, assessing, managing and controlling tax risk,
according to international standards shared periodicallywith the Italian tax authority. The TCF is part of theinternal control system. The effectiveness of the tax

Constant, preventive dialogue with tax authorities is also
ensured through the Advance Pricing Agreements (APA)
and Basic Asset Protection Agreements (BAPA) withlocal tax authorities - consisting of sharing ex ante thetax treatment of intercompany transactions in relation totransfer pricing legislation - and advanced clarification
requests addressed to the various tax administrations
regarding the uncertain interpretation of both regulatory
and practice issues and aspects. Assurance on fiscally
relevant processes is also guaranteed through theinternal control system (Internal Audit) and through thechecks carried out by second-level control functions.

2021

The Prada Group believes that responsible corporate
governance calls for adopting collaborative actions
that can improve the common value creation process
while maintaining the balance between businessobjectives and stakeholders’ expectations.
This approach is also reflected in the Group’s tax
strategy that is based on risk prevention and “taxcertainty”, both pursued through ongoing dialogue
and honest, long-term interaction with the main
Italian and foreign tax authorities. This strategy aims
at mitigating tax risk, at granting the compliance withlaws and regulations in all jurisdictions where theGroup operates and at promoting the importanceof the involvement of the Tax Department in all theGroup’s operations and company processes.

risk management system has entitled Prada S.p.A. toparticipate in the Cooperative Compliance Tax Regime
in Italy (under Italian Legislative Decree 128/2015), witheffect from 2016. Within the Cooperative Compliance
Tax Regime, the Group has expanded the systematic andcontinuous communication channel with the Italian tax
authorities based on mutual transparency and trust, inorder to minimize uncertainties about potentially risky
situations.
After its inclusion in the regime, the Italian tax
authorities invited some Group companies to join theInternational Compliance Assurance Program (ICAP)
launched by the OECD.
The Group’s participating companies shared extensive
information with the tax authorities of the countries
where they reside (among others, Italy, the U.S.A., theUnited Kingdom, Canada, Australia). At the end of theassessment, the respective tax authorities assigned thestatus of “low-risk taxpayer” to those companies.

PRADA GROUP— Tax Strategy
and Compliance

The Prada Group sends to the Tax authority the“Country-by-Country Report” providing key
information about the income and activities ofresident companies, in compliance with the obligations
for mandatory automatic exchange of tax information
between the various countries.
Furthermore, the necessary safeguards have also been
put in place recently to verify compliance with thereporting obligations of the respective tax authorities
regarding any cross-border transactions containing thehallmarks identified in EU Directive 2018/822 (DAC 6).
Finally, Prada S.p.A. holds the status of Full Authorized
Economic Operator (AEO), which means with thehighest level of reliability. This recognition, issued by the
Customs Agency, is granted to companies that prove to
be competent and virtuous in the management of theirbusiness processes, in compliance with both customs
regulations and safety standards for goods.

33indexInvestments in retail space and processes raised
store productivity rates and were critical tostrengthening the brands identity. In 2021 alone, 120
store renovations were completed and 80 pop-up
installations were set up, leading to increased footfall
in stores and a continuously evolving retail image.
The Prada Outdoor, Prada Holiday, Miu Miu Upcycled
and Miu Miu Nuit pop-up shops resonated the most,traveling around to some of the most prestigious
department stores and malls.
Investments in content and in traditional and digitalcommunication channels led to excellent results
even in the online brand visibility metrics. Effective
communication campaigns made it possible to expand
the involvement of the digital community during
successful events, such as the Prada 2022 Spring/
Summer fashion show, the first to be presented
simultaneously in two cities (Milan and Shanghai), andthe 36th America’s Cup presented by Prada, the mostviewed edition ever.
The omni-channel growth strategy included newinvestments that will soon lead to additional
optimization of back end retail operations andLast but not least, having joined the Aura consortium
as a founding member enables the Group to
further enrich the customer journey: throughBlockchain technology, the Group’s brands will
guarantee to customers enhanced transparency andtraceability. Moreover, a digital evolution roadmap
was approved during the year that will lead to a
cutting-edge information system for the Group interms of engineering and technology, giving anothercompetitive advantage in the performance of all
distribution and communication channels and indeed
the entire business operation.
The industrial area benefited from important
reduction of complexity as well as investments in theverticalization of the production process to enhanceartisanal know-how and further boost the highquality standards of the products. Use of operating
capacity was optimized at the Levanella logistic
hub, a forerunner of technology and sustainability
in the industry and a crucial site for integrating
manufacturing processes with store procurement
ones. Manufacturing activities were also strengthened
through the acquisition of the remaining minority
stakes in two subsidiaries, and the acquisition of a
stake in Filati Biagioli S.p.A., renowned for Italian
excellence in the production of cashmere and othernoble yarns.

2021

The Covid-19 pandemic continued to fuel atransformation process in the luxury goods market
in 2021, making it truly evolve. The share of
consumers belonging to young generations increased
considerably, as did the input of the digital sales
channels and local consumers. Ethical products, thesocial responsibility of the brands and the significanceof human beings in the buying experience, even in
the new physical-digital ecosystem, have becomeof paramount importance to the industry’s value
proposition.
Focusing on being relevant, sustainable and impactful,
the Prada Group has succeeded in evolving with themarket in this scenario of mutations. The combinationof its unique creative process and a transformationalomni-channel strategy has enhanced the perceived
value of the brands and products, paving the way forrevenue growth and putting the Group back on thepath of long-term value creation.
The commercial strategy was behind this growthwith a more profitable sales mix, the eliminationof markdowns, and a fully streamlined wholesale
distribution channel. The increase in the Group’s own
E-commerce sites also contributed to the growth,
mainly with new customers.

greater use of data, making the customer relationshipmanagement (CRM) activities even more effective.

PRADA GROUP— 2021 Highlights

For Capital Markets Day in November, the strategic
guidelines for the Group’s sustainable growth werecommunicated as formalized based on the principles
and priorities that have always motivated the PradaGroup, organized into three pillars: environment,
people and culture.
The Group’s operating results improved considerablyfrom those of the pre-pandemic levels, showing
increases in both amounts and as a percentage ofnet revenues. The consequential cash generation,
net of investments and resumed dividend payments,
enabled the Group to accumulate enough cash assets
to face confidently the important short and medium
investments.

34

PRADA GROUP

2021

index

— In 2021, in a context of change,
focusing on being relevant, sustainable
and impactful, the Prada Group has
succeeded in evolving with the market.
35indexGRI-201 Disclosure
Direct Economic Value Generated and Distributed
2019

2020

2021

3,232,054

2,424,970

3,368,418

Economic Value Distributed

2,901,673

2,255,583

2,961,880

Operating costs

1,968,912

1,545,670

1,941,997

Value distributed to Employees

752,049

657,537

744,554

Value distributed to Banks and Bond Holders

12,044

12,613

10,994

Value distributed to Government Authorities

951

22,636151,210

Value distributed to Investors

154,642-

91,233

Value distributed to the Community

13,075

17,127

21,892

330,381

169,387

406,538

Economic Value Retained

The consolidated income statement for 2021,
presented according to the model of economic value
generated and distributed defined by the GRI-201
disclosure (GRI Standards), shows a retained economic
value of Euro 406.5 million, more than double thatof 2020 and even higher than the pre-pandemic
level of 2019. Compared to 2020, the additional
generation of value was offset by the increase in thevalue distributed to employees mainly as a resultof the larger workforce, to public authorities for

PRADA GROUP

Economic Value Generated

2021

Amounts in thousands of Eurothe higher direct taxes, and to Shareholders for the
resumption of dividend payments. Compared to 2019,
the increase in the economic value retained emerges
primarily from the higher value generated and thelower value distributed to Shareholders, net of thenormalization of the value distributed to the publicauthorities as explained by the extraordinary nature of
2019, the year in which the Prada Group obtained therecognition of the Patent Box tax benefit for the years
2015-2019.

36

index

2 — SUSTAINABLE DEVELOPMENT
Highlights 2021

3

Sustainability Pillars

2

GHG emissions reduction targets
approved by SBTi

4

Sustainability-linked loans

Strong
ESG governance

Bold Climate strategy

Leading DE&I agendaindex— The Prada Group’s strategic choices havealways been guided by a desire for lasting
success that benefits all its stakeholders, bethey shareholders, employees, customers or
the communities in which the Group operates.

2021

Prada Group reinforces the already high standardsof corporate governance and roots its commitment
through a sustainability strategy that revolves aroundthe areas of intervention where it believes it cancontribute most to creating long-term value.
The Board provides direction and maintain oversightover the non-financial - or the environmental, socialand governance (ESG) - performance of the Group
with the support of the departments involved in theimplementation of the sustainability strategy. The topics
covered in this Report have been reviewed and deemed
relevant, having taken into consideration the impacts
associated with the organization's business activities.
Sustainability performance, as well as ESG objectives,
are reported to the Board at least once a year or whensignificant developments occur. Any updates of theobjectives set with respect to material ESG issues will
be discussed with each department involved.

SUSTAINABLE DEVELOPMENT

The Prada Group’s strategic choices have always been
guided by a desire for lasting success that benefits all
its stakeholders, be they shareholders, employees,
customers or the communities in which the Group
operates. Prada S.p.A.’s Board of Directors is in factcommitted to conducting the business responsibly,
to building an inclusive and safe work environment
for all, in the conservation of the environment and in
the protection of the communities in which the Group
operates.
Sustainability, increasingly rooted in corporate
strategy, together with a continuous and transparent
dialogue with stakeholders, are key factors to reaffirm
the identity of the Group and support the competitiveedge of the company, as well as to face changes andcontemporary and future challenges and grant a longterm sustainable development.
Constantly inspired by its essential values, the38

index— Sustainability Journey2015

In 2015, the Group’s Sustainability
Report is prepared for the first time
following the GRI (Global Reporting
Initiative) standards, considered theglobal best practice.

2017

In 2019, the Prada Group formalizes
its commitment to sustainability issues
through the drafting and publicationof a dedicated Policy. In the same
year, the Diversity and Inclusion
Advisory Council is established by
Prada’s USA subsidiary; assisted
by prominent personalities from
authoritative international academic
and cultural institutions, it guides theGroup on social sustainability issues,
among others. Also in 2019, Prada
S.p.A. signs the Fashion Pact amongits first signatories, recognizing that
only collective action can mitigate
the harmful environmental impact of
the fashion industry. The Group also
launches the first limited edition ofbags and accessories entirely realized
in Re-Nylon and announces that,starting with the Women's Spring/
Summer 2020 collections, it will nolonger use animal furs in the creationof its products. Moreover, the same
year, Prada S.p.A. is the first company
in the luxury goods sector to take out
a sustainability-linked loan from the
Crédit Agricole Group. Finally, in 2019,
the Group promotes SEA BEYOND,
the educational program to raiseawareness of sustainability and oceanpreservation developed with UNESCO’s
Intergovernmental Oceanographic
Commission (IOC).

2021

Before any mandatory requirement,
in 2013 the Prada Group publishes its
first Sustainability Report to illustrate
the initiatives taken in the area ofenvironmental, social and governancesustainability in a single document.

2019

SUSTAINABLE DEVELOPMENT2013

In 2017, the Group organizes in Milanthe first event of the “Shaping a Future”
cycle of conferences with the aimof stimulating a debate on the mostsignificant changes taking place incontemporary society.

39indextask of ensuring that diverse culturesand points of view are represented at
all levels of the organization. At theend of the year, the Group becomesthe first company in the luxury fashionindustry to join The Valuable 500,
an international coalition whose
goal is to strive for an increasingly
radical transformation of corporate
organizations in order to include people
with disabilities. Finally, in 2020, thePrada Group measures its first carbon
footprint, a fundamental step towarddefining a climate strategy.

2021

In 2020, Lorenzo Bertelli also takeson the role of Head of Corporate
Social Responsibility for the PradaGroup to give further impetus to theintegration of sustainability into thelong-term corporate strategy. In thesame year, a Chief Diversity, Equity andInclusion Officer is appointed at theNorth American subsidiary, with the2021 marks a turning point for
many aspects related to the PradaGroup’s sustainable development.
The strengthening of sustainability
governance is a prime example,
thanks to Lorenzo Bertelli’s joining
the Prada S.p.A. Board of Directors
while being the Prada Group’s Headof Corporate Social Responsibility,
together with the decision to forma Board level Committee dedicatedto environmental and social
sustainability issues and the selectionof two new Prada S.p.A. Board
members with significant professional
ESG (Environmental, Social andGovernance) experience. Furthermore,
the Prada S.p.A. Board members
approved the Group’s strategic
sustainability guidelines and, during
the year, received training on themain sustainability issues and industry
trends.

SUSTAINABLE DEVELOPMENT

2020

2021

Also in 2021, the Group defines its
climate strategy, submitting its GHG
emissions reduction targets to the
Science Based Targets initiative (SBTi)
and participating for the first time in
the Climate Change questionnaire of
the CDP (Carbon Disclosure Project),presenting the progress of this longterm journey during the CapitalMarkets Day held in November.

40

On that same occasion, Lorenzo Bertelliannounces the Group’s Sustainability
Strategy and the concrete actions
ahead to achieve the quantitative
targets approved by SBTi, and confirms
the progress made, both internally andexternally, on the Diversity, Equity andInclusion commitment.
The Group secures two newsustainability-linked loans during theyear and organizes specific training
programs for the Industrial Divisions
to provide constantly updated tools
for managing and analyzing thesustainability issues that most impact
the supply chain.
Finally, in 2021, the Prada Group
achieves full conversion to Re-Nylon
and launches the second edition of
SEA BEYOND, in partnership with
UNESCO-IOC.

SUSTAINABLE DEVELOPMENT

2021

index

41

index— Sustainability Strategy
Sustainability is of vital importance to the PradaGroup’s development process and is essential for
protecting its identity and reputation. In recent years,
the Group launched increasingly ambitious andoriginal initiatives in line with the priorities set in theSocial Responsibility Policy.
In 2021, the Prada Group defined and communicatedits sustainability strategy, aimed at further
strengthening and consolidating this commitment,
identifying for each line of action - environment, people
and culture - medium-long term objectives, on thebasis of which quantitative targets will be formalized inorder to guide future actions in the sustainability field.

We commit to shaping
our operations to
reduce our footprint

We commit to an
inclusive, creative andfair workplace

We commit to sharing
our values and to build
a sustainable society

Mitigate our impact
on climate changeChampion diversity
and promote inclusion

Contribute to culturaldebatePreserve theecosystems

Foster creativity andknow- how preservation

Further sustainability
literacy

Embrace circular
thinking

Ensure wellbeing
and fair workplace

Inspire scientific evolution

2021

As already anticipated, at the beginning of 2019,
the Prada Group formalized its commitment tosustainability and drafted a Sustainability Policy,
approved by the Board of Directors of Prada S.p.A.
and available on the pradagroup.com website.
The publication of this policy is an importantmilestone underpinning the Directors’ commitment to
the wider responsibility that a contemporary businessis called on to assume.
More in details, Company’s commitment and its
sustainability initiatives are based on three priorities
for action – environment, people and culture - where
the Group firmly believes it can provide the greatest
contribution in terms of returning value to its own
industry and to benefit society as a whole.
The continuous work on numerous aspects ofsustainable development, such as the investment inculture for extending the benefits of its activities tocivil society, the cooperation with stakeholders, theimportance of diversity and equal opportunities,

the fight to climate change, the research of new
sustainable materials and the investment in thequality of working environment are only few concrete
examples of the Group’s commitment in social andenvironmental sustainability.

SUSTAINABLE DEVELOPMENT— Sustainability Policy

with PARTNERS
we commit to engaging with our partners to strengthen our sustainability paths

42for each person at every level of the organizationand in the fashion industry in general. The “forPeople” pillar also comprises a long-term investment
to preserve craftsmanship and develop new talents,
positioning Prada as a beacon of excellence for
new generations. Respect for and protection of theGroup’s workers and business partners is another key
element, along with greater monitoring of employee
engagement levels to improve employees’ personal
and professional wellness.
The third, most distinctive pillar of the strategy, “forCulture”, summarizes the Group’s constant investmentin the preservation and dissemination of Italian andinternational cultural heritage as well as the naturaland scientific ones, reiterating the Group’s activerole as populizer and educator even in those areasof research dedicated to actively contributing to theapplication of sustainability principles.
The Prada Group views these strategies as part ofa broader responsibility toward the community inwhich it operates, and for this reason working closelywith its suppliers and other partners, across all its
key areas, is essential to achieving its biggest goals.
In fact, the Group intends to meet the goals set for
the three sustainability pillars by realizing concrete,
ambitious targets that track their progress, defining
key performance indicators (KPIs) and assigning themto the management involved.

SUSTAINABLE DEVELOPMENT

Unveiled by Lorenzo Bertelli - Prada Group’s Headof Corporate Social Responsibility - on CapitalMarkets Day, the Group’s sustainability strategy
is the blueprint of a long process of growth andenhancement for the planet, people and culture.
This strategy, approved by Prada S.p.A.’s Board of
Directors in 2021, is based on the values, principles
and priorities that have always defined Prada’s DNA
and demonstrate, with coherence and integrity,
continuity between past actions and future projects.
Organized into three pillars, the “for Planet” strategy
sets out environmental impact reduction goals,
including the attainment of carbon neutrality for all
Prada operations starting from 2022 and the targets
approved by the Science-Based Targets initiative(SBTi) for reducing Scope 1, 2 and 3 greenhouse gases
emissions, extensive use of alternative low-impact
materials for both finished products and packaging,
and an approach more geared toward circularity forthe materials used in production and production
scrap, which are reintroduced to new circuits andreused. The strategy also focuses on raw material
traceability and continuous improvement in socialand environmental standards along the supply chain,
thanks to close collaboration with suppliers, also forthe purpose of reducing their environmental footprint.
Initiatives to promote and enhance diversity,
equity and inclusion are also foreseen, including
advancement of an inclusive culture based on respect

2021

index

43

indexSUSTAINABLE DEVELOPMENT

2021— Stakeholders andMateriality Analysis

Prada Group’s Stakeholders
The Prada Group operates in a dynamic context
interacting with many stakeholders, all of which candirectly or indirectly influence or be influenced by theachievement of business objectives; transparency andopen dialogue with those stakeholders is fundamental
to pursuit sustainable growth and long-term value.
The Group mapped the main categories of
stakeholders operating along its value chain on thebasis of two criteria:
Influence on Prada: ability to affect theCompany’s strategic or operational decisions;

Dependence on Prada: extent to which thestakeholder depends on the Company’s
decisions, products and activities.
The Prada Group over the years have encouraged
numerous listening and interaction activities with themain stakeholders in a perspective of mutual learningand sharing with the aim to identify their expectations
and incorporate them into the Group businessobjectives.
In the pursuit of its goals, the Group actively
participates in association with its stakeholder or as
part of multi-party coalitions.

44

indexIdentifying sustainability issues;
Ranking the sustainability issues previously
identified based on their relevance for achieving
business goals (internal significance)
and for meeting stakeholders’ expectation(external significance).
The material topics for Prada were defined as
the intersection of significance for the Group andsignificance for its stakeholders, as shown in thefollowing materiality matrix validated by the Prada
S.p.A.’s Board of Directors.

2021

The depth and detail of the various topics presented
and disclosed in this Sustainability Report reflects
the outcome of a materiality analysis, which is theprocess of identifying, evaluating, and ranking thesustainability aspects that are relevant to stakeholders
and that influence the ability of Prada to create value
in the short, medium and long-term.
In 2021, the Prada Group have updated its materiality
analysis, with the direct involvement of the Group’s
top management, including members of the Board of
Directors, following two steps:

SUSTAINABLE DEVELOPMENT

Materiality Analysis

45

The following results emerged:
again, the most significant aspect proved to be
product creativity and excellence, which
demonstrates the fundamental importance —for the Group and its stakeholders alike — of
the high standards of quality and style that
accompany Prada merchandise along the entire
value chain. Together there is the aspect ofbusiness strategy and economic performancesince financial stability is the essential condition
for the pursuit of sustainability goals;
equally relevant for the Group and its
stakeholders are the aspects related to climate
action, the improvement of environmental andsocial standards along the supply chain, diversity
and equal opportunity and occupational healthand safety;
aspects associated with the respect of humanand workers’ rights and the procurement of low

environmental impact raw materials resulted
among the most relevant for stakeholders,
demonstrating the pressure that the Group hasfrom stakeholders related to its procurement
practices;

SUSTAINABLE DEVELOPMENT

2021

index

customer experience, know-how preservationand skills development, and the protection andenhancement of the artistic, cultural and natural
heritage are among the most important issues
to the Group, considering that they represent
fundamental elements of Prada’s DNA.
Compared to the results of the 2020 materiality
analysis, issues related to waste management, water
management and circular thinking emerged asmaterial topics, testifying the Group’s ever-increasing
commitment to environmental issues.
In the table below it could be found the definitionof each material topic identified by Prada, while thecorrelation between material topics and GRI indicators
is disclosed in chapter 7 “Note of the Methodology”.

46

indexPeopleClimate Action

Reduce greenhouse gas emissions related to activities
carried out along the Group’s value chain, reducing
not only the impact relating to the Group’s operations,but also that generated by actors operating upstream
and downstream of the value chain.

Circular Thinking

Integrate the principles of the circular economy
in the performance of the Group’s activities,
for example in the setting up of pop-up shops,
in the organization of fashion shows and in productdevelopment.

Procurementof low environmental
impact raw materials

Promote the procurement of raw materials withlow environmental impact, considering not only
the impact on climate change, but also othersustainability issues such as biodiversity and animal
welfare.

Responsible
Waste Management

Responsibly manage the waste produced during
production processes with the aim of reducing the
production of total waste and increasing the amountof waste destined for recycling.

Sustainable
Water Management

Responsibly use water resources during production
processes by promoting practices aimed at reducing
water consumption (e.g.: recycling/reuse of water)
and aimed at minimizing the impact of water
discharges (e.g.: wastewater treatment plants or
reduction of hazardous chemicals substances used in
production).

