Annual Non-financial information report statement 2018 Annual Non-financial information report statement 2018 Letter from1. EROSKI the chairperson p. 4

Key data 2018 p. 6

1 2 3 4 5 6 7 8 Letter from the Chair 102-14

e present this annual report to society and our from a guaranteed responsible source. Certification in sential to our future and ability to respond to what society Wstakeholders as part of a regular and fundamental animal welfare and chain of custody of sustainable fish, expects from us and deserves. We are moving forward in exercise in transparency. For the third year in a row, we are using antibiotics responsibly and eliminating post-harvest the right direction. publishing this report in accordance with the new Global treatments are just some of the criteria the foods sold Reporting Initiative (GRI) standards to continue to improve under this brand meet. I encourage you to read this annual report to learn more the communication of our impacts and improvement about our performance in 2018 and the actions we actions in three areas where we measure our level of sus- We are also committed to the consumption of local foods, have taken as a result of the commitment to sustainable tainability: the economic, social and environmental areas. promoting an agri-food sector that bases its sustainability development we endorsed in 2002 by signing the Global on the fact that its productive fabric is a key element for Compact and which we renew every year. This is how we With the 2018 financial year, we’re at the midpoint of the local economy and culture, and the environment. It are working to meet the 17 UN Sustainable Development our current strategic plan based on differentiation, with is our nature as a cooperative that lead us to commit to Goals that came into force on January 1, 2016. We hope health and sustainability as the main pillars. The good this diversity and to creating collaborative environments you find it interesting and inspiring. results of the "with you" business model has strengthened to work with a large number of suppliers. In this way, our our leadership in the North, where we have concentrat- business offer is more and more specialized and focuses ed the transformation of our network thus far. This has on making a healthier and more sustainable diet possible. included the opening of stores under our own-brand and Thank you. franchises that bolster our position. Consequently, our Our commitment to the environment also translates into operating results have continued to improve significantly continuous improvement of our processes and stores. and confirm good business health and firm stability over Containers and packaging with an ecodesign to prevent recent years. Our roadmap is supported by the benefits plastic pollution, the efficient management of logistics arising from recent transformations in our value chain, and the building and renovation of stores according to from logistics processes and our relationship with suppli- environmental criteria and using eco-efficient equipment ers to our stores and relationship with Client Partners via clearly demonstrate that this line of work also represents Agustín Markaide. EROSKI Club. We must continue developing this roadmap one of our strategic development pillars. Chair of EROSKI Group to become a better business, capable of responding to the needs of constantly evolving consumers. Therefore, In line with environmental sustainability and our social we are now focused on accelerating renovations in our commitment, we have maintained the objective of Zero remaining markets, and we’re making significant progress Waste of food suitable for human consumption in our in the Balearic Islands, as well as Catalonia, to boost our business network. In 2018, we donated 4,928 tons of prod- competitiveness in these regions. ucts to those who need it most through more than 100 social organizations throughout the country, under guar- We have taken an important step with our best customers anteed conditions of food security, gratuity and solidarity. by launching the Gold Programme, which offers stable discounts on all their purchases and which has yielded We also collaborated with the country’s main charity noteworthy results. This initiative was developed by the causes and organizations and dozens of entities of Client Partners Club and has allowed us more opportuni- various types working for different social causes. Many of ties to meet them and offer a more intense, participatory these actions are channelled through the EROSKI Founda- and personalized relationship that we will continue to tion, which manages the 10% of our annual profits that we strengthen. dedicate to social and charity projects.

We continue to make progress in our digital transforma- Another of the Foundation’s main axes of work also tion and in 2018, for the second year in a row, we were rec- deserves special mention: consumer information and ed- ognized as the best online supermarket, which confirms ucation. We have been involved in consumer education the excellent evaluation we receive from our customers. for 40 years through our news project EROSKI CONSUM- Likewise, we closed the year as leaders of the online order ER, a consumer magazine published in Spanish which delivery service, with 50 pick-up locations, by car or at the receives approximately 50 million visits online per year. In store. addition to this project, we must mention the EROSKI Foun- dation Nutrition School, with its Healthy Eating and Habits At EROSKI, we believe that the store, be it physical or on- Education Programme aimed at schools and which has line, is the ideal place to promote a good, healthier and educated more than 1 million boys and girls since 2013. It more environmentally friendly diet. That’s why in 2018 we is aimed at helping the citizens of tomorrow improve their published 10 new commitments to health and sustainabil- nutrition habits and, like the aforementioned actions, is ity that set the path for us. We have launched more than part of our commitment to health and sustainability. 20 lines of work to meet these commitments. Implement- ing advanced Nutri-Score nutritional labelling on our own- Those of us who make up EROSKI are working together to brand products – which makes us pioneers in Spain – is a strengthen our cooperative project and ensure our place clear example. Moreover, we relaunched our EROSKI Natur in the future. This internal collective strength that has brand, which includes produce with a differential flavour granted us almost 50 years of business is undoubtedly es-

4 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 5 Highlights

€5.393 5,000 30,048 3,000 billion in turnover tons of food donated, or9,747 meals employees at the EROSKI Group gluten-free products in our stores, of which...

