Company Presentation

1 HOK-Elanto’s business area Matti Niemi, President and Chief Executive Officer: 110 years for owner’s benefit

HOK-Elanto reaches its HOK-Elanto is developing its own op- 110th anniversary in the eration on several fronts. The exten- coming autumn. The ini- sive refurbishment project of the Alepa tiative came from bakers chain has been completed. Meanwhile, who wanted to provide the work of developing online grocery consumers with better sales continues. We are the leading and purer products, at operator in the internet grocery trade. the same time improving the working As for consumer goods, we have re- Hconditions in their trade. The idea of vised the Sokos business idea and their own bakery cooperative grew brought a multi-storey Marks & Spen- into a consumer cooperative society cer store into central Helsinki. covering many trades and also making Our preparations for the coming rad- the role of retailing possible. The lead- ical changes in retailing are also shown ing principle was that the owners and by the fact that we have sold some of customers of the cooperative society our retail premises to property inves- received good value for their money, tors. At the same time, we have en- when buying products. sured that the premises remain in our A hundred and ten years later, the own use by long-term lease agree- Cooperative Society has grown to be- ments. This gives us the resources to come an important operator in the re- respond quickly to changes in our HOK-Elanto’s values tail sector. Its mission of supporting operational field. consumers’ sound housekeeping by of- With consumers struggling in the re- - co-op member benefits fering high-quality and safe products cession with dwindling buying power, at competitive prices has remained as S Group was proactive in bringing the - competent staff clear-cut as ever. importance of food prices into pub- - ability to change In the Greater Helsinki area, lic debate. Neither did we leave it at 1. Helsinki 4. Nurmijärvi 7. Järvenpää HOK-Elanto has more than 590,000 debate level, but reduced the prices - responsibility 2. Espoo 5. Tuusula 8. Hyvinkää owners who regularly use the services of hundreds of food products signifi- 3. Vantaa 6. Kerava 9. Mäntsälä of their own store. Their number con- cantly and permanently in our stores. - performance tains many kinds of needs, different At the same time, it is good to bear demands, expectations and views. quality in mind. Even economical prod- HOK-Elanto has taken a long-term ucts must be of good quality, and that view in developing its outlet network. is why the lowering of grocery prices The aim has been good coverage of concerns well-known domestic trade- the network. Different business ideas marks, the quality of which people trust. bring about a variety of offerings, giv- Yet, the price is not the only factor ing the consumer the opportunity of guiding the consumer’s choices. The HOK-Elanto in 2014 choosing their store according to their location of the store, different taste own needs. By keeping our network preferences and diets impact in many and business operations well up-to- ways on what Finland eats. Locality Net sales EUR 1.894 billion Outlets 318 date and sound, we increase the value and Finnish sourcing are important cri- teria for many, and the Cooperative Trend -1.2% Equity ratio 72.6% of the co-op members’ property. The retail sector is going through a Society also wants to promote them. Co-op members 590,694 Operating profit EUR 41.6 mill. period of transition, which requires a Despite some controversy in public de- - Bonuses paid EUR 65.7 mill. Market share greater than ever capacity for reform. bate, I firmly believe that a Finnish and - Interest on cooperative - grocery trade 40.9% Particularly in the case of the consum- local retail operator is best placed to capital EUR 1.9 mill. - licensed restaurants 12.2% er goods trade, the whole sector is ensure the offering of Finnish food al- Personnel 6,033 - fuel retail 15.5% hard pressed this year, squeezed be- so in the future. tween weakened buying power and the growing offerings of international online trade. 3 HOK-Elanto provides services and benefits to further the well-being The Finnish company owned by you of its customer-owners.

Alepa S-market Sokos & Emotion Restaurants

The neighbour you know by name. There are almost Freshness. Quality. The right price. The first choice The specialist in fashion, beauty and feeling good. The largest restaurant operator in the Nordic coun- 90 Alepa stores in the HOK-Elanto business area, for groceries. The Helsinki city centre Sokos department store also tries: from the expert service of beer rooms to the the majority of them serving every day until 11 p.m., More than 50 S Markets in our area serve until contains the store-within-a-store of the British cloth- diverse menus of restaurants and entertainment for some right around the clock. 9 p.m. on weekdays, at weekends until 6 p.m. ing chain Marks & Spencer. a variety of tastes.

