2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT AUDACIOUS RETAILERS Profile

e are first and foremost a group of retailers rather than just shopkeepers. We enjoy connecting with peopleW and relationships, we want to satisfy our customers, and we know and love our products. Our retail businesses hinge on initiative and intuition. For us, retailers, audacity means a zeal for enterprise, the capacity to rise to challenges and take commercial risks, a desire to innovate…. and to succeed in the long term.

2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT I 01 Contents

Our agreement with Système U and Metro +14% makes us RISE IN OWN-BRAND AND NO-NAME the leading PRODUCTS IN HOUSEHOLD EQUIPMENT, TEXTILE AND BAZAAR purchasing SOLD IN ALL THE COUNTRIES OF THE GROUP organisation in Europe.” POLAND NOW TRANSFERRED Jean-Denis Deweine Head of the International Product PUBLIC NOTICE UNDER THE AUCHAN BANNER Sourcing and Purchasing Department TO ENTREPRENEURS After Ukraine, Russia and Romania, where all 38 hypermarkets have been 30 additional A2pas stores successfully transferred to the Auchan banner, it is now Poland’s turn. in Paris, a first multi-business 57 hypermarkets and 11,000 employees joined Groupe Auchan in 2014. line franchise in Reunion Island, a promising new partnership PAGE 36 in Vietnam… More than ever, franchises and partnerships are driving the Group’s development around the globe. SOUS-TRAITANCE : LE GROUPE AUCHAN: DEVOIR DE TRANSPARENCE EVERYWHERE, THE SAME PAGE 34 Defined in 2013, an action plan VISION OF THE FUTURE in 8 axes for secured supplies After a revamp in 2013, BUY TOGETHER was developed in 2014. Its the new Group Vision TO BUY CHEAPER encouraging results have was distributed, shared With Système U in France, Sisa in Italy and Metro Group internationally, been communicated in a fully and appropriated by all Groupe Auchan has sealed 3 major purchasing partnerships that give it an even transparent manner. 330,700 employees in all countries greater competitive edge. PAGE 68 and core businesses. PAGE 18 PAGE 44

ENERGY REDUCTION LILLAPOIS, PROGRAMME CHARGEZ-VOUS THE NEW To improve its energy efficiency, CHEZ NOUS ITALIAN BEAUTY an ambitious voluntarist Result of a partnership This small store specialised project has been launched by between Auchan France and in beauty, hygiene and Groupe Auchan and positively Nissan, the first hypermarket household cleaning products 4.4 experienced in Spain. fast charging stations were has already seen rapid Feiniu.com MILLION HOURS OF TRAINING installed on the parking 1,035 development less than one year THE 1ST B2C E-COMMERCE PLAYER TO IN 2014 of 40 stores. HYPERMARKETS AND 2,849 SUPERMARKETS after its launch. ACHIEVE ABOVE RMB100 M TURNOVER (excl. RT-Mart) PAGE 61 MANAGED IN THE WORLD IN ITS 1ST YEAR OF OPERATION PAGE 14 PAGE 66 PAGE 40 PAGE 32 PAGE 27

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TAKING FURTHER

GROUPE AUCHAN’S again driven exclusively by Eastern Europe and China. In France, Groupe Auchan’s reve- nue fell by 2.2% to €19.7 billion, mainly due to the decrease in prices. Similarly, revenue in the euro zone AUDACITY excluding France fell by 6.0% to €10.4 billion, primarily due to diffi- culties in Italy. However, Central and “We are audacious retailers”: these are the words Groupe Auchan Eastern Europe saw growth of 5.9% chose to summarise its corporate Vision. In the current changing and Asia, after restatement for the impact of the consolidation of 100% environment, only the audacity of its employees will enable the Group of Sun Art Retail Group, saw growth to seize opportunities for growth and development. Even of 5.8%. Both regions fulfilled their if Groupe Auchan went through a mixed year in 2014, it has role as growth drivers. property activity (+1.7%) and our bank, Oney Banque Accord Our historical core business, the (+0.7%), turned in good performances, while e-commerce, implemented a number of structuring projects that allow it to look hypermarkets, accounted for 81.2% the Drive format and the other activities saw growth of 2.2% to the future with confidence. Vianney Mulliez, Chairman of Groupe of Groupe Auchan’s revenue, at to €1.2 billion. Auchan’s Board of Directors, reviews the year in question. €43.6 billion (+1.2% after restatement for the impact of the full consolida- In 2014, despite this strained environment, Groupe tion of Sun Art Retail Group). The Auchan once again demonstrated the resilience of its supermarkets, for their part, had a core businesses and its business model. Indeed, we more difficult year, with a 3.1% decline generated revenue growth in Central and Eastern Europe in revenue to €7.6 billion. Our retail and Asia. Our sales formula proved virtuous almost every- where. Even in France, we saw growth in customer num- 2014 was a particular year for Groupe Auchan. On the one many countries are seeing a significant bers and in articles sold per customer thanks to substantial hand, our financial results fell short of our expectations in a increase in regulatory and fiscal pres- investment in prices. Groupe Auchan therefore fulfilled its strained environment, and on the other, all our core busi- sure, particularly France and Hungary. mission as a responsible discounter in all countries in which nesses, in all areas, achieved various successes. Thus, if But the environment is one element; it Despite a tense it operates, with healthy fundamentals: cash flows from I were to summarise 2014, I would choose the words is up to us to draw on our profession- operations increased by 4.0% and financial debt almost lucidity, resilience, and preparation for the future. alism and our commitment so that we environment, halved from €3,164 million in 2013 to €1,833 million at the can make a difference. Groupe Auchan end of December 2014. First of all, we need to be lucid about the current sit- There were also several successful operations during the uation. The global economic environment remains difficult. At the same time, we must be demonstrated year, and first of all in the area of purchasing partnerships. Economic turmoil persists in the euro zone, with Italy in a lucid about our performance. once gain the With markets showing zero growth and competition very particularly deep crisis, while an aggressive price war is being Despite the dedication shown by tough, the consolidation of the retail sector had become waged in France. In Eastern Europe, while the fundamentals all of our employees, in all coun- resilience inevitable, particularly in the euro zone. Yet, our ambition is in Poland and Romania are still good, Groupe Auchan had to tries and core businesses, Groupe of its activities to be “a group of major, audacious retailers through contend with a complex geopolitical situation in Russia and Auchan’s 2014 results fell short of our determination to always and everywhere be Ukraine, which caused a slowdown in the Russian economy our expectations, and once again thanks to a strong cheap and cheaper”. If we are to uphold this commitment and a sharp depreciation of local currencies. In Asia, China showed mixed trends. Consolidated sales performance to remain a discounter without impacting our long-term saw a relative slowdown in its economy. At the same time, revenue excluding taxes amounted to profitability, inevitably we must also purchase cheap and €53.5 billion, up 11.2% (+3.7% at con- in Eastern Europe cheaper… For this reason, we signed several purchasing stant exchange rates and +0.8% after and Asia, and partnerships, in France with Système U, in Italy with Sisa, restatement for exchange rate effects and internationally with Metro Group. Alongside our part- and the consolidation of 100% of Sun reduced its ners, we are now the leading purchasing organisation in Art Retail Group). Organic growth was financial debt. Europe, thanks to which we can pursue our discount policy.

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We also continued to develop our partnership activities, thanks nota- bly to the success of the “super- Drawing on our revamped Vision and our markets” division. A2pas is now developing successfully as a fran- 4 strategic axes, we plan to concentrate on chise in Paris, with the banner gaining our core businesses to accentuate, where 30 points of sale located in strategic areas in the capital, and is well placed possible, how we stand out for our customers: to reach its objective of 100 points of our offering, choice, prices, reception, And we will continue to study all opportunities to consolidate sale in 2016. In January, the first mul- our purchasing power in the countries in which we operate. ti-business franchise was launched purchasing experience. Thus, in January 2015, Alcampo and Simply Market signed on Reunion Island. In June, Groupe a partnership with Euromadi Ibérica SA in Spain covering the Auchan signed a partnership involving negotiation of own-brand products. an equity investment with CT Group to develop the supermarkets activity in In France, we used cross channel offers Being a discounter means being cheap and cheaper. Vietnam. We expect this partnership to to increase the number of Auchan Naturally, therefore, I am very happy with the price replicate the success we encounter in brand shopping routes for our cus- awards our companies won in several countries, Tunisia, where, with 86 supermarkets tomers. We now offer in-store pick-up and in all regions: Eastern Europe, Asia, the euro zone, (11 opened in 2014), our association of items bought online, the possibility to help us meet the challenges of tomorrow as best as including Portugal and Spain, where Alcampo was recog- with Société Magasin général made us of ordering Auchan.fr’s broad range we can. First fundamental axis: “to be a group of audacious nised for the 6th year in a row as the country’s cheapest the leading food retailer in the country of products in the hypermarkets, and retailers, promoting the superiority of our offering and our aim banner, and for the first time in Italy. In France, Auchan in 2014. 1-hour pick-up in stores, all of which to always and everywhere be cheap and cheaper”. Our lead- launched a recapture plan in March 2014 which involved generated more than 1 million order ership in terms of prices, the development of cross-channel a significant reduction in its average selling prices, the pick-ups at our hypermarkets and offers, the appeal and relevance of our offering… all are factors goal being to offer customers the cheapest shopping helped to strengthen the weight of our that help us to stand out and attract customers. The next basket in everyday shopping. Everywhere, we are working brand and the appeal of our sites. 2 axes, “to improve the Group’s efficiency and profitability” to give purchasing power back to ever more customers. and “to pursue audacious, closely-managed and profitable 2014 also saw a stronger sales dynamic. Among the various Finally, our audacious human development in own-brands and partnerships”, are designed powerful promotional drives we implemented to win over our Our sales, business resources policies and our deter- to establish a lasting and profitable dynamic for our companies. customers were the “Black Friday” in Spain and France, and and human mination to become “our employ- Finally, all of this must be achieved while remaining “a group the innovative “11-11” in China. ees’ preferred employer” were apart through our policies of corporate and social responsibility Finally, we continued to modernise our offering and offer resources model rewarded in several countries, and by listening to the women and men who work for us”. customers real quality thanks to own-brand products such must constantly notably in China where Auchan is one of From 2015, the Group’s companies will face a certain num- as Qilive household equipment, In Extenso textiles, and the only 2 retailers ranked as one of the ber of challenges: to transform the partnerships signed at Cosmia, our new personal care line in Spain. be adapted so 100 best companies in terms of human a national and international level into purchasing gains; to that we continue resources, and in Spain where Alcampo strengthen the appeal and relevance of our offering, notably In Eastern Europe, the integration of the Real hyper- was recognised for its policy of aware- through our own brands, particularly in non-food prod- markets was successful on both a commercial and to respond to the ness and integration of disabled people. ucts; to finalise the integration of the Real hypermarkets in human level. In Romania, Ukraine and Russia, the results changing demands Poland, with the same success that was achieved in the three confirm the relevance of Auchan’s business model and Groupe Auchan’s business strat- other countries; to pursue cross channel development; to our choice of acquisition. In Poland, where integration only of our markets, egy was built around 4 structuring strengthen Auchan’s business and sales model in France and began in February 2014, the initial trends are also positive: particularly given axes and 15 operating decisions, Italy; to speed up the roll-out of the innovations developed via sharp fall in prices, significant increase in the number of whose implementation is designed Creative Attitude, our participative innovation programme… customers and articles sold, establishment of a virtuous the transformation Groupe Auchan’s success is only possible through the sales formula. The current economic difficulties in Russia brought by digital dedication of the women and men who work in it, its service and Ukraine confirm, if this were needed, the relevance of a and quality of execution, and efficient steering of our stores general discounter for consumers in these countries. technology to our and shopping centres. All of this will play out at a local Parallel to this, the Group continued its rapid development in everyday lives as level, through our relationship with our customers. It Russia, where our business models are attracting custom- is up to us to set the scene so that we can maintain ers. We opened 5 hypermarkets and 29 supermarkets in the customers, citizens and demonstrate the appeal of our business and the country over the year. and employees. audacity of our teams.

06 I 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT I 07 Governance

The Executive Committee, chaired by Vianney Mulliez, implements the Group’s corporate vision The Board of Directors defines the Group’s strategic orientations Composition of the Board of Directors and values. It conducts the Group’s global projects, organises and supports synergies. It proposes and ensures they are implemented by the Executive Committee. It sets out on 5 March 2015: a development strategy to the Board of Directors according to the outlook for growth, profitability the corporate vision, establishes the rules of governance and appoints Vianney Mulliez, Chairman Marion Buchsenschutz and risk. It encourages the development of the Group’s human and financial resources and submits and assists the executives. It allocates resources between the different Jean-Louis Clavel their allocation to the Board of Directors. business lines, oversees the ownership and security of the Group’s assets Christophe Dubrulle, Representing Ausspar as well as supervising risk management. The Board of Directors creates Barthélémy Guislain the conditions for lasting and sustainable business growth. Benoît Leclercq Didier Leroy Valérie Vendeville

We are audacious retailers In every country in which While our performance Immochan has been Despite a difficult year, Because our employees are who enjoy connecting with Auchan operates, our has fallen in the euro zone reorganised and is now marked by a persistently close to both products and people and relationships, customers have been hit due to an unfavourable the best generator of traffic drab environment in the euro customers, they play a central and put priority on knowing heavily by crisis. For this environment, our banner’s at its retail and living spaces. zone and a tense geopolitical role in the success of our our products and satisfying reason, Auchan’s retailers have positioning in fresh products, By being ever more audacious, situation in Eastern Europe, audacious trading business. our customers. Our audacity been working harder than ever convenience and low prices, we can increase traffic, Groupe Auchan once again It is up to us to give them can be seen every day in to improve their purchasing in every country, is grow our trade, and become demonstrated the resilience the necessary tools to be able our zeal for enterprise, our power and quality of life… appreciated and sought the preferred brand of banners of its business model. Thanks to act autonomously and take capacity to rise to challenges This is our company’s purpose, out by consumers. and customers alike. to good control of its financial on responsibilities that can and take commercial risks, as expressed in our Philippe Saudo Benoît Lheureux debt, the Group can look to the produce results every day. our desire to innovate and Group Vision. General Manager, Supermarkets Chief Executive Officer future with confidence. Philippe Gracia of Immochan Director of Human Resources succeed, and the pleasure Philippe Baroukh Oney Banque Accord, for its we take in satisfying General Manager, Hypermarkets part, turned in a very good year of Groupe Auchan and surprising our customers, in almost all countries. by all possible means. Xavier de Mézerac Vianney Mulliez Chief Financial Officer of Chairman of the Board Groupe Auchan and Chief Executive of Directors Officer of Oney Banque Accord

