Our stakeholders are people, groups, organizations or systems that affect or can be affected by our Company. They include communities, suppliers, governments, the media, non-governmental organizations (NGOs) and reporting agencies. As our sustainability strategy continues to evolve, we communicate regularly with these groups to listen and further understand their needs and expectations. This feedback, in turn, helps us to develop our own strategies, policies and processes. The following table summarizes the means by which we engage with our primary stakeholder groups on an ongoing basis.

Stakeholder Group Primary Communication Channels
Primary Customers Dedicated sales force by category and distribution channel; product literature; training programs; “voice of the customer” surveys; social media
Shareholders Quarterly SEC filings; quarterly earnings conference calls with senior management; one-on-one meetings; annual meeting; annual report
Employees Intranet system; social media; “cascading” management briefings
Product Advocacy NGOs Targeted outreach product literature; social media; consumer and trade industry affiliations

Stakeholder Engagement & Materiality

In preparation for our transition to the new Global Reporting Initiative (GRI) 4.0 guidelines in this year’s report, we conducted an in-depth stakeholder engagement exercise in early 2016. Our goal was to determine which concerns were most important to both internal and external stakeholders in order to inform the future direction of our sustainability strategy and execution.

This engagement exercise consisted of two parts — an online survey, followed by interviews with a representative from major stakeholder groups. We distributed the survey primarily to employees and customers, who were asked to rate the relative importance of a range of business and sustainability topics related to the flooring industry. As a second source of input, we conducted in-depth interviews with individuals, each representing a stakeholder group: employees, industry association, investors, issue-based non-governmental organizations, suppliers, community leaders, retail customers, commercial customers and consumers.

Among these stakeholders, we were gratified to discover that Mohawk is considered a sustainability leader in the marketplace and is perceived as a company that incorporates sustainability as part of our day-to-day business execution. With this leadership, however, comes responsibility. As a leader, we are put under more scrutiny by our stakeholders, and industry peers expect us to set standards.

Our stakeholders also pointed out several areas in which we have the opportunity to extend our sustainability leadership. These include continuing to put responsible material inputs at the forefront of product design; managing resource constraint risks, such as water scarcity; and enhancing the communication of sustainability benefits in our product marketing.

At a higher level, stakeholders noted ongoing shifts in industry dynamics, such as pricing, product categories, technology and innovation. Among internal stakeholders, there is a need to manage potential shortages in the skilled workforce due to technical training gaps. Conversely, internal stakeholders see an opportunity to further deploy sustainability initiatives as an employee engagement tool. External stakeholders noted that healthy living and working environments will continue to be a purchasing consideration for customers of the building materials industry.

Materiality Assessment & Mapping

The results of the stakeholder survey prioritized key material issues, which were further validated by the series of stakeholder interviews. These issues were then mapped on a matrix based upon importance to the business and stakeholders. As a final validation step, members of Mohawk’s senior management team reviewed the issues and their placement on the matrix.

Reporting on Material Issues

Issue Description of Issues Discussion Location Within the Report

Climate Change

Greenhouse gas emissions

Approach; Goals & Progress/Energy & Emissions

Community Relations

Strategic philanthropy

Local economic impact

People/Community

Corporate Transparency & Accountability

Management accountability for sustainability performance

Government & ethics

Company/Governance

Economic Performance

Direct economic value generated and distributed

Indirect economic value generated

Company

Employee Health & Safety

Healthcare costs

Employee wellness

Occupational safety

People/Safety

Employee Relations

Labor relations/collective bargaining

Skilled workforce — recruitment and training

People/Employee Relations

Energy

Alternative energy use

Energy use in manufacturing

Transportation — fleet fuel efficiency/route optimization

Goals & Progress/Energy

International Expansion

Corruption

Human rights standards

Data collection reliability/sustainability reporting

Environmental standards/regulations

Trade agreements

Company; Approach

Material Inputs

Recycled feedstocks — post- & pre-consumer

Local/regional sourcing

Petroleum-based materials

Chemicals of concern

Product Stewardship

Product Design

Product use

End of life

Product Stewardship

Product Quality & Safety

Indoor air quality — customer health

Product compliance— recalls

Labeling/certifications

Product Stewardship

Supplier Sustainability

Raw material extraction/harvesting — deforestation

Supply chain visibility — chain of custody

Conflict minerals

Materials verification

Human rights/labor practices

Environmental standards/regulations

Company/Supply Chain

Waste & Recycling

Packaging

Marketing waste — samples/digital tools

Manufacturing waste

Goals & Progress/Waste