Champion diversity
and equal opportunities

Promote and guarantee gender equality andequal opportunities among the entire company
population, not admitting discriminatory behaviors
and guaranteeing an inclusive organization, also
considering the multitude of nationalities andethnicities of the Group’s employees.

Know-how preservationand skills development

Invest in the training and professional growth of
employees in order to enhance their skills andtalents and to disseminate corporate know-how.

Occupational Healthand Safety

Guarantee a safe and healthy workplace for all
workers by minimizing accidents and occupational
diseases through prevention and protection
activities.

Repect of humanand workers’ rights

Ensure respect for fundamental human rights and inparticular the rights of workers operating within theGroup’s operations.

SUSTAINABLE DEVELOPMENT

Environmental

2021

Material Topics

47

index

Improve the environmental
and social standard along
the supply chain

Guarantee responsible management of the supply
chain with the aim of improving the environmental
and social standards of suppliers, aligning them withinternal standards through engagement, training andad-hoc assessments.

CommunityProtectionand enhancementof the artistic, culturaland natural heritage

Contribute to the conservation of the Italian andinternational cultural, artistic and environmental
heritage, encouraging and supporting avant-garde
culture and arts.

Business & Ethics

Integrity, transparency
and cooperation

Ensure transparent Corporate Governance, aimed at
guaranteeing the interests of all the Group’s internaland external stakeholders by guaranteeing an ethicalbusiness conduct in compliance with laws and atransparent approach to taxation.

Product creativity
and excellence

Offer products of the highest quality,
expressions of creativity capable of shaping
the collective imagination.

Business strategy
and economic
performance

Guarantee the economic sustainability of the Group’sbusiness model, promoting economic growth, inorder to increase the indirect economic impacts on
the Group’s internal and external stakeholders.

Customer experience

Increase customer satisfaction by guaranteeing safe
products and improving the customer experience,e.g. by digitalizing sales channels.

— Sustainability Risks
Management
In compliance with the “ESG Reporting Guide” of theHong Kong Stock Exchange, the Prada Group is called
to identify and evaluate the nature and extent of theenvironmental, social and governance (ESG) risks
related to its material aspects.
In 2021, the Prada Group carried out a first highlevel and qualitative assessment of ESG risks, whichwere previously identified, according to a broad viewof the main sustainability challenges, based on four
categories of risks:
Strategic risks: related to those risks that could
adversely affect the decision-making process and

SUSTAINABLE DEVELOPMENT

Supply Chain

2021

Material Topics

the achievement of the organization's mission andstrategic objectives;
Operational risks: related to those risks that could
disrupt or damage the performance of thecompany’s business operations;
Financial risks: related to those risks that could
have a direct impact on the company’s financial
performance;
Compliance risks: related to those risks of
non-compliance with applicable national andinternational laws - that could expose the Groupto legal penalties - or with the Code of Ethics andinternal procedures.

48

indexMaterial
Topic1

Risk
Name

Description

Typeof Risk

References
Risk Mitigation
Actions

Climateaction2

Pressuresfromstakeholders
andinvestors

In recent years, the interest of investors
and external stakeholders on climatechange has increased. For this reason,in case of insufficient disclosure regarding
its impact and in the absence of concrete
actions aimed at reducing greenhouse gas
emissions along its value chain, the PradaGroup could see its access to financial
capital reduced and weakened its positionin comparison with competitors.

• Strategicrisk• Financial
risk

Sustainability
Strategy

The fashion industry is increasingly interested
in sustainability issues, which implies that
consumer choices are influenced by this typeof aspect. In particular, millennials seemto favor products made with low-emission
raw materials. The absence of a proactive
approach by the Company on this issue
could lead to an economic loss linked to thechange in consumer choices towards brands
capable of offering products with reduced
greenhouse gas emissions.

• Strategicrisk• Financial
risk

Noncompliancewithemerginglaws and/or
regulations

Europe is moving towards an economy withzero net greenhouse gas emissions by 2050.
This goal could imply the introduction ofincreasingly stringent laws and regulations
relating to greenhouse gas emissions. Prada’s
failure to manage climate issues could
make the Group unprepared to respond topotential future laws or regulations.

• Compliancerisk

Replacementof existingproducts
and services
with lowcarbon
options

The current unavailability oftechnologies that allow the removalof greenhouse gas emissions derivingfrom the breeding of livestock for the
production of leather entails risks for the
Prada Group. Furthermore, a further risk
derives from the current impossibilityof selecting a raw material equivalent toleather in quality and characteristics, andwhich can be produced on a large scale.

• Strategicrisk• Operationalrisk

Scarceavailabilityof rawmaterials

The availability of natural raw materials
can be affected by potential changes inclimate patterns. In the medium term,
the Group could encounter difficulties inpurchasing the raw materials necessary
to ensure business continuity, and beforced to face a potential increase in costs.

• Strategicrisk• Operationalrisk• Financialrisk

1 - No relevant risks have been identified for the material topic “Protectionand enhancement of the artistic, cultural, and natural heritage”.
2 - Risks and opportunities related to Climate Change have been alreadydisclosed in the CDP - Climate Change Questionnaire published in 2021.

Responsible use ofnatural resources
Preservationof the territory

Sustainability
Strategy
Climate Strategy
Responsible use ofnatural resources
Preservationof the territory

Sustainability
Strategy
Climate Strategy
Responsible use ofnatural resources
Preservationof the territory

2021

Shift inconsumerchoices

Climate Strategy

SUSTAINABLE DEVELOPMENTENVIRONMENTCATEGORYESG Risk Assessment

Sustainability
Strategy
Climate Strategy
Responsible use ofnatural resources
Preservationof the territory

Sustainability
Strategy
Climate Strategy
Responsible use ofnatural resources
Preservationof the territory49

indexRisk
Name

Description

Typeof Risk

References
Risk Mitigation
Actions

Frequency
andseverityof extreme
weather
events

The widespread presence of thebusiness and the distribution of theretail sales network in Europe, Asia,
North America and Latin America
exposes the Group to some risks
associated with extreme weather events.
For example, some industrial sites of
Prada are located near rivers, someof which are characterized by the riskof flooding (due to rising sea levels),
which could result in both damage tothe plant itself and inaccessibility to theestablishment for employees.

• Strategicrisk• Operationalrisk

Sustainability
Strategy

Responsible
wastemanagement

Noncompliancewith local
environmental
regulations

Failure to comply with environmental
laws and regulations on waste
management could result in financial
penalties for the Prada Group.

• Compliance
risk

Waste
management

Circularthinking

Noncompliancewithemerginglaws and/or
regulations

The European Green Deal includes
some sections relating to the circular
economy. The European plan for thecircular economy, one of the pillars of
the Green Deal, envisages the applicationof the concept of “extended producer
responsibility” to the fashion sector andthe introduction of eco-design principles
in the creation of products.
The criticality for the Prada Groupwill be to be able to adapt / convert
its operations in a circular way, without
damaging the competitivenessof the Group.

• Compliancerisk• Operationalrisk

Circular thinking

Shift inconsumerchoices

The fashion industry is increasinglyinterested in sustainability issues,
which implies that consumer choices
are influenced by this type of aspect,
especially considering millennials, whofavor circular business models with
reduced environmental impact.
The absence of a proactive approachby the company on this issue could
lead to an economic loss linked to thechange in consumer preferences towards
brands able to offer products andservices in line with the principles of thecircular economy (e.g. use of materials
regenerated raw materials, extension of
the product life cycle).

• Strategicrisk• Financial
risk

Circular thinking

Climate Strategy
Responsible use ofnatural resources

2021

Preservationof the territory

SUSTAINABLE DEVELOPMENT

Material
Topic

ENVIRONMENTCATEGORYESG Risk Assessment

50

indexRisk
Name

Description

Typeof Risk

References
Risk Mitigation
Actions

Sustainablewater
management

Scarceavailabilityof waterresources

In the case that the geographicalareas in which the Prada Group
operates have problems related
to water stress, there could be criticalissues, especially for factories where
significant use is made of waterin production processes.

• Operationalrisk

Responsible
use of natural
resources

Noncompliancewith local
environmental
regulations

The Prada Group uses chemicals
in its production processes (e.g.
for leather processing), therefore
environmental laws and regulations
concerning water discharges could imply
risks of non-compliance. Considering
also the impact that an ineffective
management of water discharges
could have on the territory where
Prada operates, there is a significant
reputational risk.

• Compliancerisk

Responsible
use of natural
resourcesLow
availabilityof sustainable
raw materials

In recent years, Prada has beencommitted to increasing the percentage
of sustainable raw materials used inits products. However, large-scale
sourcing of sustainable raw materials
could be critical. Therefore, when
the Group exposes itself by declaring
quantitative objectives for the purchaseof sustainable raw materials, there
could be reputational damage in theevent of the non-achievement ofthese targets.
Furthermore, any difficulties in finding
sustainable raw materials could cause
a high dependence on a small numberof suppliers, decreasing the Group’s
bargaining power and potentially
increasing production costs.

• Strategicrisk• Operationalrisk• Financial
risk

Responsible
use of natural
resources

Greenwashingconnected
to the use ofsustainable
raw materials

The commitment of the Prada Groupto replace traditional raw materials
with sustainable alternative raw materials
could involve the risk of sourcing
from raw materials whose effective
sustainability may not be better than
the traditional raw materials replaced,considering all the dimensionsof environmental sustainability(eg: climate change, water consumption,
biodiversity, etc.).

• Strategicrisk

Responsible
use of natural
resources

SUSTAINABLE DEVELOPMENT

Procurementof low
environmental
impact raw
materials

2021

CATEGORY

Material
Topic

ENVIRONMENTESG Risk Assessment51

indexPEOPLE

Material
Topic

Risk
Name

Description

Typeof Risk

References
Risk Mitigation
Actions

Improve theenvironmental
and social
standard
along thesupply chain

Noncompliancewithenvironmental
practices andstandards
along thesupply chain

Some of the Group’s suppliers(e.g. suppliers of the tanning industry)
operate in sectors with a highenvironmental impact. In addition,
the leather supply chain is also
concerned about deforestation.
Prada’s connection, even indirectly,with companies that are in breach ofenvironmental regulations or that are
accused of promoting deforestation
represents a significant reputationalrisk for the Group.

• Strategicrisk

Industrial
Strategy

Noncompliancewith social
practicesand standards
along thesupply chain
and possible
violationsof humanrightsThe Prada Group supply chain
is complex and often consists ofseveral levels of subcontracting.
Any cases of violation of human rights,
including health and safety issues,along the Group’s supply chain
represent a significant reputational risk
for the Group.

• Strategic
risk

Misalignmentof supplierswith Prada’s
sustainability
strategy

The sustainability strategy of the
Prada Group, and its targets, canonly be reached with the cooperationof all suppliers. Failure to cooperatewith suppliers could jeopardize theachievement of the sustainability
objectives defined by the Group.

• Strategicrisk

Supply chain
responsible
management

Respect ofhuman andworkers’
rights

Noncompliancewith Human
Rightsstandards

The Prada Group operates in numerous
countries, in some of which compliancewith local legislation may not be
sufficient to guarantee respect for thefundamental human rights of workers.
Failure to respect human rights in its
operations represents a reputational risk
considering the media exposure of the
Prada Group.

• StrategicriskWorkers’ healthand safety
and respect forhuman rights

Know-howpreservationand skills
development

Difficulty inattracting
and retaining
qualified
employees

The success of the Prada Groupdepends on the ability to attract
and retain qualified people in the main
corporate functions, both in managerial
and more operational positions.
A high outgoing turnover could represent
a risk of loss of competitiveness for the
Prada Group.

• Strategicrisk• Operationalrisk

Talent attraction
and retention

Supply chain
responsible
management

Supply chain
responsible
management

2021

Industrial
Strategy

SUSTAINABLE DEVELOPMENT

SUPPLY CHAIN

CATEGORYESG Risk Assessment52indexDescription

Typeof Risk

References
Risk Mitigation
Actions

Loss ofcorporateknow-how

The development of skills is afundamental element for Prada’s success,for this reason, the intergenerational
passage of company “knowledge”
is fundamental. Failure to pass on
artisan skills to new generations could
undermine the Group’s ability to create
excellent products.

• Strategicrisk• Operational
risk

Prada
Academyand skills
development

Occupational
health andsafetyNoncompliancewith healthand safety
legislation

Failure to comply with laws andregulations on occupational healthand safety management could resultin financial penalties for the PradaGroup. Furthermore, the occurrence ofaccidents in the workplace represents a
reputational risk for the Group.

• ComplianceriskWorkers’ healthand safety
and respect forhuman rights

Championdiversityand equal
opportunities

Occurrenceof incidents of
discrimination

The promotion of diversity, equity
and inclusion are fundamental elements
for the Prada Group.
Any episodes of discrimination, insideand outside the workplace, could
represent a reputational risk for the
Prada Group.

• StrategicriskChampiondiversityand equal
opportunities

Product
creativity
andexcellence

Shift inconsumerchoices

The demands of consumers, especiallyof the new generations, are increasingly
challenging. This implies that the PradaGroup may not be able to anticipate
trends and react to changes in consumer
tastes.

• Strategicrisk• Financial
risk

Value creation

Risks relating
to the healthand safety of
products

The products of the Prada Group
must meet rigorous health andsafety standards and comply with therelevant regulations in force in all thecountries in which Prada operates.
The use by some suppliers of hazardous
chemicals in their manufacturing
processes could represent a healthand safety risk for consumers, andof non-compliance with regulatory
standards for the Group.

• Compliancerisk

Product
responsibility

Misalignment
with
consumer
expectations

Difficulty in identifying, understanding
and responding to changing consumer
expectations regarding services and sales
channels.

• Strategicrisk• Financial
risk

Value creation

Customerexperience

BUSINESS AND ETHICS

Diversityand inclusion
advisory council

2021

Risk
Name

SUSTAINABLE DEVELOPMENT

Material
Topic

PEOPLE

CATEGORYESG Risk Assessment

53indexMaterial
Topic

Risk
Name

Description

Typeof Risk

References
Risk Mitigation
Actions

Businessstrategy
andeconomic
performance

External
macroeconomicrisks

The performance of the luxury goods
market is influenced by the propensityof individuals to consume, and by thegeneral economy. An unfavorable
economy, or regulatory, social andpolitical changes in one or more of themain countries in which the Prada Group
operates, or globally, could have negative
economic consequences.

• Strategicrisk• Financial
risk

Value creation

Integrity,transparency
andcooperation

Noncompliancewith laws andregulations
relating tosocioeconomic,
corruption
or tax issues

The risk associated with unethicalconduct of the business and not being incompliance with the various regulations
applicable to the Prada Group could
represent a significant reputational risk
for the Group as well as expose it topotential financial penalties.

• Compliance
risk

Risk
management

Risks
related tocybersecurity

Difficulty in protecting sensitive
corporate data or consumer personal
data in the event of cyber-attacks andrisks of non-compliance with European
privacy regulations (GDPR).

• Strategicrisk• Compliancerisk• Operationalrisk

Code of ethics

2021

Tax strategy
and compliance

In recent years, stakeholders’ expectations in termsof environmental, social and governance sustainability,
as well as the evolution of national and international
legislation, have given a strong boost to thenon-financial performance of the Prada Group.
At the same time, given the complexity of theenvironment in which the Group operates, a carefulassessment of ESG risks is essential, not only

Product
responsibility

SUSTAINABLE DEVELOPMENT

BUSINESS AND ETHICS

CATEGORYESG Risk Assessment

to ensure stable long-term growth, but also thesafeguarding of corporate reputation.
For this reason, the Prada Group is committed toincorporating the evaluation of these risks into its
business strategy, an essential activity closely related
to the increase in the level of transparency andaccountability that stakeholders require.

54

index— Sustainable Finance
The Prada Group has been the first in the luxury
industry to sign a “Sustainability Linked Loans”, which
are financial facilities with a mechanism that, upon theachievement of quantitative targets in the sustainability
field, allows a reduction in the interest rate.
The Prada Group signed two loans of this type in
2021, the most recent was signed with Banca Intesa
Sanpaolo in July, which was anticipated by the one
with UniCredit signed in February.
Both facilities are linked to the following KPIs:
the regeneration and reconversion of productionwaste;
the increasing of the share of self-produced
energy.

Group's climate strategy, the investment plan for theconstruction of photovoltaic systems in its industrial
and corporate sites continues in order to ensure an
increasing production of KWh/year in the period2021-2025. A significant part of these interventions
will be concentrated on the production and logistics
sites in Tuscany (Italy), with the aim of making
the complex of buildings in this territory nearly
self-sufficient from an energy point of view.
These two facilities follow a first loan with Crédit
Agricole Group in 2019, and a second loan,
in January 2020, with the Japanese Bank Mizuho.
These first facilities were linked to the achievementof similar objectives relating to the following:
the number of stores assigned of a LEED Goldor Platinum Certification;

the use of Prada Re-Nylon (regenerated nylon)
for the production of goods.
All operations fit perfectly into a much wider
framework of sustainability integration into thecorporate strategy. For all loans, the achievementof the objectives is subject to an annual review by
independent third-party.

SUSTAINABLE DEVELOPMENT

Regarding the first target, the Prada Group’s recent
investments in the industrial sector, especially in themost delicate phases of the production process, have
led to reducing production waste in clothing, leather
goods and footwear, while effectively managing its
collection and disposal. The Group is now committed
to transferring these waste materials to third parties fortheir introduction into other production cycles.
For what concerns the energy field, in line with the2021

the amount of training hours for the employees;— “Sustainability, as a value, is now
universally recognized and shared, also
by the financial industry. For us and for allcompanies, this results in an important stimulus
to achieve increasingly ambitious goals
towards a sustainable economy.
We are proud to be among the first players
in the luxury sector to have embarked
on this path and to be considered a reference
counterpart in the field today.”Alessandra Cozzani
Chief Financial Officer of Prada S.p.A.
56

index3 — RESPONSIBLE MANAGEMENT
Highlights 2021

Strong vertical integrated
business model

23

Industrial facilities

Strict controlof the value chain

81%of the Group's industrial suppliers are located in Italy

55%

of the Group's industrial suppliers have been working
with the Group for more than 10 yearsindex— “In the past years, starting fromthe idea of Mr. Bertelli, our industrial
operations have been stronger
and stronger. We are convinced we are
the best in what we do, therefore
we are constantly investing in our assets
and our people – our maestros in
our factories.”
Massimo Vian
Prada Group's Industrial Director— Industrial Strategy
The Prada Group’s competitive advantage also derives
from its distinctive manufacturing tradition, developed
through the buildup of its production premises, theprogressive expansion of its manufacturing skills andenhanced control over its supplier network.
In recent years, thanks to investments of morethan Euro 80 million since 2019, the Prada Group’s
industrial strategy has focused on strong vertical
integration of the supply chain, progressive insourcingof sensitive phases of the production process and theacquisition of key capabilities.
The havoc wreaked by the public health emergency
have effectively highlighted the benefits of the
manufacturing choices made, since competition
hinges more and more on the speed of reaction to2021

search to meet its stakeholders’ expectations,pursuing long-term economic development.
The Prada Group’s commitment also extends tothe creation, development and strengthening of
the cooperative ties with the communities where it
does business, in terms of social and environmental
sustainability, as they are deemed necessary forinclusive long-term growth.

RESPONSIBLE MANAGEMENTOver the years it has become increasingly evident how
the integration of sustainability into the business andan open and transparent dialogue with stakeholders
were fundamental. The Prada Group is aware thatsustainability is a way of thinking and operating, anddefines its strategies and operational processes towithstand over time; in increasingly complex and
uncertain social and market contexts, Prada faces
challenges and seizes opportunities in the constant

rapid market changes and on the business model’sability to adapt.
The Prada Group has always used an extensive
network of carefully selected external suppliers, withwhich it works in the long run, to ensure flexibility andaccess to additional resources. At the same time, theGroup relies on a high degree of autonomy, which isvital for sudden business slowdowns, as proved to be
the case during the initial phases of the pandemic.
In fact, the Prada Group has created all its prototypes
internally for many years, thanks to investments in the
expansion of its facilities and an important hiring plan,and in the past few years it has gradually insourced
its leather cutting phases followed by the handbag
and footwear assembly processes. Controls over raw
materials and finished products are also handledinternally now.

58

indexInternal Production (%)
Internal Activities

2015

2021

TargetSamples
Production

Leather Goods
Cutting2021

Total Internal Assembly:
Bags + Shoes3

RESPONSIBLE MANAGEMENT

Quality Control on
Finished ProductVertical integration and internalization effectively
ensure more control over value creation, an extremely
important aspect even from a sustainability point ofview, not just for the processes but especially in termsof responsible supply chain management.
Thanks to the acceleration recorded in recent years
in the selection process of the industrial supply chain,
the Group works with the best suppliers, in their own

right leaders and reference points in their sectors. In
most cases, these are long-term relationships, initiatedand maintained following a rigorous selection process,whose strict parameters are intended to ensure
the highest standards of technical and economical,
as well as ethical reliability. The Prada Group has
always valued long-term relationships built on steadyinteractions, which are also crucial for mutual growth.

3 - RTW and Leather Goods Accessories not included.

59indexRaw Material
Supply Chain Localization

5%
Europe11%

Rest of the world

84%

Semi-manufacturing
Supply Chain Localiation

remaining 11% in other non-EU countries. In manycases they are long-established partners: slightly over
61% of them have been working with the Group for
more than 10 years, and around 18% for a period oftime between 5 to 10 years.

7%
Europe7%

Rest of the world

RESPONSIBLE MANAGEMENT

The international success of the Prada Group is deeply
rooted in Italy, starting right from its supply chain.
In 2021, the Group purchased raw materials fromabout 470 suppliers 4, 84% of them located in Italy,
around 5% in other European Union countries and the

2021

Italy

86%
Italy

4 - For the purposes of this analysis, only raw materials

suppliers with which purchases of more than Euro 30
thousand were conducted in 2021 have been considered.