Staff: 1,084 Turnover: EUR 348.5 mill. Staff: 1595 Turnover: EUR 579.3 mill. Staff: 263 Turnover: EUR 69 mill. Staff: 966 Turnover: EUR 134.5 mill. Outlets: 89 Trend: +0.9% Outlets: 54 Trend: -0.3% Outlets: 11 Trend: – 11% Outlets: 109 Trend: – 2.1%

Funeral services and Prisma Kodin Terra Tuusula ABC & Citykeittiö Deli Estate Inventory offices

Good but economical. The forerunner of lower pric- The full-coverage hardware store provides solutions One stop, many services. ABC serves every day all A reliable and traditional full-service funeral service es with comprehensive ranges to fulfil the multitude and services for building, refurbishing, interior the year round, weekdays and holidays. and a wide range of legal services for the various of family needs. decoration, gardens, garden structures and holiday stages of life. homes.

Staff: 1,601 Turnover: EUR 611 mill. Staff: 39 Turnover: EUR 18.2 mill. Staff: 183 Turnover: EUR 142.2 mill. Staff: 48 Turnover: EUR 9.8 mill. Outlets: 12 Trend: – 0.4% Outlets: 1 Trend: -17% Outlets: 32 Trend: – 7.7% Outlets: 12 Trend: + 5.3%

4 5 You are an owner of Finland’s biggest Cooperative Society

HOK-Elanto is the largest area cooperative society in the S Group and one of the most important employers in its area. It has more than 300 outlets and employs in excess of 6,000 people. Even a big company can be close to its customers. It is important that it listens to the customers’ changing needs, so that they can President and Chief Executive Officer be fulfilled when developing its operation. Matti Niemi

Controller S Markets, Alepa stores and Ko- Operating environment HOK-Elanto 2014 Pirjo Tarkkanen More than 1.3 million people live HOK-Elanto’s turnover was EUR din Terra) did the best of all the divisions, with the lowest fall in the HOK-Elanto area. In 2014, 1,894 million. The group’s ad- Internal audit the number of residents grew by justed trading profit was EUR in turnover and trading profit almost 19,000, and it is estimat- 41.6 million and operating profit growth of EUR 4 million on the ed to keep growing by about EUR 25.3 million. The result held previous year. 20,000 people a year until 2050. up at the previous year´s level About one-third of the whole and was better than budget- HOK-Elanto is part of country’s jobs and buying power ed. The result includes one-off S Group Deputy Chief Executive Officer lies in the HOK-Elanto area. income, mostly profit from the S Group consists of the Coop- Veli-Matti Liimatainen Chief Human Resource Officer sale of capital assets, of EUR erative Societies and the SOK Antero Levänen Responsibility 23.5 million and one-off costs of Corporation with their subsidi- Groceries and Consumer Goods Cooperative activity includes the EUR 9.4 million. The sales profits aries. HOK-Elanto is the largest goal of common good. Economic from capital assets were mostly of the 28 regional and local co- and social well-being, environ- from the sale of the premises of operative societies forming the mental issues, research and the Malmi, Olari and Tikkurila S Group. The cooperatives’ share Chief Planning Officer development work, as well as Prismas, Tuusula Kodin Terra, of S Group’s retail sales was EUR Juha Ilvonen business and staff development and five smaller stores, to the 10,373 million or 92.8 per cent. Chief Operating Officer guide our daily operation. Swedish property investor Red- The cooperatives’ retail sales fell Markku Kuusinen ito in spring 2014. HOK-Elanto by 0.7 per cent from the previ- continues trading in all the units ous year. At the end of the year, Fuel Retail and Convenience Stores under long lease agreements. S Group had 1,643 outlets and Chief Real Estate Officer The supermarkets (Prisma stores, more than 40,000 employees. Jyrki Karjalainen

HOK-Elanto Group net sales and operating profit per division Chief Operating Officer Jouko Heinonen Net sales Operating profit Chief Financial Officer Laura Oja 2014 MEUR change 2014 MEUR Restaurant Operations Supermarkets 1,519.9 -0.3% 26.3 Department stores 67.3 -11.0% - 4.8 HOK-Elanto’s management organisation Fuel Retail and Convenience Stores 142.2 -7.7% - 1.8 HOK-Elanto’s Management Group comprises the President and Chief Executive Officer; Deputy Chief Restaurant operations 134.5 -2.1% 1.0 Executive Officer, Groceries and Consumer Goods; Chief Operating Officer, Restaurant operations; Chief Operating Officer, Fuel Retail and Convenience Stores; Chief Planning Officer; Chief Financial Other operations and administration 30.1 19.0% 20.8 Officer; Chief Human Resource Officer and Chief Real Estate Officer. Members of the Management HOK-Elanto Group total 1,893.9 -1.2% 41.6 Group report to the CEO. The President and CEO of HOK-Elanto is Matti Niemi, Commercial Counsellor, M.Sc.(Econ.) and his Deputy is Veli-Matti Liimatainen, M.Sc.(Econ.).