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Group vision

WE ARE KEY FIGURES AUDACIOUS RETAILERS 330,700 th EMPLOYEES(1) Formalised for the first time in 1994, our Vision incorporates 11 the bedrock, meaning, direction and cohesion of all of Groupe Auchan’s companies. Since its last update was in 2008, it had become necessary to adjust this Vision and especially PRESENT to share it again with all of our employees. LARGEST IN FOOD 16 In 2013, a major collaborative project was launched to update RETAILER the Group Vision, drawing on Groupe Auchan’s culture of IN THE WORLD COUNTRIES We are simple, serious, friendly (Source: Deloitte) enterprise, and involving every management committee in and united retailers. every country and core business. Once completed, it was Mohammed Amrioui distributed over the course of the year, to be shared and most Referent Store Manager, Simply Market France importantly appropriated by all our employees. HYPERMARKETS With the Group’s business models facing challenges in mature (2) E-COMMERCE IN 12 COUNTRIES (AUCHAN.FR, GROSBILL, AUCHANDIRECT) countries, the online shopping experience raising new ques- These values are within each of us. 888 2.1 BILLION CHECK-OUT TRANSACTIONS tions about the company’s customer relations and the value We just need to know how to express of its brands, it had become necessary for the teams to focus them, and our Group gives us the opportunity to express them every day. 182 DRIVES again on the Group’s purpose, objectives, and commitments. The renewed Vision can be summarised in a few words, which Bénédicte Lenoire 26 ALINÉA Head of Human Resources, Immochan Italy SUPERMARKETS are relevant anywhere: “We are audacious retailers”. (2) 17 LITTLE EXTRA While our purpose and values have 862 IN 6 COUNTRIES not changed, the Vision has been 15.8 MILLION CUSTOMERS Any employee from a core business, 473 MILLION CHECK-OUT TRANSACTIONS Our Vision helps to enhanced to include strong convic- clarify the future, whether it is Oney Banque Accord, reflecting our tions, such as the importance of listen- a hypermarket or a supermarket, shared ambitions. ing to our customers, the strength of can easily integrate into any other team work, simplicity, decision-making core business thanks to our Vision SHOPPING MILLION ONEY BANQUE Madalina based on close contact with custom- and our shared values. Dumbraveanu CENTRES . ACCORD CUSTOMERS ers, and our long-term performance, 370 77 Head of Human Agata Bettencourt Resources, Auchan all of which now guide the behaviour of Head of Human Resources Development, MANAGED IN 12 COUNTRIES IN 11 COUNTRIES Romania all our employees every day. Oney Banque Accord Portugal 15,000 RETAILER PARTNERS

(1) Consolidated scope, average full-time equivalent. (2) Consolidated perimeter.

10 I 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT Financial overview

CONSOLIDATED REVENUE EXCLUDING TAXES – 31/12/2014 CURRENT INVESTMENTS

64.3% HYPERMARKETS 81.6% 13.1% € HYPERMARKETS € SUPERMARKETS 53.5 2,050 CURRENT 19.4% IMMOCHAN 14.3% INVESTMENTS SUPERMARKETS BILLION MILLION BY ACTIVITY 0.8% ONEY BANQUE ACCORD 1.2% 2.4% IMMOCHAN OTHER ACTIVITIES 0.8% ONEY BANQUE ACCORD (1) 25.9% 2.1% FRANCE +11,2% OTHER ACTIVITIES +9.3% CURRENT 11.9% WESTERN EUROPE INVESTMENTS EXCLUDING FRANCE 2014 53.5 2014 2,050 BY GEOGRAPHICAL AREA 26.2% CENTRAL AND 2013 48.1 2013 1,875 EASTERN EUROPE REVENUE EXCLUDING TAXES 36.0% ASIA 2012 46.9 BY ACTIVITY 2012 1,896

36.8% FRANCE 19.4% WESTERN EUROPE EXCLUDING FRANCE NET PROFIT FROM CONTINUING PROFIT FOR THE YEAR ATTRIBUTABLE 21.6% EBITDA(2) OPERATIONS TO OWNERS OF THE PARENT CENTRAL AND EASTERN EUROPE 22.2% €2,591 €787 €574 ASIA MILLION MILLION MILLION REVENUE EXCLUDING TAXES BY GEOGRAPHICAL AREA 2014 2,591 2014 787 2014 574

(1) At current exchange rate. 2013 2,636 2013 835 2013 767 2012 2,540 2012 719 2012 656

REVENUE INCLUDING TAXES REVENUE GROWTH ON A REVENUE GENERATED FOR THE CHAINS: LIKE-FOR-LIKE BASIS INTERNATIONALLY CASH FLOWS FROM OPERATIONS NET FINANCIAL DEBT (EXCLUDING TAXES, EXCLUDING PETROL, AT CONSTANT €63.0 EXCHANGE RATES) €2,156 €1,833 BILLION 63.2% MILLION MILLION The simplified financial 2014 63.0 2014 2,156 2014 1,833 statements are available –1.0% at the end of the report. 2013 62.1 2013 2,051 2013 3,164 The 2014 Financial Report can be downloaded on 2012 60.2 2012 1,956 2012 3,163 www.groupe-auchan.com

(2) Operating profit from continuing operations excluding other operating profit and expenses and excluding depreciation, amortisation and impairment.

12 I 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT I 13 2014 CSR Overview

SOCIAL ENVIRONMENTAL Groupe Auchan’s aim is for employees to be “responsible, enthusiastic and highly regarded”. The environmental footprint produced by Groupe Auchan’s various activities makes it necessary To achieve this goal, its businesses are committed to promoting diversity, encouraging personal to constantly seek novel energy-saving solutions and new environmentally-responsible products development, employing participative management methods, ensuring good quality working in order to help combat climate change and safeguard biodiversity. conditions and sharing the fruits of its success.

464 67% 12,200 KWH/SQM AVERAGE ELECTRICITY OF WASTE RECYCLED TONNES OF PACKAGING ELIMINATED CONSUMPTION RATE IN RELATION ON AVERAGE SINCE 2004 ACROSS OWN-BRAND 330,700 TO HYPERMARKET SALES AREA BY HYPERMARKETS PRODUCTS EMPLOYEES(1) 29 (Consolidated scope – average full-time equivalent – 31/12/2014) (1) Excluding RT Mart China. HYPERMARKETS CERTIFIED ISO 14001 7,880 423 ORGANIC PRODUCT LISTINGS SOLD HYPERMARKETS HAVE SELF-DISCOUNT BY HYPERMARKETS AND SUPERMARKETS DEPARTMENTS 41,500 PERMANENT APPOINTMENTS SOCIETAL By ensuring sustainable supplier relationships and seeking dialogue with stakeholders, the Group’s 4.4 7,800 businesses demonstrate a desire for shared progress. The main aim of Groupe Auchan’s solidarity MILLION TRAINING HOURS DISABLED EMPLOYEES initiatives, which it implements with the help of its foundations and programmes, is to create PROVIDED IN THE WORKFORCE momentum for solidarity at local level by involving its employees. 186 NON-PROFIT PROJECTS 3,457 SUPPORTED BY THE AUCHAN, SIMPLY OWN-BRAND PRODUCTS LABELLED AND IMMOCHAN FOUNDATIONS 163,000 13 IN BRAILLE EMPLOYEE MILLION MEAL EQUIVALENTS 11,885 47% €1.9 DISTRIBUTED IN THE FORM 175 MEETINGS HELD WITH EMPLOYEE OF GROUPE AUCHAN’S SHAREHOLDERS MILLION ALLOCATED OF FOOD ITEMS BY AUCHAN SCI SOCIAL AUDITS CONDUCTED REPRESENTATIVES MANAGERS ARE WOMEN WITHIN THE GROUP IN 9 COUNTRIES TO SUCH PROJECTS FRANCE TO FOOD BANKS IN 2014

The CSR reporting methodology is available at the end of the report. The CSR section of the 2014 Management Report can be downloaded on www.groupe-auchan.com

14 I 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT I 15 OUR RETAIL AUDACIOUS AND PIONEERING CHOICES Our retail

BUY ALLTOGETHER TO BUY BETTER

Thanks to the signature of purchasing partnerships, at both national and international level, Groupe Auchan succeeded in increasing its purchasing power, making it the largest in Europe. A strategic move at a time when price remains the decisive criterion for the consumer.

A drab economic environment, tougher competition, price internationally. The choice of part- wars, sector concentration… like many of its rivals, Groupe ners meets 2 criteria: compati- Auchan operates in increasingly difficult environments. In the bility of values (Groupe Auchan euro zone especially, deflation is destroying value and the pros- shares the same human values, pects for growth are slim. To deal with this, the Group decided business concept, and desire to 51 to team up with other retailers to increase its purchasing power. be a responsible company with JANVIER 2015 ALCAMPO Its main goal: to do much greater business with major interna- Système U) and little or no com- HYPERMARKETS tional suppliers, and in this way improve its purchasing terms. petition downstream (as proven by To compete with the Carrefour / Dia / Cora group (market Alcampo and Simply NOW HAVE the complementary nature of our share of nearly 23%), the Intermarché / Casino group (mar- Market joined forces SELF-SERVICE with Euromadi in Spain BAKERY AND geographical presence and core ket share of nearly 24%) and Leclerc (market share of 20%), PATISSERIE UPHOLD OUR COMMITMENT > Desarrollo de Marcas SA, UNITS WITH AN businesses with Metro Group). Groupe Auchan and Système U signed a purchasing coop- a subsidiary of Euromadi ASSORTMENT OF AUDACIOUS RETAILER eration agreement exclusively covering major national and Ibérica SA, will now handle OF 176 PRODUCT Central to Groupe Auchan’s business strategy is its determi- international brands. Together they represent nearly 21% negotiations for Alcampo REFERENCES REPOSITIONED AMONG THE nation to be “a group of major, audacious retailers through of the market, and have repositioned among suppliers as a and Simply Market’s BIGGEST MASS RETAILERS own-brand products in our determination to always and everywhere be cheap and major mass retailer in France. Spain. At present, Groupe cheaper.” If we are to uphold this commitment to remain a To begin with, the same observa- Similarly in Italy, by signing a partnership with Sisa, a group Auchan has an assortment discounter without impacting our long-term profitability, inev- tion was made everywhere, par- of 450 partners with nearly 1,600 points of sale, the Auchan- of 3,500 food, hardware itably we must purchase cheap and cheaper again… ticularly in euro-zone countries: SMA central purchasing department boosted its position as and cosmetic items, which The first necessary step Groupe Auchan took was to split due to downbeat domestic mar- leader in Italy’s 5 most populated regions, and together with it retails at 55 Alcampo hypermarkets and up the supply and purchasing functions in 2012. Groupe kets that show little growth, large its partners it now has a market share of 14%. 270 Simply supermarkets. Auchan’s central purchasing department now concentrates suppliers no longer hesitate to give Finally, the international agreement signed with Metro Group Euromadi is the leading solely on its primary function, to negotiate purchasing terms big discounts to the largest retail- is along similar lines. By being in a position to negotiate spe- central purchasing and with suppliers and leave each banner complete autonomy to ers to secure the biggest possible cific terms and services at an international level with major multi-sector services define their own offering and sales policy. markets for their products. international suppliersor by implementing new sourcing solu- department in Europe, and its market share in tions enabling the joint purchase at a global level of non-food Since then, several purchasing partnerships have been In France, Groupe Auchan was food, cosmetics and signed to strengthen Groupe Auchan’s positions: with the main player in the recomposi- products, Groupe Auchan, along with its partners, has dou- hardware products is now Système U in France, Sisa in Italy, and Metro Group tion of the competitive landscape. bled its purchasing power and at the same time found topping 20% in Spain.

18 I 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT I 19 Our retail

Interview “TO IMPROVE THE BALANCE OF POWER WITH OUR MAJOR SUPPLIERS AS INDUSTRIAL GROUPS CONCENTRATE WORLDWIDE”

Arnaud Tardy, Will suppliers not Finally, what will be Directeur benefit all the same? the impact for your international Our suppliers end-customers? INNOVATION alimentaire, (essentially international It was above all with Groupe Auchan brands) now have our customers in access to the largest mind that we signed JUMBO PET CLUB, What are the benefits purchasing group in this partnership. THE CLUB FOR PET OWNERS of a partnership Europe. This means By improving our like this for Groupe that with one point sourcing and our own With the cost of keeping pets on Auchan and Metro of contact, and purchasing power, the increase, Auchan decided to Group? discussions with our we can offer them launch Jumbo Pet Club in Portugal, Firstly, we are shifting negotiators, they get the best products an online platform dedicated to the balance of power access to all possible at the best price. They pets, and a completely new venture with our major distribution networks will also have access for the mass retail sector. suppliers, as industrial (from cash and carry to products we did On this site, owners have access groups concentrate and online through not offer previously, worldwide, making to hypermarkets and including innovative to specialised content which us more competitive supermarkets) and products that major is certified by a veterinary team, when it comes to opportunities for more international groups and differentiated services such purchasing and we rapid expansion in new decide to launch as Pet Dating, to adopt a pet, Pet can pass this on to geographical areas. firstly with us, new suppliers and broadened Groupe Auchan’s teams’ proximity to their customers, Radar, to share information on our end-customers. Also, we plan to precisely thanks its offering… working as closely as possible to each catchment area, pets that have been lost or found, In addition, we can propose a catalogue to the high number These agreements will improve has become essential. Through its purchasing agreements, and MyVET, a forum for discus- take advantage of shared international of customers they the Group’s positioning as Groupe Auchan is giving consumers access to new prod- sion with a team of vets. Animals of our shared services so they can can reach at once! a responsible discounter ucts and lower prices, regardless of how they shop: whether that have been registered with the sourcing expertise generate greater value everywhere and will revive the online with home delivery, Drive, or at hypermarkets, super- Club receive an exclusive mem- to better supply our added. This will enable competitiveness needed to markets or convenience stores, everyone benefits. bership card offering their owners no-brand and them to make various own-brand non-food economies of scale compete in the price war. But shopping is now a globalised activity, particularly where information and promotions that offerings. Finally, by on the value chain purchasing is concerned and even more in the non-food correspond to the characteristics purchasing larger (logistics, optimisation segment. In order to participate and sell at cheap and ever of their pet. volumes together, of product launch BE CHEAPER AVERYWHERE cheaper prices, Groupe Auchan must know how best to we can now sit down campaigns, etc.). AND FOR EVERYBODY take advantage of its international presence, and conduct with major suppliers Ultimately, our shared Act locally, act globally… Retailers mass purchasing so that it is on an equal footing with the that previously were decision-making today must gain strength in these large suppliers of national and international brands. This is out of our league will necessarily help 2 dimensions if they are to achieve where Groupe Auchan is now succeeding. This is also what because our volumes simplify their sustainable development and it means to be an audacious retailer. were not large management success. Locally because, every- enough. procedures. day, shopping requires teams to remain close to the customers.

