Carter's Inc. (CRI) — ESG & Values Scores

Environment story

Carter's discloses ESG goals on Scope 1 & 2 emissions, suppliers with science-based targets, waste, plastic packaging, and water usage, but does not specify target net-zero year, Scope 1/2 baseline metrics, or Scope 3 (product-usage) emissions, triggering mandatory deductions. The company acknowledges climate change risk to agricultural inputs (cotton) and supply-chain disruptions but lacks quantified decarbonization infrastructure investments or renewable electricity percentage. Greenwashing checklist applied: no evidence of offset-only strategy or supply-chain emissions being deliberately hidden, but undisclosed Scope 3 and missing net-zero year credibility result in significant penalty.

Criticisms on file

Undisclosed Scope 3 (Product-Usage) Emissions: Company does not disclose Scope 3 emissions metrics or trajectory, representing material supply-chain and product-usage carbon footprint in apparel manufacturing and distribution.
Source: CRI 10-K Item 1A Risk Factors; MD&A states ESG goals but omits Scope 3 quantification.
Missing Net-Zero Credibility: No disclosed target net-zero year. Risk Factor explicitly states company may 'announce changing goals and initiatives' and acknowledges 'anti-ESG sentiment,' suggesting ESG commitments lack firmness and long-term credibility.
Source: CRI 10-K Risk Factor: 'Our failure to appropriately address ESG matters...may be unable to meet them.'
Cotton Supply-Chain Risk: XPCC and XUAR Exposure. Although company states 'do not knowingly source any products from the XUAR,' approximately 60% of fabric is sourced from China; fibers origin outside China is stated but material sourcing integrity and forced-labor audit findings are not disclosed.
Source: CRI 10-K Risk Factors: Uyghur Forced Labor Prevention Act compliance section; MD&A sourcing disclosure.
Climate Change Physical Risk Acknowledged But Unmitigated: Company notes susceptibility to weather, cotton-supply disruption, and store-closure risk from extreme weather and sea-level rise, but provides no quantified climate scenario analysis or resilience initiatives.
Source: CRI 10-K Risk Factor: 'Our business could suffer a material adverse effect from unseasonable or extreme weather conditions, or other effects of climate change.'

Disclosed initiatives

Scope 1 & 2 Emissions Goals

Company has announced goals related to Scope 1 and Scope 2 greenhouse gas emissions but specific targets and baseline years are not disclosed in the 10-K.
Supplier Science-Based Targets

Goals to work with suppliers who have science-based sustainability targets.
Waste and Plastic Packaging Reduction

Goals announced for waste reduction and plastic packaging reduction.
Water Usage Goals

Goals stated for water usage reduction across operations and supply chain.

Social story

Carter's presents no disclosed CEO-to-worker pay ratio, leadership diversity percentage, or formal union-standing documentation. Company acknowledges labor challenges at Braselton distribution facility (wage increases to attract/retain staff) and supply-chain labor-dispute risks (port strikes, vendor labor instability), but lacks transparent human-rights audit findings, modern slavery statement, or living-wage commitment. Diversity and inclusion programs are not mentioned. Supply-chain audits by third parties are referenced generically but no high-risk-geography findings or corrective-action disclosures appear, preventing full social scoring.

Criticisms on file

No Disclosed CEO-to-Worker Pay Ratio: CRI does not disclose CEO compensation, median worker wage, or pay-equity metrics in 10-K or proxy filings reviewed.
Source: CRI 10-K does not contain executive-compensation analysis or pay-ratio disclosure; standard SEC narrative omitted.
Undisclosed Leadership Diversity: No percentage of women, underrepresented minorities, or diversity initiatives in executive/board leadership disclosed in 10-K MD&A or risk factors.
Source: CRI 10-K contains no diversity reporting by gender, race, or ethnicity; EEO-1 or HRC CEI scores not mentioned.
Supply-Chain Labor Risk: Company acknowledges dependence on foreign-based suppliers (Vietnam, Bangladesh, Cambodia, India ~75% of sourcing spend) and vulnerability to labor disputes at third-party factories and shipping ports, with past experience of delays due to port labor disruptions. No public corrective-action disclosures or independent third-party audit reports provided.
Source: CRI 10-K Risk Factors: 'Labor or other disruptions along our supply chain'; 'West Coast port labor disputes' noted as past impact.
No Modern Slavery Statement or Living-Wage Commitment: 10-K does not disclose UK Modern Slavery Act compliance, forced-labor audit findings, or commitment to living wages in supply chain, despite ~75% sourcing from high-risk geographies (Bangladesh, Cambodia, India).
Source: CRI 10-K absent forced-labor, modern-slavery, and living-wage disclosures.

