2009 Global Citizenship Report - Mattel

Recalls Involving Magnets
Magnets are used in certain toys to enhance play features
that are very engaging to children. Most magnets used in
toys are low-power, traditional magnets. However, some
toys designed for older children use small, more powerful
“rare earth” magnets. The increased power and smaller
size of these magnets increases product functionality. In
late 2005 and 2006, safety concerns were raised about
the potential of magnets coming loose from toys and
children swallowing them. The risk of injury could occur
if multiple magnets are swallowed within a sufficient
interval of time that enables them to attract one another
through intestinal walls and create an obstruction. The
likelihood of this occurring is extremely slim, but the
consequences can be serious.
In response to these concerns, the Safety Standards and
Technical Committee of the TIA, in conjunction with the
ASTM, convened a panel of experts to review this issue
and then developed a more stringent magnet safety
standard. Mattel employees played a prominent role on
the panel, which included representatives from consumer
groups, government and other manufacturers. In
January 2007, Mattel adopted the new ASTM standard
for all magnet toys across all of our brands—five months
before it was officially published as the industry standard.
We also improved the design of the magnet retention
systems to ensure that “rare earth” magnets used in
future toys would be securely locked-in.
After developing this new magnet retention system, we
reevaluated our pre-2007 toys that contained these
magnets. We found that some of our toys did not meet
the proactive goals of this new standard. This led us to
notify the CPSC and other regulatory authorities of
our decision to initiate a voluntary worldwide recall of
approximately 22.7 million toys manufactured between
2002 and 2006. In effect, the recall applied the new ASTM
safety standard retroactively to toys that were made
before the panel was even convened.
We believe that applying the 2007 ASTM Magnet
Safety Standard retroactively was the right thing to
do. To our knowledge, no other toy company
retroactively applied the new standard.
Disposal of Recalled Product
We are committed to the proper management of recalled
products, including those that were retuned to the
company or quarantined prior to distribution. In the U.S.,
all returned products are being held in warehouses until
we are sure they are no longer needed for our own
investigation or for legal reasons. We are exploring ways
to separate and recycle parts of the products, including
plastic resins, batteries and paper packaging. In some
cases the sorting of these materials for recycling is
required—for example battery recycling in California.
Outside of the U.S., Canada and Venezuela, all affected
products have been disposed of in accordance with
applicable laws.
Case study:
ALERTING CONSUMERS DURING A RECALL
In collaboration with the U.S. Consumer Product
Safety Commission (CPSC), Mattel swiftly
communicated to consumers and retailers about
the product recalls and the process for returning
affected toys, including measures that go beyond
required protocols. To reach consumers around
the world we took the following steps:
• Developed Web-based resources to help
consumers in the U.S. and Canada easily search
for and identify affected toys. As a result of this
increased capability, our service Web site was
able to respond to an estimated 95 percent
of consumer inquiries. For consumers outside
North America, we created an online tool,
accessible in more than 20 different languages,
which provided directions on how to contact
a local Mattel representative.
• Provided information through our toll-free,
multilingual, interactive phone line about the
affected toys
• Issued press releases, in addition to those
released by the CPSC, to publicly alert consumers
• Granted numerous television and print interviews
to speak directly about the recalls
• Placed advertisements in major newspapers and
on various Web sites worldwide
• Produced and displayed prominently on the
Mattel Web site three videos in which our CEO
addressed recalls and spoke directly to consumers
and other stakeholders
PROMOTING FAIR AND JUST WORKING CONDITIONS
While Mattel directly employs a large workforce in our
factories, the manufacturing of our products affects
thousands more who are employed by our vendors that
operate their own factories. Additionally, thousands
work at licensee factories that produce products
bearing our brands. We strive to ensure that our products,
as well as licensed products, are manufactured in
a responsible and ethical manner. We continue to evolve
our standards and oversight processes to reflect our
expectations for fair labor practices and environmental
stewardship.
This section details:
• GMP audit findings and how we have addressed them
• Results of external audits
• Our approach to external auditing moving forward
REGIONAL RECOGNITIONS
• Caring Company Award 2006, 2007 and 2008
awarded to Mattel Asia Pacific Sourcing, Hong
Kong. (Presented by the Hong Kong Council of
Social Service)
• CSR Program Implementation Award 2009
awarded to Mattel Indonesia. (Jababeka
Industrial Estate, ranked first among more
than 700 companies operating in the industrial
manufacturing zone)
18 | OUR TOYS 19 | GLOBAL CITIZENSHIP REPORT
While we have begun the process of incorporating GMP
audit elements into our new QMS, we have continued to
conduct internal GMP audits of our factories and vendors.
Mattel’s GMP include standards for the following:
1. Management Systems
2. Wages and Working Hours
3. Age Requirements
4. Forced Labor
5. Discrimination
6. Freedom of Expression and Association
7. Living Conditions
8. Workplace Safety
9. Health
10. Emergency Planning
11. Environmental Protection
GMP audits include an assessment of many social and
environmental factors. We pay particular attention to zero
tolerance issues (minimum age requirements for workers
and free will employment), as well as wages and working
hours, living conditions and clear access to emergency
exits. Mattel’s GMP requires that a factory address a zero
tolerance finding immediately and that other findings be
corrected according to an agreed timeline.