60

— Supply Chain
Responsible
Management
As already anticipated, for the Prada Group, theselection of its suppliers is fundamental not only forreaching the highest standards of product excellence,but also for creating long-term value. In fact, througha collaborative and transparent approach, the Group
has always worked with its suppliers to implement
work, health, safety and environmental standards
in the workplace and, therefore, to transmit its highethical standards.
This collaboration favors long-term relationships andis based on regular dealings, in order to share mutual
growth and a common strategic objective, reducing
the risk of non-compliance with the Group’s Code of
Ethics and the current regulations.
Another fundamental factor is the proximity of the
supply chain to the Prada Group; the vicinity enables
Prada to perform a constant monitoring activity,

even daily for the main suppliers, for the purposeof control and risk management.
The location of the supply chain in Italy is also
important for the working conditions of theemployees, as they are governed by the collective
bargaining agreements currently in force. The
Italian Collective Bargaining Agreement (CCNL)
supplements the law and is stipulated at a national
level between trade unions and associations
representing companies. The CCNL regulates therights, guarantees and obligations of all workers
in terms of pay and regulatory provisions, such as
guaranteed minimum wages, working hours, vacation
time, seniority treatment, treatment of overtime,
holiday and night-time work (with the related pay
increases), the duration of the trial period and notice
period, sick leave, maternity leave, accident leave andthe disciplinary code. The CCNL is negotiated andrenewed every three years, thus allowing for wage
and regulatory adjustments in line with economic andlegislative changes in Italy.
In the past few years, Prada has directed efforts
toward raising awareness in the purchasing structuresof more responsible management of the industrial
supply chain. To this end, in early 2017 the Group
adopted a “Qualified Vendor List” procedure todefine the responsibilities and operational criteria
required to evaluate the ethical, technical andeconomical reliability of its suppliers. The list ispart of the controls needed to initiate and continue
with the supply relationship, as set out in the
procurement policy, which calls for mitigating risks
of non-compliance through additional checks andaccountability.
With respect to ethical issues, the accreditationand maintenance of a supplier’s qualification are
confirmed through requested documents, attestations
and self-certifications that ensure compliance withthe laws on remuneration, social security, taxes,
occupational health and safety, the environment,
privacy and the governance model. Finally, the Codeof Ethics must be signed in order to work with Prada.
This information asset undergoes systematic first-leveland second-level controls, including interim ones,
to ensure that the information is updated, true andconsistent. Such controls, which involve documents

RESPONSIBLE MANAGEMENT

Also for outsourcing, the Prada Group stands out
for its strong ties with the typically Italian artisanal
tradition; in fact, in 2021, the Group worked withapproximately 370 manufacturing suppliers5. Around
86% of these manufacturing suppliers are located in
Italy, around 7% in the rest of the European Union andthe remaining 7% in non-EU countries. Around 47% of
the manufacturing suppliers have been collaboratingwith the Group for more than 10 years and around
24% for a period of time between 5 to 10 years. These
are relationships built on mutual trust, characterized
by working together on a daily basis with a view
toward constant improvement and learning.
On the whole, approximately 81% of the Group’s
industrial suppliers are located in Italy and about 55%of them have been working with the Prada Group for
more than 10 years; from the beginning a strategic
choice for Prada, which has always considered acompetitive leverage to root its supply chain in thoseterritories where the manufacturing sector represents
an excellence appreciated all over the world.

2021

index

5 - For the purposes of this analysis, only manufacturing

suppliers with which purchases of more than Euro 30
thousand were conducted in 2021 have been considered.

61

RESPONSIBLE MANAGEMENT

2021

index

— For the Prada Group, the selectionof its suppliers is fundamental not only
for reaching the highest standardsof product excellence, but also for
creating long-term value.
62

Although the Prada Group considers the risk of
non-compliance throughout its direct supply chain
to be low, thanks to its geographical location and theduration and quality of the relationships established,
it is aware that first-tier suppliers use subcontracting,and of the reputational and legal risks associated with
that, including in terms of human rights infringement.
For this reason, in 2019 the Group set up internallya task force dedicated to tighten the controls overthe supply chain and respond to the growing demand
for transparency and accountability in the sourcing
and production practices. The Group formalized
then in 2020 the inspecting activity with a dedicatedprocedure.
The work team consists of representatives of theadministrative, occupational safety, compliance andhuman resource functions and assists production
division managers with controls at supplier and/or sub-supplier premises, reviewing documents
and checking the observance of the Group’s ethicalprinciples and proper application of labour, tax,
occupational safety and environmental regulations.
The inspection plan includes a risk assessment,
conducted in the first phase by the various managers,
also according to the composition of the industrial
supply chain in terms of supply and subcontracting,and any critical issues detected by them or by thefunctions responsible for the second-level controls
during the periodic inspections required by the
Qualified Vendor List procedure.
The analysis performed during the inspections,which follow a six-month schedule, completes othercontrols carried out in previous phases and thoseforeseen by the Qualified Vendor List procedure, thus
strengthening the control over the industrial supply
chain, ensuring compliance with the Code of Ethics
and current regulations.
The results of the inspections are reported to thevarious managers so that a corrective action plan

(Remediation Plan) can be drawn up in the event ofbreaches or partial breaches of the criteria standards,
and corrective actions are identified that the suppliermust implement over a period of time that varies
according to the irregularity found. In the event ofserious breach, or the supplier’s inability to ensure a
positive outcome in the prescribed time, terminationof the supply relationship is evaluated.
Since 2019, with the aim of bringing the monitoringand management of the supply chain to the Group’slevels of excellence, the task force operates in Italy,
where the most important portion of the industrial
supply chain is rooted, focusing on both first andsecond tier suppliers for all three industrial divisions:leather goods, footwear and clothing.
Both in 2020 and in 2021, the control activities
were slowed down due to the health emergency but,
as soon as the working conditions allowed it, they
continued to cover the largest number of suppliers. In
the three-year period 2019-2021, 175 suppliers wereinvolved and 30 supply relationships were interrupted
due to serious irregularities with respect to the ethicalstandards of the Prada Group.
Generally, the inspections effectively confirmed
what the managers of the production divisions had
already perceived; most issues are found at the subcontracting level, with the Leather Goods Divisionexperiencing more than others. The controls overfirst-tier suppliers are more encouraging, as they
confirmed the effectiveness of the Prada Group’s
streamlining decisions of recent years.
The breaches found in the sub-contracting
relationships regarded primarily social security andtax aspects, the workplace, occupational safety andthe work force employed in terms of contractual
conditions and actual working hours.
During 2022, the control activities on suppliers willcontinue in order to promptly and efficiently monitor
and mitigate the risks associated with the supply chain
management.

RESPONSIBLE MANAGEMENT

and are performed by the procurement structures
or business areas specialized in the various topics,
are also conducted upon notification of potential
situations of crisis, breaches or anomalies; in thesecircumstances, the procedure involves additional
analysis, targeted controls or an immediate encounter
with the parties involved.
The procedure, initially applied to suppliers in the
manufacturing area, has now been implemented withthe engineering and logistics suppliers and is gradually
being extended to the other business areas.

2021

index

Finally, since 2016, the Prada Group has published astatement describing the measures taken to ensure
the absence of any form of modern slavery, forced
labour and human trafficking within its organization
and along its supply chain, as required by UKlegislation “Modern Slavery Act 2015”.

63

The Prada Group is actively committed to protecting
its intangible assets. With a specialized internal
department dedicated to Intellectual Property (IP),the Group registers its trademarks, designs, patents
and domain names with the competent authorities
and adopts preventative and defensive measures
worldwide to protect its IP rights on all on-line andoff-line channels.
The Prada Group regularly monitors registrations
by third parties and any possible misappropriationof trademarks, designs and domain names identicalto or that could be confused with its own distinctive
marks and products. Any violation is tackled throughappropriate action with the competent authorities.
The Group cooperates on a daily basis with the Italianand international customs agencies to assist theblocking of market entries of unauthentic products,
and with the police and tax authorities in order tohave counterfeit products existing in the market
confiscated, distribution and production processes
rebuilt and the individuals and organizations
responsible brought to justice. In pursuing suchobjectives, the Group shares relevant information

with the authorities and participates in training eventson the Company’s brands and products, so that theauthorities may have everything at their disposal
to effectively fight counterfeiting and the criminalorganizations responsible for it.
It also cooperates with major associations, such as
INDICAM, the Italian Association for the Protection ofIntellectual Property, the Union des Fabriquants, andthe Quality Brands Protection Committee (QBPC), tobring such issues to the attention of the institutions,the public and consumers. The Prada Group monitors
the evolution of intellectual property rights legislation
and actively takes parts to the consultations addressed
to trademark owners in relation to the creation of newlegal tools aimed at challenging illegal counterfeiting
activities.
The Group keeps monitoring the regulatory progressof the Digital Services Act, deeming of primary
importance that the European Union recognize agreater responsibility for digital platforms and online
operators, with the aim to guaranty a more secureenvironment to companies and users.
More accurate surveillance has been implemented
on the Internet to counter the promotion and sale ofcounterfeit goods on websites, E-commerce platforms
and social networks. In recent years, the Prada Grouphas contributed to important international operations
coordinated by the “Guardia di Finanza”, Interpol andEuropol, sharing information on hundreds of websites
and thousands of social media accounts helpful inthe identification of criminal networks and removalof infringing listings that illegally advertise the sale ofcounterfeit products.
Thanks to a close collaboration with the authorities,
the fight against counterfeiting undertaken by
the Prada Group led to, in 2021 alone on a global
level, the seizure of more than 482,000 counterfeit
products in off-line markets, the deletion of 220,870
unauthorized advertisements, the deactivation of
more than 3,200 websites with illegal content, and theremoval of more than 100,000 social media posts.

RESPONSIBLE MANAGEMENT— Trademark Protection

2021

index

65

RESPONSIBLE MANAGEMENT

2021

index

66

indexWithin the scope of these control and guidance
activities, since 2014 the Prada Group has drawn
up and updated a Restricted Substances List (RSL),the procedure that sets limits on the presence ofchemicals in its products. In 2016, Prada took theadditional step of aligning its RSL limits with themore stringent, proactive approach outlined in the“Guidelines on eco-toxicological requirements for
clothing, leather goods, footwear and accessories”
endorsed by the “Camera Nazionale della Moda
Italiana” (CNMI). These limits are the most virtuous
in international practice and aim to ensure higher
chemical safety standards than those prescribedby the strictest national and international laws. The
Prada Group's suppliers of raw materials, packaging
and manufacturing services have all received theGroup's RSL and progressively accepted and signed

Extending the reach of the RSL is important for
improving the sustainability of the Group's production
cycle, as is Prada's ongoing commitment to CNMI
programs on chemicals, for which in-depth studies
have been initiated on the application of the guidelines
to manufacturing processes, and on other matters.
The collaboration with CNMI continued in 2021
with multiple meetings aimed at the finalization andpublication of the guidelines “Good Manufacturing
Practices - Guidelines on the use of chemicals in
the fashion manufacturing supply chain”, an activity
started in 2020 by the Chemicals Commission of which
Prada is actively part. The document, sponsored by
the Ministry of Ecological Transformation, adds tothe indications already disclosed in previous years
on the use of chemicals substances in products andproduction processes.
To ensure that the RSL is being followed, in addition torequiring certification and testing from every supplier,the Prada Group monitors observance of the guidelines
and the supplier certifications through an additional
internal control process by conducting spot checks on
all sourced materials through accredited laboratories.
During 2021 no cases of non-compliance with healthand safety regulations were recorded, as none in2020. At the same time, no cases of non-compliancewith information and/or labeling requirements werereported both in 2021 and 2020.

2021

Product quality and customer health and safety
are central to the Prada Group’s manufacturing
processes. The products must meet uniform quality
standards and satisfy all current regulations in morethan 70 countries where they are sold.
To achieve these goals, the Group employs
technicians with at least ten years’ experience, who
run strict quality controls on every material usedin the production process, from sourcing to thefinishing touches. They make periodic visits to the
manufacturing sites of raw material suppliers andcontractors to assess their processes, the quality of
their goods and the general workplace conditions.

it: since 2016, when 72% of the purchase volumes
were carried out according to this procedure, by
2021 the “proactive” level of the RSL reached 100%of the purchase volumes relating to Prada’s externalindustrial suppliers, but also 100% of the work carriedout in the Group’s production sites.

RESPONSIBLE MANAGEMENT— Product
Responsibility— During 2021 no casesof non-compliance with healthand safety regulations wererecorded, as none in 2020.

67index4 — FOR PLANET
Highlights 2021

53%

of the energy purchased
at global scale is renewable

13

owned Photovoltaic
plants3

LEED
certifications for Building
Design & Construction

57

LEED
Interior Design& Construction

81

LEED
Operations& Maintenance89%

certified or recycled paper
for packaging

68indexThe Group is aware of the fashion industry's impact
on climate change, and as a luxury Fashion Company
wants to set the path to decarbonization in a way thatwill inspire the entire sector.
Since 2014, Prada has been constantly investing inenergy efficiency projects and initiatives, aimed at
reducing its energy consumption and Greenhouse Gases(GHG) emissions, positively contributing to the global
goal of fighting climate change. In particular, numerous
projects have been implemented to a different extent
within industrial sites, corporate headquarters, and retailspaces. Among the most relevant:Relamping project: since 2014, the Group has
been pursuing an important project to replace
store lighting systems with LED technology
leading to the full conversion in all the storeslighting already in 2018. The direct andindirect energy savings obtained are significant
compared with the previous technologies used(fluorescent and halogen lamps); moreover, thisalso led to less waste disposal considering that
LED lamps life-cycle is longer than traditional
lamps.

LEED: starting from 2016, Prada began the
LEED (Leadership in Energy and Environmental
Design) certification process for some of
its assets, with the aim to increase energy
efficiency.
Green electricity: in 2017, the Prada Groupsigned a partnership and began to purchaseelectricity supplied by renewables sources with
Guarantees of Origin (GoO), both in the Italian
territory and on a global scale.
Energy box project: starting from 2017, Prada
began a multi-year investment plan to optimize
its energy consumption in factories, offices andstores. The project consisted in the installationof multi-meters to constant monitoring andanalyzing consumption information throughaccurate comparisons between periods.

Calculation of GHG Inventory
2019 - Baseline
In order to have a more holistic and strategic
approach to climate change, from 2020 the PradaGroup decided to measure the first inventory of theGroup's greenhouse gas emissions, measuring theemissions directly related to its activities (Scope 1 and
2) and those caused by the upstream and downstream
activities of the value chain (Scope 3), for the year ofreference 2019 (baseline), with the aim to identifying
the areas having the largest climate impact along theentire value chain.

2021— Climate Strategy

Photovoltaic systems: starting from 2015,
Prada began installing photovoltaic systems
at its production sites, most of which were
installed on industrial sites rooftops in Italy.

FOR PLANETThe Prada Group considers environmental protection
a very important matter, for which it engages inand cultivates virtuous behaviors that contributeto sustainable long-term growth while being an
examples of good practice for the entire industry.
This commitment is emphasized in the Group's
Sustainability Policy and represents a pillar of the
Prada Group’s sustainability strategy, whose main
objectives are related to the mitigation of Prada
impact on climate change6, the preservation of theecosystems and the promotion of circular thinking.

6 - As defined by the United Nations, climate change refers tolong-term change in weather patterns as a result of the increases
in the Earth’s temperature. Since the 1800s, with the advent ofindustrialization, human activities have been the main driver of the
Earth’s temperature increase, mainly due to the burning of fossil
fuels (such as coal, oil and gas), which generate greenhouse gas(GHG) emissions.

69

indexGHG Inventory Prada Group2019(t CO2e)

Scope 1

8,353

38,773Market-based

19,506

Scope 3418,748

3.1 Purchased goods and services

296,715

3.3 Fuel related activities

4,665

3.4 Upstream transportation and distribution7

75,096

3.5 Waste generated in operations

2,316

3.6 Business travels

4,722

3.7 Employee commuting8

20,631

3.8 Upstream leased assets

14,602

Total GHG emissions with location-based method

493,734

Total GHG emissions with market-based method

446,6072%
Scope 1

FOR PLANET

Location-based2021

Scope 2

4%

Scope 2Market-based

94%
Scope 3

7 - Activity refers to inbound and outbound logistics (when costs arepaid by the organization). For this item the data have been estimatedfor a 38%.
8 - For this item the data have been estimated for a 30%.

70

indexAfter a careful analysis of all the possible actions that
Prada could implement to reduce its greenhouse gas
emissions, in September 2021, the Group officiallyset GHG emissions reduction targets validated by the
Science-Based Target initiative (SBTi)11. Targets set
by Prada related to Scope 1, 2 and 3 are consistent
with a maximum increase of 1.5°C in the Earth’s
temperature compared to pre-industrial values.
Moreover, the Group increased its ambition bycommitting to reaching Net-Zero within 2050.
GHG reduction targets were officially announced in
November 2021 during the Capital Markets Day. On
this occasion, the Group disclosed the two following
targets:

Reduce absolute Scope 3 Greenhouse Gas
emissions by 42%, by 2029 from a 2019 baseyear.

For the Prada Group the completion of the GHG
inventory was the first useful step for measuring its
impact on greenhouse gas emissions and identifying
areas for improvement.

In addition, during the Capital Markets Day, theGroup announced its commitment to offset its Scope
1 and 2 emissions from 2022 onwards, becoming
Carbon Neutral13 for what concerns GHG emissions
associated with its own operations. It is importantto underline that the Prada Group sees offsetting
as a plus, but this initiative does not discharge thecompany from reducing its CO2 emissions.
The table below showcases the milestones of the
Prada Group's climate strategy and the action planthat it started to implement related to Scope 1 and 2
emissions categories.

9 - In the Scope 2 calculation are considered the emissions related
to stores for which the Prada Group has control on utility bills, while
the emissions related to the other directly operated stores for which
the Prada Group does not have control on utility bills are accounted
in Scope 3 (category 8: upstream leased assets).
10 - Compared to the values represented in the Social Responsibility
Report 2020, the 2019 baseline data have been updated, also as aresult of a better classification of the emission categories.
11 - The SBTi was established between CDP, the UN Global
Compact, the World Resources Institute and the World Wide
Fund for Nature (WWF) in order to support companies in setting

GHG emissions reduction targets consistent with the latest climate
science.
12 - The 2019 base year takes into consideration Scope 2 calculatedwith the market-based approach.
13 - Carbon neutrality is obtained by balancing carbon emissions
with offsetting, that means purchase carbon credits generated byprojects with a positive impact to reduce or neutralize the impact
generated by an organization own activities. In particular, eachcredits, certified according to the most important and recognizedinternational standards, certifies the reduction or removal of one
tonne of CO2e.

GHG Emissions Reduction Targets
and Roadmap

2021

Reduce absolute Scope 1 and Scope 2
Greenhouse Gas emissions by 29.4%, by 2026
from a 2019 base year12;

FOR PLANET

Scope 1 emissions are related to the consumptionof natural gas, used mainly for operations at
production facilities, to the company fleet and to
fugitive emissions related to the leaks of refrigerant
gases used for air conditioning. Scope 2 emissions
are related to the purchase of electricity for
manufacturing sites, logistics centers, offices andstores9 throughout the world.
Finally, for Scope 3 emissions, the main sources are
related to the indirect emissions deriving from thepurchase of goods and services (71%), followed by theemissions related to inbound and outbound logistics(18%) and employee commuting (5%).
The data presented in this Report are consistent
with the data submitted in the CDP Climate Change
questionnaire, to which the Prada Group reported forthe first time in 2021, obtaining a B- score, with theambition to be increasingly transparent in reportingon its impacts and in the management of issues
related to climate change10.
It should be considered that the baseline may change inthe course of the next few years due to the updating ofsome emission factors with particular reference to theones used for calculating raw materials related emissions.
For further details related to the calculation of the
GHG inventory see chapter 7, paragraph “GHG
Calculation methodology and emission factors”.

71indexPrada Group’s Climate strategy

2019

2021

2022

2026

2029

Baseline

Science-Based
Targets (SBTs)
approved

Carbon neutral
Scope 1 and 2
to begin

Reach SBTs
- 29%
Scope 1 and 2

Reach SBTs
- 42% Scope 3

2050

SBTs -29% GHG emissions Scope 1 and 2
C

SBTs -42% GHG emissions Scope 3

FOR PLANETRoad to Net-zero

Electrification of industrial sites heating systems
One of the main drivers for achieving the European
Green Deal's zero-emission target is the electrificationof consumption, which, combined with the integrationof renewable energies into national energy mixes, would
make it possible to reduce emissions considerably.

3 SITES

6 SITES

2021

Supply chain engagement to identify reduction initiatives

2019

2021

FutureAlready in 2019, three industrialsites were not using natural gas
for heating. In particular the
production plant in Scandicci andthe warehouse in Montegranaro areprovided with a full electric systems
for heating, while the production
plant in Piancastagnaio is equippedwith a geothermal system.

By 2021, two more interventions
were carried out in the production
plant located in Arezzo and in thewarehouse of Levanella converting
the heating system to electric,leaving natural gas only asa back-up. Moreover, the
new logistics hub is equippedwith a geothermal system.

Prada continually explores
opportunities for electrification
on its existing assets, where
technically feasible, and considers
electrification of consumptiona priority at newly built
industrial sites.

72

index

By the end of 2021, 24% of the whole Group car fleet
was made of green vehicles, a significant increase
from the 2% share in 2019. At the same time, Pradacontinues to invest in the infrastructures aimed
at enabling electric mobility by installing charging
stations at its Headquarters.

Green company car fleet
During 2021, the Prada Group continues
the progressive replacement of gasoline anddiesel-powered vehicles14 with hybrid and electric
ones. The number of green vehicles in the company
car fleet increased from 9 in 2019 to 131 in 2021.

% of green car of the company fleet
24%

6%

2020

The target of the Group is to have 60% of the whole
fleet green by 2022.
LEED Gold or Platinum certified stores
Every time a new store is built, or an existing one
is renovated, the goal for the Group is to make thebuilding highly energy-efficient, by getting the LEED
(Leadership in Energy and Environmental Design)certification.

