Levi CEO Chip Bergh not afraid to take a stance

For Chip Bergh, CEO of the storied jean maker Levi Strauss, taking a stance on social issues paves a path to brand longevity, he tells Axios' Hope King at yesterday’s Axios BFD in San Francisco.

Why it matters: For a company that is still standing and going strong after 170 years, the executives behind it may know something about staying relevant.

What they’re saying: “This is a company that's not afraid to take stands on important social issues of the day,” Bergh says, adding that his employees also always come first.

• “It's like the last thing a lot of companies think about when they're forming and storming and norming,” he says. “I do think it's the key to longevity.”

Zoom in: Bergh cited Levi's decision to exit its business from Russia.

• “We need to be prepared to make the harder right decision or the easier wrong decision and be prepared to live with the consequences of that,” he says.
• The decision was difficult, especially because it had to lay off its employees there, but it couldn’t continue to do business there given geopolitical turmoil, he says.
• “And it was one of the highest profit margin businesses that we had.”

Zoom out: Over the past few years, Levi has also taken steps to de-risk its supply chain, helping it stave off some of the political trade pressures that other companies face, especially with China, Bergh says.

• “When I joined the company, almost 20% of our sourcing was done in China. Today, it's mid-single digits of our total sourcing and the amount of product that we import here to the United States is less than 1% coming from China,” he says.

• “So we've really de-risked our our source dependence on China going all the way back to when the tariffs started.”
• The company has worked hard to ensure it has a big global and diversified sourcing base so that it isn’t as “overly reliant anywhere.”

Yes but: He doesn’t see Levi moving with the trend of onshoring, but he does see opportunities to move production closer to home.

• “The closer our supply chain is to the market, the more agile we can be and the more responsive we can be,” Bergh says.