413,499 €4.698 +43,000 enquiries responded to by our Customer billion in net sales from distribution tons of waste recycled or recovered 541 Service Department, which was awarded following the principlesof a circular are EROSKI brand gluten-free product for the seventh year in a row economy

13,000 1,652 Client Partners participated with their ideas 19,509 establishments supplier product analyses and store, platform 4,200 to improve our business offer and stores business suppliers and production plant audits

+3,300 869,411 58 2,493 employees in franchises, approximately school children educated through our Healthy new openings small local producers Eating and Habits Education Programme

71% A B C D E Pioneers +6 21,352 of management roles are held by women million Client Partners local product references in adopting Nutri-Score labelling, with advanced nutritional information help consumers eat healthier

6 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 7 1 EROSKI 1. EROSKI EROSKI 1.

A unique business model 102-1; 102-2; 102-5; 102-7

102-2; 102-6

ROSKI is the leading retail distribution cooperative for way, we can ensure that the entity’s specific strategy and Due to our search for greater quality and excellence in the E mass-consumption goods and services in Spain and the demands of employees and consumers in general is a benchmark in the regions of Galicia, the Basque are linked and coordinated. Our business network is products and services we offer, the EROSKI group includes Country, Navarre, Catalonia and the Balearic Islands. The currently developed and managed through the cooper- various entities specialized in different business lines and group’s parent company is the consumer cooperative ative and the other 26 subsidiary companies that make EROSKI S. Coop., which meets three conditions at once: it up the EROSKI Group and which appear in the financial specific geographical areas: is a distribution company, a consumer organization and a statements. A list of these companies, as well as how cooperative project in which consumers and employees each one stands as regards the aspects presented in this share the spotlight and autonomy. document, can be found in the section on transparency of this report. This unique business model allows both management professionals and our main stakeholders – the clientele – to participate directly in governing the cooperative. In this

CAPRABO is the leading supermarket company in Catalo- VEGALSA-EROSKI, a 50-50 joint venture between the nia. Founded in 1959, it is the oldest supermarket compa- González Prieto family and EROSKI, has formed part of the ny in Spain and has a network covering strategic areas of EROSKI Group since 1998 and is a leader in commercial Organizational chart of the 27 EROSKI Group companies and their stake in EROSKI S. Coop.: Catalonia and Andorra. CAPRABO has formed part of the distribution in Galicia. It also operates now in the neigh- EROSKI Group since 2007. bouring regions of Asturias and Castile and León, where it has strong foothold.

78.85% 100% 100% 100% 60% 100% 82.15% 100%

15.07% 5.98%

Cecosa Cecosa Cecosa Cecosa Cecosa Central Grupo Eroski EROSKI has its own travel agency, Viajes EROSKI, which, FORUM SPORT is the EROSKI Group’s sports brand. With 25 Institucional Gestión Diversificación Hipermercados Supermercados 17.85% de Serveis de Distribución S.L. S.A. S.L. S.L. S.L. Ciencies Gredisa, S.A. in addition to its activity in the holiday sector, also holds years of experience in the specialized sale of sport equip- S.L. a noteworthy position in business trips and conference ment and a presence in 10 regions, the chain has kept up organization through its brands Travel Air and Travel Air a positive growth rate. Events.

Vegonsa 78.95% Parque Jactus Spain Viajes Agrupación Marítimo 100% S.L. 100% EROSKI S.A. 100% 50% Alimentaria Jinamar S.L S.A

Afersa Vego super- (EROSKI S.A Forum Inmobiliaria mercados 60% 86.99% 100% financial con- Sport S.A. Rearé, S.A.U. 100% tributions)

100%

EROSKI EROSKI Equipafasa, Mercash-sar, Contigo S.L. franchise 100% 100% members’ company S.A. 100% S.L. company Contigo S.L. Caprabo S.A.

Gespa Forum Alcamuga, 68.59% S.C.P. 100% S.A.U 13.01%

Picabo S.L.U. 100%

Desarrollos EROSKI comerciales 49% 4.27% Hipermercados 49% de Ocio e S. Coop 40% Inmobiliario de Orense, S.A. Ges 100%

10 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 11 1. EROSKI EROSKI 1.