6 7 “One day all this will be yours”

Owner’s business card

HOK-Elanto has almost 600,000 The green colour unites, but there are differ- Time for ownership reorganisation customer-owners. Of all the house- ences in the functions of S Etukortti cards. in your family? S Etukortti Visa Credit/Debit – an international Giving an S Etukortti Cash to children and holds in the area, 81 per cent use the credit and debit card young people living at home builds up Bonus S Etukortti, the owner’s business card. When you use your card’s debit function, your pur- for the household and provides benefits, chases are charged direct from your S Account. The which makes sense, as increasing the common During 2014, 21,877 new co-op members signed up, card’s economical credit function gives you credit for pot raises the household’s Bonus rate. What and the number of member households totalled 30 days on average. about when young people move into their 590,694 at the end of the year. Of all households in own homes? Or if there are other changes in the area, 80.7 per cent are co-op customer-owners. S Etukortti Visa Debit – like a traditional debit card the family relationships? HOK-Elanto’s customer-owners were paid Bonuses to- you can use to withdraw cash and pay for purchases talling EUR 65.7 million and payment method benefit both in Finland and abroad. Your shopping is charged HOK-Elanto membership means ownership of of EUR 1.3 million. In addition, EUR 1.9 million was direct from your S Account. the cooperative society. HOK-Elanto’s coop- paid in interest on cooperative capital. Thus, co-op S Etukortti Visa Credit – an international credit erative contribution is EUR 35, payable either members were rewarded by EUR 130.30 / household card with interest-free credit of 30 days on average. as a one-off payment or by accruing it from on average. Your shopping is charged to your Visa account. the Bonuses. In the event of customer-owners wishing to terminate their co-op membership, Your green S Etukortti is proof of your ownership. It S Etukortti cash – without payment functions, it re- the contribution paid is refunded. brings you benefits and accrues Bonus in more than cords your Bonus and allows you to utilise price bene- 300 stores and restaurants in the HOK-Elanto area fits. Without payment functions, it is also suitable for Interest on the cooperative contribution or and more than 1,600 across the country. the youngest members of the family. the annual return on the invested capital S Etukortti Visa allows you to pay and withdraw cash You can upgrade your card to suit your requirements at HOK-Elanto has been 10 per cent or EUR all over the world, as well as depositing and with- at S Group customer service points or by logging into 3.50 in recent years. The interest is paid to drawing cash also at the store checkout. Using it to the online S Bank. You can also use Asiakasomistajan customer-owners who have fully paid up their pay also brings you money – all purchases made in palvelulomake [Co-op members’s service form] availa- cooperative contribution by the end of the S Group in Finland accrue payment method benefit ble at almost every outlet. accounting period (most recent 31 December of 0.5%. 2014) and whose membership is ongoing.