2021

FOR PLANET

2019

2021

2%

At December 31, 2021, the Prada Group counts:
3 LEED certified Building Design andConstruction (the Scandicci plant, the Logistic
Hub in Levanella and the Arezzo plant);
57 LEED v4. Interior Design and Construction
certified stores;
81 LEED v4.1 Operations and Maintenance(O+M) certified stores.
The ongoing commitment to this issue allows theGroup to be the one with the highest number of LEED
certifications in the high-end luxury sector.

14 - As green vehicles are considered BEV (Battery Electric Vehicle),
PHEV (Plug-in Hybrid Electric Vehicle), HEV (Hybrid Electric
Vehicle), MEV (Micro-Electric Vehicle).

74

indexElectricity from owned photovoltaic systems
At December 31, 2021, the Prada Group counts
13 photovoltaic systems installed mainly at its
production sites. During 2021, Prada installed two
new photovoltaic systems: one on its New York
headquarters and one over the production plant of
Piancastagnaio. Overall, in 2021, the Group was able
to produce 3,585,104 kWh, out of which 2,534,187
kWh were consumed internally, 26% more if
compared to 2019 (2,014,207 kWh). The photovoltaic
plants installed at global level allowed to cover
2.7% of the entire Group electricity need, while thephotovoltaic plants installed in industrial sites allowed
to cover 9% of the entire industrial electricity need.

FOR PLANETElectricity from renewable source
In 2017, the Prada Group signed a partnership andbegan to purchase electricity supplied by renewablesources with Guarantees of Origin (GoO), both in Italy
and worldwide. More in detail, the Group purchased
certified renewable electricity in Italy, USA, United
Kingdom, France, Spain, Austria, the Netherlands
and Switzerland. In 2021, 54% of the total electricity
purchased came from certified renewable sources
covered by GoOs, allowing to avoid over 20,000
tons of CO215. Prada is fully committed to increasing
this share in the coming years, focusing in strategic
countries such as China and Japan.

2021— At December 31, 2021,
the Prada Group owned
13 photovoltaic systems,
which covered 9% of the entire
industrial electricity need.

15 - The emissions avoided were calculatedusing the Market-based calculation method.

75

indexMWh of electricity consumed from photovoltaic plants
2,534

2019

2020

The target of the Group is to double the self-produced
energy from owned photovoltaic systems by 2026
from the 2019 base year.

2021 Energy Consumption
and Scope 1 and 2 Emissions
Energy consumption under the direct control of the
Prada Group is related to electricity consumption(78% of the total), natural gas consumption (12%)
and the Group's corporate fleet (10%). Compared to2019, the Group's direct energy consumption was
3% lower, mainly thanks to the decrease in naturalgas (-7%) and fuel relating to the company's car fleet(-15%) consumption. In particular, the contraction in2021

fuel consumption was related to less traveling due tothe health emergency.The GHG emissions associatedwith the consumption of gas, fuel and refrigeration
gas refills (Scope 1) amounted to 7,744 tons of CO2e,
recording a decrease of 7% compared to 2019. In
the last quarter of 2021, the Prada Group signed acontract with its gas supplier for the offsetting ofgreenhouse gas emissions linked to the consumptionof natural gas from its production sites, throughthe purchase of certified carbon credits from the
supplier, and which led to the offsetting of 747 tonsof CO2e. Scope 2 emissions relating to the purchaseof electricity decreased by 12% compared to 2019considering the location-based method, and increased
by 6% considering the market-based method.

Energy consumption (GJ)

2019

2020

2021

Company fleet

51,11028,58543,445Natural gas

57,11455,94953,369

Electricity

341,379

312,544

340,084

Total energy consumption

449,603

397,079

436,898

2021

2,080

FOR PLANET

2,014

76

2019

2020

2021

Company fleet

3,698

2,042

3,089

Natural gas

3,243

3,164

3,017

F-gas leaks

1,412

1,182

1,639

Total Scope 1

8,353

6,388

7,744

Electricity - location based

38,77333,42934,044

Electricity - market based

19,506

18,251

20,620Total Scope 1 + 2 (location-based)

47,12639,817

41,788

Total Scope 1 + 2 (market based)

27,85924,63928,3642021 Scope 3 Emissions
The Prada Group has calculated its indirect greenhousegas emissions (Scope 3) also for the reporting year
2021. The calculation of the Group’s carbon footprint
will be carried out annually in order to monitor progressagainst reduction targets - validated by the ScienceBased Target initiative, and ultimately to be moretransparent towards stakeholders.
As in 2019, the main sources of Scope 3 emissions
in 2021 are related to the purchase of goods andservices (73%), upstream logistics and distribution(14%) and upstream leased assets (5%). Compared tothe baseline, emissions related to investments havebeen added following the acquisition of a minority

stake in Filati Biagioli Modesto S.p.A.; in particular,
greenhouse gas emissions deriving from the purchaseof electricity and fuel by Filati Biagioli has been
included proportionally. The related emissions’ share(56 CO2e) is very limited because the company is100% supplied by certified renewable electricity.
Scope 3 emissions have reported a significant
contraction (-32%) compared to 2019 (baseline), which
is mainly due to the decrease in category 1 (-30%) andrelated to lower production volumes in general and,in particular, lower purchase of leather in 2021.
The Group is committed to implement concrete actions inthe short and medium term to reduce Scope 3 emissions
through the direct engagement of its supply chain.

Scope 3 emissions (t CO2e)

2021

3.1 Purchased goods and services

206,399

3.3 Fuel related activities

8,440

3.4 Upstream transportation and distribution16

41,206

3.5 Waste generated in operations843

3.6 Business travels

1,045

3.7 Employee commuting17

12,190

3.8 Upstream leased assets

14,025

3.15 Investments
Total Scope 3 emissions

FOR PLANET

Scope 1 and Scope 2 emissions (t CO2e)

2021

index

56
284,204

16 - For this item the data have been estimated for a 36%.
17 - In order to calculate this item, a survey on commuting was sent
to all Prada Group employees.
77indexThe Prada Group is aware of the growing importanceof water-related issues and the impacts that the
fashion industry has on water consumption and waterpollution relating to both raw materials procurement
and the industrial processes referred to raw materials
transformation. As previously reported, water
management has become a material topic following the
updating of the materiality analysis and, therefore, Pradaassessed for the first time the water withdrawals of its
manufacturing plants and warehouses related to 2020
and 2021.
The Group's water consumption is mainly related tosanitary services and irrigation of green areas; theonly production sites where water is used for industrial

Water withdrawals19 (m3)

2020

2021

Groundwater

44,288

212,704

Surface water

10,856

9,136

Municipal water supply

44,191

52,118

Total water withdrawals

99,335273,958

Compared to the reporting year 2020, whose data cover
75% of the total square meters of industrial sites, in
2021, the Prada Group expanded its reporting perimeter,
including the data related to 90% of the square metersof its production facilities, with the aim of reaching 100%for the next reporting period. Considering the same
perimeter of 2020, water withdrawals in 2021 were equal
to 97,684 m3 (decreasing by 1.7%).
Water discharges are of particular importance forindustrial sites that use water in their industrial
processes, such as the above-mentioned factories in

2021

Water Management

processes are its French Tannerie, where leather isprocessed, and the production facility in Torgiano(Italy), where knitwear is processed and therefore
numerous washing cycles are carried out.
The Group is committed to reducing and increasing
the efficiency of water consumption at its industrialsites. For example, at the Torgiano factory a closedcircuit multi-purpose machine was installed to cool the
dry-cleaning machines. Moreover, in both Torgiano
and Valvigna italian production sites, rainwater isrecovered for sanitary or irrigation purpose. Finally,at the new logistic hub, where a geothermal heating
system is used, the exchange water is recovered forsanitary and irrigation purpose.
Overall, as shown in the table below, in 2021, theGroup withdrew18 a quantity of water equal to 273,958
m3, 78% of which came from groundwater (e.g. wells),
19% from third parties (e.g. aqueducts) and 3% fromsuperficial waters (e.g. rivers).

FOR PLANET— Responsible useof Natural Resources

Torgiano (Italy) and France.
In particular, at the Torgiano site there is a wastewater
treatment plant that filters civil and industrial watercoming from the site (amounting to 8,476 m3). At the
French Tannerie, the waste water (amounting to 6,461m3) is treated in a purification plant before being sent
to a municipal wastewater treatment plant, where thesludge is filtered; a monthly analysis of the wastewater
is then carried out by a government laboratory inorder to assess the presence of chromium or otherhazardous substances.

18 - In 2021, according to the online database “Aqueduct” that isaligned with the World Resource Institute (WRI), the 92% of theGroup's industrial withdrawals took place in water-stressed areas,considering that, Tuscany and Marche regions, where most of theGroup's production sites are located, are considered high-water risk
areas.
19 - The data in the table refers to freshwater.

78

The Prada Group feels a sense of responsibility forsourcing and managing raw materials in a manner thattakes into account not just the intrinsic value given by
the quality of the raw materials used, but also their
origin and the manufacturing processes that they
undergo. Indeed, protection of the environment and its
biodiversity is a fundamental element of the Group's
growth strategy and the search for new materials havealways characterized Prada's design.
As fully described in chapter 3, paragraph “Industrial
strategy”, investments made in industrial developmentin the last years have led to insourcing various
production phases, with the purpose of maintaining
quality at the highest levels of excellence while
optimizing the use of raw materials.
The clothing, footwear and leather goods divisions
directly select the suppliers of all raw materials thatare used in the production of finished products,
even those used by their manufacturing suppliers,
coordinating and monitoring in this way the entire
production process. This strong integration ofdesign, product development and direct andoutsourced production - a distinctive element that has
characterized the Prada Group’s industrial strategy

Raw Material

Units

Leather- ensures full control of a crucial phase of the value
chain. Vast majority of the prototypes and samples,
as well as a part of the finished products and the mostdelicate phases of production, such as the controls
over all raw materials and the product accessories(also for suppliers), and the cutting of hides, arerealized at the Group’s own facilities.
The Group scrupulously complies with local andinternational regulations on the procurement,
import, use and export of raw materials, such as theConvention on International Trade in Endangered
Species (CITES).
Already in 2019, in collaboration with the Fur Free
Alliance (FFA), the Prada Group announced theadoption of a fur-free policy for all its brands, thus
allowing the research and development of new, moreinnovative and responsible materials.
The materials Prada uses in the manufacturing
process can be broken down into primary materials- such as leather, fabrics and yarns - and ancillarymaterials or semi-finished products - such as soles,
heels, zippers, buttons, threads, ribbons, buckles,
clasps and name plates.
The most significant information relating to raw
materials purchased from 2019 to 2021 is listed
below, including the related unit of measure.

2019

2020

2021

Feet

29,514,844

11,898,684

17,408,039

Fabrics

Meter

4,141,910

2,911,897

4,039,425

Yarns

Kilo

154,394

109,788

185,055

Shoes’ soles

Pair1,388,294

978,927

1,436,327

In the table above, data shows that in 2020 the pandemic
also had a significant impact on the Prada Group’s
production processes. The suspension of activity andthe closure for five weeks of 21 factories caused a great
effort in the proactive and efficient management of
inventories to align the purchases of raw materials withthe rescheduling of production according to a completely
extraordinary situation. In 2021, the main raw materials
essentially found their pre-pandemic values, except
for leather that recorded a decrease. Overall, in
2021, purchases of the aforementioned raw materials

FOR PLANET

Optimization of Processes
and Consumption of Raw Materials

2021

index

accounted for approximately 83% of the economic valueof all purchases including accessories and semi-finishedproducts.
Moreover, the Fashion Pact coalition includes the useof low-impact raw materials among its main objectives;
this focus is shared by the Group's commercial partners
and is in fact speeding up the cultural and technologicaltransition necessary to satisfy the growing demand formore sustainable alternatives, which will be increasingly
integrated into production processes to encourage
greater circularity of the supply chain.

80index

Leather
The focus on Italian origin is demonstrated
by the procurement data regarding leather for
footwear, bags and accessories. In terms of quantity,
in 2021, 90% of the leather came from Italiantanneries renowned for their quality and long
tradition. Another 6% has been purchased fromsuppliers based in the rest of the European Union,
while the remaining 4% came from outside theEuropean Union.

4%

Leather (qty)

Rest of the world

6%

2021

EuropeFOR PLANET

90%
Italy

Leather is purchased from selected tanneries
following criteria that meet environmental and social
parameters for production. 100% of the leathers
come with a certificate of origin, a data sheet
guaranteeing quality and compliance with standards,
and certification regarding the parameters stated on
the Group’s Restricted Substances List (RSL).
During the Capital Markets Day, which was held on
November 18, the Prada Group communicated an
important target regarding leather procurement,
which will be all Leather Working Group (LWG)
certified by 2023. In 2021, 52% of the tanneries
employed by the Group were already LWG certified.
The Leather Working Group is the number one
globally recognized brand representing responsible
leather sourcing to the industry and to consumers.
Its mission is to improve the impact of the leather
supply chain by becoming the overarching standard
for leather manufacturing, covering all elements andactors in the value chain.

— Responsible Waste
Management
In the last years, the Group conducted a reviewof the processes carried out and waste producedin each manufacturing phase at the factories, andsubsequently set up a system to manage the internal
cycle of waste collection, temporary storage,transport, and disposal. The analysis enabled to
optimize the production cycles, thereby reducing
waste production and increasing the proportion ofwaste recycled. The Prada Group also places greatemphasis on encouraging its staff to use industrial
waste collection methods and standards thatcan ensure waste reuse and recycling or disposal
according to best practices.
The significant Group's industrial investments,
especially those regarding the most delicate phasesof the production processes, have made it possible toreduce the production waste relating to clothing, leather
goods and footwear products and, at the same time, toeffectively manage waste collection and disposal.

81indexof paper and cardboard, packaging materials, textile
and leather waste. Just around 1% of waste produced
is classified as hazardous waste and is managed,transported and delivered to authorized disposers incompliance with current regulations.

As shown in the table below, at December 31, 2021,
the Prada Group produced 2,210 tons of industrial
waste, recording a 41% decrease compared to 2019,
also due to the lower production volumes, in a year
still affected by the health emergency. The waste
generated in the Group’s factories mainly consists

2019

2020

2021

3,724

44%

2,202

56%

2,184

62%

Paper
and cardboard

t

960

100%

683

100%

680

100%

Mixed
packaging

t

343

99%

284

100%

351

100%

Textile andleather waste

t

619

20%

491

25%

489

44%

Sludge

t

1,297

0%

455

0%

403

0%

Organic waste

t

14

0%

14

0%

58

8%

Metal

t

68

100%

24

100%

41

100%

Paint

t

2

0%

2

0%

8

0%

Other

t

421

39%

249

47%

154

33%

Hazardous waste

17

6%

15

41%

26

6%

Mixed
packaging

t

11

8%

11

57%

11

15%

Solvents

t

1

0%

2

0%

5

0%

Paint

t

-

-

1

0%

2

0%

Organic waste

t

-

-

-

-

1

0%

Other

t

5

0%

2

0%

8

0%

Total

t

3,742

44%

2,217

56%

2,210

61%

FOR PLANET

Non-hazardous waste

2021

Waste
Unit of
Waste Waste
Waste Waste
Waste Waste
composition Measure generated diverted generated diverted generated diverted
from
from
from
disposaldisposaldisposal%%%82indexIn 2021, about 61% of the waste generated by theGroup was diverted from disposal, reporting a steadyincrease from both 2020 (+56%) and 2019 (+44%). It
should be noted that the waste diverted from disposal
does not include waste destined to energy recovery(waste-to-energy plant).

— Circular Thinking
The principle of circularity, or circular thinking, ispart of the Prada Group’s sustainability strategy. It
is integrated throughout its value chain, from thegrowing use of recycled and regenerated raw materials
to the proper management of scrap materials that canbe repurposed and reused in alternative value chains.
Circularity can be approached from various angles,
one of which is extending the life of a product. The
Prada Group has always offered care for its products
even after they reach the end consumer. To this end,
the stores provide clear information about proper
product maintenance and supply after-sales and repair
services.
The commitment to enhancing the durability of thematerials is not limited to this aspect; the Group has

been succeeding in implementing a truly circular
strategy through various initiatives.
The Prada Re-Nylon project is perhaps the mostemblematic of the Group’s exercise of circular
thinking: the decision to use for its nylon products
exclusively a material obtained from the recovery
and recycling of items, that otherwise would havebeen destroyed, has facilitated the application of thisconcept to various levels of the process. In this case,circular thinking extends to the proper recuperation of
production scrap, which is reused in the regenerated
nylon production system thanks to close collaboration
with suppliers.
The Upcycled by Miu Miu project is an example ofexperimentation on an existing product, with theproposal to the customer a new perception of vintage.
Circular thinking has also involved other processes of
the Prada world. For example, the Prada Group Re-Set
project has made it possible to set up a real system forrecuperating the materials used in setting up eventsand fashion shows so that they can be reused.
Finally, extensive mapping of the material utilized
for packaging has led to solutions to reduce thequantity of the packaging materials used in industrial
distribution and of the environmental impact throughthe employment of more sustainable options.

83indexAfter a first edition limited to men’s and women’sbags and accessories launched successfully in 2019,in 2020 the use of Re-Nylon was expanded to clothing
and footwear.
In 2021, despite the difficulties caused by the
pandemic and the consequent slowdown of the global
economy, the Prada Group succeeded in totallyconverting from virgin nylon to regenerated nylon andextending the Prada Re-Nylon collection in part to its
partnership with adidas – launched at the beginning of2022 – confirming, once again, Prada’s commitment
to finding lower environmental impact solutions
involving prominent partners.

FOR PLANET

2021

Prada Re-Nylon
Nylon is emblematic of the Prada brand and is adistinctive feature of its approach to contemporary
fashion. The Re-Nylon project, an importantsustainability initiative for the Prada Group, has
emerged from a profound reflection on the growing
concern of today’s society for environmental
protection. The Prada Re-Nylon collection is crafted
entirely from regenerated nylon created through therecycling and purification of plastic collected fromoceans – like fishing nets - and landfills, as well as
textile fiber waste globally. Through a process of depolymerization, purification and transformation of the
new polymers into threads, this material can be madeinto new nylon fabric.

— Achieved full conversion
to Re-Nylon in 2021.

84index

2021

In 2021, the project presents a careful selection of
the iconic vintage 501® jeans and Trucker jackets,
original Made in the USA and dating back to the period
between the 80s and 90s, adapted and customized.
This new collection of classic denim garments
reinterpreted through Miu Miu’s unconventional anddeliberately playful gaze debuted with two dedicatedpop-up stores in London and Shanghai.

FOR PLANET

Upcycled by Miu Miu
Upcycled by Miu Miu, launched in 2020 with the firstexclusive collection of vintage garments recycled andcustomized by Miu Miu - carefully rediscovered andhandpicked in vintage clothes shops and markets
across the world, continues to develop a culture
founded on sustainability by giving new life to vintage
denim items with a special collaboration with Levi’s®.

85

FOR PLANET

2021

index

Prada Group Re-Set
The Prada Group puts circular thinking into
practice not only by selecting and using recycled orregenerated raw materials for its collections; it also
provides for the management and effective reuse of
the materials used to set up events and fashion shows.
It is with this spirit that the new upcycling project Prada Group Re-Set - was created in collaboration
with Spazio Meta in Milan, La Réserve Des Arts in
Paris and global partners chosen by the Group near
events and fashion shows to prevent unnecessarytransportation of materials that find a new life once
duly recovered from these local partners.
The Re-Set project, started up in 2020 with Pradafashion shows and then extended to Miu Miu, offers
to professionals and students raw materials andsemifinished goods that can be reused for different
purposes, whether in education, research or creative
installations. The Prada Faux Fur video, with theartistic supervision of OMA/AMO, released for thelaunch of Re-Set at the beginning of 2022, shows all
the phases of the project and the collaboration withstudents of the Design Academy in Eindhoven andRoyal Academy of Art in Aia, who reinterpreted somematerials originating from the Prada Fall/Winter 2021
fashion show.
Since 2020, the Re-Set project has recuperated
approximately 130 kilos of medium-density
fiberboard, 1.6 tons of faux fur and more than 70 tonsof wood.
This project brings together the various figures of the
Prada Group as the core aspects of its sustainability
strategy converge, such as the integration of circular
thinking and the engagement with the cultural andacademic world, while the Group seeks to apply thisphilosophy to all its events and explore new upcycling
opportunities.

86indexPackaging: Paper and Plastic
In 2021, the Prada Group used 4,691 tons of paper
for packaging worldwide, returning to pre-pandemic
consumption levels. 89% of the total packaging
consumption was represented by paper certified by
the Forest Stewardship Council (FSC) and recycled
paper, confirming the Group’s commitment towards amore sustainable packaging.

Paper consumption for packaging (tons)
5,621

16%

4,691

11%
89%

11%
89%

FOR PLANET

84%

2021

4,583

2019

2020

In the last years, the Group also embarked on a
program within the clothing and leather goods
divisions aimed at converting some packaging
components made from 100% virgin plastic into
recycled or regenerated plastic.

2021

Recycledor certified paper
Other paper

The graph below shows the % of virgin and recycledplastic used in product packaging; in 2021, plastic
with recycled content reached 61% out of a total of
500 tons (49% in 2020).