Mission, vision and values 102-16

Our mission Our values

ROSKI emerged from the consumer cooperativism Our mission is to offer society goods and services that t EROSKI, we have five values that define our business Eof the 60’s, when seven small cooperatives joined improve the quality of life, health and wellbeing of con- Aproject and the way we relate to people and the together in a bid to achieve quality products at an sumers under the best conditions of quality, information environment where we operate: affordable price and defend consumer rights. Since then, and price, with a commitment to promoting the practice our business strategy has remained aligned with this goal of sustainable consumption. as we have integrated the needs and demands of our consumers.

Cooperation Employees are key players at EROSKI, not just in Our vision the cooperative they are also owners of, but all the companies through their commitment to the organization. t EROSKI, we also place our employees at the heart distribute it. We are strongly committed to health, wellbe- Aof our activity, since we aim to generate sustainable ing and the sustainable development of society. and quality employment. Moreover, we work to earn profits With our vision we aim to: that allow us to generate greater wealth and charitably

Offer our clientele Reach leadership Remain committed to

satisfactory solutions positions in the Spanish protecting consumers We include consumer opinion through permanent market Participation in our strategy through their participation in the cooperative and innovation by actively listening to our clients.

Create a business project Promote an and model that includes Earn profits that enable environmentally friendly people wealth-generating growth type of management and attitude

We believe that permanently renovating all areas of Promote the personal € Promote the economy Contribute to improving operation is necessary to grow as a business and adapt to the and professional of the setting where we the community where we Innovation expectations that our activity generates in society and consumers. development of our operate by working with operate workforce local suppliers

We contribute to the welfare of the communities Social where we operate, collaborating in social, cultural and economic responsibility development through the charitable distribution of wealth.

Our vision drives us to integrate the needs and demands of consumers into our business strategy to make our stores their favourite place We advocate for consumer health and safety to shop. on a daily basis by offering healthy, wholesome and safe Commitment products, as well as transparent, useful and complete information. At the same time, we work to reduce the negative environmental impacts resulting from our operations.

12 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 13 1. EROSKI EROSKI 1.

102-18; 102-19; 102-20; 102-22; 102-23; 102-24; 102-26; Governance 102-27; 102-28; 102-29; 102-30; 102-31; 102-33; 205-2

EROSKI Group management model

As regards corporate governance, tion. It is made up of 12 members elected by the General An ordinary meeting is convened on an annual basis. Lastly, the Governing Council has two advisory bodies: the the companies in the Group follow Assembly to serve a period of four years, with the possibil- In 2018, half of its members were also renewed. Social Council, made up of 16 employee partners and ity of re-election. Half come from the group of consumers focused on social and labour matters, and the Consumer the guidelines of the parent and the other half from the employee group. The Governing Council delegates certain faculties to the Council, formed by representatives of Local Consumer company, EROSKI S. Coop. Board of Directors – with which it meets monthly to discuss Committees and which deals with consumer matters. The Articles of Association establish the disqualifications the organization’s different economic, environmental and of the members of the Governing Council and Man- social issues of the – and others to the committees creat- We have a training and content update programme for he only company that has a different management agement. In turn, the Appointments and Remuneration ed by it to approve the regulations established regarding members of the Governing Council that aims to deepen Tmodel for some matters – and even then, they are very Committee ensures they meet the established suitability its composition and operating rules. Thus, the Governing their knowledge of economic, environmental and social is- similar and agreed upon by the Group – is VEGALSA, as criteria, taking care to avoid conflicts of interest and take Council consists of the Audit and Compliance Committee, sues. In January 2019, we carried out two training actions: EROSKI only has a 50% stake in it. issues of gender diversity into consideration. the Appointments and Remuneration Committee, and the one aimed exclusively at new executives and focused on Executive Committee. knowledge of the business, and another aimed at all the The corporate governance of our parent company, EROSKI The most senior director joined in 2009 and, following inter- executives and focused on economic, retributive, internal S. Coop. is unique because it is a consumer cooperative. nal regulations, in 2018, half of the directors were renewed. Moreover, the cooperative has the Appeals Committee, audit and corporate governance matters. Therefore, both consumers and employees participate in Although none of the current members of the Governing composed of five members elected by the General As- the organization’s management and decision making. Council has executive responsibilities, their duties include sembly, half of which were renewed in 2018 according to And, for the third year in a row, we also made progress in Thus, EROSKI is structured into two communities: on the appointing the chairperson and general directors of the our internal regulations, which processes and resolves ap- annual performance self-evaluations of the Governing one hand, 1,170,803 Consumer Partners (which rep- cooperative, establishing the Internal Regime Regulations peals presented by partners against decisions made by Council and its Committees, as well as certain positions. resents a 4.72% increase as compared to last year, with and approving investments. the Governing Council and the provisions of the Articles This self-evaluation system consists of individual question- 52,797 new consumer partners), or individuals with a spe- of Association. We also have a Supervisory Committee naires with qualitative questions that make it possible to cial awareness of their consumer habits and who decide The Governing Council chairs the General Assembly, that serves as a control body. It consists of three members gather complete information and specific improvement to get involved in the cooperative; and, on the other hand, which is the highest body of expression of the company’s elected by the General Assembly and is dedicated to proposals. The Appointments and Remuneration Com- 9,796 Employee Partners (8,974 at EROSKI S. Coop., 413 of intent. It is composed jointly by 250 Consumer Partner supervising and monitoring election processes, as well as mittee analyzed the results of the self-assessment ques- whom joined in 2018), that provide both capital and work representatives and 250 Employee Partner representatives. to other functions set forth in Article 71. This Committee is a tionnaires and presented new action plans, which the as part of their commitment to the organization. The election of its members is ratified in the correspond- guest attendee of the Audit and Compliance Committee, Governing Council approved and have been implement- ing Preliminary Consumer and Employee Meetings and which is responsible for auditing and corporate gover- ed in order to improve the performance of the board and To manage both groups, we have created the corre- their term lasts four years. General Management and nance functions. the committees in handling the issues relevant to them. sponding articles of association and regulations, which the Chairperson of the Social Council also attend with govern the organization of each group through its own the right to speak, but not to vote. Their functions include The Governing Council is proactive about remaining structure. approving accounts, presenting and distributing profits, up-to-date on the organization’s most relevant concerns The EROSKI S. Coop Governing Council is responsible for establishing the general policies of the cooperative and by monitoring the progress of the different businesses, its corporate governance, management and representa- modifying the Articles of Association, when appropriate. the organization and the market, as well as through the participation of different company managers in Govern- ing Council meetings. This activity is supplemented by pe- riodic reports and the preliminary information procedures corresponding to each committee or commission on their specialized subjects, which are the object of analysis and specific proposals.