8 9 Your ownership grows and develops Owner benefits

HOK-Elanto has more Vantaa and Suurpelto in Espoo. Kauppakassi brings your shop- OK-Elanto exists for Bonus than 150 S Markets, Alepa A residential area for 10-20,000 ping right to your front door. The its owners. With our The basic principle of a coopera- stores and Prisma stores in people requires two large super- Alepa and Prisma Kauppakassi on- large service range, tive system is “the more you buy, markets. The future focus is fore- line store is growing rapidly. On- members benefit its area. With its 109 res- the more you benefit”. As you cast to shift from hypermarkets line grocery sales grew in 2014 by from their ownership increase your monthly purchases, taurants, it is the biggest to smaller stores that bring the 50 per cent on the previous year, in many ways. your bonus percentage also in- restaurant operator in the services closer to the customers. corresponding to the turnover You receive benefits creases. With a minimum monthly Nordic countries. HOK-Elanto opens 4-5 new stores of a medium-sized S Market. The from the neighbourhood store, purchase value of EUR 50, the or supermarkets a year. growth is continuing and gather- Hsupermarket and shopping cen- bonus percentage is 1, but with During 2014, HOK-Elanto invested Co-op members’ neighbourhood ing pace. tre. From the car wash, floor tiles, monthly purchases of EUR 1,500 about EUR 44 million in develop- services will be significantly im- If necessary, the restaurants up- pizzas, perfumes, wills… it goes up to 5% (or at least EUR ing its outlet network. The popu- proved in the coming years, when date their concepts to ensure cus- 900 a year). lation grows at the rate of about HOK-Elanto returns for its own tomer satisfaction. The concept Benefits 20,000 a year in its business area, use a number of traditional busi- of Kappeli has remained practi- As an owner, you are entitled to a Interest on cooperative and the most recently complet- ness premises that served for dec- cally unchanged since 1867, but number of products and services capital ed regional and city master plans ades as Elanto shops. Starting in as an example, the Czech-themed at customer-owner prices both In recent years, the interest on forecast development to continue 2016, HOK-Elanto will open sev- beer rooms changed last year to from HOK-Elanto’s own outlets cooperative capital at HOK-Elanto at this level until 2050. The need eral neighbourhood stores in its become the Ølhus chain, rooted and many benefit partners. You has been 10%. for homes and various services own premises, once their current in the Nordic beer culture. The will find a list of partners on the grows along with incomers. They lease agreements with Suomen König corner will also undergo a back page of this brochure need schools, day care facilities, Lähikauppa Oy terminate. big change. Double Bonus health centres, libraries and stores. In 2015, HOK-Elanto will open From time to time, the stores run Whole new suburbs will form in three new S Markets, in Tikkuri- Double Bonus campaigns, during the HOK-Elanto area, such as Kal- la, Karaportti on the Kehä II ring which any purchases earn twice as asatama in Helsinki, Kivistö in road, and Konala. much bonus. 10 11 over 60 yrs under 20 yrs 55-59 yrs 4 (4) 4 (5) 5 (5) over 20 yrs 8 (8) under 1 yrs 15 (16)