— Fast transition to moresustainable packaging solutions.
87indexPlastic consumption for packaging (tons)

526

500

55%

39%
356
51%
61%

45%
49%

— Preservationof the Territory
Respect for places is a guiding principle for the PradaGroup. Reducing land take, renovating and upgrading
existing facilities are at the core of the industrial
development of over thirty years of activity. Indeed,
the Prada Group prefers to purchase and renovate
existing buildings and the few newly constructed ones
fit in harmoniously with the local areas, without causing
disruption.
The Prada Group has more than 200,000 m2 of
production facilities and warehouse spaces, locatedalmost entirely in Italy. Among these, 6 are newbuildings and many are cases of renovations ofindustrial buildings and degraded sites that had beenabandoned for many years.
When the Prada Group is unable to restore existingbuildings, it hires masters of architecture such as Guido
Canali, known for his sustainable architecture, toensure results that have a low impact on the territory
and that create a new landscape that fits harmoniouslywith the surrounding area.
Facilities are designed and conceived as workplacesof people and for people, and to respect nature2021

faithfully. Those in Montevarchi and Valvigna, Tuscany,
and in Montegranaro, in the Marche region, were
designed specifically with the environment in mind; thevolumes have a contained visual impact also thanks
to the vegetation and well inserted in the landscape.
This feature makes them fully fledged “garden
factories”. The factories, with their wide, bright spaces
enclosed by hanging gardens, are intended to have a
discreet external image, but also distinctive interiors
experienced by the employees.
Among the projects designed by Guido Canali, thelogistics hub in Levanella (Tuscany) is the focal pointof a major restructuring project regarding outboundlogistics. The hub was designed to be responsibly
integrated into the territory thanks to border plantings,
artificial dunes, roof gardens, glass walls, walkways,
and outdoor relaxation areas.
The green areas occupy more than 50% of the entire
surface of the structure, maintaining intact the vegetation
typical of the Mediterranean scrub to preserve the varietyof local flora and insulate the buildings.
In terms of energy efficiency, the logistics hub is areference point for the Group’s cutting-edge industrial
structure since it was built with a photovoltaic system,
LED lighting, an energy-saving smart home system, anda geothermal plant.

2021

2020

FOR PLANET

2019

Recycled plastic
Virgin plastic

88

— “The main strategy
was to integrate thearchitectural structurewith the territory.
Quality can only comefrom the quality of thework environment.”
Patrizio BertelliindexClimate change

Biodiversity

Oceans

The fight against climate change
will be pursued through thecommitment to a progressive supplyof electricity from renewable sources,
to the search for alternative raw
materials with a lower environmental
impact and to the setting ofemission reduction targets aiming
for carbon neutrality.

The protection of biodiversity
will be guaranteed throughthe commitment to definea strategy for the safeguardof the territory, the promotionof sustainable managementof natural forest andthe support of activities todiscourage deforestation.

The protection of the oceans
will be ensured throughthe commitment to graduallyreplace the plastic usedin packaging with sustainable
alternative materials.

In 2021, the Prada Group’s commitment andcontribution continued and focused on acquiring new
knowledge necessary to progress in the increasingly
ambitious initiatives launched by the Fashion Pact.
Specifically, the Group’s CSR Department took part toall the online meetings with the high profile partners
made available by the Fashion Pact for the benefit of
the signatories for the alignment on specific skills andthe main reference standards.
The Prada Group is making progress on all Fashion
Pact’s pillars and the commitment to the climate,already described in the previous paragraphs, istied with that for biodiversity and the protection

2021

2019 clearly marked a turning point for the fashion
world in climate change and environmental protection
challenges. On the occasion of the G7 meeting in
Biarritz, 32 world leaders of the fashion industry,including the Prada Group, signed the Fashion
Pact. This coalition, which sees luxury, fast-fashion,sportswear companies, suppliers and retailers working
side by side, is born out of the recognition that only
collective action can change the environmentally
harmful impact of the fashion industry. It is an
unprecedented initiative, with peers, competitors,
established brands and newcomers, coming together

to work on the most pressing issues facing our planet.
At the end of 2021, following an increasing numberof adhesions, the coalition reached an exceptional
magnitude bringing together more than 70 fashioncompanies, testifying the power of the collective forthe sustainability of the fashion sector at large.
The Fashion Pact defined concrete targets in three
key areas that are crucial for the preservation of
the planet: the fight against climate change, theconservation of biodiversity and the protection of theoceans. The set of goals, which all the signatories arecommitted to achieving over the next few years, are
not only declarations but also represent a tangible
commitment that will be pursued through action plans
with solid scientific bases.

FOR PLANET— Partnership:
The Fashion Pactof the oceans. The progressive adoption of anincreasingly sustainable packaging, the spread of an
education oriented towards ocean literacy for the newgenerations, and a first initiative to restore marine
ecosystems - with the reforestation of Posidonia
oceanica meadows in the Marine Protected Area
of “Capo Carbonara” (Sardinia) - are all tangible
examples of this strategy.
Posidonia oceanica is a marine plant endemic to theMediterranean Sea, providing an important habitat formarine species and playing a crucial role in absorbing
CO2 to help mitigate climate change.

90index

5 — FOR PEOPLE
Highlights 2021

13,140Workforce

62%
Women

57%

Women among top executives

107

Different nationalities

89%

Permanent contracts

index— The Prada Group iscommitted to operating withfull respect for the valueof the individual and for thehuman and workers’ rights.

The Prada Group is committed to operating with fullrespect for the value of the individual and for thehuman and workers’ rights enshrined in Italian andinternational covenants and declarations, such as
the United Nations Universal Declaration of Human
Rights, the International Labour Organization (ILO)
Declaration on Fundamental Principles and Rights
at Work, and the Organization for Economic Cooperation and Development (OECD) Guidelines forMultinational Enterprises.

At December 31, 2021 the headcount of the Group
stands at 13,140, substantially recovering from thecontraction recorded in 2020, a year upset by the
pandemic. 2021 sees the entry of very importantmanagerial figures who are part of the Group’s
long-term development vision regardless of theuncertainties still underway related to the health andeconomic emergency.
Despite the instability due to the global healthemergency has again affected 2021, the percentage ofpermanent contracts stands at 89% of the workforce
at an international level, confirming the Group’scommitment to stability in employment relationships
and long-term investment in human resources.
The return to favorable business conditions madeit possible to exceed the percentage of permanentcontracts achieved in 2019 (88%), which was the lastyear before the pandemic.

2021— Workforce

FOR PEOPLE

Respect for human rights, for workers and forthe people in general, as well as the promotion ofdiversity, equity and inclusion, are elements thatcharacterize the Prada Group and its way of operating
in a global and constantly evolving context. Thisapproach also extends to people working along theGroup’s supply chain.
Prada has always considered human capital to be
key to its competitive edge and makes every effort
to promote and reward personal and professional
skills, teamwork and improvement. The employees’
enthusiasm, craftsmanship and intellectual curiosity
are the elements that underpin the innovation,
creativity and quality of the Group’s products.

92

indexNumber of Employees

13,9882019

12,85813,140

2020

2021

Employees
per Geographical Area

39%
Italy

7%

20%

Japan

Europe9%America2%

Middle East

23%

Asia PacificindexOutside Italy, where 39% of the workforce is located,the most sizable part of the workforce is in AsiaPacific (23%) followed by the rest of Europe (20%).
In Italy, where 20 of the 23 production facilities arelocated, most employees (63%) work in the industrial
division, while in other countries, where 576 out of
635 Directly Operated Stores are located, 84% of
employees are in retail.

Employess by Gender
62%

62%

38%

38%

2021

38%

62%

2020

2021

FOR PEOPLE

2019

Females
Males

Women permanently represent the majority of
the workforce, counting for 62% of the corporate
population.

Employees per age range< 30

30 - 50

> 50

2019

24%

56%

20%

2020

20%

59%

21%

2021

19%

63%

18%

A breakdown of the workforce by age shows thatat December 31, 2021, 19% of Prada employees
were under 30 years old and 63% were aged 30
to 50. Further analysis shows that 24% of theretail workforce were under 30 years old, whilein the industrial division, where at least ten yearsof experience in production and craftsmanshipis particularly important, 52% of the workforce
belonged to the 30-50 year old range and 38% to theover 50 year old range.

94indexFM< 30

30 - 50

> 50

< 30

30 - 50

> 50

2019

1.4%

5.5%

5.0%

1.8%

4.3%

2.5%

2020

1.4%

5.6%

5.4%

1.7%

4.6%

2.6%

2021

1.1%

5.7%

5.5%

1.3%

4.0%

2.2%

F

M

< 30

30 - 50

> 50

< 30

30 - 50

> 50

2019

13.1%

23.8%

6.5%

7.4%

12.9%

3.5%

2020

10.2%

24.7%

7.1%

5.9%

13.8%

3.5%

2021

10.3%

26.3%

5.0%

5.9%

15.5%

2.6%

Top, Senior and Middle management

F

M

< 30

30 - 50

> 50

< 30

30 - 50

> 50

2019

0.3%

5.4%

1.3%

0.2%

4.0%

1.3%

2020

0.2%

5.9%

1.5%

0.1%

4.3%

1.4%

2021

0.2%

6.7%

1.5%

0.1%

4.7%

1.5%

In the periods under comparison, the breakdown of
employees by age and gender remained quite stable.
Globally, the average age of the Group’s employees at
December 31, 2021 was 39.6 years.
In the Staff and Professionals and Top, Senior andMiddle management categories, within the category
30–50 year old, females accounted for 26.3% (vs.
15.5% of males) and 6.7% (vs. 4.7% of males) of thetotal workforce respectively.

2021

Staff and Professionals

FOR PEOPLE

Operators

Finally, again in the 30-50 year old range, there is
the greatest concentration of fixed-term contracts,
mainly in the retail area. 68% of the total fixed-term
contracts are for women.
Full-time employees represent 97% of the total. In
2021, there were no differences in terms of benefits
granted to employees, between full-time and parttime contracts.

95indexOperators

Staff andProfessionals

Top, Senior andMiddle management

F

M

F

M

F

M

2019

58%

42%

65%

35%

56%

44%

2020

58%

42%

64%

36%

57%

43%

2021

62%

38%

63%

37%

57%

43%

2021

Diversity, an essential element of social
sustainability, is a value for the Prada Group; theenhancement of differences is to be meant as apremise for creating the ground of an inclusive work
environment that allows people to express theirpotential, to be used as a strategic lever for achievingorganizational objectives. Freedom of expressionis the founding factor of a creative industry like
Prada, which must understand and anticipate
social changes, surrounding all generations in thediversity of their aspirations, especially today in an

increasingly integrated and globalized society.
The vast international presence of the Prada Group
reflects a multitude of different cultures, nationalities
and religions. The communities and areas in which it
operates are a constant source of inspiration and growth.
The statistics on employees’ origin prove the various
backgrounds of the workforce. In fact, people with 107
different nationalities (104 in 2020) work for the Group.
The strong female presence is demonstrated by
the ratio between males and females for each job
category: women not only represent the majority ofOperators (62%) and Staff and Professionals (63%),
but they are also the largest component (57%) of Top,
Senior and Middle management.

FOR PEOPLE— Champion Diversity
and Equal Opportunity

Another distinctive characteristic is the prevalenceof females in all divisions.

Industrial

Corporate

Retail

F

M

F

M

F

M

2019

60%

40%

57%

43%

64%

36%

2020

60%

40%

57%

43%

64%

36%

2021

61%

39%

58%

42%

64%

36%

Even at a geographical level females represent morethan half of workers in all areas, with peaks in Japanand the Asia Pacific, where females account for 71%
and 68% of employees respectively.

96index

Employees per gender and geographical area

F

M

Italy

60%

40%

America58%

42%

Europe60%

40%

Asia Pacific

68%

32%

Japan

71%

29%

Middle East

52%

48%

equal treatment by gender, seniority and role, asalso confirmed by the substantial equality in the
remuneration treatment as showed in the table below.

Pay Gap(with the median as 100%)
Operators

Staff andProfessionals

Top, Senior andMiddle management

F

M

F

M

F

M

2019

99%

102%

98%

103%

97%

102%

2020

98%

102%

98%

104%

96%

103%

2021

98%

103%

97%

105%

97%

103%

In 2020, the Prada Group appointed a Chief Diversity,
Equity and Inclusion Officer for Prada North America
responsible for developing policies, strategies andprograms to help ensure diverse representation ofexperiences and perspectives at all levels of thecompany. Her role is to work closely with the Group’s
global leadership to strengthen an inclusive culture
and ensure progress in terms of equal opportunities
within the organization.
During 2021, the Prada Group announced a series of
initiatives aimed at further deepening its commitment
to diversity, equity and inclusion within the Company

FOR PEOPLE

2021

Respect for equal opportunities is also reflected in
the Compensation & Benefit system, based on theenhancement of skills and merit, which ensuresand the fashion industry as a whole. These efforts
reflect Prada’s comprehensive strategy that seeks tocreate a culture of inclusion. Also important to thisstrategy are ongoing diversity, equity and inclusion
leadership trainings.
Furthermore, the Group has launched internshipand mentorship programs and has partnered with
the Fashion Institute of Technology (FIT) to develop
scholarships focused on aspiring fashion industry
professionals and undergraduate students of colourin the United States and Africa. The Prada Group is
working closely with the United Nations Population

98FOR PEOPLE

2021

index

— “Prada Group is taking real and significant
actions that will expand career and professional
opportunities for people of colour in the fashionindustry. We recognize the barriers to entering
the fashion industry and the importanceof representation, so we want to develop many
new programs that will advance and mentor
aspiring fashion professionals, while investingin the next generation of diverse talent.”
Malika Savell
Chief Diversity, Equity & Inclusion Officer
at Prada North America
99index— “We are extremely proud ofthese programs, which reflect PradaGroup’s commitment to cultivating,recruiting and retaining diverse talentand to creating an inclusive culture.
These initiatives mark real progress,
and we look forward to buildingon this momentum to create more
opportunities that increase diversity
and representation both within Pradaand in the fashion industry today
and in the future.”

2021

At the end of 2020, the Prada Group was the first
luxury fashion player to join the Valuable 500, theglobal community dedicated to radically transforming
the business system to make it more inclusive ofpeople with disabilities. Prada strongly recognizes
the intrinsic value of people living with disabilities
and commits to supporting it with its inclusion andsustainability agenda. In 2021, the company exploredvarious options to define a long-term program,which will start in 2022 with the hiring of people withdisabilities at its Italian stores. For this purpose, aspecific training course was organized during the year
not only for the retail staff who will welcome these
new individuals to their team, but also for the Human
Resources Department that will oversee this newactivity, to better manage the recruiting and hiring of
the new employees.

FOR PEOPLE

Fund (UNFPA) to develop an educational fashion
module to promote gender equality in Africa,
launching in Ghana and Kenya.
To elevate more emerging designers of colour, theGroup will collaborate with its Diversity and Inclusion
Advisory Co-Chair, artist, social innovator, andFounder of Rebuild Foundation, Theaster Gates, tocreate a design lab for diverse creatives and artists in
Chicago, New York and Los Angeles.

Lorenzo Bertelli
Prada Group’s Head of Corporate Social Responsibility

100index— Diversity andInclusion Advisory
Council

FOR PEOPLE

2021

As anticipated, the Group firmly believes in the valueof diversity as a source of inspiration for its activities
and, more generally, as a form of cultural heritage,
wellbeing and creativity, which allows to establish
a bond of affinity with a global base of diversified
stakeholders.
For years now, in the United States, the Groupestablished the Diversity and Inclusion Advisory
Council (hereinafter “D&I Council”) in order topromote diversity and inclusion within the company
and in society.
The D&I Council, as a consultative body fully
independent from any form of governance of theGroup, has the mission to support the knowledge andthe development of the company on the social aspectsof sustainability, particularly diversity, equity andinclusion within the fashion industry.
The D&I Council is composed of academics, artists,
activists, representatives of the world of art andculture from world-renowned institutions. The
Council has two Co-Chairs, Theaster Gates andAva DuVernay, and avails itself of the contributionof three other members: Joyce Brown, President of
the Fashion Institute of Technology (FIT), Mariarosa
Cutillo, Humanitarian and Chief of StrategicPartnerships at The United Nations Population Fund
(UNFPA), and Sarah Lewis, Associate Professor ofHistory of Art and Architecture and African American
Studies at Harvard University.
In 2021, the D&I Council regularly collaborated with
Prada Group leadership, including Chief Diversity,
Equity and Inclusion Officer, Malika Savell, to ensure
the definition and launch of the long-term initiatives
plan that the Group then launched during the year andwhich was described in the previous paragraph.

Theaster Gates
Co-ChairAva Duvernay
Co-Chair

Joyce F. Brown

Marıarosa Cutıllo

Sarah Lewıs

101

index

Learning and Development Academy
Employees are trained from the time they join Pradathrough an onboarding process, during which the
managers meet the new staff members and introduce
them to the Prada world and the respective businessareas.
The professional training dedicated to the Group’s
employees focuses on effective management of
the complexities present in the various businessenvironments. Courses are formulated by first— Skills development
is fundamental for
the Prada Group, as
is Prada’s commitment
to the transmissionof skills from one
generation to the next.

2021

Since the beginning of the 2000s, the Prada Grouphas designed learning paths for its employees,
creating over time a true internal Academy structured
with conventional courses, on-the-job training andonline training.
Prada Academy is a physical and digital place whereknowledge, skills, techniques and innovative ideas areshared and developed to foster talent and hand down
the diverse expertise essential for the Group.
In a year characterized by uncertainty due to theglobal trend of the pandemic, Prada Academy has
redesigned its internal managerial and behavioral
training processes in a way that lays the foundations
for a working experience increasingly aligned withthe constantly evolving scenario. At the same time,
an important course of action has been undertaken
to rediscover the corporate values through training
activities aimed at transmitting and consolidating therelated professional skills.
In 2021, the training program concentrated on
developing a new customer approach based onbuilding authenticity and durability in the relationship,
and obtaining in-depth knowledge of the Group’s
brands and products; furthermore, work methods
were modernized through the efficient applicationof digital tools in the different departments. Finally,
the Academy started up a process to highlightsustainability, a topic that has become strategic at alllevels throughout the various business functions.
The different projects, content and learning methods
that make up the Prada Academy are divided into threemacro areas: a general one focusing on the formationand development of skills to best express the potentialof all employees in the company, one dedicated to theindustrial world, and one specialized in the retail world.

FOR PEOPLE— Prada Academy and
Skills Development102indexworldwide to benefit from e-learning content andregister autonomously for courses, has been further
refined through the integration of virtual classrooms
and other platforms. The digital language-training
program is a recent example of this evolution: after apilot project in 2020, it was enriched with access given
to all employees to take numerous languages courses
in a flexible and effective manner.
Industrial Academy
The learning paths for the industrial area are geared
toward the acquisition of production know-how inthe luxury leather goods, footwear and clothing
sectors. The training takes place mostly on the job, indesignated areas of the Group’s factories and at theexcellent technical schools located throughout Italy.
In this case, the main objective of the Academy is toconstantly enhance the technical and craft skills of
the employees, enabling them to become increasingly
expert at their jobs and move freely within theirscope while experimenting with new tasks, in orderto gain a comprehensive overview of the operatingprocesses and thus improve their efficiency. The
courses for the technical staff include training on
the use of cutting-edge software, in which Prada has
increasingly invested over the past few years. During2021, investments were made in 3D training withthe aim of progressively extending the knowledge ofinnovative tools and techniques to various Company
departments.
The Industrial Academy holds dear the safeguardingof fashion expertise, considered a national heritage
to be handed down to the new generations. For thispurpose, the Prada Group creates training courses

2021— During the year,
the Academy worked
toward exploring
more sustainability
topics for the benefitof employees.

FOR PEOPLE

analyzing the demands in order to build the content
according to the specific personal and professional
growth needs, in behavioral, specialized andmanagerial areas.
During the past year, the training focused onstrengthening basic skills to support the disseminationof corporate values, from a person-oriented
approach. In this perspective, a new training program
has been co-designed with the contribution of training
managers from different countries; the content was
targeted to store staff and delivered worldwide to
develop effective communication skills for improving
personal interaction both within the Group and withcustomers. The co-creation of this training content,
carefully structured to meet the needs of eachcountry, has allowed maintaining strong adherence tothe real communication demands of each situation.
The Academy also worked with managers on building
up a feedback culture to support them in their crucialrole of ensuring the well-being of the people in theorganization.
During the year, the Academy worked toward
exploring more sustainability topics for the benefitof employees. In close collaboration with the Prada
North America Diversity, Equity and Inclusion teamand the Group’s CSR Department, in 2021 theAcademy provided two introductory training projects
on diversity and inclusion, and on the environmental
and social issues affecting supply chain management.
After starting out as a pilot project in the UnitedStates, DE&I training involved all the top managementin Italy during the first half of the year, in advance ofa global expansion of the program that will involve,
from 2022 onwards, the entire Group’s population,
regardless of their role.
The first edition of the training dedicated tosustainability along the supply chain, delivered as aworkshop at the end of 2021, focused on the mosturgent social and environmental issues emerging
along the Prada Group’s value chain and in the fashionindustry as a whole. This course will be held in 2022
as well, with the aim of reaching the most employees
possible in the spirit of connecting people while
they learn and debate on current topics essential fornumerous business functions.
In general, the 2021 learning and development
program confirmed the increasing trend of digital
support in the training process, as the programs
are developed online and offline to ensure an
ongoing experience. The Group’s digital training
platform, which since 2017 has allowed all employees

103

Stores Academy
The activities contemplated for store staff include
courses intended to strengthen professional skills,
product and brand knowledge, and customer
orientation and service, assisted by the daily supportof experienced personnel.
The social distancing imposed by the public healthemergency required overhauling the training
modalities, with a strong evolution of the digitalchannel: webinars, online sessions and videos
enabled to reach systematically the entire store staff
worldwide despite the complicated scenario.
In light of ever-changing consumer demographics
and purchasing behaviors, with consumers showing
more interest in knowing the brand purpose and theusual product content, which remains central, in 2021
an important course was introduced for areas moreclosely linked to the brand values, the Storytelling
Project. This ambitious training project has set itself
the goal of increasing the store staff’s knowledge ofthe issues and values relating to the Prada Group andtwo of its brands, Prada and Miu Miu, thus allowing
store staff to expand the conversation topics with thecustomer and enhance their involvement.
The overall training approach was also redefinedwith the production of engaging multi-channel
narratives (E-Learning, gaming apps, workshops). The
harnessing of this recreational approach (gamification)
represented further significant progress in the supplyof store training content: the intuitive and digital
aspects of the game maximized the learning of thecontent, creating and building engagement and asense of belonging to the Group and two of its brands,
Prada and Miu Miu.