20 I 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT Our retail

AUDACIOUS RETAILERS: IT’S EVERYWHERE

ONEY BANQUE AND EVERY DAY ACCORD BOOSTS THE PURCHASING POWER AT GROUPE AUCHAN Give customers back purchasing power: Oney Banque Accord also took measures in this area. In France, the bank now offers credit on a proportion of cash purchases, and advances ranging from €100 to €500 ITALY: THE GOOD TASTE which are repayable in 3 months. Another example, in OF THE MARKET Hungary, Oney launched a new In Italy, Simply Market began its price Auchan card offering the best repositioning via the fruit and vegetable reductions and cash-back advantages on the market. segment, installing a selection of low-cost seasonal fruit and vegetables at store AUCHAN, NO.1 IN PRICE entrances. These frequently included IN THE EURO ZONE Amid the ongoing economic local products, purchased from regional crisis in the euro zone, Auchan cooperatives. As of 2015, some will be continued its efforts to be directly purchased from local producers, recognised as the banner with the cheapest prices so as to broaden our assortment of regional AUCHAN FIGHTING INFLATION and to meet its objective of products. This ties in perfectly with customer IN UKRAINE improving the quality of life demand, as shown by the significant and purchasing power of as In 2014, Ukraine saw a sharp rise in prices many customers as possible. increase in sales of these products. th and competition. As part of its commitment In Spain, for the 6 year in a row, Alcampo was to restore customers’ purchasing power in recognised by the Organisation SPAIN: A NEW PRICE POLICY difficult economic times, Auchan created a of Consumers and Users as AT SIMPLY MARKET the cheapest banner in the Price Committee and negotiated an country. Auchan Portugal was To further increase its customers’ purchasing power, Simply improvement in its purchasing terms with certain once again ranked first in terms Market revised its price policy to include a Simply Market of price in a survey conducted product (in its most sold format) within each product range suppliers. Local sourcing was also developed by the Portuguese Association that is guaranteed the cheapest on the market. This range now 26 with the result that it was able to reference for Consumer Protection, and, includes more than 550 items. Parallel to this, Club Simply, LILLAPOIS for the first time, also first in which now has more than 700,000 customers, conducted (new drugstore concept 130 new companies. The customers were the Italy, based on the independent more than 500 sales promotions in 2014 and more than specialised in beauty, “Retailer of the Year” survey hygiene and household real winners: price increases at Auchan were 2,000 exclusive offers on which customers could accumulate cleaning products) conducted among more than points for subsequent purchases. OPENED IN 2014 IN ITALY lower than the national inflation rate. 140,000 customers.

22 I 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT I 23 Our retail

AUDACIOUS RETAILERS: IT’S EVERYWHERE AND EVERY DAY AT GROUPE AUCHAN BLACK FRIDAY, AUCHAN MAKING THE NEWS In the United States, Black Friday has become an institution. Having successfully reproduced the concept in Spain in 2013, Auchan decided to catch its rivals off-guard and launch the first ever version of this concept in France. Thanks to effective digital and radio coverage and the distribution of more than 9 million leaflets, customers came to the store in droves to take advantage of exceptional offers. Over 3 days, Auchan France received nearly 3 million customers and sold more than 48 million articles. This success was equalled on Auchan.fr with nearly 28,000 orders filled, while the sales record for the January sale period was beaten 3 days in a row.

SHOPPING AUCHAN POLAND, NIGHT AT STILL THE CHEAPEST VOLGOGRAD In 2014, the transformation The Volgograd of the Real hypermarkets shopping centre to the Auchan banner revived launched “Nuit business. At all of its stores, des Soldes” during Auchan Poland’s teams worked VERTUVIN which some hard to create an offering CLUB, 50,000 customers of product ranges that are SOLIDARITY came to shop even more suited to its WINES between 10 p.m. customers, while maintaining ALINÉA SHAKING UP and 4 a.m. to take their leadership record in terms The Simply “Goût du advantage of of price. In December 2014, Partage” Foundation has FURNITURE RULES reductions of up 2 independent surveys been working since 2009 The model of a set shopping route through to 90% and attend (including WP Finanse) showed as an innovative social various shows that POLISH CUSTOMERS ENJOYING that Auchan was still the laboratory supporting furniture stores has become outdated. Customers were put on in ORGANIC FOOD cheapest banner in the country. solidarity projects steered have less time and no longer feel this model is tandem. by the Group’s employees. relevant. Audaciously, Alinéa has rewritten the rule In 2014, Simply Market finalised the FREE-RANGE PORK, FROM In 2014, Simply Market rollout of its convenience store concept THE FARM TO THE TABLE accompanied the launch book at its new store in Troyes. The shopping path Auchan Hungary and more and offerings that cater for the needs of VertuVin Club, a collective now incorporates a “day” and “night” zone, and was than 40 Hungarian breeders of winegrowers that favour of local customers at its 34 Polish launched the “Free-range Pork” the employment of disabled optimised to significantly reduce shopping time. supermarkets. Fresh products are central project, promoting a product people. Today, 8 labels are The space was opened up to favour impulse that combines tradition, quality presented on the shelves of to this new concept, and a full range and local know-how. The all our French supermarkets, buying, cross merchandising and interior design of organic and ecological products are animals are fed with traditional with particular know-how concepts. Furniture and decoration for each room now available to meet new customer feed made from grains and expertise available from are laid out on both sides of the aisle, so products cultivated by the breeder, our employees, who demands. Organic, light, soya-based, which means that very high promote the winegrowers are more visible and the shopping experience lactose-free and gluten-free products, quality meat is guaranteed. among our customers. 700 In the future, Auchan Hungary simpler. A perfect backdrop for the interior design PRODUCTS AT €1 HAVE and a range of environmentally-friendly VertuVin was a finalist for BEEN SOLD BY SIMPLY plans to extend this project to the “Convergences Europe” and layout ideas offered as part of Alinéa’s MARKET IN SPAIN DURING household cleaning products are now more local farmers and to other THE “€1” COMMERCIAL prize in 2014. decoration coaching service. OPERATION offered in-store. types of meat.

24 I 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT I 25 Our retail

AUDACIOUS RETAILERS: IT’S EVERYWHERE AND EVERY DAY AT GROUPE AUCHAN FEINIU.COM: WHEN CHINA STARTS BUYING ONLINE

In January 2014, Sun Art Retail Group launched its online shopping site www.feiniu.com to take advantage of the opportunities for growth in SHOWCASING TALENT online shopping in China. In its first year, Feiniu captured more than AT THE 2014 VOCAL TOUR 1.4 million members, 29% of which made at least 1 purchase. More than As a pioneer in the organisation 150,000 references, including fresh, consumer, general, household CROSS-CHANNEL EXPERIENCE SECURING of national event tours, Immochan electronic, fashion and childcare products, are available. Currently THE LOYALTY OF ITS CLIENTS launched a Vocal Tour in 2014, Feiniu.com’s delivery covers 4 provinces and it is planning to roll out to which visited all of the main Quality shopping routes, whether in-store or online: this is Groupe Auchan’s commitment. nationwide from 2015 in the model of online to offline, using the 372 Sun shopping centres in France Thanks to its brand power, Auchan.fr surpassed 100 million visitors a year, ranking it Art’s hypermarket as the delivery spots. among the top 15 online shopping sites in France. This traffic is also of benefit to the and proved a genuine springboard stores, where the cross-channel shopping concept has been diversified: with 1-hour for all of the amateur, semi- store pick-up times and the possibility of purchasing all of the online ranges in-store, professional and professional the shopping experience under the Auchan brand has been further enhanced. singers who participated. The winner received an opportunity to record and release a single with the help of a studio and media IN RUSSIA, promotion. Unique events like this AUDACIOUS provide concrete evidence RETAILERS ONLY of Immochan’s “Better living every In 2014, to deal with the day” motto. The purpose was to difficulties encountered bring a large public together and by Russian consumers continue to transform shopping and limit rising prices, areas into living spaces and the teams at Auchan experiences in their own right. Russia took 14 concrete decisions to continue EATALY MAKING THE to be the cheapest and INACCESSIBLE ACCESSIBLE… remain true to their The hypermarkets and slogan of “Guaranteed AUCHAN AND DISNEY PUT A SPARKLE supermarkets in Italy signed an ALCAMPO: low prices”. These exclusive partnership with Eataly, included, at all of the INTO THE TROLLEYS an SME that produces exclusive CUSTOMERS TAKING THE LEAD hypermarkets: the In China, own-brands are still struggling to be choice Italian food products, “Offer the best possible customer satisfaction”: to make development of new highly sought after by customers. bulk markets (such as noticed by consumers. To remedy this, Auchan More than 200 references (pastas, this commitment a reality, Alcampo intensified work household cleaning and RT Mart signed a contract with The Disney sauces, olive oil, etc.) are now on its customer relations in 2014. It conducted satisfaction products), the offering offered at the Group’s stores surveys, accompanied customers on their shopping route, of 150 best-of products Company to use their characters on nearly at Auchan prices, allowing them cheaper than at the to differentiate from their rivals held focus groups, and set up a desk at checkouts to competition, and 100 own-brand food products. They are the first and promote made-in-Italy conduct 36 surveys every day at each hypermarket. guaranteed lowest prices and only retail banners in China to sign a food- products as well as Italian SMEs. A total of 600,000 contacts with customers gave rise in Russia for fruit and In fact, Auchan Italy works with vegetables. product partnership of this scale with Disney. nearly 1,200 SMEs, i.e. nearly 40% to the implementation of more than 1,700 specific measures With this, Auchan, RT Mart and Feiniu.com were of its suppliers, promoting more on the ground. than 17 local gastronomic products Alcampo also allows customers to actively participate in able to boost their appeal by co-branding a either at its hypermarkets or by range of innovative copy-protected products for exporting them to the Group’s the selection or creation of new products. Witness “Cosmia”, 16 countries via the Auchan Export the Alcampo own-brand personal care line. their customers, young customers in particular. programme.

26 I 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT I 27 Our retail

ALL FORMATS ARE CONCERNED 1 – Organise the convergence of format product ranges THE CENTRAL and of partners Hypermarkets Supermarkets Convenience 2 – Draw up a purchasing strategy stores (sourcing, selection of suppliers, PURCHASING share of own-brands, etc.)

3 – Negotiate, establish contracts Online shopping Cash and carry and monitor the results of DEPARTMENT, negotiations with suppliers SERVICING PARTNERS AND CUSTOMERS

THANKS TO THE WORK OF THE CENTRAL PURCHASING DEPARTMENT, END-CUSTOMERS BENEFIT FROM LOWER PRICES, AS WELL AS… Definition of prices and promotions: THE 5 FU NCTIONS while purchasing prices are negotiated by the OF A CE NTRALE central purchasing Implement department, the banner decides freely on the merchandising: PURCH ASING Definition selling prices it wishes the space allocated to to apply in-store and each product universe, DEPAR TMENT Privileged access of the sales project: selects the products it the presentation, Better value each Groupe Auchan wishes to promote. promotional drives, etc. for money to innovative or banner and partner defines, are all decided entirely exclusive products based on its customers and independently by the positioning, the offering they banner. wish to make in their stores, in terms of regular stock More rapid access and promotional products. to high-end products

ALTHOUGH AFFILIATED WITH 4 – Design, source, A CENTRAL PURCHASING negotiate and New and/or more organise the own-brand advantageous DEPARTMENT, EACH PARTNER supply chain REMAINS ENTIRELY RESPONSIBLE promotions FOR ITS OWN SALES POLICY. 5 – Manage product- supplier reference lists

Partners End-customers

28 I 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT I 29 OUR DEVELOPMENT AN AUDACIOUS AND BALANCED DEVELOPMENT Our development

AN AUDACIOUS AND CLOSELY-MANAGED DEVELOPMENT IN OUR 3 PRIORITY AREAS

In 2014, Groupe Auchan adapted its development strategy in accordance with the growth potential in each region. Development in the euro zone slightly slowed down while it remained just as strong in the growth markets of Central and Eastern Europe and Asia.

EASTERN EUROPE: ASIA: GROUPE AUCHAN GROUPE AUCHAN CONSOLIDATES MOVES FORWARD In a region suffering from a major geopolitical crisis and a In Asia, the goal of 400 hyper- sharp economic slowdown, all of the Group’s core busi- markets is getting closer. With WESTERN EUROPE: nesses continued to develop. the opening of 9 Auchan and In addition to the integration of 58 hypermarkets, of which 40 RT-Mart stores, Groupe GROUPE AUCHAN CAPITALISES the 57 Real ones in Poland in February 2014, 5 hypermar- Auchan now manages 390 hyper- Despite a persistently difficult environment in the euro zone, kets were opened in Russia, 1 in Poland, 1 in Romania and markets in Asia, of which 372 Groupe Auchan continued to invest, concentrating on main- 1 in Ukraine, demonstrating the capacity of our teams to in China through its subsidiary, taining and modernising its premises on the one hand, and rapidly establish a normal rate of development. The Group Sun Art Retail Group. But the development on the other, allocating a total of €776 million now operates 232 hypermarkets in Eastern Europe, com- biggest highlight was the open- (€531 million of which in France). pared with 166 in 2013. ing of Feiniu.com, Sun Art Retail In 2014, on top of the development of its franchise business, At the time of Real’s acquisition in Romania, the 20 hyper- Group’s online store, at the start notably A2pas in Paris, Simply Market continued to opti- development of Auchandirect and markets operated in leased space. In 2014, Auchan of the year. An immediate hit with mise its store network. 37 points of sale were opened, in Auchan Traiteur) and non-food acquired 14 of these, confirming its commitment to remain customers, Feiniu.com is the first France (4), in Spain (4) but mainly in Italy where, in addition (development of the store pick-up in the country, while rebalancing its portfolio of direct- Chinese online shopping site to to 3 supermarkets, Simply Market opened 26 Lillapois, a format and in-store availability of ly-owned and leased premises. surpass RMB100 million in its first new drugstore concept specialised in beauty, hygiene and the broader online offering) prod- The supermarkets saw further rapid development, particu- year of operation. household cleaning products. At the same time, 24 points of ucts helped to win and secure the larly in Russia, with 29 new ATAK stores opened in 2014, Such a rapid development sale were closed or sold. Immochan continued to success- loyalty of new customers. Alinéa, giving a total network of 150 points of sale. In Poland, in was still accompanied by Oney fully implement its asset rotation plan, mainly in France and which opened its 26th store in addition to the opening of 2 supermarkets, Simply Market Banque Accord and Immochan, Italy. Extensions were successfully completed at shopping France, completely revamped its revised its business model and rolled it out to its 34 stores. which opened 7 shopping cen- malls in Le Havre, La Seyne-Toulon and Annecy in France, business plan and the customer 2015 will see consolidation of these activities in preparation tres in China, including the and Setúbal in Portugal, adding a total of 45,000 sqm. shopping route. Finally, Little Extra for a resumption of expansion as of 2016. Finally, Immochan 180,000 sqm Sun Art Plaza in the The concrete roll-out of Groupe Auchan’s cross-channel opened 4 new stores, giving it a opened 2 new shopping centres, in Ukraine and Romania, iconic city of Ningbo. strategy in food (16 Drive outlets opened and ongoing total of 17 outlets. giving a total of 90 in Eastern Europe.