45-54 yrs 10-20 yrs 14 (14) 20-24 yrs Working26 (27) 18 (16) % % 35-44 yrs 17 (17) 6-9 yrs 1-5 yrs 19 (14) 40 (46) for you.25-34 yrs Henri Penttinen, Anna Röyti, Heidi Liljelund, 30 (29) Chef, Business Concept Manager, Assistant Store Manager, ABC Nihtisilta Restaurant Casa Largo Emotion Hyvinkää HOK-Elanto employs more The morning and evening shifts The days and shifts vary. I check The work is really varied, which Service distribution vary, but I start both by mak- that we have enough manpow- is the salt and sugar of this job. than 6,000 people in the 31.12.2014 ing sure everywhere is tidy, the er, the reservations are kept and As well as the sales floor, we al- stocks are in place, and then get the shifts function smoothly. All so do lashes, eyebrows, make- on with preparing portions. The the day’s activities share a com- up, beauty advisory services and Greater Helsinki area directly over 60 yrs under 20 yrs 55-59 yrs 4 (4) 4 (5) busiest time is lunchtime, and mon goal: that our customers ear piercing. As Assistant Store and many times that number 5 (5) Sunday evenings are also live- leave satisfied. It’s brilliant that Manager, I naturally also assist overly. 20 But yrs after a busy day it’s nice HOK-Elanto has so many differ- the Manager in everything we indirectly. 8to (8) note that we did it again. ent restaurants, to which one do here. I love this job, we have under 1 yrs HOK-Elanto15 (16) is a really good em- can apply if one wants a change. a dream team and really nice cus- At the close of 2014, the personnel numbered 45-54 yrs 10-20 yrs ployer. I want to get on and Of course, there are also oppor- tomers. In five years’ time I see 6,033. In accordance with the goals of the person- 14 (14) 20-24 yrs 26 (27) 18 (16) learn new things. A service sta- tunities in other divisions, should myself still here, but I want to nel strategy, the number of full-time staff grew tion suits me fine, but of course you want to go into retailing, for improve myself and develop my to 47 per cent (prev. year 46%). Converted to full- % I’m% also interested in restaurants. example. skills. time person years, the imputed number of per- 35-44 yrs 17 (17) sonnel was 5,080 (5,181). 6-9 yrs 1-5 yrs 19 (14) 40 (46) We take care of our employees in a responsible 25-34 yrs way, giving them the opportunity to grow and 30 (29) develop in different jobs. HOK-Elanto supports its employees throughout their careers, helping to maintain their capacity and zest for work. The staff job satisfaction survey was returned by Age distribution more than 90 per cent of the personnel. Employee 31.12.2014 engagement at HOK-Elanto is significantly higher than in Finnish organisations in general. Some Heikki Hölttä, Tiina Antila, Hanna Kervinen, critical opinions do arise in the context of factors Sales Assistant, Checkout Supervisor, Office Manager, affecting work motivation, but the results for the to offered summer jobs to about 2,000 young other topics exceed the national average very sig- people. The number of summer jobs in 2015 will Kodin Terra Tuusula S Market Vaasanhalli HOK-Elanto Funeral nificantly. Particularly the topics at corporate lev- be similar. We try to get as many sales as we The day starts before seven. Services, Tikkurila office el, such as employer image, management culture We offer numerous training opportunities for can. When it’s quiet we unpack I check the safe, open the store, We do our best to implement and operational culture were rated positively and people who are difficult to place in employment, merchandise and fill shelves. fill the plastic bag racks, check the families’ wishes regard- are among HOK-Elanto’s strengths. and employ dozens of people with learning diffi- There is actually no such thing the sweets and cigarettes. More ing the funeral. We must have We have invested a lot of determined effort in culties and mental health rehabilitants every year. as a normal day. My neck prob- people arrive at work at 7.30, good situation awareness and the occupational wellbeing of our staff, which HOK-Elanto has played an active part for a long lem made it impossible for me to which is when I withdraw to the an ability to read people, as we is evident in the reduced numbers of sickness time in employing and training immigrants. At continue working in the build- office to do paperwork with the work in a sensitive area. absences and early retirements. Working capac- the end of the year, there were people from 42 ing trade, so I’m really pleased receipts. During the day, I pro- I like my present job. The team ity management has been systematically devel- different countries among the personnel. to get this job where I can put duce the “seating plan” for the is really supportive and nice. If I oped, with the result that sickness absences have HOK-Elanto again paid a profit-share bonus of my knowledge and skills to good next day, showing who sits at wasn’t here, I would work as a dropped in three years by as much as 27.6 per cent. EUR 1.1 million to its permanent employees from use. It’s by no means certain that which checkout, the breaks etc. gardener or in some hand craft About 35 per cent of HOK-Elanto’s permanent the previous year’s profits. The profit-share bo- one can find a new job at my Naturally, I also do checkout job staff, about 2,200 persons, are under 25 years old. nus was paid to 5,166 employees, and it amount- age. My practical experience has work. I started as checkout su- The retail sector offers young people a good way ed to 1.0 per cent of the employee’s annual earn- been useful in this job anyway, pervisor at the beginning of this of entering the world of work. In 2014, HOK-Elan- ings in 2014. and I’m glad if I can help. year. One of my big career goals has now come true, and I haven’t 12 had time to think of the next 13 step! Tanner creates an ideology of ow- nership: the retail outlets and production units operate in Elan- to’s own premises. The HOK side does not have the benefit of such a strong lea- der and visionary. Instead, HOK stresses collective power and the loyalty of the members. It grows rapidly and its lines of business in- crease. Alongside grocers selling imported goods, it opens shops selling bakery, butchery and dai- ry products, clothiers and a ba- kery. In 1929, a central building is completed on the corner of Man- nerheimintie and the present Ru- neberginkatu, containing the first licensed restaurant as well as sho- ps. Licensed premises and restau- rants become HOK’s goldmine in the shadow of the large Elanto, which takes a negative view of Long history seen in city landmarks alcohol. 