FOR PEOPLE

for recent graduates and/or unemployed youths
eager to learn the techniques of the manufacturing
world. These courses, conceived as an introduction to
fashion trades, are a mix of theory and practice.
Studying the production processes is the first stepof intensive practical training: it is undertaken
immediately in tackling the creation of handbags,
accessories, footwear and clothing. Under theguidance of internal instructors and professionals whotransmit their extensive know-how, each process is
included in detail so that the participants can learn
how to work at the highest quality standards. In 2021,
as soon as it was possible to resume on-site training
activities, the Company opened its factories towelcome 37 young people to be trained for careers in
the manufacturing sectors.

2021

index

104

indexTraining Hours
In 2021, 122,410 hours of training 20 - out of whicharound 42% delivered online in the form of E-learning
or webinar - were provided to 81,268 participants.
About 56% of employees received at least one hour of
training during the year.
Below there is a summary of the average hours of training
broken down by gender and by professional category.

During the year, the restrictions derived by the healthemergency have significantly affected the possibilityof providing training in person; this has mainly
affected the training of those employees in theindustrial area that are difficult to reach by online
training. In 2021, the average number of hours per
employee was 9.32, while in 2020 it was 11.94 and12.28 in 2019.

W

Total

7.85

10.21

9.32

Operators

0.60

0.79

0.72

Staff andProfessionals

10.22

12.80

11.86

7.42

11.14

9.54

Average number of hours
per employee by gender
Averagenumber ofhours peremployeeby employee
category

Top, Senior andMiddle Management— Talent Attraction
and Retention
Recruiting the best professionals in the job
market, people capable of adding value while
fully understanding complex business processes,
is a fundamental strategy for the Prada Group’s
organization. Finding talented youths and continuously
reaching out among the new constantly evolving
academic courses and disciplines are essential forkeeping abreast of the times.
For this reason, the Prada Group participates
regularly in events organized by schools anduniversities in order to connect with students, get
to know them during the career days, meet them intraining seminars presenting Prada and its processes,
and enlist them in projects initiated and coordinatedby Prada managers in a combined effort that creates
challenging, mutual growth.

Moreover, for years, the Prada Group jointly withsome academic institutions has been organizing visitsof students to its premises in order to introduce themto its work environment and methods, as it considers
opening up in this way to be crucial for its image as
an employer of excellence. The visits to the factories
in Italy have always been met with enthusiasm for theorganizational quality of the areas visited, which arelocated in unique architectural and scenic settings.
Another peculiarity of the educational efforts
undertaken by the Group is the creation of synergies
with technical schools in Tuscany (Italy), as part of astrategy to orient teaching to the professions requiredby businesses in the industry and include the training
needed to give continuity to technical and craft knowhow. This approach is also shared by the Church’s
Group, which has been conducting meetings at local
schools in England since 2019 to come into directcontact with students and present the company and its
heritage.

FOR PEOPLE

M

2021

Training Worldwide 2021

20 - The hours of training exclude those on health & safety.

105

index— Respect for flexibility, the offer
of a good work-life balance
and the definition of medium
and long-term career paths are
key to attracting talents.

a periodic salary review that takes into
consideration the overall market competitivenesswith respect to company positions and internal
remuneration fairness;an annual incentive plan linking remuneration
to the Company’s earnings and to individual
performance;long-term incentive plans, for key managers,
linked to the growth in profitability andcompany’s value, aligning individual targets to
those of the shareholders;specific benefit plans for each country, which
supplement in whole or in part the mandatory
entitlements (healthcare, insurance, etc.), andbenefits including social services and assistanceto families (public transportation, cars, school
subsidies, subsistence allowances, etc.).

2021

specific incentive plans for the sales teamand for technical personnel specialized in thecreation of seasonal collections;

FOR PEOPLE

The recruiting process uses transparent policies,
based on objective skills assessment, and intended
to ensure equal opportunity to the applicants. In
fact, it is possible to collect and process candidates’
profiles in a global universe with the support of anadvanced digital platform, which assists and simplifies
the synergistic, integrated operation of the Human
Resources Department globally.
The Group is attentive to all the new trends in thelabour market: respect for flexibility, the offer of agood work-life balance and the definition of medium
and long-term career paths are key to attracting
talents, and such aspects are by now sought by thelabour market in general rather than just by young
generations.
The Prada Group’s remuneration and retention policy
is designed to reward and retain highly professional
staff and skilled managers, new graduates andworkers, with the certainty that the creation of value
is achieved in the medium and long-term throughconstant organizational learning and the consolidationof employees’ experiences and skills.
The policy features a balanced combination ofcomponents that are fixed and variable, direct anddeferred, tailored to the position and professional
qualifications, and consistent with the needs of thevarious geographical areas.
More in details, the Group’s remuneration policy isbased on the following elements:

The Board of Directors, together with theRemuneration Committee, is actively involved indetermining the top management remuneration
taking into account the roles and responsibilities
assigned, and considering the most challenging
market compensation applicable to similar positions
in comparable businesses in term of industry, size andcomplexity.
The Group promotes freedom of association andrecognizes the right to collective bargaining. In
fact, the Prada Group engages with trade unions
to improve the working conditions of its employees
and to foster the medium/long-term well-being of
its employees and thus its surrounding communities.
Over the years, the Group has stipulated many
supplementary agreements especially in Italy, theUnited Kingdom and France, whereby it offers better
benefits than those established in the local collective
bargaining agreements. For instance, around 80%of the employees in Italy and 100% in France
can benefit from the supplementary agreements.
Employees in the UK’s manufacturing division also106indexvacation bonus: fixed amount equivalent to one
month’s pay as defined in the collective
bargaining agreement;easy access to severance pay advances;flexible working hours enabling employees toachieve a more productive work-life balance;
supplementary Healthcare Fund: supplementary
health insurance with an option to include
immediate family at a special rate;
special leaves of absence for illnesses of
employee’s children (up to 12 years of age) in
France;regulations, employment protection and better
conditions in terms of Sunday premium pay inthe stores in France;
improvement in sick leave for the employeesof the Church’s plant in Northampton, United
Kingdom.
As part of the supplementary agreements in Italy,
in 2018 a corporate welfare plan was launched withthe aim of allowing employees access to an extensive
package of services such as reimbursements forhealthcare, education and welfare expenses, leisureactivities (travel, vacations, cultural and sports events),
vouchers for fuel, food, payments to supplementary
pension funds, and much more. The welfare plan canbe activated under the employees request in viewof the performance bonus; the company adds anadditional 25% to the amounts converted.
In 2021, due to the impact of the pandemic on
the financial results of the Prada Group, and theconsequent impossibility of defining reliable targets in
2020, performance bonus related to supplementaryagreements was not released. However, as a sign ofattention for its employees, the Group decided toprovide a one-off extraordinary bonus for welfare in a

— Workers’ Healthand Safety and Respectfor Human Rights
Personal protection and the promotion of healthand safety are key priorities for the Prada Group:
high quality of the workplaces, internal policies andprocedures safeguard workers, customers and every
person at all Company’s locations according to thehighest standards and in full compliance with local
and international regulations.
2020 will always be remembered as the year marked
by an unprecedented global health emergency. The
Prada Group reacted immediately, focusing on thehealth and safety of its employees, and extended thestrict measures adopted in Italy to all the regions in
the world where it operates, along with implementing
the various emergency measures across all
geographical areas, where lockdowns were imposedby the national governments at different times.
In exceptional circumstances, timely action was taken.
Right from the start, a working group dedicated tomonitoring and managing the crisis was organized; it
developed a protocol to contrast and contain the riskof infection and had it implemented at all the Group’s
locations in Italy and abroad.
Constant collaboration with local health authorities,
company doctors, and worker and trade union
representatives ensured prompt responses to acontinuously evolving situation.
During 2021, a year still marked by the pandemic,
work activity was accompanied by strict anticontagion measures and the application of scrupulous
precautions to protect the health of the employees
in all workplaces in accordance with the guidelines
imposed by the government health protocols andPrada’s even more stringent ones. The prevention

2021

performance bonus: variable bonus linked to
production, sales and profit targets;period still heavily affected by the health and economiccrisis. Employees then used corporate welfare mainly
for the reimbursement of medical and school expenses.
The Group complies with the applicable internationaland national laws and regulations for working hours,
minimum guaranteed breaks and rest periods. In Italy,
where the vast majority of the industrial workforce
is located, thanks to the respect, dialogue andcooperation in place with Italian trade unions, there
were no labour strikes during the year, just as none
had occurred in the previous four years.

FOR PEOPLE

benefit from supplementary agreements.
The most significant benefits provided by these
supplementary or company agreements for 2021 were
the following:108

indexmeasures were differentiated according to the typeof activity and degree of exposure to the risk ofinfection.
In most locations - offices, warehouses and stores occupational health and safety risks associatedwith the Group’s operations are considered limited,also thanks to training activities and updated safetymeasures, especially in the industrial areas.
In the following table, the data for 2019 and2020 refer to accidents at work in Italy, whereapproximately 39% of the employees of the PradaGroup were located, in addition to those relating

to employees of the production sites in France, theUnited Kingdom and Romania, which accounted fora further 6%. In 2021, the data collected cover amuch broader perimeter as they include, in addition
to Italy and the foreign production sites, also theinformation of the majority of the retail subsidiaries,
including the most important in terms of number of
employees (United States, China, Singapore, Korea,
Japan, France, Germany, Great Britain, Spain, etc.),
thus reaching a coverage of 90% of total employees at
December 31, 2021.

2020

2021

9,475,823

7,586,654

17,255,394

53

42

95

of which number of serious injuries

0

0

1

of which fatal injuries

0

0

0

5.64

5.54

5.51

0

0

0.06

Hours worked
Numbers of injuries at work

Injury Rate
Serious Injury Rate

FOR PEOPLE

2019

2021

Injuries (*) at work

Injuries with at least one day lost were considered. Injuries data are only related to Group's employees and not to external contractors as they
are not material.

(*)

For years, the Prada Group has added digitalplatforms for on-line training to traditional forms ofclassroom training, platforms that also in 2021 wereof fundamental use to reach the largest possible
number of employees and raise awareness of theculture of safety. In 2021 training on Health and
Safety was provided to 384 people in Italy (780 total
people in 2020). Also in 2021, training was heavily
affected by the restrictions imposed by the healthemergency, and only some categories of employees
were able to carry out online training. For the most,for which training can only be provided in person, it
was not possible.
There are no committees within the Group responsible
for creating and monitoring occupational healthand safety programs, whereas the positions andinternal organization structures required by the local

legislation of the various countries in which Prada ispresent do exist.
Generally, the Group is committed to respect humanrights in the workplace and its compliance withinternational rules for the safety and well-being ofworkers inside the organization and promotes thesame respect along its supply chain.
Moreover, the Group fights against all forms of
discrimination, forced and child labour. Prada believes
that the risk of modern slavery, forced and childlabour within its own organization is non-existent,
while it considers the same risk to be very low along
its industrial supply chain. The geographic location of
the suppliers selected by the Group, as well as theirprofound knowledge in terms of duration and qualityof the established partnerships, reduces the risk of
conditions or pre-conditions such as to constitute110indexThe bond developed with the series of “Shaping
a Future” conferences, organized by the PradaGroup from 2017 to 2020 (more information on
pradagroup.com and in the Social Responsibility
Report 2020 - chapter 5, paragraph 2), paved theway for further collaboration with the School ofManagement of Politecnico di Milano (MIP). In fact,
since the 2019/2020 academic year, Prada has been amain sponsor of the International Master’s in Luxury
Management (IMLux) degree program together with
the French champagne Group, Taittinger.
The post-graduate program is highly international
as it welcomes students from all over the world, andconcentrates on Italy and France – the most important
countries in the world for high-end products – where
its classes are conducted. Half the lessons are held at
the NEOMA Business School in Reims, and half at the
School of Management of Politecnico di Milano (MIP),
allowing the students to access a double degree.
The IMLux Master’s degree is sponsored throughcontinuous interaction with the professors andstudents of the Master’s program and numerous
projects carried out. The sharing of businessstrategies by key people of the Prada Group, involvedin true “classroom” moments, provides inspiration to
the students during the academic year, who are called
upon to reprocess, in project work, very interestingand highly complex topics. During the sessions inwhich the projects are presented, while the Groupillustrates its experience, the students are able to offer
a concrete contribution with the perspective of young
professionals and consumers.

In 2021, the Master’s students addressed various
topics, including:Retail and Sales Management, focusing on theCentral European market;
Digital connectivity technologies and possible
applications to Prada products, with thepresentation of project work dedicated tothe exploration of RFID, NFC and QR-code
technologies;

2021— Partnership: IMLux

Prada’s commitment is contained in the Sustainability
Policy and realized in part by the promotion,
distribution and underwriting of the Group’s Codeof Ethics, which is included, as required by company
policies, within business agreements with all suppliers.
Factories and external suppliers are also required
to ensure that any third party that provides themwith materials and/or labour for making the Group’s
products is provided with all the permits requested bylaw and complies with the Code of Ethics.

FOR PEOPLE

circumstances of modern slavery, forced labour andhuman trafficking.
The Group’s business partners are encouraged to
go beyond the minimum regulatory requirements
and foster dialogue among all parties involved tofacilitate the implementation of and compliancewith the standards in order to create positive work
relationships. In the relationships with suppliers, social
awareness is encouraged and regulatory knowledge
and the adoption of environmental, social and quality
certifications are promoted.

Diversity, Equity & Inclusion Strategies, withthe presentation of project work dedicatedto the exploration of the different strategic
approaches used by multinational companies in
Europe, the Middle East and the Far East.
With this commitment to learning, Prada underlines its
interest in training and attracting talent, both of which
are strategic elements essential for ensuring long-term
growth.

111

index

6 — FOR CULTURE
Highlights 2021

3

permanent venues between Milan and Venice

14

exhibitions and cultural projects
realized in 2021

38

art and photography
exhibitions in Milan
since 201513

online conferences on neurosciencesince 202027

82

since 2004

since 1993

film projects

publications

index— The bond with art andculture is an integral part of thecorporate identity and enables
the Prada Group to understandand interpret changes in society
and stimulate new ways to grow.
— Fondazione Prada
The interests and the passions of Miuccia Prada andPatrizio Bertelli have inspired the Prada Group to
support Fondazione Prada’s activities in the fields ofart and culture since 1993.
Fondazione Prada was created in Milan as a platform
to conceive and develop art exhibitions along witharchitecture, cinema, philosophy, science andperforming arts projects. Until 2010 it has presented
twenty-four shows in Milan dedicated to key
international artists and other activities in cinema,architecture, and philosophy in Italy and abroad.
Since 2011, Fondazione has also been operatingfrom its Venetian venue, Ca’ Corner della Regina,
an eighteenth-century building that has hosted nine
exhibitions and an experimental platform dedicated tocinema.
The exhibition program of Fondazione Prada’s
permanent venue in Milan, inaugurated in 2015
and designed by the architecture firm OMA,
included in 2021 a site-specific project created by acontemporary artist and a retrospective dedicated toan artistic figure of the twentieth century. The project“Who the Bær,” conceived by artist Simon Fujiwara,
narrates the problematic search for the identity of thefictional character that gives the exhibition its title.
Fujiwara’s large installation revealed the paradoxof the dual search for invention and authenticity
in the culture we consume daily. The “Domenico
Gnoli” retrospective, conceived by Germano Celant,
reconstructed the artistic and biographical path of the
Italian artist fifty years after his death. The exhibition
traces his brief but intense career as a set designer,
illustrator, and painter through a collection of morethan one hundred paintings and as many drawings anda vast selection of documents.

2021

the well-being of the community in which it operates,
and not only that, are strictly related.
The Prada Group’s commitment to culture, the mostdistinctive pillar of its sustainability strategy, is the toolthat the Group considers most natural and closest to
its identity for extending the benefits of its activities tosociety.

FOR CULTURE

Social changes, deep economic crises, difficulties
experienced by the institutions and the new paradigms
introduced by technological progress have caused anever increasing number of companies to adopt a closer
approach to develop greater sensitivity to the demandsof civil society. According to this principle of sharedvalue creation, the competitiveness of a company and

The multifunctional spaces of the Deposito, inside thefoundation’s main venue in Milan, hosted “Riccardo
Muti Italian Opera Academy” for the first time in
December 2021. Audiences could participate in tendays of rehearsals and concerts focused on Giuseppe
Verdi’s Nabucco. Maestro Muti has embarked on a
training program for five young conductors and fivecollaborating maestros under 35 worldwide.
In 2021, two film festivals, “Multiple Canvases” and113

indexFinally, the projects in the historic Prada Rong Zhai
residence in Shanghai, presented by Prada with thesupport of Fondazione Prada, continue with theexhibitions “China Cabinet” and “A Moon Wrappedin Brown Paper”. The former was conceived by
Theaster Gates, who exhibited his ceramic works,
revealing the connections between the different
dimensions of his career as a ceramist, visual artist,
performer, professor, urban planner and social
activist. For “China Cabinet,” Gates devised anarrative in dialogue with the building’s architecture,transforming it into a craft workshop. Nathalie
Djurberg and Hans Berg’s solo exhibition, “A Moon
Wrapped in Brown Paper,” brought together aselection of sculptures and videos made between
2000 and 2019 by the artist duo. An organic carpet
connecting the rooms of Prada Rong Zhai and alabyrinth led visitors into a dreamlike universe
populated by fairy-tale characters, animals, posthumans and strange creatures.

2021

In 2021, the Venice outpost hosted the exhibition“Stop Painting,” curated by artist Peter Fischli. In apath that included over 110 works by more than 80
artists, the project explored the moments of ruptureof painting in the art history of the last two centuries,
its eternal return and the ability of this language torenew itself continuously. The second floor of Ca’
Corner della Regina became the space for creating
and presenting “AURA | SUL TOCCARE LE COSE”, achoreographic project conceived by Virgilio Sieni andpresented in collaboration with Fondazione Archivio
Luigi Nono. The performance took place in November
2021 as part of the fourth edition of the Festival Luigi
Nono alla Giudecca in various places in Venice.
Osservatorio, the foundation’s space dedicated tophotography and opened in 2016, is located on the
5th and 6th floors of one of the central buildings ofGalleria Vittorio Emanuele II in Milan. In 2021, theexhibition project “Sturm&Drang”, born from thecollaboration between Fondazione Prada and gta
exhibitions, ETH Zurich, was presented. Curated by
Luigi Alberto Cippini, Fredi Fischli and Niels Olsen,“Sturm&Drang” explored the applications, experiencesand environments related to Computer-generated
imagery (CGI) to reveal the complexity of computermodelling and analyze the current production ofimages. Prada, with the support of Fondazione
Prada, presented a different version of the exhibition,
titled “Sturm&Drang Preview Services”, on a floorof Prada Aoyama Tokyo in Japan in spring 2021. A
program of online lectures with artists, designers andcreative experts in these technologies, published on
Fondazione Prada’s website, explored the themes ofthe exhibitions.

meetings and publishing activities dedicated tobrain studies, was further developed. The project,which will continue through 2022, aims to attract
public interest in neuroscience and create a forum tofacilitate exchanges among scientists, philosophers,
and scholars. Since September 2021, a program ofseven online conversations involving international
personalities and creating interaction with remoteaudiences has been initiated.

FOR CULTURE“Proof. Incorporated,” were programmed at theFoundation’s Cinema. Artists Simon Fujiwara, Peter
Fischli, Goshka Macuga and Betye Saar selectedfilms that marked their personal and intellectual
formation for the first project. During the evening
screenings, the moving walls of the Cinema were
fully activated for the first time, creating an open-air
screening room. “Proof. Incorporated” investigated
the analogies and reciprocal influences between video
journalism and film language, delving into the mostrecent evolution of news communication methods andthe forms of hybridization typical of contemporary
film narration.

In 2021, the activities of “Human Brains,” a global
project of exhibitions, scientific debates, public114

index

SEA BEYOND, supported by a percentage of theproceeds from the sales of the Prada Re-Nylon
collection since June 2019, underscores the PradaGroup's commitment towards sustainability, and more
specifically on ocean preservation, in line with theUnited Nations 2030 Agenda and its 17 Sustainable
Development Goals (SDGs).
In January 2021, aware of the value of the sea for
our future and that of the Planet, the Prada Groupdecided to support the initiative of the United
Nations Decade of Ocean Science for Sustainable
Development, the “Ocean Decade”. The Group is
one of the first Italian signatories, confirming its
commitment to the creation of an Ocean Generation
through the SEA BEYOND project.
The first edition of the program, which allowed to trainsome 300 students in ten cities throughout the world- Berlin, Cape Town, Mexico City, Lisbon, London,
Milan, New York, Paris, Shanghai and Venice - ended
successfully in March 2021, despite the difficulties
caused by the health emergency, which hit hard allsocial environments, including the learning one.
The professors of the schools involved through the
UNESCO network participated in webinars led byocean literacy experts, during which they received
guidance on how to develop an educational module
dedicated to ocean preservation. At the end of the
training, the students were invited by the Prada Groupand UNESCO-IOC to create an ocean preservation
awareness campaign. In March 2021, the winning
campaign was presented during a digital event,previously selected by a prestigious international jurythat included: Lorenzo Bertelli, Prada Group’s Headof Corporate Social Responsibility; Vladimir Ryabinin,
Executive Secretary of the Intergovernmental
Oceanographic Commission of UNESCO and Deputy
Director General of UNESCO; the Italian writer
Alessandro Baricco; the aquanaut, oceanographic

In June 2021, for World Oceans Day, the PradaGroup and the Intergovernmental Oceanographic
Commission of UNESCO announced the second
edition of SEA BEYOND. The program has beenenriched with learning activities for all ages, with theaim of engaging a higher number of people globallyand locally:a new educational module for secondary school
students around the world, with the intention ofextending the project to other countries. Evenfor this edition, a contest will be held to selectthe school that can best interpret one of the ten
Ocean Decade Challenges, nominated by aninternational jury of “Sea Beyonders”, experts
who have dedicated their lives to the ocean andto education;
training activities for the Prada Group’s 13,000
employees around the world, who will become
more ocean literate and be encouraged totake on an active role in protecting the ocean.
Engaging webinars as well as an app will be
used to enable the employees to participate in a“sustainable challenge” on a global scale;2021

In 2020, the Prada Group and UNESCO’s
Intergovernmental Oceanographic Commission (IOC)- the world’s foremost authority on ocean science– launched SEA BEYOND, an educational program
dedicated to the preservation of the sea and ocean
literacy. The purpose of the project is to educate for amore responsible and conscious behavior towards thesea and its resources, and to highlight its fundamentalrole for the future of our Planet.

explorer and environmentalist Fabien Cousteau; theenvironmental artist Anne de Carbuccia; the marine
scientist and social entrepreneur Kerstin Forsberg;
and the Italian freediver gold medalist Alessia
Zecchini.