Disclosed initiatives

Vendor Code of Conduct and Compliance Monitoring

Company maintains policies with vendors, third-party manufacturers, and licensees; employees and third-party auditors periodically monitor operations. Compliance covers ethical business practices, health and safety standards, labor laws, and anti-bribery.
Braselton Distribution Center Wage Increases

Increased wages and implemented policies to retain existing employees and attract new workers at Braselton, Georgia distribution facility to address competition and staffing challenges.

Positive labor retention; however, driven by competitive labor market rather than proactive living-wage policy.

Governance story

Carter's board independence percentage is not disclosed in the 10-K excerpt; share structure is single-class (no dual-class supermajority penalty applies). Company does not disclose annual lobbying expenditures or PAC contributions in the filing. Governance audit reveals no active antitrust or consumer-safety regulatory proceedings; however, company is subject to standard product-liability, IP infringement, cybersecurity, and data-privacy litigation risks acknowledged as ongoing. Cybersecurity breach history (disclosed as 'incidents in the past, including within the last three years') and reliance on cloud vendors (Amazon Web Services, SAP Rise) create material control and third-party dependency risks. No evidence of shareholder litigation, stockholder-rights plan abuses, or active climate-denier lobbying is disclosed.

Criticisms on file

Undisclosed Board Independence: CRI 10-K does not report board independence percentage, committee composition, or director qualifications. Standard governance disclosures appear absent from the Risk Factors and MD&A sections provided.
Source: CRI 10-K excerpt does not contain board composition or independence metrics.
Cybersecurity Incident History Without Quantified Impact: Company acknowledges 'cybersecurity and information security incidents in the past, including within the last three years' and states 'aggregate impact...has not been material to date,' but provides no remediation details or incident-specific controls. Reliance on third-party cloud vendors (AWS, SAP Rise) creates dependency and breach risk.
Source: CRI 10-K Risk Factor: 'Cybersecurity, Data Privacy, and Information Technology'; 'we have been subject to cybersecurity and information security incidents in the past, including within the last three years.'
Data Privacy Regulatory Compliance Risk: Company is subject to GDPR, CCPA, and CPRA but does not disclose any fines, consent decrees, or enforcement actions in the 10-K.
Source: CRI 10-K Risk Factor references GDPR, CCPA, CPRA compliance obligations; no disclosed enforcement history.
No Disclosed Lobbying or PAC Contribution Activity: CRI does not disclose annual lobbying expenditures, PAC contributions, or trade-association climate stance in the 10-K or corporate-governance sections provided.
Source: CRI 10-K excerpt does not contain political expenditure or lobbying disclosures.

Disclosed initiatives

Information Security and Data Protection Framework

Established physical, electronic, and organizational measures to safeguard systems; relies on commercially available security software and monitoring; uses cloud-based vendors (AWS, SAP Rise) for data storage and operations.
Compliance Monitoring and Audit Procedures

Employees and third-party compliance auditors periodically visit and monitor operations of vendors, third-party manufacturers, and licensees to verify compliance with vendor policies, health/safety standards, and labor laws.
Stockholders Rights Plan (Limited Duration)

Board authorized a limited-duration stockholder rights plan to delay or discourage mergers or takeovers not approved by the Board.

These are Missionomics' own editorial scores — directional signals built from disclosed facts under a published method, not certifications or definitive ratings of Carter's Inc.. Coverage and confidence vary by data point, and figures can lag real-world changes. Read the full Methodology for sourcing, scoring, and correction details — or open Carter's Inc. in the app for interactive charts and portfolio building.

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