32 I 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT I 33 Our development

THE SUPERMARKET DIVISION IS DEVELOPING ITS EXPORT EXPERTISE FRANCHISES In 2014, the supermarkets developed their export AND PARTNERSHIPS, supply activity, covering 12 destinations, mainly in the French overseas OTHER departments and territories, North Africa, West Africa, Eastern GROWTH DRIVERS Europe, and Asia. The proposed product assortment was enhanced “To pursue audacious, closely-managed and profitable growth”: and now includes more than 20,000 entry-level this is Groupe Auchan’s development strategy, of which franchises bulk product references and partnerships have become key aspects because they perfectly of the Auchan and complement the integrated development of its core businesses. international brands to best meet the demands of customers on these very different markets.

Although Groupe Auchan has always favoured organic the regulations governing direct activity growth, franchises and partnerships are now a major foreign investment changed, Société part of its development plans, not only to rapidly expand which led both groups to end the Magasin général, its presence within its countries, but also to launch new partnership by mutual consent in the sales concept into line with 10% owned by sales concepts, invest in zones where the overall market July 2014. 2014, A PROSPEROUS YEAR the specific demands of local Groupe Auchan, became the size is limited, and obtain a footing in countries in which it Despite everything, thanks to this FOR THE SUPERMARKETS consumers and their lifestyles. leading retailer is very difficult to invest directly. For this reason, Groupe first experience, Groupe Auchan The supermarket division had a very successful year The goal is to replicate the in Tunisia in 2014. Auchan has worked for several years to fulfil all of the has learned a lot about Indian in 2014. First of all, in January it signed the first multi- success seen in Tunisia. The It operates conditions necessary to convince solid partners (dedicated consumers and is determined to business franchise in Reunion Island. 2 hypermarkets partnership with Société Magasin 86 points of sales. teams, stabilised and profitable sales concepts, appropriate invest in this market in the long and 6 supermarkets were brought under the Auchan général saw a very good year in logistics and competitive purchasing terms). term. It continues to explore all and Simply Market banners. A first success in the French 2014, with 11 openings (giving possibilities for the development overseas departments and territories, where the Group a total of 86 points of sale) and of its brand, particularly in areas plans to pursue development in the future. the successful adaptation of INDIA, A COMPLICATED STORY where direct foreign investment is In Paris, Groupe Auchan seized the best opportunity the business model to different THAT WILL TAKE TIME authorised. to develop its new ultra-convenience banner, A2pas. In formats: large supermarkets, Auchan benefits from a recognised brand name that is May 2014, 4 independent partners acquired 30 points of supermarkets and convenience synonymous with quality, solid own-brands, and in particular sale as part of the disposal of Parisian stores by the Casino stores, the brands of which (MG a powerful business model that is always supported in group. Since then, 15 have already changed banner and Maxi, MG Super and MG City) Eastern Europe and Asia. For this reason, Groupe Auchan adopted the A2pas business model. Located at strategic were made more coherent for is confident it will enter into more successful partnerships points around the city, these new sites have significantly greater impact and visibility. for its hypermarket brand, despite the end of its partnership strengthened the A2pas store network, bringing it closer to in India. its 2016 target of 100 points sale. 1,987 In 2012, it had signed a franchise agreement with Max Finally, in June 2014, Groupe Auchan signed a partnership SUPERMARKETS Hypermarkets, which at the time benefited from Auchan’s with CT Group to develop the supermarket activity in AND 147 HYPERMARKETS OF ALL KINDS OF brand name and know-how for its stores. This agreement Vietnam. The first points of sales are to open in 2015. PARTNERSHIP MANAGED progressed as far as permitted by Indian law. However, The teams on the ground are currently working to bring IN THE WORLD

34 I 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT I 35 Our development

REAL, A BUSINESS SUCCESS THANKS TO ITS SUCCESS AT A HUMAN LEVEL

In February 2014, Groupe Auchan received the green light from the Polish competition authorities to integrate the 57 Real hypermarkets. Its key objective: to integrate this activity at both a human and business level and replicate the success seen in the other 3 countries.

approve the Group’s business UKRAINE, ROMANIA, RUSSIA: policy. Attracted by a sharp fall KEY DATES After all banner SUCCESSFUL BANNER TRANSFERS in prices, customer numbers are changeovers, in In Ukraine and Russia, all of the hypermarkets were rapidly increasing and more and more Ukraine as well as November 2012 in Russia, in Poland > acquisition transferred to the Auchan banner in 2013. In Romania, articles are being purchased. The and in Romania, of Real activities where the company tripled in size from 11 to 32 hypermar- relevance of Auchan’s business for Groupe Auchan. In Russia, for numerous in Eastern Europe customers kets, the banner changeover was finalised in April 2014, model is being confirmed each example, 89% of employees and immediately came less than 6 months after it began. The Group even returned day. 98% of the management stayed shopping to benefit March 2013 from the huge cut > integration of to organic growth in these countries, with the opening of Nevertheless, over and above to work alongside Auchan’s in prices. Real Ukraine: 8 hypermarkets in Eastern Europe in 2014. the sales challenge and signif- teams, and 20 who show strong 2 hypermarkets Each change of banner was a success, as reflected in the icant investment to transform potential have already been pin- significant growth in products and customers. The custom- the stores, the company must pointed for subsequent advance- April 2013 > integration of ers supported Auchan’s business model, which immediately optimise the management of this ment within the company. The Real Russia: brought substantial price falls, and involved significant work phase of transition and strong skills and expertise of the former 16 hypermarkets and on the offering and entry-level prices. growth. Real teams were also put to use. 7 shopping centres In Ukraine and Romania, Auchan AUCHAN ROMANIA CELEBRATES THE COMPLETION identified the strengths of the OF REAL’S INTEGRATION September 2013 POLAND: INTEGRATION IS UNDERWAY THEY CHOSE THE > integration of Real business in order to replicate Real Romania: In Poland, the integration of the 57 hypermarkets began AUCHAN ADVENTURE them at all of its hypermarkets. In To celebrate the completion of the transfer of the Real hypermarkets to the 20 hypermarkets and in February and, by the end of December 2014, 12 hyper- Real is not just a business suc- Russia, a plan to provide train- Auchan banner, Auchan Romania launched the Auchan Anniversary, a major 6 shopping centres markets had already been transferred to the Auchan ban- cess, but also a human one. ing in the Group’s policies was company event held at its 32 stores. Over 19 days, employees and customers ner. When integration is complete at the end of 2015, the Thanks to its recognised business launched for store managers and enjoyed competitions, raffles, even lower prices and promotions on products February 2014 introduced for the first time into Romania: 3D printers, aquariums, ostrich company will also have tripled in size here (nearly 90 hyper- and managerial model, Auchan sector heads from Real. Finally, in > integration of meat, and more. In the end, more than 4 million customers came to purchase Real Poland: markets) and will be established in 17 new cities. While the succeeded in convincing a large Poland, a sponsoring system was more than 55 million articles. A genuine success that demonstrated the 57 hypermarkets Auchan business model is not yet in operation everywhere, majority of the 20,000 former Real implemented at all stores and the strength of Auchan’s business and the audacity of its teams. the trends are already promising: here also customers employees to remain and work working conditions improved.

36 I 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT I 37 Our development

IMMOCHAN, FROM ALWAYS MORE TO ALWAYS BETTER

In order to better accompany the Groupe Auchan banners, Immochan constantly reinvents its development and asset strategies. This may involve enhancing its existing premises, disposing of assets or entering into partnerships. Its goal is to obtain the resources to achieve its ambitions and acquire levers for business value creation, while at the same time factoring in the impact on the Group’s finances.

which conducted an in-depth A RECORD NUMBER OF INVESTMENTS review and overview of all of the Working closely with Groupe Auchan’s banners in all coun- shopping centres and malls. tries, the number of projects and investments made by The aim is to help improve the property fund managed by Antirion SGR. It The word from Immochan reached a record level. In 2014, Immochan com- operating performance going for- also entered into a strategic and innovative ALI KHOSROVI, 2,39 pleted 7 extensions in France, China and Portugal, where ward, the appeal of each of the partnership concerning the shopping centres GENERAL MANAGER MILLION SQM OF the reopening of the Alegro Setúbal shopping centre was a sites, and better accompany the of Zenia Boulevard (Spain) and Alegro Alfragide SHOPPING CENTRES genuine success. Parallel to this, Immochan opened 10 new Group’s banners. (Portugal) with a well-known US investor, OF IMMOCHAN MANAGED IN THE WORLD BY IMMOCHAN shopping centres in Ukraine (1), Russia (1), Romania (1) and Alaska Permanent Fund Corporation (APFC), FRANCE China (7), including Sun Art Plaza, a regional shopping cen- PARTNERSHIPS, as part of its first acquisition in Western Europe. ADDED tre and public space. In the majority of cases, Immochan retained the During growth periods, our existing sites, Over the next 3 years, 70 new creations or extensions are A GROWTH DRIVER management and marketing of the sold sites. our commercial making them into 130,000 planned. These include service malls and large regional Since 2013, to speed up its devel- In 2 years, Immochan thus generated more property policy hinged urban centres and SQM IN 2014 shopping centres, such as the Saisons de Meaux (France), opment while paying attention to than €1.7 billion on asset transactions. By rein- on the concept of public spaces. And Coresi (Romania) and Sosnowiec (Poland) centres which will the impact on Group’s finances, vesting part of the proceeds from disposals in “more”: more leases, it also means being open in 2015. Immochan expects to invest a gross amount Immochan implemented a projects designed to generate profitability and more sqm, etc. Now, innovative in our of nearly €1.5 billion in development between now and 2017. dynamic asset management pol- value creation, Groupe Auchan continued to we are focusing on the development and with icy, conducted asset arbitrage, increase the value of its asset portfolio while concept of “better”. regard to the strategic This includes dynamic partnerships we enter and outsourced specific mature effectively managing its debt. re-marketing and into to enable us to A REVISED PATRIMONIAL STRATEGY sites. the integration of invest selectively and “Continue to be a group of audacious retailers”: this is In 2013, 23 shopping malls and innovative banners. audaciously in tailored Groupe Auchan’s ambition. Immochan shares this ambition activity parks were sold, mainly It involves enhancing projects. completely, which is why it decided to review its develop- in France and Italy, in the con- ment and asset valuation strategies, placing the property text of 3 partnerships. In 2014, sites at the centre of its organisation. With this in mind, Immochan transferred a portfolio Immochan created an asset management division in 2014 of 3 shopping malls in Italy to a

38 I 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT I 39 Our development

GROUPE AUCHAN IN THE WORLD (as at 31 December 2014)

WESTERN EUROPE CENTRAL AND EASTERN EUROPE ASIA REST OF THE France WORLD (71,920 employees) Luxembourg Spain Hungary Romania Mainland China – 128 hypermarkets (650 employees) (15,260 employees) (6,160 employees) (10,150 employees) (134,875 employees) Senegal (o.w. 119 Auchan) – 1 Auchan hypermarket – 55 Alcampo hypermarkets – 19 Auchan hypermarkets – 32 hypermarkets – 68 Auchan hypermarkets – 4 supermarkets – 257 supermarkets – 1 shopping centre – 127 Simply Market – 18 shopping centres (25 Auchan, 2 Auchan City and 5 Real) and 304 RT-Mart hypermarkets Tunisia (o.w. 247 Simply Market) (contract-managed) supermarkets – Oney – 11 shopping centres consolidated in Sun Art Retail Group – 86 supermarkets – 106 shopping centres – 3 drive outlets – 31 shopping centres (o.w. 1 contract-managed) – 66 shopping centres Poland in partnership (o.w. 8 contract-managed) (o.w. 1 contract-managed) – Oney – Oney Italy (19,500 employees) – Oney Banque Accord – Oney – 1 drive outlet Kurdistan (16,870 employees) Russia – E-commerce (Auchan.fr, – 191 supermarkets under – 86 hypermarkets (37 Auchan, – E-commerce (Feiniu.com) – 1 hypermarket under (38,960 employees) Auchandirect and Grosbill) – 50 Auchan hypermarkets franchise 45 Real and 4 Auchan owned franchise – 174 drive outlets – 290 supermarkets by Schiever Polska(2)) – 84 hypermarkets (55 Auchan, Taiwan (99 AuchanDrive and (264 Simply Market and 26 Lillapois) Portugal – 34 Simply Market 23 Auchan City and 6 Nacha Radouga) (4,440 employees) 75 Chronodrive) – GCI(1) : 45 shopping centres (7,660 employees) supermarkets – 150 ATAK supermarkets – 18 RT-Mart hypermarkets – 26 Alinéa (o.w. 18 contract-managed) – 32 hypermarkets (22 Jumbo – 22 shopping centres – 35 shopping centres – 3 drive outlets – 17 Little Extra – Oney et 10 Pão de Açúcar) – Oney (o.w. 19 contract-managed) – 22 shopping centres – 15 hypermarkets and – 2 drive outlets – 9 shopping centres – E-commerce (Auchandirect) – Oney (o.w. 3 contract-managed) 175 supermarkets under – 7 hypermarkets and (o.w. 3 contract-managed) – 8 hypermarkets

franchise / associated 1,535 supermarkets under – Oney Ukraine contract-managed (4,250 employees) franchise / associated – 116 outlets supplied by Vietnam Auchan Portugal – 11 Auchan hypermarkets – 4 shopping centres – Signature of a partnership with CT Group in June 2014 Average FTE headcount, consolidated scope – 31 December 2014. – Oney (1) Gallerie Commerciali Italia SpA, wholly owned by Immochan since January 2012. 21.2% holding in the capital of Anthousa, (2) Subsidiary 50% owned by Groupe Auchan and 50% owned by Schiever group. the company that owns the Furshet supermarkets.

