Better Health for All

Arhaus, Inc. is a retailer of home furnishings, and its core products and services do not have a direct positive or negative impact on health, nor do they generate revenue from products with established negative health outcomes. The company does not offer health-related products or services that would require considerations for price accessibility or vulnerable population reach. While Arhaus is subject to California's Proposition 65 reporting requirements,

the provided articles do not quantify any specific health risks of its products or the revenue derived from them, nor do they detail the clarity and honesty of disclosures. The company's operations do not involve health innovation, healthcare workforce support, preventative health measures, health data management, global health crisis response, mental health initiatives, pharmaceutical patents, nutrition, health education, addiction mitigation, or clinical trials. Therefore, for all relevant KPIs, the company's activities are considered neutral or not applicable to the 'Better Health for All' value.

Fair Money & Economic Opportunity

Arhaus, Inc. is a retailer of home furnishings and does not operate as a financial institution. The company does not offer lending or deposit services to consumers, nor does it provide consumer credit products with APRs or generate revenue from high-cost financial products. Therefore, KPIs related to financial services, such as underserved client share, pricing fairness, exploitative fee exposure, inclusion initiatives, data accessibility, fair lending compliance, wealth-building outcomes, debt burden ratio, geographic inclusion for financial access points, and product simplicity for financial products, are not applicable. While Arhaus supports philanthropic initiatives like donating furniture to Habitat for Humanity and a $10 million donation to The Nature Conservancy, these are not considered reinvestment in community finance or profit-sharing with underserved communities as defined by the rubric.

The company's Audit Committee Charter mentions financial literacy requirements for committee members, but no financial literacy programs for customers. A $6 million settlement for misleading sales practices was related to product pricing, not financial product pricing or lending.

Fair Pay & Worker Respect

In 2024, Arhaus CEO John Reed's total compensation was $2,257,528, resulting in a CEO to median employee pay ratio of 41:1.

Employee reviews on Glassdoor indicate an overall rating of 3.1 out of 5 stars, with 43% of employees recommending working at Arhaus. Compensation and benefits received a 2.9 out of 5 stars, with concerns about low base pay ($10-$10.50/hour) and potentially unfair commission structures. Reviews also highlight concerns about high employee turnover, poor management communication, and safety issues in the warehouse. The company states it complies with the California Transparency in Supply Chain Act and conducts supplier audits to prevent child labor, involuntary labor, and human trafficking, with internal accountability measures for employees and suppliers.

Fair Trade & Ethical Sourcing

Arhaus requires all suppliers to annually certify compliance with its Supplier Standards of Business Practice.

These standards explicitly prohibit child labor, involuntary labor, and human trafficking. Employees involved in procurement receive training on these standards, and violations can lead to the termination of the business relationship. The company also supports the California Transparency in Supply Chain Act.

Honest & Fair Business

Arhaus restated its financial statements for the period ended September 30, 2023, due to errors in cash receipts from landlord reimbursements.

This restatement, filed with the SEC on April 29, 2024, impacted net cash provided by operating activities and net cash used in investing activities by an estimated $1 million to $5 million.

Kind to Animals

Arhaus has donated $10 million to The Nature Conservancy and YKAN, which is preserving 54,000 acres of rainforest in Borneo, a habitat for various species including pygmy elephants, clouded leopards, and orangutans.

This donation represents approximately 0.79% of the company's 2024 revenue. Additionally, Arhaus has planted over 100,000 trees in the U.S. and pledged to plant 1 million trees in the next 10 years in collaboration with American Forests.

No War, No Weapons

Arhaus, Inc. reports $0.00 revenue from arms contracts and does not engage in dual-use technology, surveillance, or intelligence activities.

The company has no defense business to oversee, no defense assets to divest, and no lobbying related to arms control. Arhaus states it has policies to comply with applicable laws and regulations and its due diligence measures for conflict minerals are informed by the OECD Guidance. It requires suppliers to certify compliance with standards prohibiting child labor, involuntary labor, and human trafficking, conducting periodic inspections and unannounced visits. For conflict minerals, it conducts annual due diligence, with 310 in-scope suppliers in 2024 and 285 in 2023. Supplier response rates for the Conflict Minerals Reporting Template were 81.94% in 2024 and 71.23% in 2023. The company identified 24 smelters in 2024 and 217 in 2023 that potentially posed a risk due to red flag indicators, relying on third-party audits like the Responsible Minerals Assurance Process (RMAP). Arhaus engages with suppliers for corrective actions and assesses their conflict minerals status. The company states it values diversity and fosters a culture of inclusion, diversity, and equity, but does not explicitly mention alignment with UN Guiding Principles on Business and Human Rights.

Respect for Cultures & Communities

Arhaus has no reported cultural appropriation incidents in the provided articles.

The company has made a $10 million donation to The Nature Conservancy and its local Indonesian affiliate, YKAN, which is preserving 54,000 acres of rainforest in East Kalimantan, Borneo, contributing to cultural site protection. The company's annual report is available in English, Spanish, and Chinese. While nearly 70% of upholstery is domestically sourced and the company works with over 400 global vendors, a specific proportion of procurement spending directed to local suppliers is not provided.

Safe & Smart Tech

Arhaus experienced two data breaches within the past three years.

The first breach, occurring between March 25 and May 24, 2022, compromised employee data including names, driver's license numbers, Social Security numbers, and financial account numbers for an undisclosed number of individuals. Notification letters for this breach were sent on July 22, 2022. A second breach, between October 3 and October 19, 2022, affected more than 3,100 individuals, with notifications starting on February 10, 2023. The company conducts mandatory computer-based training and phishing awareness campaigns for employees. Its privacy policy, effective October 20, 2023, outlines user choices for communications and data deletion, and mentions compliance with CCPA and COPPA. The policy also describes data categories collected and their purposes, but specific data minimization practices or retention periods are not detailed.

Zero Waste & Sustainable Products

In 2023, Arhaus achieved a manufacturing waste recycling rate of 62% and a packaging material recycling rate of 78%.

Approximately 50% of raw materials used in products are recycled, including salvaged wood, recycled copper, and aluminum. The company had no specific waste disposal violations mentioned for 2023. Arhaus also set a 2023 annual waste reduction goal of 15%.