1930–40: he Cooperative Socie- Elanto’s first bakery is completed The battle for political direction ty Elanto and Helsinki in 1907, the first baker’s shops in the country gathers pace. Tan- In 1932, HOK acquires its first Cooperative Society are and cafes open – and the first ner lets it be known that the in- long-term managing director. Finnish versions of the vehicle is purchased. habitants of the capital from all Lauri Koskivaara, an economics international cooperati- ideological and political groups graduate, remains at the helm for ve movement in the ear- 1910–20: are welcome at Elanto, both as the next 30 years. 1950–60: ly 1900s. It follows the customers and in its governance. As well as licensed premises, transition from agrarian society The world is in turmoil and Fin- Not all Helsinki residents HOK concentrates on the retail The Sokos department store is fi- ser, book shop and funeral ser- Tto industry and trade, resulting in land is drawn in. Conflicts are satisfied with the coopera- of imported commodities, fruit nally completed in the Olympic vice. Merihotelli [Marine Hotel] is migration from rural areas to between the working populati- tive model represented by Tan- and vegetables. In 1936, a restau- year 1952 as a joint enterprise of a large, but risk-free acquisition; towns and cities. on and landowners increase. Wor- ner. Pro-Finnish bourgoisie, led by rant seating a record 1,000 cus- SOK and its Helsinki cooperative the hotel business is familiar to kers’ cooperative societies set up the architect Jalmari Kekkonen, tomers is opened in Lasipalatsi, a societies, HOK and Varuboden. A the cooperative from a good de- 1900–10: Suomen Osuustukkukauppa OTK start setting up their own coope- building intended as temporary in considerable part of it is taken up cade ago. [Finnish Cooperative Wholesa- rative society, affiliated to SOK. the heart of the capital. by Hotel Vaakuna, Finland’s big- The Elanto management un- With the rapid growth of the ler Society] in 1917. Alongside it The founding meeting of Helsin- The Sokos department store is gest of its kind. dergoes a complete overhaul. number of cooperative societies, a forms the ideological collaborati- ki Cooperative Society is held in erected in the city centre. Because Elanto’s first express sto- Ylermi Runko is appointed Direc- need for collaboration was identi- on organisation Kulutusosuuskun- January 1919. In the same year, of the war, however, the building re opens in 1951 and HOK’s first tor General, and the average age fied. In 1904, Suomen Osuuskaup- tien Keskusliitto [Central League retail stores on Katajanokka and is wrapped up in a parcel, the self-service store in 1956. Other of the management group drops pojen Keskuskunta [SOK Corpo- of Consumers’ Cooperative Socie- Etelä-Esplanadi open. unwrapping of which takes seve- novelties for consumers are plas- from 55 to 38 years. ration] is established to carry out ties]. Elanto joins OTK. It never ac- ral years. tic carrier bags, milk cartons, and Runko focuses his energy on the functions of central buying, tually terminates its SOK member- 1920–30: sell-by dates on bakery products. retailing. The number of express consultancy and steering. ship, but is deemed to have left 1940-50: Finland recovers from the war, stores quickly rises to 50 and then The first significant cooperati- before long. The Director General of Elanto ri- builds and consumes. HOK and to a hundred. In total, the num- ve society in Helsinki is Elanto. In a little more than 10 years, ses both in national politics (e.g. The sales are down in HOK’s Elanto respond to the demand by ber of shops reaches 578, a record It comes into being in October the Cooperative Society Elanto becoming Prime Minister and Mi- grocery shops. Nevertheless, the opening one shop after another; in Elanto’s history. On top are the 1905, when a group of bakery grows to become a strong opera- nister for Foreign Affairs, Deputy restaurants continue to attract in every city suburb and in every 29 restaurants, including Fennia workers, dismissed from their tor. In 1915, a young lawyer and President and presidential candi- customers. Business in the central country village, and two in each and Kappeli. employments, start organising social democrat, Väinö Tanner, is date) and in the capital’s groce- Sokos building gradually gets un- one. Consumer habits change. their own production unit. They appointed Director. He anticipa- ry and retail business. The coope- derway after the war. A new res- Elanto continues to sell its bread, receive ideological encourage- tes the impacts of the world war rative society builds a new head taurant, seating a record 1,250, 1960–70: regardless of the consumers as- ment from the Pellervo Society on both trade and the real esta- office on Kaikukatu, opens new is opened on the first floor. The king for other goods too. and expertise from the university. te business. Elanto acquires land shops and modernises its sausage people give it an affectionate Helsinki continues to grow at a The association, planned as a pro- and properties in excess of its re- and soft drinks factories. Bread nickname, Hehtaarihokki [Hecta- fast pace. The HOK family is join- duction cooperative, expands to quirements: for future use and as production is secured by a new re-HOK]. ed by a service station, hairdres- become a consumer cooperative. investments. bakery and the society’s own mill.