40 I 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT I 41 OUR TEAMS AUDACIOUS AND ENTERPRISING RETAILERS Our teams

TO REMAIN A COMPANY APART, A CENTRAL AXIS OF THE GROUP’S STRATEGY

“To be our employees’ preferred employer”: a commitment made by Groupe Auchan as part of its updated Vision. To meet its objectives

and the expectations of its employees, the company must make During 2 days, 26 employees progress in detecting, integrating, promoting and retaining talented representing all countries employees, now and in the future, and enhance its ability to deal with and business lines met in changes in its core businesses and environment. Villeneuve-d’Ascq (North of France) to enhance the Groupe Auchan’s Vision. A SHARED VISION the management committees OUR PURPOSE “We are audacious retailers”: these few words, simple but of each country and core busi- which carry meaning and reflect our values, are how Groupe ness participated, representing To improve Auchan summarises its corporate Vision. A Vision that the all 330,700 employees, the Vision the purchasing General Management does not impose on its companies was updated and enhanced to power and quality of life and employees, but rather one that has developed gradually better correspond to today’s of as many as part of a collaborative process. realities. customers Based on the Group’s history and values over more than Shared by all of the Group’s core shared by all. They then actively as possible 50 years, the last Vision dated from 2008. It needed to be businesses, the Vision reflects launched the collective proce- OUR IDENTITY through our updated to take account of the new global economic envi- its ambitions for customers and dure of appropriating and distrib- responsible, We are a professional, ronment, the Group’s international development, and its employees. It defines the com- uting the Vision. In all countries federation committed new ambitions. As part of a collaborative process, in which pany and its commitments, high- and at all sites, it was presented of autonomous and esteemed lights its convictions, and confirms to everyone to ensure all could companies employees. the fundamental principles of its understand it, appropriate it and, and audacious corporate culture. In all countries, in particular, put it into practice retailers, sharing values and it mobilises our teams and sets every day. convictions Groupe Auchan apart from the with a view competition. HUMAN RESOURCES ARE to sustainable To bring everyone into line with economic this Vision, 26 employees repre- CENTRAL TO OUR BUSINESS and human development. senting the Group’s countries and STRATEGY core businesses met for 2 days to Parallel to this, Groupe Auchan 41,443 4.4 discuss how it could be reflected fine-tuned its business strategy, EMPLOYEES HIRED MILLION HOURS on a day-to-day basis. They which breaks down into 4 axes IN PERMANENT OF TRAINING GIVEN TO demonstrated in a concrete man- and 15 operating decisions, and CONTRACT BY GROUPE GROUPE AUCHAN’S EMPLOYEES AUCHAN IN 2014 (EXCLUDING RT-MART) ner that it was actually already in which our human resources

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Interview “AN INVITATION TO INNOVATE IN A WORLD MOVING AT TOP SPEED”

Viktoria Gots (V. G.), of its store. It involves of the decision-making in charge of training, sharing our values process: this is what Auchan Ukraine and convictions on an sets Groupe Auchan Mohammed Amrioui everyday basis. apart. (M. A.), directeur AWARD magasin référent, How does this Vision As an ambassador, Simply Market make Groupe Auchan what did you gain France different? from this experience? AUCHAN’S HUMAN V. G.: Our convictions V. G.: I felt responsible RESOURCES POLICIES How is the Vision and commitments for my country, expressed on a daily motivate us to make firstly for accurately REWARDED IN CHINA basis within your decisions based on reflecting what my Sponsored by 51job, Inc., the lead- activity? close contact with colleagues believed ing supplier of integrated human V. G.: When we our customers, this is and experienced, and resources solutions in China, circulated the Vision in how we differ. It also then for demonstrating Auchan China was selected as Ukraine, it immediately involves showing an that the Vision was one of the “100 best companies for spoke to all of us interest and paying being lived, applied because it corresponds attention to everyone, and relayed in Human Resources Management fully to our daily an aspect that the the same fashion in 2014” and was the winner in the experience and the Real employees everywhere, with the category “Best Performance for the meaning of our work. immediately same concern for development of e-learning in 2014”. Our values, which have appreciated when they the employees who Along with Metro Group, Auchan remained unchanged were being integrated. are above all part play a central role. Not only during the banner changeover, or in France where Auchan China is one of only 2 retailers to for more than 50 years, They discovered of one and the same must they support the sales strat- has launched the set-up of a psychological and social assis- have won a prize. galvanise us not Auchan’s corporate company. egy, enabling Groupe Auchan to tance service for its employees. Next, develop a culture of This rewards the fundamental only to always strive culture, which differs M. A.: It was above all recruit and develop audacious working together at all levels of the company, such as at work conducted by Auchan China to better serve our greatly from what an opportunity to meet retailers, but they must also help Alcampo, which employs seniors and people with disabili- in its human resources manage- customers but also they had previously employees from all achieve one of its biggest objec- ties, or Simply Market, which regularly enters into partner- ment, bearing in mind that Auchan to put each of our experienced. countries and all of the tives: “to remain a group apart ships with employment agencies to facilitate the recruitment individual strengths M. A.: The Vision core businesses to set China had already won the title through our policies of corporate of local staff during store openings. Finally, every employee to work for all. breathes life into our out Groupe Auchan’s of “Best Employer in 2013”. All of activity, guides us Vision together. As social responsibility and by lis- that contributes to the company’s results benefits from the this demonstrates that our Vision, M. A.: Our appropriation and inspires us. With regards my role as an tening to the men and women resulting value creation through our participation policies. values, and corporate culture are of the Vision is audacity to boot, it is an ambassador, it is only who work for us”. In addition to 163,000 employees, i.e. more than 90% of those eligible, being effectively applied at Auchan. constantly being invitation to innovate in beginning… strengthening our CSR policies, are shareholders of Groupe Auchan. And going forward, renewed, even a world that is moving 3 priority areas for action were our ambition is to “be our employees’ preferred employer”, within each team, at top speed. It lays a identified. Firstly, help to improve a commitment made by the Groupe as part of its Vision. because each regional lot of importance on the well-being of our employees, company integrates the human dimension such as in Poland where Auchan it according to the and places the fits out the former Real hypermar- employee at the centre specific requirements kets with canteens and training rooms and renovates cloakrooms

46 I 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT Our teams

“16 SUMMERS”, TV DEPICTION OF THE LIFE BECOME OF AN RT-MART EMPLOYEE OUR EMPLOYEES’ RT Mart enjoys an excellent reputation in Taiwan because it is the only mass retail banner founded by a local family. TVBS, the leading national television channel, naturally turned to RT Mart when it wanted to create a TV series covering the life PREFERRED EMPLOYER: of a hypermarket employee. “16 Summers” tells the story of a young woman starting work and her career path over 16 years until she becomes store manager. AN EVERYDAY’S Through her experiences, viewers discover life at RT Mart. Broadcast over 17 weeks on Saturday night prime time, “16 Summers” received top audience ratings in Taiwan and China. Thanks to this, RT Mart benefitted from several positive mentions in the press, greater interest from customers in the banner, CHALLENGE and a surge in applications to join the company.

ALCAMPO, RANKED THE BEST LARGE PRIVATE COMPANY AIMING TO BE A REFERENCE COMPANY BY THE TELEFÓNICA ABILITY AWARDS FOR YOUNG PEOPLE Awarded by the Queen of Spain, One of the objectives of Auchan France’s HR policy, this prestigious prize was awarded to Alcampo for its integration policy as part of its goal to be a reference company for concerning employees with a young people, is to recruit, accompany and train disability, the access it provides to young people to enhance their employability. In 2014, employment, and the awareness it this involved the reception of more than 6,000 interns raised among all of its employees. This project was initiated in 2000 and the signature of more than 2,500 apprenticeship with the signature of the ONCE and professional training contracts. Parallel to this, Foundation/Convention Inserta plan, 15 food industry apprenticeships received support via which promotes the integration of people with disabilities. The the payment of an additional apprenticeship tax, while prize highlights Alcampo’s a “grant for excellence” was distributed to 36 students commitment to the Groups’ Vision: of partner schools. Auchan France continued its work SIMPLY MARKET HELPING THOSE to be a reference employer and a with the association “Passerelle” which facilitates the IN MOST NEED FIND EMPLOYMENT responsible player in society. As proof, 4% of its employees have a integration of students with disabilities into business In September 2014, Pôle emploi and Simply Market disability, while the minimum legal schools. signed a regional agreement in Rhône-Alpes to develop level is only 2%. a partnership around sustainable employment. While Pôle emploi works on cooperating with companies SIMPLY MARKET TOSSES GENERATIONS AROUND to help find employment for those in most need, In France, Simply Market implemented the generation contract it signed in Simply Market enhanced its policy to recruit locally, September 2013 to incorporate specific measures for young people (better integration during sandwich courses, proposition of as many open-ended its position as a local economic player, and its employment contracts as possible at the end of sandwich courses, implementation commitment to employment. In collaboration with of tutoring and sponsorship schemes) and seniors (priority in terms of internal Pôle emploi and based on the expertise of its advisors, promotion, presence of the company on forums dedicated to the recruitment of 7,828 Simply Market works to combat professional exclusion EMPLOYEES OF GROUPE AUCHAN seniors, implementation of an orientation/training passport, specific fit-out of work HAVE A DISABILITY stations, etc.) and to promote the transmission of know-how. and discrimination. (+9%)

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BECOME OUR EMPLOYEES’ PREFERRED EMPLOYER:

AN EVERYDAY’S CHALLENGE ATAK RUSSIA: PRIORITY ON LOCAL ROOTS AND INTERNAL PROMOTIONS In Russia, ATAK has enjoyed rapid growth: 26 openings in 2013 and 29 in 2014. To follow this up, ATAK needs to add to its teams regularly. GIVING AGAIN THE TASTE OF WRITING Since the concept of establishing local roots is central not only to In 2014, Oney Banque Accord pursued its efforts to improve writing skills within the company. its business strategy but also 42 employees participated in the “Écrire sans faute” training course and 700 were part of the “Projet its HR policy, recruitment within Voltaire”, the aim of which is to improve writing skills and simultaneously the quality of the customer its catchment area is prioritised. relationship. 15 employees even participated in the “Trophée Voltaire des Entreprises” competition It also set up a training school as part of the “Journées de la Francophonie” or francophone celebration days. for store and shelf managers to prepare them for a swift transition into their new positions. Priority is HIGH-POTENTIAL EMPLOYEES also placed on internal promotion when manager positions become GETTING TRAINING EXPERIENCE available. All of this has contributed IN FRANCE to the company’s success.

In the wake of the Fly programme developed IN DIFFICULT TIMES, by Auchan China, Auchan Russia now offers HUMANIA IS PRESENT some of its high-potential employees the Auchan France already promotes well-being in the workplace opportunity for training experience in France. as part of a general policy, They are placed in a management position for but it was looking to provide 3 years, such as deputy store manager followed an individualised response for employees experiencing difficulty by store manager, while also benefitting from either professionally or in their personal development measures such as personal lives. With this in mind, WORKING SAFELY, AN AMBITION individual coaching and mentoring. On their in December 2013 it launched HumaniA in partnership with THAT BECAME REALITY return to Russia, they are assigned strategic Humanis to provide assistance For several years Auchan has led an intensive functions such as CFO, Head of human in a variety of areas, including resources, or regional Director. 7 managers have psychological and social campaign to prevent accidents in the workplace assistance to help resolve family, already benefited or are currently benefitting financial, housing and other types in Poland. Thanks to targeted activities (additional from this training scheme. of problems. A total of 400 social training, a communication drive to promote workers are involved. HumaniA has already received nearly 1,500 calls compulsory use of security equipment, an 200 MANAGERS AND FUTURE MANAGERS from employees, and nearly awareness-raising drive entitled “Work safely BACK TO SCHOOL 900 have received care from the service. at Auchan”), the frequency rate of workplace In 2014, 200 Groupe Auchan managers and future managers participated accidents has fallen significantly, even though in a training programme for a total of 750 hours. These skills-enhancement new hypermarkets are regularly being opened. programmes were devised in partnership with specialised bodies and recognised business schools, such as the EDHEC and ESCP. 2 new programmes Auchan recorded 10.6 accidents per million were recently added to this service, one covering the development of human working hours to 30 September 2014, versus resources management skills and another covering information systems management. 14.3 to 30 September 2013.

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“CREATIVE ATTITUDE”, WINNERS OF THE GROUP’S INNOVATION FROM AWARDS – “Business, products PARTICIPATIVE TO and offering” category Boutique sécurité � Auchan France: grouping of security-related products at the store entrance, close to COLLABORATIVE the security guard, who is well qualified to advise the customer. INNOVATION – “New customer services and customer relations” category Client box – Oney Banque If Groupe Auchan has developed in the same manner for more than 50 years, Accord Portugal: grouping of it is because its managers and employees have constantly innovated, customer, marketing and sales information on a single IT platform invented and, in short, dared. This is what “Creative Attitude”, Groupe Auchan’s to better target customers, participative innovation process, is pursuing today. and simplify analysis of the effectiveness of promotional drives.

– “Operational efficiency and profitability” category Macaron informatif – Auchan MAKING IDEAS AND A GLOBAL France: identification of the boxes used to pick up products for KEY FIGURES ENTREPRENEURS EMERGING ATTITUDE “Creative replacement on shelves using Expedition”, > 5 countries (France, For Groupe Auchan, the company’s success cannot be It is by moving beyond borders, will also meet the twin objectives Berlin, 2014. a simple fluorescent badge. Spain, Italy, Portugal, envisaged without the creativity, individual initiative and whether geographical, cultural of encouraging more employees These trips aim at bringing – “Growth drivers and Luxembourg) innovative capacity of each employee. From the very begin- or mental, that Groupe Auchan to put forward ideas, and bring closer top audacious development” ning, Groupe Auchan has encouraged all of its employees will invent its future. To identify about a clear improvement in managers to category > 4 core businesses employees by Automatric – Alcampo Spain: (hypermarkets, to put forward ideas that help implement the Group’s strat- new methods of creating value the rate at which these ideas are making them egy, test them, and, when successful, develop them. The and new services that will appeal transformed into innovation. more aware of immediate identification of petrol supermarkets, Oney innovation’s Banque Accord, implementation in 2011 of a global participative innovation to our customers in the future, Finally, in 2015, all management issues. station customers via their Immochan) programme, “Creative Attitude”, therefore came about nat- “Creative Attitude” will shortly be levels will be informed of the inno- registration plate to ensure urally. Its aim is to promote and strengthen innovation in all replicated in countries and core vation objectives so that they can GOOD TO KNOW quicker payments and shorter > 120,000 employees queues. core businesses, create a permanent dynamic of progress, businesses, particularly in Asia, a allow for initiative and innovation are concerned > Among the – “Innovative managerial and favour the emergence of entrepreneurs within all of the continent on which some of the among their employees, who will 3,000 ideas submitted, > 3,000 proposed Group’s companies. biggest changes over the last also be encouraged to organise 10% concern practices and CSR” category ideas “Creative Attitude” has since become a central part of decade were born. networks so that we move from breakthrough Art partout – Immochan Groupe Auchan’s Vision and strategy. The first edition of In European countries, “Creative a participative to a collaborative innovations or new Portugal: integration of a special > 200 ideas under the “Trophées de l’innovation” in October 2014 proved Attitude” will be applied to help approach to innovation. concepts. space for arts and culture at the way building site during the work the company was advancing very steadily: to date, more implement the Group’s major > Automatric was carried out at the Alegro Setúbal than 3,000 ideas have emerged from a population of strategies, for example by launch- recognised in 2014 shopping centre to benefit from 120,000 employees, and more than 200 have been ing creative challenges related as one of the “100 best related positive media feedback. selected for testing before potential roll-out. The goal each to cross-channel sales and per- ideas” in Spain in the time is to bring new value added, whether to the Group’s sonalised offerings. By providing “Services” category by the prestigious business, operational efficiency, development or CSR a platform for those with ideas economic magazine policies. to get together with our internal Actualidad Económica. or external technical experts, it

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SHARING POLICIES, THE CORNER STONE OF GROUPE AUCHAN’S HR POLICY

Since their launch in 1977, Groupe Auchan’s sharing policies have set it apart from other players. Symbols of the value of sharing, they strengthen cohesion within the company, and give our employees a sense of belonging and pride. But because the Group has diversified and developed internationally, it became necessary to update them…

PARTAGER LE SAVOIR, that has underpinned the Auchan 2014 OVERVIEW Group is our shared know-how, LE POUVOIR ET L’AVOIR power and assets. The sharing of > 163,000 employee Our updated Vision and business strategy both express assets therefore is only one com- shareholders a strong conviction: that Groupe Auchan will only be suc- ponent of a much broader policy 91% of beneficiaries cessful in business and in gaining the trust of its customers founded on meaning and values. are Group through its teams. Business primarily hinges on the human shareholders relationship, which is why it is vital that our employees REVIVE AND RESTORE are included and committed. It is therefore valid that all 10.2% of the capital can share the reasons for their work and performance, by MEANING is owned by the employees broadening the scope of their professionalism, taking on Sharing therefore is both effi- new responsibilities in a growing company, and sharing in cient because it contributes to coherence and equity within the 9 managed funds in the results of their progress. In short, the historical triptych the company’s performance and Group. Throughout 2015, coun- 9 countries (France, equitable because it allows our tries can use it to adapt their own Italy, Luxembourg, employees to participate in the sharing policy. This will be done Spain, Portugal, Hungary, Poland, results of their work. Due to an locally, in close contact with the Russia, China) and in increasingly difficult economic employees to take maximum all core businesses environment, however, it became account of the specific factors (except e-commerce) necessary to adopt a precise affecting each country and core framework for our sharing policies business, and, while remaining in to guide all countries in imple- phase with the Group’s historical menting or reviving their policies. foundations and strategic ambi- €200 With this in mind, in 2014 the tions, to value and remunerate MILLION DISTRIBUTED IN 2014 THROUGH Group created a common refer- as best as possible the individual THE SHARING POLICIES ence base designed to ensure and collective performance of all.