FOR CULTURE— SEA BEYOND

the Prada Group and UNESCO’s
Intergovernmental Oceanographic Commission
will collaborate to found the “Kindergartenof the Lagoon” (Asilo della Laguna) in Venice.
The kindergarten, established on the basis of
outdoor education principles, will openin September 2022.
In October 2021, for the Pre-Cop26 - a preparatory
event to the annual United Nations Climate Change
Conference of the Parties (COP26) held in Glasgow inNovember 2021 - the Prada Group collaborated with
UNESCO on the “Ocean&Climate Village” initiative at
the Triennale Milano. A training pavilion designed forchildren and young people, from primary school to the
University, was set up with interactive activities andworkshops to raise awareness of the ocean literacy
principles.

116

FOR CULTURE

2021

index

— “We are very proud of the success of SEA
BEYOND, stemming from the passion andcommitment that UNESCO’s Oceanographic
Commission continues to dedicate every day
to the promotion of a more responsible ocean.
We are pleased to embark on a new phaseof the project, which plans to address not
only students from all over the world but alsoa wider audience, with the aim of involving
local communities and all our employees.”
Lorenzo Bertelli
Prada Group's Head of Corporate
Social Responsibility
118

index

2021

Within the cultural program undertaken by the PradaGroup, Prada Mode is conceived as a touring private
Club that offers to its members the access to meetingsand cultural debates on contemporary issues. Imagined
as a place that augments and extends significant global
cultural gatherings at diverse locations worldwide,
Prada Mode offers exclusive access to unique programs
and content that complement the themes and subjectsof the host event.
Launched for the first time in 2018 in Miami during
Art Basel Miami Beach, the Prada Mode moved in2019 in Hong Kong and London, and then, in 2020,
to Paris and to the historic Prada Rong Zhai residencein Shanghai. The building was transformed for theoccasion by the director, producer and writer Jia
Zhangke into a specially created design reflecting
the Chinese word ’MIÀN’, inspired by his cinematic
output.
For its sixth edition, Prada Mode Moscow took over
the Levenson Mansion on December 2021. For theoccasion, the artist Damien Hirst transformed thehistoric building with his installation, Pharmacy: inside
he designed furniture, architectural details such asa huge molecular model in its window, light boxes,
and a wallpaper design taken from a catalogue ofprescription medicine. The event days were animatedby conversations in the morning and in the afternoon
with prominent personalities from the world of art andculture, followed by parties and performances withlive music.

FOR CULTURE— Prada Mode

119

In 2018, the Prada Group announced its partnershipwith the Gianni Bonadonna Foundation as “Supporting
Partner” for the therapeutic and scientific research
project in the field of oncology conceived by
Fondazione Bonadonna.
The purpose of this program is to give continuity
to the work of Gianni Bonadonna, the great Italian
oncologist, a leading figure in the international
panorama of oncological medicine, who has innovatedevery aspect of research and therapies, allowing
to reach enormous progress and concrete clinicalsuccesses in the treatment of neoplasia. His researchand discoveries have inspired and influenced theapproach to cancer therapy of entire generations ofdoctors in Italy and around the world.
The project involves the support of a multidisciplinary
teams of doctors and researchers dedicated to
studying and developing new treatments for cancer
patients, and a fellowship program for young
oncologists in partnership with universities acrossthe world, hospitals and leading research centers,
providing an effective way to expand the exchange ofscientific ideas.

In 2021, it was announced that the fellowships,
intended to finance a period of study abroad, arereserved for physicians enrolled in the last two yearsof graduate programs specializing in medical oncology
or hematology, and for neo-specialists within two
years of receiving their degree.
With the support of the Prada Group, Fondazione
Gianni Bonadonna and Fondazione AIRC firmly
believe that promoting the training of new generationsof medical researchers in oncology in international
centers of excellence is a key aspect of progress incancer treatment, in line with Gianni Bonadonna’s
tradition of innovation and education. With this sharedview, they are sponsoring this call for applications forstudy-abroad fellowships, so that a new generation of
medical researchers will be optimally equipped for the
study and treatment of cancer. For those candidates
who win the fellowship, the study period is scheduled
to start in 2022.
The Prada Group finally will contribute also throughthe commitment of its representatives to thedevelopment of the project by promoting the
Fondazione Gianni Bonadonna initiatives andproviding their expertise in communication to ensure
the public is informed about the ideas, results andbreakthroughs that will emerge over the years.

FOR CULTURE— Partnership:
Fondazione Bonadonna

2021

index

— “Education and culture are essential
tools that help us not only to understandourselves and the world we live in but also
push us to explore what we do not know.
I am happy that Prada can support a newgeneration of excellent researchers intheir study and education path alongside
the Gianni Bonadonna Foundation.”
Miuccia Prada
121

index7 — NOTES ON THE METHODOLOGYThis document is the Prada Group’s ninth - fourth
according to the GRI principles published in 2016 Sustainability Report and contains a description of themain initiatives undertaken in the fiscal year 2021,
i.e. from January 1, 2021, to December 31, 2021,
and the performance trends for the three-year period
2019-2020-2021 where available; if data alreadydisclosed in previous years have been changed, thishas been indicated in the text, including the reasonsfor the restatements. Where environmental data were
unavailable, conservative estimates were used that
resulted in choosing assumptions associated withthe least positive environmental performance for theCompany.
Particularly significant initiatives and events of the
fiscal year 2022 already known at the reporting dateare also included.
The performance indicators were collected on anannual basis and the reporting cycle is set according
to an annual frequency. The reporting boundary is thesame as the information reported in the 2021 Annual
Report, of Prada S.p.A. and its subsidiaries, with the
exception of some data expressly indicated in the text.
Prada S.p.A., together with its subsidiaries collectively
the “Prada Group”, is a joint-stock company withlimited liability incorporated and domiciled in Italy
with headquarters in Via Antonio Fogazzaro 28,
20135 Milan, whose share capital is 80%-owned by
Prada Holding S.p.A., a company domiciled in Italy,
while the remaining shares (20%) are listed on theMain Board of the Hong Kong Stock Exchange (HKSE).

In compliance with Standard GRI-101: Foundation,
paragraph 3, this document has been prepared in linewith “GRI Standards: Core Option”. References to theHong Kong Stock Exchange’s ESG Reporting Guide(Main Board Listing Rules - Appendix 27) are listed in
the Content Index 21.
The attention given to topics related to theenvironment, to people and to the promotionof the culture have always distinguished thecorporate culture. The Sustainability Report aims
to represent the Group in view of these topics sothat its stakeholders can evaluate the impacts of
Prada’s activities from an environmental, social andgovernance standpoint. This document was drawn
up with the purpose of reporting both the successful
aspects and the weaknesses of the Prada Group,with a view toward continuous improvement. The
information and indicators included aim to provide
a balanced portrayal of the Group’s sustainability
performance and initiatives.
The Prada Group involved all corporate functions todetermine the contents of the 2021 Sustainability
Report, the data and information are disclosed withthe ultimate purpose of enabling stakeholders tocompare and comprehend fully the information
contained herein.
In this regard, at the beginning of 2019, the Group
adopted a procedure for the preparation of the
Sustainability Report (“Guidelines for the preparationof the annual Sustainability Report”) approved by the
Board of Directors, which indicates the principles tobe followed (materiality, measurability, impartiality,
coherence, consistency) and the responsibilities fordrawing up the document.

NOTES ON THE METHODOLOGY— Scope andReporting Standard

2021

index

21 - In this Report no reference is made to the following“Comply or Explain” provisions: KPI B1.2 (related to Employment),
KPI B2.2 (related to Health and Safety), KPI B6.4 (related to ProductResponsibility) and KPI B7.3 (related to Anti-corruption).
The Prada Group is committed to extending the scope of its
ESG reporting in compliance with the ESG Reporting Guide of theHong Kong Stock Exchange.

123indexScope 1 emissions: that refers to Prada’s direct
GHG emissions, i.e. those that physically occur
within its boundaries from owned or controlled
sources;
Scope 2 emissions: that refers to Prada’s
emissions associated with the generation ofelectricity, heating/cooling, or steam purchasedfor own consumption. Emissions related topurchased electricity are calculated with two
different approaches:
Location-based: that reflects the average
emission intensity of national grids,
considering both renewable and nonrenewable productions, the GHG emissions
are calculated using an average emission
factor that refers to the national electricity
mix: the higher the share of renewableenergies used by a specific country the lower
the related emission factor;
Market-based: that considers the shareof certified electricity purchased fromrenewable sources. To be considered as
renewable the electricity purchased should
be covered by contractual instruments suchas Guarantees of Origin (GoOs). The partof electricity purchased covered by GoOs
is considered as zero emissions, while theremaining part is multiplied by a factor called
residual mix, whose take into consideration
emissions intensity of national grids
considering only non-renewable production.

2021

The Company’s GHG inventory (also referred as“Carbon footprint”) has been drafted for 2019 and
2021, while for 2020 are disclosed data only related
to Scope 1 and 2 emissions. The draft of PradaGroup's GHG Inventory is aligned with the GHG
Protocol.
The Group adopts an operational control approach toconsolidate its GHG emissions. The only exclusion isrelated to Marchesi 1824 S.r.l. and its UK subsidiary,considering the low impact in terms of emissions,considering the size of the business and the fact that
Marchesi is not characterized by energy-intensive or
emission-intensive processes owning only pastry shops.

In addition, Luna Rossa Challenge S.r.l. was notincluded in the scope of the inventory as it was
acquired only at the end of 2021.
The Group includes in its GHG Inventory the following
categories of emissions:

NOTES ON THE METHODOLOGY— GHG Calculation
Methodology
and Emission Factors

Scope 3 emissions: that refers to Prada’s
indirect GHG emissions that are a consequenceof the Company’s activities, but which derivefrom sources not owned or controlled by Prada.
In the table below are summarized all categories andsources of GHG emissions of Prada:

124

indexOperational Boundaries
Scope

Category and Sources

SCOPE 1STATIONARY COMBUSTION: combustion of fuels in stationary equipment (e.g. natural gas
in heating systems) related to assets owned or controlled by the Group (Prada’s headquarters,
representative offices, manufacturing sites, boutiques and outlets 22 ).

(Direct
GHG emissions)

MOBILE COMBUSTION: Company’s vehicle fleet fuel combustion.

STATIONARY COMBUSTION: electricity purchased from the national grid related to assets
owned or controlled by the Group (Prada’s headquarters, representative offices, manufacturing
sites, boutiques and outlets).

SCOPE 3

PURCHASED GOODS 23 AND SERVICES (cat.1):• Raw materials and accessories used for production.
• Scope 1 and 2 GHG emissions of suppliers of finished and semi-finished products related tothe production outsourced by the Company: combustion of fuels in stationary equipment andelectricity purchased from the national grid.
• Packaging.

(Energy indirect
GHG emissions)(Other indirect
GHG emissions)

FUEL AND ENERGY RELATED ACTIVITIES (cat. 3):• Upstream emissions of purchased fuels.
• Upstream emissions of purchased electricity.
• Transmission and distribution (T&D) losses related to purchased electricity.
UPSTREAM TRANSPORTATION AND DISTRIBUTION (cat. 4):• Transportation of materials purchased by the Company.
• Transportation of raw materials/semi-finished products to the network of suppliers of finishedand semi-finished products and back.
• Distribution of final products (when costs are paid by the Company).
WASTE GENERATED IN OPERATIONS (cat. 5): disposal/recycling of waste generated by the
manufacturing sites 24.

NOTES ON THE METHODOLOGYSCOPE 2

2021

FUGITIVE EMISSIONS: leakages of refrigerant gases (F-gas) from air-conditioning andrefrigeration units related to assets owned or controlled by the Group (Prada’s headquarters,
representative offices, manufacturing sites, boutiques and outlets).

BUSINESS TRAVEL (cat.6): transportation of employees for business-related activities(transports included: plane, train, private car and rented car 25).
EMPLOYEE COMMUTING (cat.7): transportation of Group’s employees for daily commuting
from home to the Prada Group’s facility in which they work.
UPSTREAM LEASED ASSETS (cat. 8): emissions associated with activities that take place indirectly operated stores upon which Prada does not have direct operational control of the asset
itself and for which it is not responsible for the purchase of energy (department stores andoutlets). In particular, in this category GHG emissions associated with electricity consumption
and F-gas losses within department stores are included.
INVESTMENTS (cat. 15): emissions relating to the energy consumption of companies in which the
Prada Group has a minority interest, allocated on a proportional basis considering the % interest held.

22 - Only outlets where the Group is responsible for paying energy
bills are considered.
23 - Emissions related to finished products have not been
included as they represent a minor part of the Prada Group's total
procurement.
24 - Waste generated by retail and offices is not included in

calculation considering that is negligible.
25 - Business travels done with vehicles part of Prada’s fleet are notincluded in this category considering that are already considered in
Scope 1 emissions.

125

index
Displayed in the table below the details related toemission factors used for each GHG source:

GHG Emissions Scope 1
SourceActivity Data

Emission Factor

GWP-100

Volume [m3]

DEFRA (Department ofEnvironment, Food & Rural
Affairs), Conversion factors Full set, 2019, 2020, 2021

CO2 equivalent emissions
were considered

Diesel, Petrol, LPG,
litresAviation turbine fuel purchasedfor vehicle fleet

DEFRA (Department ofEnvironment, Food & Rural
Affairs), Conversion factors Full set, 2019, 2020, 2021

CO2 equivalent emissions
were considered

Refrigerant Gases-

Global Warming Potentials(GWPs) are taken from IPCC
Fourth Assessment Report(AR5)

Emission Factor

GWP-100

Refrigerant gas refilled [kg]GHG Emissions Scope 2
SourceActivity Data

(2019-2020-2021)

Electricity purchasedfrom each country (forlocation-based method)

Electricity
purchased [kWh]Terna, International
comparisons, data 2017,2018, 2019

Only CO2 emissions wereconsideredElectricity purchased fromeach country not covered by
GoOs certificates (for marketbased approach)Electricity
purchased [kWh]AIB - European Residual
Mixes, 2018, 2019, 2020
For USA: Green-e Energy
Residual Mix emission
factors 2018 and 2020

Only CO2 emissions wereconsidered

Emission Factor

GWP-100

NOTES ON THE METHODOLOGYNatural gas purchased forheating and other purposes

2021(2019-2020-2021)

GHG Emissions Scope 3
SourceActivity Data

(2019-2021)

Raw materials purchased(Cat. 1)

Kg of raw materials,
accessories, packaging
purchased

Ecoinvent, v.3.7.1
DEFRA (Department ofEnvironment, Food & Rural
Affairs), Conversion factors Full set, 2019, 2021

CO2 equivalent emissions
were considered

Leather purchased (Cat. 1)

m2 of raw leather
purchased

Leather Carbon FootprintReview of the European
Standard EN 16887:2017
United Nations - Industrial
Development Organization

CO2 equivalent emissions
were considered126

indexGHG Emissions Scope 3
SourceActivity Data

Emission Factor

GWP-100

Volume [m3]

DEFRA (Department ofEnvironment, Food & Rural
Affairs), Conversion factors Full set, 2019, 2021

CO2 equivalent emissions
were considered

Diesel and LPG purchasedby suppliers of finishedand semi-finished products

litresDEFRA (Department ofEnvironment, Food & Rural
Affairs), Conversion factors Full set, 2019, 2021

CO2 equivalent emissions
were consideredElectricity purchased bysuppliers of finished andsemi-finished products fromeach country not coveredby GoOs certificatesElectricity
purchased [kWh]AIB - European Residual
Mixes, 2018, 2019, 2020

Only CO2 emissions wereconsidered

Fuel and energy related
activities (Cat. 3)

Fuel and electricity
purchased (m3, l or kWh)DEFRA (Department ofEnvironment, Food & Rural
Affairs), Conversion factors Full set, 2019, 2021

CO2 equivalent emissions
were considered

Upstream logistics anddistribution (Cat. 4)

km covered by air, truckor ship multiplied by total
shipped weight (ton*km)

DEFRA (Department ofEnvironment, Food & Rural
Affairs), Conversion factors Full set, 2019, 2021

CO2 equivalent emissions
were considered

Waste disposed or
recovered (Cat. 5)

kg of waste disposedor recovered

Ecoinvent, v.3.7.1
DEFRA (Department ofEnvironment, Food & Rural
Affairs), Conversion factors Full set, 2019, 2021

CO2 equivalent emissions
were consideredBusiness travel by air
and train (Cat. 6)

km travelled by eachpassenger

DEFRA (Department ofEnvironment, Food & Rural
Affairs), Conversion factors Full set, 2019, 2021

CO2 equivalent emissions
were consideredBusiness travel by car(Cat. 6)km

DEFRA (Department ofEnvironment, Food & Rural
Affairs), Conversion factors Full set, 2019, 2021

CO2 equivalent emissions
were considered

NOTES ON THE METHODOLOGYNatural gas purchased bysuppliers of finished andsemi-finished products forheating and other purposes

2021(2019-2021)

127indexGHG Emissions Scope 3
SourceActivity Data

Emission Factor

GWP-100

km travelled by eachpassenger by car, bus, rail

DEFRA (Department ofEnvironment, Food & Rural
Affairs), Conversion factors Full set, 2019, 2021

CO2 equivalent emissions
were consideredElectricity purchased bysuppliers managing dept.
store from each country
not covered by GoOs
certificates (Cat.8)

Electricity purchased [kWh]– market-based method

AIB - European Residual
Mixes, 2018, 2019, 2020

Only CO2 was considered

Refrigerant gases usedin dept.store (Cat.8)

Refrigerant gas refilled [kg]-Global Warming Potentials(GWPs) are taken from IPCC
Fourth Assessment Report(AR5)

Electricity purchased bycompanies in which the
Prada Group has a minority
interest (Cat. 15)

Electricity purchased [kWh]– market-based method

AIB - European Residual
Mixes, 2018, 2019, 2020

Only CO2 was considered

Natural gas purchasedfrom companies in which
the Prada Group has aminority interest (Cat. 15)

Volume [m3]

DEFRA (Department ofEnvironment, Food & Rural
Affairs), Conversion factors Full set, 2019, 2021

CO2 equivalent emissions
were considered

Diesel acquired bycompanies in which the
Prada Group has aminority interest (Cat. 15)

litresDEFRA (Department ofEnvironment, Food & Rural
Affairs), Conversion factors Full set, 2019, 2021

CO2 equivalent emissions
were considered

NOTES ON THE METHODOLOGY

Employees commuting(Cat. 7)2021

(2019-2021)

128indexAccording to the GRI Standards and HKSE ESG
Reporting Guide organizations that draw up sustainability
reports are required to define the content on which to
set up reporting according to the principle of materiality.
As defined by GRI materiality is the threshold at whichaspects become sufficiently important that they should
be reported.
In fact, the identification of material issues for Prada is offundamental importance representing the key contents
that must be addressed within the Report and, ingeneral, in the context of sustainability communication.
As already described in chapter 2, paragraph“Stakeholders and materiality analysis”, during 2021
the Prada Group updated its materiality analysis bycarrying out two main phases:
Identifying sustainability issues: determining
which issues are key to understanding Prada’s
business and strategic context and to describing
its main environmental, economic and social
impacts;
Ranking the potentially sustainability issues
previously identified: putting these aspects inorder based on their relevance for achieving
business goals (internal significance) and formeeting stakeholders’ expectations (externalsignificance).
A comprehensive list of the potentially relevant
sustainability topics for the Prada Group was
identified by the following steps:

Performing a media analysis relating to theGroup, which enabled to present the perceptionof public opinion and other stakeholders;
Analyzing the main sustainability documents
relating to the Textile and Clothing sector(such as the Global Reporting Initiative - GRI,
RobecoSam, SASB) to identify industry trends;
Analyzing the main sustainability trends at a
global level, identified by major internationalorganizations such as the Dow Jones
Sustainability Index, the World Economic Forumand the GRI.
Once the sustainability potentially relevant topics
have been defined, they were ranked based on theirrelevance for both Prada (internal significance) andits stakeholders (external significance). The relevancefor the stakeholders was identified through a “desk”
analysis and by submitting a questionnaire to themain functions of Prada Group to which was asked torank the sustainability topics on which they receive
pressures from stakeholders. On the other hand,
the relevance for Prada was discussed and assessed
through an internal workshop, which involved the
top management and key members of the Board of
Directors.
The material aspects for the Prada Group were thendefined as the intersection of significance for theCompany and significance for its stakeholders. The
materiality analysis was later formally approved by the
Board of Directors.