14 15 chain. The Director General, Yler- mi Runko, initiates discussion on a couple of occasions of a possible merger between Elanto and HOK, or at least substantial collaborati- on. 1990–95:

Finland is hit by the most severe slump in decades. Elanto starts the new decade prosperous, but unprofitable and alone. The new Director General, Jorma Seppänen, tries to find re- medies for the recession. Every single cost item and work stage is scrutinised. Elanto’s management obtains an undertaking from its principal financier, KOP, that the bank will secure the cooperative society’s funding under all circum- 1970–80: Despite pressures to the contrary, mises and directs its cash on its co- stances. Elanto determines to remain inde- re business. HOK is engaged in active and HOK’s Managing Director, Armas pendent. The financial purge begins to bi- flexible collaboration with SOK. Tasa (1969-75), steers his compa- SOK and HOK face unavoidable te both at SOK and HOK. The year HOK acquires the successor of Äs- ny ever more clearly towards the restructuring. There are few app- 1984 sees the birth of Ässä-Mar- sä-Market, Ässä-Partners Oy, and hotel and restaurant business. Ho- licants for the job. SOK finds Juha- ket Oy, of which SOK owns 80 and sells Helsinki Hotels Oy to SOK. tel Helsinki, Torni, Hesperia, Olym- ni Pesonen from the Wihuri Group HOK 20 per cent. Ässä-Market HOK concentrates on its original pia and Klaus Kurki elevate HOK and HOK discovers Pentti Pasuri takes charge of all HOK’s viable business of grocery retailing and 2000–05: 2005-15: to the position of the absolute from the SOK Board of Directors. grocery stores. New HOK members SOK on hotels. leading operator in Helsinki and Up to now, the cooperative so- are the cooperative societies Teho Tauno Palmroos, director of In the spring of 2000, the Elanto HOK-Elanto becomes stronger and number two in the whole country. cieties of both the bourgoisie and from Hyvinkää, Ahomaa from Jär- the retail group, is elected to the Board of Directors plans its futu- grows. The rapid migration to the Hesperia, built in 1972, in particu- workers have grown abreast, and venpää, and Väinölä from Mänt- post of Director General at Elanto. re for the period following debt Greater Helsinki area pumps up lar is a real golden egg to HOK. later gone downhill. Now their sälä. The membership leaps to restructuring. There are three al- property values. Member numbers The hotels and restaurants are strategies start to diverge. 60,000 in one fell swoop. 1995–2000: ternatives: risky collaboration with jump in a couple of years to over profitable, but the grocery busi- Elanto, deciding alone on its The loss-making spiral is bro- capital investors from outside the half a million, personnel to over fi- ness is in deep water. Year after affairs, is forging ahead at full ken. More thrust comes from chain The KOP and SYP banks merge. sector, increasing collaboration ve thousand. The balance sheet is year, HOK has to rely on the cent- speed and acquires a great deal collaboration and a bonus system. Elanto wants to know whether or with EKA’s successor, Tradeka, or good, the cash flow steady and st- ral organisation’s support for its of totally new business: Tasokalus- S Group introduces the basic tenet not the financing undertaking gi- partnership alongside HOK. In all rong. The equity ratio exceeds 60 accounts. te and Koti-idea bring furniture to of the cooperative movement to ven by KOP is shared by its mer- the cases, the condition of colla- per cent. Elanto keep its head above the range, Koneveljet household the present day: the more the con- ger partner SYP. Funding is promi- boration is getting out of the debt Stores, restaurants and ser- water thanks to its property hol- appliances, and Pizzeria Nr 1 piz- sumer buys, the more benefit he sed for other purposes, but not to restructuring ahead of schedu- vice stations are refurbished and dings, but the core business is run- zas. gains. Over the next fifteen years, replace possible depletion of the le. The restructuring programme new ones opened. Alepa stores, ning at a loss. Even the new Maxi HOK does not have a sing- the company’s market share gro- Savings Association. proceeds a good deal faster than S Markets, restaurants, pubs and hypermarkets in Kannelmäki and le spare Markka in its coffers. The ws from under 16 to 31 per cent. News of the funding policies planned. It is over in 2001. ABC convenience stores pop up all Leppävaara fail to change the ove- new Managing Director, Pentti Pa- Nothing like this has been seen become public, and the Savings Helsinki Cooperative Society around the Greater Helsinki area. rall picture. suri, knows that nursing the finan- anywhere else in Europe. Association members rush to wi- Elanto starts operations officially The company enters the hardwa- ces back to health requires getting thdraw their savings. In a single on 1 January 2004. Arto Hiltunen re and gardening sectors through 1980–85: rid of loss-making businesses. The 1985-90: morning, tens of millions of Mark- is appointed the first Managing the Kodin Terra store chain, with first to go is the notorious Korpi- kas are taken from the fund. Elan- Director. After him, from 2007, the first outlet opening in Tuusu- Heavy industry and unprofitab- lampi, followed by 130 small sho- S Group pulls off one of its best to seeks corporate reorganisation. the Managing Director and CEO la. New Prisma stores open in Viik- le cooperative societies have dri- ps. The hotel business in the city deals. OK-Liha is put up for sale. Elanto’s liabilities are not cut. The has been Matti Niemi. In October ki and Itäkeskus, and HOK-Elan- ven OTK to the brink of a crisis. of Helsinki remains profitable, and The biggest shareholder, HOK, ma- company becomes profitable qui- 2005, the new cooperative society to’s biggest investment project is The long-standing bearers of res- further investments are made in it. kes 23 million on the deal and uses te quickly. celebrates its 100-year journey for completed over four years: Shop- ponsibility step aside, and power is The strategic differences between it to buy 12 Perämies restaurants. Arto Hiltunen becomes HOK’s the benefit of the consumers in ping Centre Kaari, with the largest concentrated on the new Director Elanto and HOK are also evident Ässä-Market acquires the privately new Managing Director. The chief Greater Helsinki. Prisma in the country serving as its General, Eero Rantala, who rolls in their premises. Elanto continues owned Alepa chain in 1987. architect of Elanto’s restructuring, engine. Thanks to Alepa’s Kaup- up his sleeves immediately. The E in Tanner’s tradition and wants to For the first time, Elanto gets a Tauno Palmroos, dies suddenly, pakassi, HOK-Elanto becomes the cooperative societies are merged operate from its own premises, competitor from OTK’s offspring, and Arto Ihto becomes the new leading online grocery retailer in with OTK, which becomes EKA. while HOK operates in rented pre- when EKA acquires the Valintatalo Director General. the country. 16 17 The HOK-Elanto Board of Directors: From the left Markku Uitto, Managing Director, Chairman Matti Niemi, CEO, Professor Matti Pohjola, Ulla-Maija Tolonen, Commercial Counsellor, Professor Jaakko Aspara, Tuula Entelä, Director of Business Operations (Vice Chairman) and Sallamaari Muhonen, Communications Consultant. Governing bodies of Cooperative Society democratically elected