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A NEW PACE FOR THE CLIMATE BATTLE

From 30 November to 11 December 2015, France will play host to the 21st United Nations Climate Change Conference, Paris Climate 2015. The goal this time is to negotiate an international agreement on climate change for the post-2020 period. Groupe Auchan, through its numerous initiatives, is part of this battle.

The 2014 IPCC(1) report highlights the extent of the chal- Increasing soil carbon stocks is a lenges being faced. Despite an increasing number of new challenge for farmers. GLOSSARY national policies to reduce greenhouse gas emissions, Forests breathe life into our eco- Energy intensity global emissions are still rising. The annual emissions system and play an essential > energy volume increased at a rate of 2.2% per year in the 2000 role in the fight against climate TOWARDS A LOW-CARBON SOCIETY consumption in to 2010 period, compared with 1.3% between 1970 and change. According to a study Household consumption is increasingly identified as a key DID YOU relation to GDP 2000. At this rate, the Earth’s average temperature could published in July 2011 by sci- lever to transform the economy into a low-carbon model. KNOW…? rise by 3.7 °C to 4.8 °C by the end of the 21st century. To ence review Science, existing and Three main challenges must be addressed: housing, trans- Energy efficiency > In France, > the provision of limit the rise in temperature to 2 °C, IPCC recommends regenerating forest could absorb portation and food. As such, it is the responsibility of Groupe approximately an identical that greenhouse gas emissions be cut by 40% to 70% half of all fossil fuel emissions. As Auchan to develop product ranges which generate lower one third of every service with between 2010 and 2050. a result of rainforest deforestation, carbon emissions when manufactured, distributed, used inhabitant’s CO2 reduced energy only a third of such emissions are and disposed of. Moreover, it is critical to make these prod- equivalents are the consumption currently thought to be stored. ucts increasingly attractive to consumers if we one day hope result of purchases of imports from WIDELY ACCEPTED HYPOTHESES Waste is an intrinsic part of any to see “zero-carbon” shopping trolleys. abroad. Making energy efficiency “the world’s first fuel” is one of activity; there is however great the key challenges highlighted by the International Energy potential to avoid waste, decrease Agency (IEA) whose calculations show that, over the last its volume, recycle it and recover 10 years, global energy intensity decreased by 1.6% per methane from it to produce fuel or Piece of furniture to year. Under the scenario in which global warming is limited generate power. recycle client’s to 2 °C, this decrease would need to be 2.9% per year up hazardous to 2035. However, energy is not the only lever for tackling waste. greenhouse gas emissions; there are various others. Agriculture and other forms of crop-related land use are the second biggest source of emissions after the energy sector, accounting for 24% of greenhouse gas emissions. Yet they

offer enormous potential as a means of natural CO2 storage. (1) Intergovernmental Panel on Climate Change.

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A COMPREHENSIVE ENERGY REDUCTION PROGRAMME The decreased energy consumption of the hypermarket division is Interview not enough to offset its “TO MAKE CLIMATE CHANGE 1 2 environmental impact and prevent price volatility. Based on A CONCERN THAT IS SHARED BY this conclusion, a programme OUR MILLIONS OF CUSTOMERS” has emerged. For existing sites, the primary objective is to significantly accelerate energy Patrick Coignard, aspects connected must be attractive to reductions. In order to assess Chairman of with consumption, consumers for reasons the potential of such an ambition Auchan resulting in a growing other than their low- in a very concrete way, a pilot hypermarkets in importance for an carbon content, for project was launched in Spain, Iberian Peninsula approach like ours. example, their price, in association with Schneider Chairman of the health benefits or Electric, which is recognised for International So, would you say enjoyable taste. We its expertise in energy efficiency Sustainable that there are many want to make climate solutions. In 2014, a series of Development possible areas of change a concern recommended measures and Synergy action? that is shared by our investments were implemented millions of customers. at 6 sites of all categories. How can we play an Energy efficiency Together, we can The outcome was conclusive, effective role in the is already a priority develop a low-carbon confirming the potential for a move towards a low- across the Group. consumption culture. 19% to 25% reduction in kilowatt carbon economy? Other levers related to To achieve this, we hours consumed. As a result, the our product offering need researchers to replication of the programme Our business strategy include a growing provide consensus on in other countries is due to be includes plans to focus on local and the most economical stepped up. Italy and Poland, develop responsible seasonal produce, ways to reduce the most recent countries to consumption and products resulting greenhouse gas have signed up to the initiative, (1) reduce our ecological from “climate-smart” emissions in all will be among the first countries impact. We aim to agricultural practices, food and non-food to benefit from this roll-out. reduce our own eliminating food production chains. greenhouse gas waste, initiatives to (1) Term used by the United emissions and help collect recyclable Nations which in 2014 our customers to do products, and so on. announced the launch of a FROM CONSENSUS “global alliance for climate smart the same. Research agriculture”. on ways to mitigate Are such initiatives TO ACTION climate change. This map is based on a joint analysis, global emissions, compatible with your For a large organisation, address- by numerous stakeholders, of the capacity of a prod- TREES OF LIFE which has long customer promise? ing climate change involves uct, initiative or decision to lower carbon emissions. focused on energy piecing together a jigsaw of Based on this consensus, Groupe Auchan’s businesses Groupe Auchan formalised its policy on forests in 2011 matters, has begun Our guiding principle many varying initiatives with a have developed their ranges of locally sourced organic with the aid of expertise from international non-profit addressing other is that these products common purpose. To be sus- produce, the capacity of which to mitigate climate change organisation The Forest Trust: (TFT), whose aim is to tainable, these initiatives must all is commonly acknowledged. Moreover, by developing an assist businesses in analysing their product supply aim to be economically feasible. own-brand organic range, Auchan seeks to make healthy, chains with an impact on forests. In 2014, a study was From Group-wide programmes, eco-friendly products more readily available. carried out to assess the volumes of certain products such as the BREEAM certifica- The quest to provide the lowest price can therefore also be used internally such as brochures, paper and store tion which concerns all shop- compatible with climate change concerns. The sale of loose décor. A similar study was also performed on certain ping centres built or renovated products, which is offered in most of the Group’s countries goods sold in stores: charcoal and indoor and outdoor by Immochan, to necessar- of operation, provides tangible proof of the above. Such an furniture were identified as priorities. This analysis will allow the Group to establish a comprehensive map of ily local initiatives, such as the approach significantly reduces packaging and waste. In its supply chains, analyse risks by supplier according to methanation of food waste, many countries, Auchan Hypermarkets has the widest range the origin and type of wood and then develop 7,800 Groupe Auchan has mapped of loose products in the market offering everything from recommendations to reduce risks. ORGANIC PRODUCTS LISTED BY HYPERMARKETS out an evolving palette of ways everyday products to frozen foods, liquid products, animal AND SUPERMARKETS that its businesses can tackle feed and washing powders. (1) The Forest Trust.

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SUSTAINABLE STORES’ STRUGGLE DEVELOPMENT DISPLAY An instructive signage system using pictograms is AGAINST THE deployed among shelves to help customers identify environmentally-responsible CARBON products. EMISSIONS ECO-FRIENDLY HOUSEHOLD PRODUCTS Groupe Auchan wishes to involve its customers in its pursuit The Group offers own- of this policy by offering them attractive and affordable brand products bearing “climate-friendly” products, while at the same time reducing the “NF Environnement” certification or the greenhouse gas emissions linked to its business. European Ecolabel and containing very low levels of volatile organic compounds.

LOW PRICES SMEs The development of close ties at local level and AND LOW CARBON long-term partnerships with regional businesses OF FER encourages sustainable means of production.

TRANSPORT SERVICES REVOLUTIONISING In some of the Group’s REFRIGERATION countries of operation, Fitting doors on refrigerated “Auchan buses” transport display cabinets resulted customers from the town in a 20% energy saving. centre to the shopping Moreover, new coolants centre, free of charge. significantly reduced the impact on the greenhouse SALE OF LOOSE PRODUCTS LOCALLY-GROWN FRUIT gas effect. Selling loose goods helps reduce AND VEGETABLES materials, energy and transport Proposing a range of consumption and prevents food seasonal, locally-grown fruit and packaging waste by allowing and vegetables minimises customers to buy the right volume greenhouse gas emissions at the right price. linked to transport and warehousing.

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THE FOOD-WASTE Produced, CHALLENGE at reduced prices, close to their best-before date. To struggle against food waste, Groupe Auchan is stepping up initiatives linked to its product ranges and raising the awareness of its customers to new buying practices.

up with another idea – to make SAYING “NO” TO WASTE it possible for customers to buy UGLY? 2014 was designated European Year Against Food Waste, single units of products usually SO WHAT! echoing the campaign launched by the Chinese Government sold in multi-packs. Multi-packs common goal of throwing nothing away. One of the features the retail brand has been focus- in 2013. Tackling food waste worldwide has become a prior- themselves have a bar code as of this campaign was a special recipe competition which ing on traceability. Priority has > Between 15% ity in the fight against global warming. Figures published by do each of the items in them. In attracted the interest of some 1,000 employees. been given to pork meat which is and 30% of fruit and vegetables go the UN speak for themselves: the 1.3 billion tonnes of food the frozen foods department, Over the last 10 years, Auchan has developed strong exper- a key ingredient of Chinese cui- uneaten. wasted annually accounts for greenhouse gas emissions the same idea is being tested tise in selling products loose or by the unit with its “self-dis- sine. A code displayed on pack- Too often this is for equivalent to the annual total of those of the EU. Another with portionable gratin dishes. count” departments. These departments focus on offering a aging gives customers access aesthetic reasons astounding fact is that one third of the food produced for However, waste is also being wide range of products at low prices. In France, a new con- to a special Web page providing with produce being human consumption is wasted. The causes of food waste tackled with product innovation. cept is being tested with the sale of loose products bearing information on the origin of their deemed too big, too small, marked vary from country to country, depending on how well organ- In 2014, a small box containing the “Saveurs d’ici et d’ailleurs” label. This range comprises meat product, including where the or the wrong shape. ised the supply chains are. Household consumption and pure tomato powder appeared on 400 quality grocery products of both local and foreign origin, 67% animal was raised and the slaugh- In 2014, Auchan industry are the most critical levers for reducing waste(1). the shelves. Depending on how such as dried fruits, nuts, pulses, herbs, spices, cereals, OF WASTE RECYCLED tering date and location. France decided to much water is added, it makes coffees, teas, etc. BY HYPERMARKETS RT-Mart Taiwan decided to focus offer “ugly” vegeta- coulis, purée, paste or soup and on the concentration of pesti- bles to its customers. THE RIGHT AMOUNT AND NO MORE They can thus once opened can be kept for up TELL ME WHERE YOU COME FROM cides in fruit, vegetables and oils. buy strawberries How can we help our customers to stop throwing away to three months. Testing rooms are already in place considered to be products which they have not even opened, given that in In Spain, Alcampo and Simply AND I’LL TELL YOU WHAT TO EAT for customers to use in 7 stores. too large or cherries France, such waste represents 7 kg per person per year? Market joined in the “Food Waste In China, food waste is lower than in Europe. However, it All RT-Mart Taiwanese hypermar- and apricots that are Auchan’s marketing teams were the first to introduce the Reduction Week”, launched by remains a concern for the country as it must feed 21% of the kets will be equipped with such deemed too small at a reduced price, “Buy one now, get one free later” (BOGOFL) concept of the Ministry of Agriculture, Food world’s population with only 6% of global water resources rooms by 2016. without having to commercial operation. For one product bought today, cus- and the Environment. As part and 9% of arable land. Auchan China turned its attention compromise on tomers can collect the same product for free the following of the initiative, they outlined an towards one particular source of waste, toxicity alerts, 423 quality. HYPERMARKETS (1) Preparatory study on food waste week. Sharing this concern of allowing customers to buy awareness campaign aimed at which are a regular occurrence in the country. To ensure HAVE SELF-DISCOUNT across EU27, October 2010, European the quantities they actually need, Auchan Production came involving all employees in the that quality is a concern right from the production stage, DEPARTMENTS Commission.