2021

Materiality Analysis

Performing a benchmark analysis against
Italian and international fashion and luxury
firms, producing a list of the most common
sustainability topics in the industry;

NOTES ON THE METHODOLOGY— Focus on Material
Aspects

Mapping the key stakeholders and analyzing
their main concerns;

129index

Correlation Between Material Topics and GRI Standards
GRI
HKSE
Standard Topic Subject Areas

TopicsBoundaries
Within the
Organization

Outside theOrganization

Aspect A1:
Emissions
Aspect A2:
Use of Resources
Aspect A4:
305 - Emissions (2016) Climate ChangeGroup

Suppliers of finished andsemi-finished products
and departments storesGroup

Suppliers of finished andsemi-finished products
and departments stores

Procurementof low
environmental
impact raw
materials

301 - Materials (2016)

Aspect A2:
Use of Resources
Aspect A3:
The Environment andNatural Resources

Group

-

Circular Thinking

301 - Materials (2016)

Aspect A2:
Use of Resources

Group

-

Responsible
wastemanagement306 - Waste (2020)

Aspect A1:
Emissions

Industrial sites-

Sustainablewater
management

303 - Water andeffluents (2018)

Aspect A2:
Use of Resources

Industrial sites-

Improve theenvironmental
and social
standard along
the supply chain

414 - Supplier social
assessment (2016)

Aspect B5: Supply
Chain Management

Group

Suppliers

408 - Child Labour

Aspect B4:
Labour Standards

Group

Suppliers

409 - Forced Labour

Aspect B4:
Labour Standards

Group

Suppliers

302 – Energy (2016)

2021

Climate Action

NOTES ON THE METHODOLOGY

Material
topic

131

indexCorrelation Between Material Topics and GRI Standards
GRI
Standard Topic

HKSE
Subject Areas

TopicsBoundaries
Within the
Organization

Outside theOrganization

404 - Training and
Education (2016)

Aspect B3:
Development
and Training

Group

-

Occupational
Healthand Safety

403 - Occupational
Health and Safety(2018)

Aspect B2:
Healthand Safety

Group

Contractors

Respect ofhuman andworkers’ rights

406 - Non-discrimination(2016)

Aspect B1:
Employment

Group

-

412 - Human Rights
Assessment (2016)

Aspect B4: Labour
Standards

Group

-

Championdiversity andequal
opportunities

405 - Diversity andEqual opportunities(2016)

Aspect B1:
Employment

Group

-

Customerexperience

416 - Customer Healthand Safety (2016)

Aspect B6:
Product Responsibility

Group

-

417 - Marketing andLabeling (2016)

Aspect B6:
Product Responsibility

Group

-

418 - Customer
privacy

Aspect B6:
Product Responsibility

Group

-

201 - Economic
performance (2016)

-

Group

-

Businessstrategy
and economic
performance2021

Know-howpreservationand skills
development

NOTES ON THE METHODOLOGY

Material
topic

132

indexCorrelation Between Material Topics and GRI Standards
HKSE
Subject Areas

TopicsBoundaries
Within the
Organization

Outside theOrganization

205 - Anti-corruption(2016)

Aspect B7:
Anti-corruption

Group

-

419 - Socioeconomic
Compliance (2016)

Aspect B1:
Employment
Aspect B2:
Health and Safety
Aspect B6:
Product Responsibility

Group

-

307 - Environmental
compliance (2016)

Aspect A1:
Emissions

Group

-

Product
creativity
and excellence

Not GRI-Group

Suppliers of finishedand semi-finishedproducts

Protection andenhancementof the artistic,
cultural, andnatural heritage

Not GRI

Aspect B8:
Community
Investment

Group

Communities

2021

Integrity,transparency
and cooperation

GRI
Standard TopicNOTES ON THE METHODOLOGY

Material
topic

133

index8 — GRI INDEX

indexGeneral standard disclosure
References

102-1

Name of the organization

Pag. 123

102-2

Activities, brands,
products, and services

Pag. 9-22

102-3

Location of headquarters

Pag. 123

102-4

Location of operations

Pag. 10; 21-22

102-5

Ownership and legal form

Pag. 123

102-6

Markets Served

Pag. 10; 22

102-7

Scale of the organization

Pag. 9-10; 18-22; 34-36

Notes

102-8

KPI B1.1

Information on employees
and other workers

Pag. 91-95

102-9

KPI B5.1
KPI B5.2
KPI B5.3

Supply chain

Pag. 20-21; 57-63

102-10Significant changes
to the organizationand its supply chain

Pag. 34-36; 123102-11

Precautionary Principle
or approach

Pag. 30-32; 48-54; 123102-12External initiatives

Pag. 30; 33; 65; 67; 71;
74; 81; 90; 92; 98-100;
111; 116-118; 121; 124

102-13

Membershipof associations

The Group's main partnerships are with:
Camera Nazionale della Moda Italiana,
Assolombarda, Assonime, Confindustria
Toscana and The Fashion Pact.

102-14

Statement from seniordecision - maker

Pag. 6-8

2021

References
Description
to HKEx ESG
Reporting Guide

GRI INDEX

Indicator

135

indexGeneral standard disclosure
References102-16

Values, principles, standards
and norms of behavior

Pag. 4-5; 30-33; 38;
61-67; 69; 92; 96-100;
108-111; 113

102-18Governance structure

Pag. 24-30

102-40

List of stakeholder groups

Pag. 44102-41

Collective bargaining
agreements

Pag. 61; 105-108

102-42

Identifying and selecting
stakeholders

Pag. 44; 129

102-43

Approach to stakeholder
engagement

Pag. 44; 129

102-44

Key topics
and concerns raised

Pag. 45-48; 129-133

102-45

Entities includedin the consolidated
financial statements

Pag. 123

102-46

Defining report content
and topic Boundaries

Pag. 45-48; 123;131-133

102-47

List of material topics

Pag. 45-48

102-48

Restatements of information

Pag. 123

102-49Changes in reporting

Pag. 123

102-50

Reporting period

Pag. 123

102-51

Date of the mostrecent report102-52

Reporting cycle

Pag. 123

102-53

Contact point for questions
regarding the report

Pag. 150

Notes

2021

References
Description
to HKEx ESG
Reporting Guide

GRI INDEX

Indicator

The 2020 Social
Responsibility Report was
published in May 2021.

136indexGeneral standard disclosure
References102-54Claims of reportingin accordance with
the GRI Standards

Pag. 123

102-55

GRI content index

Pag. 134-147

102-56External assurance

Notes

This Report is not subject
to external assurance.

2021

References
Description
to HKEx ESG
Reporting Guide

GRI INDEX

Indicator137

indexMaterial topics - Specific standard disclosure
Indicator

References
Description
to HKEx ESG
Reporting Guide

References

Notes

Economic performance indicators

G.D. B8

Explanation of the material
topic and its Boundary

Pag. 45-48;
129-133

103-2

G.D. B8

The management approachand its components

Pag. 34-36

103-3

G.D. B8

Evaluation of the
management approach

Pag. 34-36

201-1

KPI B8.2

Direct economic value
generated and distributed

Pag. 36

GRI 205: Anti-corruption – 2016
103-1

G.D. B7

Explanation of the material
topic and its Boundary

Pag. 45-48;
129-133

103-2

G.D. B7

The management approachand its components

Pag. 30-32

103-3

G.D. B7

Evaluation of the
management approach

Pag. 30-32

205-3

KPI B7.1
KPI B7.2

Confirmed incidents ofcorruption and actions taken

Pag. 32

GRI INDEX

103-1

2021

GRI 201: Economic Performance - 2016138

indexMaterial topics - Specific standard disclosure
Indicator

References
Description
to HKEx ESG
Reporting Guide

References

Notes

Environmental performance indicators

G.D. A2

Explanation of the material
topic and its Boundary

Pag. 45-48;
129-133

103-2

G.D. A2

The management approachand its components

Pag. 20; 58-61;
80-81; 83-88

103-3

G.D. A2

Evaluation of the
management approach

Pag. 20; 58-61;
80-81; 83-88

301-1

KPI A2.5
KPI A3.1

Materials usedby weight or volume

Pag. 80

GRI 302: Energy – 2016
103-1

G.D. A2

Explanation of the material
topic and its Boundary

Pag. 45-48;
129-133

103-2

G.D. A2

The management approachand its components

Pag. 69-77

103-3

G.D. A2

Evaluation of the
management approach

Pag. 69-77

302-1

KPI A2.1

Energy consumption
within the organization

Pag. 69-77

302-4

KPI A2.3

Reduction of energy
consumption

Pag. 69-77

GRI INDEX

103-1

2021

GRI 301: Materials – 2016139

indexMaterial topics - Specific standard disclosure
Indicator

References
Description
to HKEx ESG
Reporting Guide

References

Notes

G.D. A2

Explanation of the material
topic and its Boundary

Pag. 45-48;
129-133

103-2

G.D. A2

The management approachand its components

Pag. 78

103-3

G.D. A2

Evaluation of the
management approach

Pag. 78

303-1

Interactions with water
as a shared resource

Pag. 78

303-2

Management of water
discharge-related impacts

Pag. 78

Water withdrawal

Pag. 78

303-3

KPI A2.2
KPI A2.4

GRI INDEX

103-1

2021

GRI 303: Water and Effluents - 2018

GRI 305: Emissions - 2016
103-1

G.D. A1
G.D. A4

Explanation of the material
topic and its Boundary

Pag. 45-48;
129-133

103-2

G.D. A1
G.D. A4

The management approachand its components

Pag. 69-77

103-3

G.D. A1
G.D. A4

Evaluation of the
management approach

Pag. 69-77

305-1

KPI A1.1
KPI A1.2

Direct (Scope 1)
GHG emissions

Pag. 76-77

305-2

KPI A1.1
KPI A1.2

Energy indirect (Scope 2)
GHG emissions

Pag. 76-77

305-3

KPI A1.1

Other indirect (Scope 3)
GHG emissions

Pag. 77305-5

KPI A1.5
KPI A4.1

Reduction of
GHG emissions

Pag. 69-77

140

indexMaterial topics - Specific standard disclosure
Indicator

References
Description
to HKEx ESG
Reporting Guide

References

Notes

GRI 306: Waste - 2020
G.D. A1
G.D. A3

Explanation of the material
topic and its Boundary

Pag. 45-48;
129-133

103-2

G.D. A1
G.D. A3

The management approachand its components

Pag. 81-83

103-3

G.D. A1
G.D. A3

Evaluation of the
management approach

Pag. 81-83

306-1

KPI A3.1

Waste generation andsignificant waste-related
impacts

Pag. 81-83

306-2

KPI A1.6
KPI A3.1

Management of significant
waste-related impacts

Pag. 81-83

306-3

KPI A1.3
KPI A1.4

Waste generated

Pag. 81-83

GRI INDEX

2021

103-1

GRI 307: Environmental compliance - 2016
103-1

G.D. A1

Explanation of the material
topic and its Boundary

Pag. 45-48;
129-133

103-2

G.D. A1

The management approachand its components

Pag. 88

103-3

G.D. A1

Evaluation of the
management approach

Pag. 88

307-1

G.D. A1

Non-compliancewith environmental laws
and regulations

There were no significant
cases of environmental
non-compliance during
the last three years(2019-2021).

141indexMaterial topics - Specific standard disclosure
Indicator

References
Description
to HKEx ESG
Reporting Guide

References

Notes

Social performance indicators

G.D. B2

Explanation of the material
topic and its Boundary

Pag. 45-48;
129-133

103-2

G.D. B2

The management approachand its components

Pag. 108-111

103-3

G.D. B2

Evaluation of the
management approach

Pag. 108-111

403-1

G.D. B2
KPI B2.3

Workers representation
in formal joint
management-worker healthand safety committees

Pag. 108-111

403-2

G.D. B2

Types of injury and rates of
injury, occupational diseases,
lost days, and absenteeism,and number of work-related
fatalities

Pag. 108-111

403-3

KPI B2.3

Occupational health services

Pag. 108-111

Worker participation,
consultation, andcommunication on
occupational healthand safety

Pag. 108-111

Worker training
on occupational healthand safety

Pag. 108-111

Promotion of worker healthPag. 108-111

403-4

403-5

KPI B2.3

403-6
403-7

KPI B2.3

Prevention and mitigationof occupational health andsafety impacts directly linked
by business relationships

Pag. 108-111

403-9

KPI B2.1

Work-related injuries

Pag. 108-111

GRI INDEX

103-1

2021

GRI 403: Occupational health and safety - 2016142

indexMaterial topics - Specific standard disclosure
Indicator

References
Description
to HKEx ESG
Reporting Guide

References

Notes

GRI 404: Training and education - 2016
103-1

G.D. B3

Explanation of the material
topic and its Boundary

Pag. 45-48; 129-133

103-2

G.D. B3

The management approachand its components

Pag. 98-100; 102-105;
110; 116-118

103-3

G.D. B3

Evaluation of the
management approach

Pag. 98-100; 102-105;
110; 116-118

404-1

KPI B3.1
KPI B3.2

Average hours of training
per year per employee

Pag. 105

G.D. B1

Explanation of the material
topic and its Boundary

Pag. 45-48; 129-133

103-2

G.D. B1

The management approachand its components

Pag. 25-30; 91;
94-101

103-3

G.D. B1

Evaluation of the
management approach

Pag. 25-30; 91;
94-101405-1

KPI B1.1

Diversity of governancebodies and employees

Pag. 25-30; 91; 94-98

405-2

G.D. B1

Ratio of basic salary andremuneration of women to men

Pag. 98

GRI INDEX

103-1

2021

GRI 405: Diversity and equal opportunities - 2016

GRI 406: Non-discrimination - 2016
103-1

G.D. B1

Explanation of the material
topic and its Boundary

Pag. 45-48; 129-133

103-2

G.D. B1

The management approachand its components

Pag. 96-100; 108-111

103-3

G.D. B1

Evaluation of the
management approach

Pag. 96-100; 108-111

406-1

G.D. B1

Incidents of discriminationand corrective actions taken

There were no significant
cases of discrimination
during the last three years(2019-2021) althoughconsidered some casesin the Group's North
American subsidiary.

143indexMaterial topics - Specific standard disclosure
Indicator

References
Description
to HKEx ESG
Reporting Guide

References

Notes

GRI 408: Child Labour - 2016
G.D. B4

Explanation of the material
topic and its Boundary

Pag. 45-48; 129-133

103-2

G.D. B4

The management approachand its components

Pag. 108-111

103-3

G.D. B4

Evaluation of the
management approach

Pag. 108-111

408-1

KPI B4.1
KPI B4.2

Operations and suppliers
at significant risk forincidents of child labour

Pag. 108-111
2021

103-1

103-1

G.D. B4

Explanation of the material
topic and its Boundary

Pag. 45-48; 129-133

103-2

G.D. B4

The management approachand its components

Pag. 108-111

103-3

G.D. B4

Evaluation of the
management approach

Pag. 108-111

409-1

KPI B4.1
KPI B4.2

Operations and suppliers at
Pag. 108-111
significant risk for incidents offorced or compulsory labour

GRI INDEXGRI 409: Forced or Compulsory Labour - 2016

GRI 412: Human rights assessment - 2016
103-1

G.D. B4

Explanation of the material
topic and its Boundary

Pag. 45-48; 129-133

103-2

G.D. B4

The management approachand its components

Pag. 24-30; 30-32;
61-63; 92; 108-111

103-3

G.D. B4

Evaluation of the
management approach

Pag. 24-30; 30-32;
61-63; 92; 108-111

412-1

G.D. B4

Operations that have been
Pag. 61-63; 108-111
subject to human rights
reviews or impact assessments

144

indexMaterial topics - Specific standard disclosure
Indicator

References
Description
to HKEx ESG
Reporting Guide

References

Notes

GRI 414: Suppliers social assessment - 2016
G.D. B5

Explanation of the material
topic and its Boundary

Pag. 45-48; 129-133

103-2

G.D. B5

The management approachand its components

Pag. 58-63

103-3

G.D. B5

Evaluation of the
management approach

Pag. 58-63

414-2

KPI B5.2
KPI B5.3

Negative social impacts
in the supply chain
and actions taken

Pag. 61-63

GRI 416: Customer health and safety - 2016
103-1

G.D. B6

Explanation of the material
topic and its Boundary

Pag. 45-48; 129-133

103-2

G.D. B6

The management approachand its components

Pag. 67

103-3

G.D. B6

Evaluation of the
management approach

Pag. 67

416-2

G.D. B6
KPI B6.1
KPI B6.2

Incidents of non-complianceconcerning the healthand safety impacts ofproducts and services

Pag. 67

GRI INDEX

2021

103-1

GRI 417: Marketing and labeling - 2016
103-1

G.D. B6

Explanation of the material
topic and its Boundary

Pag. 45-48; 129-133

103-2

G.D. B6

The management approachand its components

Pag. 67

103-3

G.D. B6

Evaluation of the
management approach

Pag. 67

417-2

G.D. B6
KPI B6.3

Incidents of non-complianceconcerning product and service
information and labelingPag. 67145

indexMaterial topics - Specific standard disclosure
Indicator

References
Description
to HKEx ESG
Reporting Guide

References

Notes

G.D. B6

Explanation of the material
topic and its Boundary

Pag. 45-48; 129-133

103-2

G.D. B6

The management approachand its components

Pag. 22; 32

103-3

G.D. B6

Evaluation of the
management approach

Pag. 22; 32

418-1

KPI B6.2
KPI B6.5

Substantiated complaints
concerning breaches ofcustomer privacy and lossesof customer data

During the last three
years (2019-2021), thePrada Group detected no
substantiated complaints
regarding breaches ofcustomer privacy from
regulatory bodies or
outside parties, nor
identify any thefts orlosses of customer data.

GRI INDEX

103-1

2021

GRI 418: Customer Privacy - 2016

GRI 419: Socioeconomic compliance - 2016
103-1

Explanation of the material
topic and its Boundary

Pag. 45-48; 129-133

103-2

The management approachand its components

Pag. 30-32; 67

103-3

Evaluation of the
management approach

Pag. 30-32; 67

Non-compliance with laws
and regulations in the socialand economic area

Pag. 32

419-1

G.D. B1
G.D. B2
G.D. B4
G.D. B6
G.D. B7

There were no significant
cases of non-compliancewith laws and regulationsin the social andeconomic area during
the last three years(2019-2021).

146indexAdditional Non-Material Topics Disclosed - Specific standard disclosure
Indicator

References
Description
to HKEx ESG
Reporting Guide

References

Notes

Economic Performance Indicators

103-1

Explanation of the material
topic and its Boundary

Pag. 45-48; 129-133

103-2

The management approachand its components

Pag. 20; 58-61; 80-81

103-3

Evaluation of the
management approach

Pag. 20; 58-61; 80-81

Proportion of spendingon local suppliers

Pag. 58-61; 80-81

204-1

KPI B5.1

2021

GRI 204: Procurement Practices – 2016

GRI INDEX

Social Performance Indicators
GRI 401: Employment - 2016
103-1

G.D. B1

Explanation of the material
topic and its Boundary

Pag. 45-48; 129-133

103-2

G.D. B1

The management approachand its components

Pag. 91-100; 105-108

103-3

G.D. B1

Evaluation of the
management approach

Pag. 91-100; 105-108

Benefits provided tofull-time employees thatare not provided totemporary or part-time
employees

Pag. 95

401-2

147

indexAdditional Non-Material Topics Disclosed - Specific standard disclosure
Indicator

References
Description
to HKEx ESG
Reporting Guide

References

Notes

G.D. B8

Explanation of the material
topic and its Boundary

Pag. 45-48; 129-133

103-2

G.D. B8

The management approachand its components

Pag. 9; 36; 58-61;
88-89; 98-100; 112-121

103-3

G.D. B8

Evaluation of the
management approach

Pag. 9; 36; 58-61;
88-89; 98-100; 112-121

413-1

KPI B8.1
KPI B8.2

Operations with local
community engagement,
impact assessment
and development programs

Pag. 58-61; 98-100;
102-104; 112-121

GRI INDEX

103-1

2021

GRI 413: Local communities - 2016148

index

Pag. 62 		Agostino Osio
Pag. 64		Courtesy Car Shoe
Pag. 65 		Jack Davison
Pag. 66 		David Sims (Prada)
Pag. 66 		Tyrone Lebon (Miu Miu)
Pag. 68 		Agostino Osio
Pag. 73 		Gabriele Croppi
Pag. 75 		Alessandro Ciampi
Pag. 79 		Agostino Osio
Pag. 85 		Courtesy Miu Miu
Pag. 89 		Alessandro Ciampi
Pag. 91 		Agostino Osio
Pag. 93 		Agostino Osio
Pag. 97 		Agostino Osio
Pag. 99 		Alessandro Fresco Cerdas©
Pag. 101 		Koury Angelo; Sara Pooley; Stu Rosner
Pag. 107 		Agostino Osio
Pag. 109 		Attilio Capra
Pag. 112 		Bas Princen. Courtesy
		Fondazione Prada
Pag. 115 		Agostino Osio
Pag. 122 		Courtesy Marchesi 1824
Pag. 130
2X4
Pag. 134		Bas Princen - Courtesy
		Fondazione Prada

CREDITS

Pag. 1 		Alessandro Ciampi
Pag. 11 		David Sims (Prada)
Pag. 11 		Tyrone Lebon (Miu Miu)
Pag. 11 		Jack Davison (Church’s)
Pag. 11 		Simone Rivi (Car Shoe)
Pag. 11 		Courtesy Marchesi 1824
Pag. 11 		Luna Rossa | Studio Borlenghi
Pag. 13 		Attilio Maranzano. Courtesy
		Fondazione Prada
Pag. 13 		Luna Rossa | Studio Borlenghi
Pag. 14 		Courtesy Miu Miu
Pag. 15 		Agostino Osio
Pag. 16 		Agostino Osio
Pag. 16 		Brigitte Lacombe; Willy Vanderperre
Pag. 17 		Luna Rossa | Studio Borlenghi
Pag. 18 		Attilio Capra
Pag. 19 		Brigitte Lacombe
Pag. 24 		Agostino Osio
Pag. 31 		Gabriele Croppi
Pag. 35 		Francesco Castagna
Pag 37 		Alessandro Ciampi
Pag. 38 		Gabriele Croppi
Pag. 39 		Alessandro Ciampi
Pag. 39		Ugo dalla Porta
Pag. 39 		Credits National Geographic
Pag. 40 		Gabriele Croppi
Pag. 43 		Courtesy Studio Canali
Pag. 46 		Gabriele Croppi
Pag. 55 		Agostino Osio
Pag. 57 		Alessandro Ciampi

2021— Photo Credits

Pag. 149 		Bas Princen - Courtesy
		Fondazione Prada
Other pictures: Courtesy Prada

150

Additional informationon this Sustainability Report
may be requested to:Prada S.p.A.
Via Antonio Fogazzaro, 28
20135 Milan
Italye-mail: csr@pradagroup.com