As a co-op member, you Council of Society’s Board of Directors and appoint- ing the CEO. HOK-Elanto’s Supervisory are both an important Representatives Board has 18 members, two of whom are customer of your coop- HOK-Elanto’s customer-owners select appointed by staff. The members serve from their number 60 members of the for three years. erative society and a real, Council of Representatives, along with power-wielding owner. the same number of deputies. The Board of Directors Council of Representatives holds the The Board of Directors fosters HOK-Elan- HOK-Elanto is a cooperative society highest power of decision in matters to’s interests and looks after its business owned and governed by its members. As assigned to it under the legislation and in accordance with the Cooperatives Act, an owner, you can influence the govern- Statutes. Examples of such matters are Cooperative Society Statutes, the Code ance through the Council of Represent- the Statutes of the Cooperative Society, of Practice approved by the Board of atives election held every four years, the approval of the previous year’s financial Supervisors, and directions and decisions next one in spring 2016. statement, deciding on the disposal of of the Council of Representatives and All members approved by the cooper- retained earnings, and selection of the Board of Supervisors. The Board of Direc- ative society before 31 December 2015 Board of Supervisors and auditors. In tors is responsible for ensuring that the will have a right to vote in the Council addition, members of the Council of Cooperative Society’s business is profita- election. Personal members must have Representatives can make proposals to ble. The Board decides on the key strate- reached the age of 15 during the year the Board of Directors on matters con- gies and objectives, investments, annual 2015. The voting takes place by post cerning the Society’s business sector. financial targets and action plans, as well and observes the principle of the secret as directing and overseeing operational ballot. Supervisory Board business activities. In addition to the All personal members approved on 31 The Supervisory Board represents CEO, the HOK-Elanto Board of Directors December 2015 at the latest may become the co-op members. It is tasked with consists of six members appointed by candidates, provided that they have overseeing HOK-Elanto’s administration the Board of Supervisors. The Board of reached the age of 18 before polling day and operation, executed by the Board Directors’ term of service is one year. in spring 2016. of Directors and the CEO. It approves Further information on HOK-Elanto’s Editors: Katri Karsi and Ralf Nyberg / HOK-Elanto Communications the Cooperative Society’s key strategies elections, governance, governing bodies Graphic design: Antti Kannelsuo / SOK Media and overall financial goals, decides on and their members at important changes in the operation and http://www.hok-elanto.fi/yrityksesta/hallinto/ Photos: Suvi-Tuuli Kankaanpää, Pasi Murto, Aki Rask, Mikko Ryhänen, organisation, as well as selecting the Pasi Salminen, Anton Sucksdorff and HOK-Elanto archives. 18 Printed at: SP-paino. 19 Own businesses and partners

HOK-Elanto and other S Group in Greater Helsinki area

Bonus partners in Greater Helsinki area

Benefit partners in Greater Helsinki area

Cooperation partners in Greater Helsinki area

Helsinki Cooperative Society Elanto | Company Reg. No. 1837954-9 | Tel. +358 (0)10 76 600 (EUR 0.0835 /call + EUR 0.1209 /min) | Kaupintie 14, 00440 Helsinki | hok-elanto.fi