64 I 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT I 65 Our commitments A LOW-CARBON MODEL IN JOINT DEVELOPMENT

For Groupe Auchan, the move towards low-carbon consumption will happen all the more quickly if the vision is shared by suppliers and customers.

made from recycled plastic bot- ORGANIC FOODS: NEW HORIZONS tles in all of its hypermarkets. ELECTRIC In Ukraine, Auchan implemented an “Organic food” pro- VEHICLE gramme to safeguard the quality of its offering in a country CHARGING where organic food production is still in its infancy. To this CONSUM’ACTORS POINTS ACROSS end, the retail chain has been working with the Research The growing interest of consum- FRANCE Institute of Organic Agriculture (FiBL), which is already pres- ers for food with closer local links ent in Ukraine. This joint effort enabled Auchan to increase led Auchan’s teams to become like to find in stores. Among these were 200 regional products > In April 2014, Auchan its organic product range and improve traceability within involved in participative ini- which are now available in hypermarkets. SECOND LIFE in Mantes-la-Jolie was the supply chain. Today, 500 organic products meeting tiatives. During spring 2014, As part of its effort to be responsive to local customer the first hypermarket to have a fast charging European standards – including 127 food products – are 5 French hypermarkets invited needs, Immochan France organised discussion and focus Giving objects a second life helps to postpone station for electric available on shelves. 120 customers to take part in a quality groups at 15 of its sites. In this context, 600 local greenhouse gas emissions by avoiding the production vehicles installed in meeting organised between the inhabitants shared their views on what they expected from of new objects or the disposal of end-of-life products. its car park, enabling central purchasing department and their local shopping centre. Topping the list were the need In June 2014, Alinéa made it possible for its customers customers to FUTURE OF WASTE 128 regional SMEs. The customers for store appearance to blend in with the landscape and to sell their own belongings in its 26 stores by recharge their car in organising a giant bring-and-buy sale. The retail brand less than 30 minutes. To reduce its carbon footprint, Auchan is attentive to solu- voted for products that they would respect for the environment. To help achieve this aspiration, offered price estimates for furniture, decorative objects Deployment of these tions that new partners could bring to the Group. This was the design teams for all new developments being built in and crockery, and awarded an Alinéa gift voucher for stations, which results the case with TT Plast, a company which set up an opera- line with environmental certification guidelines shall include every object sold. As for all unsold objects, local from a partnership tion to collect transparent film used to wrap pallets in order an environmental consultant. The consultant will help select charities were on hand to receive donations. As a result between Auchan to recycle it into carrier bags. The result is an 80% saving in vegetation that is best suited to the local habitat and assess of the operation, 2,500 pieces of used furniture and France and Nissan, 11 tonnes of decorative objects went to new homes. has been underway fossil-based raw materials and a 60% reduction in carbon its capacity to generate a positive ecological impact, while across 96 stores and emissions. In 2012, 12 hypermarkets and 70 supermarkets making sure that existing fauna and flora are preserved. should be complete in in northern France became raw material suppliers to a 2015. plant producing 5,000 tonnes of bags from recycled mate- 29 See the CSR section of the management report. rials annually. In another partnership in Portugal, Jumbo is HYPERMARKETS working with APED(1) to propose reusable shopping bags CERTIFIED ISO 14001 (1) Portuguese Association of Retailing Companies.

66 I 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT I 67 Our commitments

WORKING WITH A fresh approach “IN BANGLADESH, WE ARE AWARE OF HOW IMPORTANT SUPPLIERS THE TEXTILE INDUSTRY IS TO DEVELOPMENT AND ARE KEEN TO OVERHAUL TO PROTECT IT.”

PURCHASING The very next day businesses, exporters workshops destroyed in following the Rana and NGOs – to work the disaster were asked Plaza disaster in together to prevent to contribute to the Since publishing its first code of business conduct almost Dhaka on 24 April another such tragedy fund. Nearly $21 million 2013, Gilbert from occurring and to were collected. 20 years ago, Groupe Auchan has sought to improve the working Houngbo, Deputy set up compensation However, estimates conditions of its manufacturing suppliers, in accordance with Director General for victims. indicate that $30 million of the International are necessary to the major principles of international law and with the United Nations Labour Office(1) Have these joint finance the medical Global Compact’s 10 principles. travelled to efforts resulted in bills and loss of income Bangladesh. significant action of victims and their being taken? families. Groupe What role did the Auchan demonstrated International Labour A first initiative was its solidarity in Office play in the brought to the table as August 2014 by wake of the collapse early as 15 May 2013. donating $1.5 million of this textile factory? This was the Accord on to the fund. A WIDER SPECTRUM A BUSINESS CONDUCT Fire and Building Safety Thanks to the support AN OF CONTROL CULTURE The ILO promotes for clothing factories in of its development ORGANISATION Before entering into any business with a supplier, Auchan In March 2014, Groupe Auchan the creation of Bangladesh. A 5-year partners, the ILO is decent employment work programme, led today in a position to BORN IN POST- insists that a supplier audit be carried out. The purpose updated its code of business con- and respect for in partnership with implement a major WAR TIMES of this audit is to approve manufacturing sites accord- duct which describes the funda- fundamental rights 2 international labour scheme to improve ing to social and quality-related criteria. The Rana Plaza mental principles of responsible at work. Indeed, in unions and more working conditions > The International disaster highlighted that working conditions in factories purchasing. There are two parts Labour Organization Bangladesh the state than 190 companies in Bangladesh, were not the only area of concern. In May 2013, Groupe to these guidelines. The first is was founded in 1919 of many factories is in 20 countries, was addressing, in after the First World Auchan therefore decided to sign the Fire and Safety the “Code of business conduct cause for concern. In outlined to enable particular, health and War, in order “to Agreement and thus to contribute to financing building for suppliers”, which all suppli- this country, we are building inspection to safety, freedom of pursue a vision safety audits alongside all of the other retail chains party to ers must accept before working aware of how important be carried out in some association and the based on the the agreement. with the Group. The second is the textile industry is 1,500 factories. Details right to collective premise that the “Code of business conduct to development and of the progress of bargaining. Ultimately, universal, lasting for employees”, which all buyers are keen to protect inspection are available this should also result peace can be it. However the on the website in a long-term initiative CONCRETE AND TRANSPARENT must sign and agree to apply. established only if 3-4 million workers bangladeshaccord.org. to insure workers it is based on social In July 2013, with a view to strengthening the process of of this sector must In December 2013, against accidents justice”. The ILO control in place for many years, the Group’s international be allowed to work in a fund was set up in the workplace. brings together product sourcing and purchasing department, DOAPI, safe conditions. The under the auspices governments, began working proactively on an 8-point plan to tackle International Labour of the ILO to provide (1) The International employers and Labour Office is the opaque subcontracting. In 2014, the Group internal audit Office proposed compensation for those permanent secretariat of workers and has was asked to verify that the process was being properly to all stakeholders injured in the incident the International Labour been an agency of applied and regularly monitored. In accordance with the – government, and families of workers Organisation (ILO). the United Nations unions, employers, who died. Companies since 1946. In 1969, most recent commitments, progress on the implementation of the plan is communicated in a fully transparent manner in 175 SCI local manufacturing which operated in the it was awarded the SOCIAL AUDITS See the CSR section Nobel Peace Prize. the CSR section of the Groupe Auchan management report. CONDUCTED IN 2014 of the management report.

68 I 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT I 69 Our commitments

DEVELOPING IMMOCHAN FOUNDATION FOR SOCIAL A WORLD OF SOLIDARITY ENTREPRENEURSHIP (IMMOCHAN FRANCE) WITH OUR In France, social entrepreneurs SIMPLY TASTE OF in more than 90 towns and SHARING FOUNDATION cities receive support from (FRANCE SUPERMARKETS) this foundation. In 2014, the foundation supported This foundation, set up in 2009, supports solidarity and social integration 15 projects related to green FOUNDATIONS projects connected with food. In 2014, 22 projects received support. spaces, the transformation of The Foundation also continued its partnership with 280 “social” grocery fresh produce, training, and stores which allow people experiencing difficulties to buy quality mobility as a means to improving food items at low prices. The support provided goes beyond simple employability. Alongside IESEG(1), financial assistance and results in a transfer of skills. The Simply Market the Foundation also organised employees involved in the scheme assist the grocery stores, during their the CréEnSo award for social AUCHAN YOUTH working hours, to upgrade their know-how. business start-ups. The winner of this year’s prize was the “Drôle FOUNDATION de Pain” bakery which holds training workshops for people (WORLD HYPERMARKETS) facing difficulties and with poor The Auchan Youth Foundation, set up in employment prospects. 1996, provides support to young people in 11 countries, in neighbourhoods where Auchan hypermarkets are located. AUCHAN GENERATIONS FOUNDATION (RUSSIA In 2014, 58 projects received support. HYPERMARKETS) The average grant was €7,480. In Hungary, The Foundation supports initiatives for example, the Foundation helped to in aid of children. In 2014, a budget of more than €1 million finance a scheme promoting reading, helped to implement 89 projects, led by a socially-responsible publishing 44 of which targeted children company, the municipal library and teachers and young people in difficult situations, 30 of which concerned from the local neighbourhood. sporting programmes and 15 of which supported educational THE NEW WOF (WEAVE OUR FUTURE) schemes. In addition to the FOUNDATION 20,000 children who benefited GREETINGS CARDS FOR A GOOD CAUSE from the Foundation, another The desire to participate in programmes to improve 7,000 received stationery items In 2014, for the fourth consecutive year, the Auchan Youth the working and living conditions of workers in and gifts as a result of two annually Foundation produced a greetings card in aid of the charity SOS held events, “School for all!” and Children’s Villages. The operation raised €100,000 and helped developing countries led Groupe Auchan to set up WOF “Give Children a New Year”. to support 12 of the charity’s projects locally. In the Polish village in 2014. With a budget of $7.5 million over 5 years, of Bilgoraj, the purchase of IT material gave 100 young people See the “solidarity” chapter of the the Foundation is for retail chains wishing to take part management report’s CSR section”. access to the Internet. In the Italian villages of Mantova and 186 Ostuni, where the charity operates, foreign minors will be able PROJECTS SUPPORTED in initiatives to aid workers in the textile manufacturing BY GROUP FOUNDATIONS (2) (1) French School of Management. to benefit from training in bakeries, agriculture and tourism. IN 2014 and weaving industries of LDCs . (2) Least developed country.

70 I 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT I 71 CONSOLIDATED STATEMENT OF FINANCIAL POSITION

YEARS ENDED 31 DECEMBER 2014 AND 2013

ASSETS (in €m) 2014 2013 Goodwill 3,630 3,991 Other intangible assets 1,018 109 Property, plant and equipment 11,992 9,802 Investment property 4,161 3,847 Investments in associates 208 88 Customer loans – Credit activities 1,147 1,050 Other non-current financial assets 509 430 FINANCIAL Derivative financial instruments (non-current) 320 184 Deferred tax assets 209 203 Non-current assets 23,194 19,704 Inventories 4,511 3,903 AND Customer loans – Credit activities 1,513 1,528 Trade receivables 442 505 Current tax assets 120 120 Other current receivables 2,346 2,311 EXTRA-FINANCIAL Derivative financial instruments (current) 387 134 Cash and cash equivalents 2,673 2,028 Assets classified as held for sale – – Current assets 11,992 10,529 STATEMENTS Total assets 35,186 30,233 73 76 EQUITY AND LIABILITIES (in €m) 2014 2013 Consolidated statement CSR Indicators: Share capital 633 633 of financial position Social elements Share premiums 1,914 1,914 74 78 Reserves and net income attributable to owners of the parent 6,400 7,113 Consolidated income Environmental elements Equity attributable to owners of the parent 8,947 9,660 statement 79 Non-controlling interests 2,612 567 75 Societal elements Consolidated statement 80 Total equity 11,559 10,227 of cash flows CSR reporting methodology Provisions 296 199 Non-current borrowings and other financial liabilities 4,600 4,083 Debt financing the credit activity 1,079 1,236 Derivative financial instruments (non-current) 12 72 Other non-current liabilities 1,794 247 Deferred tax liabilities 816 469 Non-current liabilities 8,597 6,306 Provisions 273 198 Current borrowings and other financial liabilities 582 1,397 Debt financing the credit activity 1,267 1,034 Derivative financial instruments (current) 39 30 Trade payables 8,557 7,724 Current tax liabilities 106 95 Other current liabilities 4,206 3,222 Liabilities classified as held for sale – – Current liabilities 15,030 13,700 Total equity and liabilities 35,186 30,233

Le rapport financier 2014 est consultable sur www.groupe-auchan.com.

2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT I 73 Financial statements

CONSOLIDATED INCOME STATEMENT CONSOLIDATED STATEMENT OF CASH FLOWS

(in €m) 2014 2013 (in €m) 2014 2013 Revenue 53,454 48,077 Consolidated profit for the year (including non-controlling interests) 787 835 Cost of sales (41,168) (36,908) Share of net profit (loss) of associates 10 2 Gross profit 12,286 11,169 Dividends received (non-consolidated investments) (1) (1) Payroll expenses (5,842) (5,332) Net cost of financial debt 75 84 External expenses (3,779) (3,130) Income tax expense (including deferred taxes) 309 402 Depreciation, amortisation and impairment (1,577) (1,416) Net depreciation, amortisation and impairment expenses (other than on current assets) 2,573 1,503 Other recurring operating profit 11 13 Income and expenses on share-based payment plans 1 (3) Other recurring operating expenses – – Other non-cash items – – Operating profit from continuing operations 1,098 1,304 Capital gains/losses net of tax and negative goodwill(1) (1,172) (220) Other operating profit and expenses 63 88 Cash flows from operations before net cost of financial debt and tax 2,582 2,602 Operating profit 1,161 1,392 Income tax paid (351) (467) Income from cash and cash equivalents 49 32 Interest paid (213) (213) Gross cost of financial debt (124) (116) Other financial items 138 129 Net cost of financial debt (75) (84) Cash flows from operations after net cost of financial debt and tax 2,156 2,051 Other financial revenue 60 22 Change in working capital requirement 191 (105) Other financial expenses (40) (89) Changes in items relating to the credit activity (16) (22) Profit before tax 1,105 1,240 Net cash generated by operating activities 2,331 1,924 Income tax expenses (309) (402) Acquisition of property, plant and equipment, intangible assets and investment property (2,034) (1,831) Share of net profit (loss) of associates (10) (2) Proceeds from sale of property, plant and equipment, intangible assets and investment property(2) 540 792 Net profit from continuing operations 787 835 Acquisition of shares in non-consolidated companies including associates accounted Net profit from assets held for sale and discontinued operations – – for by the equity method (2) (3) Profit for the year 787 835 Proceeds from sale of shares in non-consolidated companies including associates ––of which attributable to owners of the parent 574 767 accounted for by the equity method 88 7 ––of which attributable to non-controlling interests 213 68 Acquisition of subsidiaries net of cash acquired(3) 386 (538) Earnings per share from continuing operations, attributable to owners Sales of subsidiaries net of cash disposed of – – of the parent (in €) Dividends received (non-consolidated investments) 1 1 ––basic 18.56 24.75 Change in loans and advances granted (38) 111 ––diluted 18.54 24.72 Net cash from (used in) investing activities (1,059) (1,461) Amounts received from shareholders on capital increases – – Purchases and sales of treasury shares (64) (31) Dividends paid during the period (374) (226) Acquisitions and disposals of interests without change of control(4) 16 (1) Change in net financial debt(5) (499) (406) Net cash from (used in) financing activities (921) (664) Effect of changes in foreign exchange rates(6) 277 66 Net increase (decrease) in cash and cash equivalents 628 (135) Cash and cash equivalents at beginning of period 1,771 1,906 Cash and cash equivalents at end of period 2,399 1,771 Net increase (decrease) in cash and cash equivalents 628 (135) (1) Including, in 2014, a capital gain of €(1,009) million related to the full consolidation of Sun Art and its subsidiaries as of 1 January 2014. Including, in 2013, capital gains on disposals net of tax of property assets in France €(139) million and Luxembourg €(96) million. (2) Including, in 2014, disposals net of tax of property assets in Italy, France, Spain and Portugal amounting to €187 million, €82 million, €137 million and €63 million respectively. Including, in 2013, disposals net of tax of property assets in Italy, France and Luxembourg amounting to €443 million, €166 million and €98 million respectively. (3) Including, in 2014, cash acquired from Chinese entities since their full consolidation as of 1 january 2014 amounting to €375 million. Including, in 2013, the impact of the acquisition of Real in Russia, Romania and Ukraine. (4) Including change in put options granted to minority shareholders. (5) Including €(98) million in 2014 and €(350) million in 2013 in debt repayments related to the acquired Real companies. (6) Including, in 2014, the impact of changes in the Chinese yuan for €80 million, the Russian rouble for €194 million, the Ukrainian hryvna for €(20) million and the Hungarian forint for €11 million.

74 I 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT I 75 CSR Indicators

Number of Frequency of Accident Number of Illness SOCIAL ELEMENTS HEALTH AND SAFETY occupational occupational severity occupational absanteeism IN THE WORKPLACE accidents accidents(1) rate(2) illness(3) rate(4) Western Europe 9,349 52.89 1.33 435 4.1% WORKFORCE BY GEOGRAPHICAL AREA Workforce Percentage of workforce Central and Eastern Europe 613 5.3 0.07 5 2.4% Western Europe 125,841 56.2% Asia 308 6.51 0.13 0 1% Central and Eastern Europe 71,145 31.8% Group 10,270 30.23 0.74 440 3.1% Asia 27,0 0 9 12% (1) The frequency rate of occupational accidents corresponds to the number occupational accidents with work stoppage per million hours. Work stoppage of one Group 223,995 100,0% calendar day or more is taken into account. (2) The severity rate of occupational accidents with work stoppage corresponds to the number of days lost due to an occupational accident with work stoppage As at 30 September 2014, employees on open-ended and fixed-term employment contracts, excluding temporary staff and interns. per thousand hours worked. 3) Number of illnesses recognised by an official body. Data is calculated over the full calendar year 2013 from 1 January to 31 December 2013. WORKFORCE BY CORE BUSINESS Workforce Percentage of workforce (4) Corresponds to all hours lost by all employees due to illness divided by the number of theoretical hours worked. Hypermarkets 180,022 80.4% Supermarkets 32,720 14.6% NUMBER OF MEETINGS HELD WITH EMPLOYEE REPRESENTATIVES Immobilier 867 0.4% Western Europe 11,321 Banque Accord 2,060 0.9% Central and Eastern Europe 346 Others 8,326 3.7% Asia 218 Group 223 ,995 100,0% Group 11,885 From 1 October 2013 to 30 September 2014.

WORKFORCE BY AGE Worforce Under 25 25-34 35-49 50 and over PERCENTAGE OF FEMALE MANAGERS Western Europe 125,841 14% 23% 45% 18% Western Europe 36% Central and Eastern Europe 71,145 13% 31% 38% 18% Central and Eastern Europe 63% Asia 27,0 0 9 24% 35% 36% 5% Asia 50% Group 223,995 15% 27% 42% 16% Group 47% As at 30 September 2014. As at 30 September 2014.

WORKFORCE BY GENDER Male Female Western Europe 43% 57% Number of Percentage of disabled employees disabled employees Central and Eastern Europe 28% 72% DISABLED EMPLOYEES WITHIN THE WORKFORCE within the workforce within the workforce Asia 37% 63% Western Europe 5,392 4.3% Group 37% 63% Central and Eastern Europe 1,712 2.4% As at 30 September 2014. Asia 724 2.7% Group 7,828 3.5% EMPLOYMENT STRUCTURE Permanent contracts Fixed-term contracts Full-time(1) Part-time(1) As at 31 December 2013, disabilities recognised by an official body. Western Europe 91% 9% 65% 35% Central and Eastern Europe 93% 7% 84% 16% Asia 59% 41% 85% 15% Number of Percentage of Group 88% 12% 73% 27% shareholder employees SHAREHOLDERS EMPLOYEES employees holding shares As at 30 September 2014. (1) Data for part-time and full-time work are based on the legal definitions in each country. France hypermarkets 52,474 89% Spain hypermarkets 11,836 99% PERMANENT CONTRACTS HIRINGS AND DISMISSALS Hirings(1) Dismissals(2) China hypermarkets 13,295 100% Western Europe 13,077 3,165 Hungary hypermarkets 5,655 87% Central and Eastern Europe 22,777 1,782 Italy hypermarkets 11,621 96% Asia 5,579 235 Luxembourg hypermarkets 473 80% Group 41,433 5,182 Poland hypermarkets 10,495 100% (1) The number of recruits on open-ended employment contracts corresponds to the total recruits on open-ended contracts and fixed-term contracts that have been transformed into open-ended contracts during the reporting period. Portugal hypermarkets 7,598 100% (2) The number of lay-offs of employees on open-ended employment contracts corresponds to all contracts terminated at the employer’s initiative. Russia hypermarkets 23,882 81% France supermarkets 11,858 99% PERMANENT CONTRACTS TURNOVER RATE(1) TOTAL NUMBER OF TRAINING HOURS PROVIDED Spain supermarkets 4,639 94% Western Europe 10% Western Europe 1,922,840 Italy supermarkets 7,161 84% Central and Eastern Europe 32% Central and Eastern Europe 1,573,073 Banque Accord France 829 88% Asia 25% Asia 8 67,020 Banque Accord Portugal 262 94% Group 18% Group 4,362,933 Alinéa 988 40% (1) The turn-over rate of open-ended employment contracts corresponds to the From 1 January 2013 to 30 September 2014. Group 163,066 91% number of employees on open-ended employment contracts that have left the company/average headcount on open-ended employment contracts x 100. As at 30 September 2014.

76 I 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT I 77 CSR Indicators

ENVIRONMENTAL ELEMENTS WASTE VALUATION RATE BY CORE BUSINESS Hypermarkets 66.9%(1) Immochan 30.9% Alinéa 48.0% ELECTRICITY CONSUMPTION BY CORE BUSINESS (kWh/m² sales area) Average ratio Les Halles d’Auchan 52.0% (1) The data covers most sites. Hypermarkets 464 The supermarkets are not taken into account. Supermarkets 652 Immochan 258 Alinéa 183 WASTE VALUATION RATE BY GEOGRAPHICAL AREA Les Halles d’Auchan 619 Western Europe 80.3% Central and Eastern Europe 49.5% ELECTRICITY CONSUMPTION BY GEOGRAPHICAL AREA Asia 52.5% (kWh/m² sales area) Hypermarkets Supermarkets Group 66.9% Western Europe 435 647 Central and Eastern Europe 538 683 NUMBER OF ORGANIC PRODUCTS CARRIED ACCORDING Asia 425 – to EU definitions Hypermarkets Supermarkets Group 464 652 7,0 6 0 817 As at 30 September 2014. WATER CONSUMPTION BY CORE BUSINESS (m3/m² sales area) Average ratio RAW MATERIALS SAVINGS IN TONNES SINCE 2004 12,200 Hypermarkets 1.45 resulting from packaging optimisation (1) Supermarkets 0.82 As at 30 September 2014. Immochan 1.89 Alinéa 0.18 Les Halles d’Auchan 0.64 NUMBER OF HYPERMARKETS WITH A SELF-DISCOUNT DEPARTMENT 423 (1) Excludes Simply Market Italy. As at 30 September 2014.

WATER CONSUMPTION BY GEOGRAPHICAL AREA (m3/m² sales area) Hypermarkets Supermarkets Western Europe 0.91 0.84(1) Central and Eastern Europe 1.45 0.73 SOCIETAL ELEMENTS Asia 3.40 – Conducted in Total 1.45 0.82 Conducted by association with (1) Excludes Simply Market Italy. NUMBER OF ICS AUDITS Groupe Auchan other retail brands 175 183 As at 30 September 2014. CO² EMISSIONS ASSOCIATED WITH ELECTRICITY (kg/m² sales area) Western Europe hypermarkets 98.3 NUMBER OF OWN-BRAND PRODUCTS WITH LABELS IN BRAILLE Hypermarkets Supermarkets Central and Eastern Europe hypermarkets 209.5 3,457 1,776 Asian hypermarkets 319.3 As at 30 September 2014. Supermarkets 179.6 Immochan 108.1 Number of Amounts projects allocated FIGURES FOR FOUNDATIONS supported (in euros) CO² EMISSIONS ASSOCIATED WITH COOLANT LEAKS (kg/m² sales area) Auchan Youth Foundation (World hypermarkets) 60 608,900 Western Europe hypermarkets 128.3(1) Auchan Generations Foundation (Russia hypermarkets) 89 980,100 Central and Eastern Europe hypermarkets 84.9(2) Simply “Taste of Sharing” Foundation (France supermarkets) 22 133,800 Chinese hypermarkets 80.7(3) Immochan Foundation for Social Entrepreneurship (Immochan France) 15 188,600 Supermarkets 129.7(4) Total 186 1,911,400 Immochan – (5) As at 31 December 2014. Data calculated for calendar year 2013. (1) Excluding Auchan Luxembourg and Les Halles d’Auchan. (2) Excluding Auchan Ukraine. (3) Auchan China only. (4) Western Europe only. (5) Since coolants are essentially used for cold storage of food, coolant leakage at shopping malls is not significant and is not subject to specific monitoring. The coolants used for air conditioning at the shopping malls and hypermarkets are reported by the store.

78 I 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT I 79 CSR Indicators

CSR REPORTING METHODOLOGY

THE CORPORATE SUSTAINABLE for some indicators. Some social indicators may be defined dif- POUR EN SAVOIR PLUS, RETROUVEZ DEVELOPMENT SYNERGY ferently according to local regulations or customs, especially the number of employees with disabilities and the number of occu- NOS PUBLICATIONS INSTITUTIONNELLES Since 2008, sustainability policies have been drafted, coordinated pational illnesses. and monitored under an International Sustainable Development Data for some categories cannot be calculated on a rolling Synergy. This synergy promotes the sharing of common objec- 12-month basis due to the collection time required. The number tives, the exchange of best practices and an increasing focus of employees with disabilities and the number of hours of training on skills development. Monthly conference calls and a yearly are among these categories. In 2014, these indicators were thus face-to-face seminar gather around thirty members representing calculated for the whole calendar year of 2013. the Group’s different countries, core businesses and certain functions. This synergy is spearheaded by Patrick Coignard, B) INFORMATION RELATING TO ENVIRONMENTAL INDICATORS Chairman of Iberian Peninsula Hypermarkets and coordinated by The indicators presented include consumption data from all Group communications director Marie-Hélène Boidin Dubrule. sales sites of Groupe Auchan entities, excluding RT Mart China LEGAL OBLIGATIONS hypermarkets, which are currently being integrated, E-Commerce International (AECI) and Banque Accord due to the specific nature Since April 2012, Groupe Auchan has been subject to extra-finan- of these businesses. Data is calculated for the period running cial reporting obligations and to certification by an independent from 1 October 2013 to 30 September 2014, unless expressly third party pursuant to article 225 of the Grenelle 2 law. Following stated otherwise. an internal mock audit, CSR data for 2013 were published as part Financial Report 2014 CSR section of the management of the Groupe Auchan annual report. To ensure the information 2014 Activity and corporate Details regarding indicators social responsibility report – Groupe Auchan report 2014 – Groupe Auchan would be more standardised and comparable, an initial reporting Only sales sites are included in the calculations. Sites used solely – Groupe Auchan protocol was drawn up and made available to everyone involved for logistics purposes and central services are excluded from the in providing information. Ernst & Young’s certification work is calculations. based on this protocol. Only shopping malls owned by Immochan are taken into account in The conclusions of the first certified financial year (2013) the calculation of indicators. The shopping malls which Immochan expressed reservations about the Group HR guidelines, which rents or which it operates under contract management, as well did not provide sufficiently specific definitions, calculation meth- as retail parks, are not included in data calculations and coverage ods or internal control procedures to track the workforce and its rates. age distribution. The conclusions did not, however, identify “any The stores’ floor space does not include storage areas, laborato- significant anomalies likely to call into question the fact that the ries or the shopping mall. CSR information, taken together, is presented in an accurate manner”. Additional observations noted the coverage rate of C) DATA COLLECTION AND VERIFICATION METHODS certain environmental indicators and compliance, still too incon- In terms of qualitative information, the country’s policies and activ- sistent, with internal control procedures. ities are communicated by email in the form of questionnaires. To address the above-mentioned reservations, the entire report- For the calculation of indicators, each reporting manager is ing protocol was comprehensively revised to make it more spe- responsible for checking the data provided. A computer tool cific. In 2014, for example, Group HR explained the deliverables to Carnet Développement Rapport d’activité Activity Report 2014 helps the reporting manager identify those entities and sites managers reporting information for consolidation. durable 2014 – Auchan France et de développement – Oney Banque Accord whose indicators fluctuate considerably from one year to the next responsable 2014 – Immochan or demonstrate little reliability based on predetermined ratios. A) INFORMATION RELATING TO SOCIAL INDICATORS A second series of checks is then carried out at Group level. The indicators presented include data from all of the core Before consolidating data, any inconsistencies and errors found businesses and countries of Groupe Auchan, except RT Mart www.groupe-auchan.com. are reviewed with the countries in question and corrected or China hypermarkets, which are currently being integrated. Data excluded as necessary. is calculated for the period running from 1 October 2013 to 30 September 2014, unless expressly stated otherwise. There are significant economic, social and cultural disparities Design and production: – March 2015. Photo credits: Sipa Press: W. Alix, M. Cristofani, For more detailed information about Groupe Auchan’s CSR policies, V. Damourette, S. Dhote, C. Dubreuil, D. Ferenczy, S. Jackson M. Nabrdalik, A. Pungovschi, N. Revelli-Beaumont, A. Rua ; between the various Groupe Auchan countries, which explain the 2014 CSR section of the management report is available on David Aubert, Olivier Degoulange, Robert Fleischanderl, Sandra Muehlburger, G. Murat, Studio Focale photographie, Metro AG, Nissan, SOS Villages d’Enfants, Fondation Simply, Groupe Auchan’s photo library. the sometimes significant variations between different countries www.groupe-auchan.com. Illustrations: Stéphane Manel (portraits), Anne-Cécile Manfré.

NorNord’imprimd'imprim SteenvoorSteenvoordede -– CertifiéeCertifié Imprim’Vert Imprim'Vert –- FSCFSC –- ISO 90019001 –- ISO 14001 –- ISO 26000 –- PSO –- Imprimé sur papier rcertifiéecyclé FSCavec avecdes encrdes esencres à base à base végétale végétale.. 80 I 2014 ACTIVITY AND CORPORATE SOCIAL RESPONSIBILITY REPORT Communications Department in charge of sustainable development – 92, rue Réaumur – 75002 Paris – France Phone: +33 (0)1 58 65 08 08 – Fax: +33 (0)1 58 65 08 15 www.groupe-auchan.com