https://corporativo.eroski.es/en/ memoria-2018/carta-consejo-rector/

Governing council Members Lander Beloki Mendizabal Iñigo Arias Ajarrista Leire Mugerza Gárate Oskar Goitia Consumer Partner Employee Partner Consumer Partner Zubizarreta (independent) Mª Asunción Bastida (independent), Chairperson Consumer Partner Sagarzazu (independent) Gonzalo Loro Periañez Javier Segarra Iñigo Eizaguirre Edorta Juaristi Altuna Consumer Partner Employee Partner Board of Agustín Markaide Appeals Director Social Director Employee Partner, Vice chairman Nerea Esturo Altube (independent) Directors Chairperson Eduardo Herce Employee Partner Sonia Ortubai Balanzategui Ana Isabel Susperregui Eva Ugarte Rosa Carabel Beatriz Santos Consumer Partner (independent), Cristina Gainza Salinas Zariquiegui Asiain Consumer Partner Marketing Director Network Director Sales Director Secretary Employee Partner Employee Partner (independent)

14 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 15 1. EROSKI EROSKI 1.

EROSKI S. Coop. governance structure

Governing Council Social Council Delegate Centre Governs, manages and represents the cooperative. Advisory body for the Governing Committees meetings Council for matters related to Composition: 6 Consumer Partners, 6 Employee Partners, elected by the General Assembly. Representative body of em- employees. Main functions: ployee partners that advises Composition: 16 Employee and informs the Social Council • Vision, mission, values and ethical management of the company. Partners, elected by all the and the partners of the centres. • Decision-making regarding the cooperative's strategy and Management's employee partners and ratified They are organized by region. by the General Assembly. business actions. • Approval of major contracts and investments. • Risk management and internal monitoring thereof. • Accountability for its management to the General Assembly. • Adopting corporate social responsibility policies.

Consumer Council Local Committees Supervisory Committee Appeals Committee Advisory body for the Governing Council for Representative body of consumer partners that Ensures that social, auditing and corporate gover- Resolves the appeals presented by partners matters related to consumers. advises and informs the Consumer Council. They are organized by region. nance bodies are functioning properly. against the decisions made by the Governing Composition: 21 Consumer Partners, elected Council and the provisions of the Statutes. by each Local Committee. Composition: Composition: 3 Partners elected by the General Assembly. 5 Partners elected by the General Assembly.

Board of Directors Body that advises the cooperative’s General Assembly General Management and meets monthly EROSKI Group Highest body of expression of the company’s intent. with the Governing Council. Chairperson Composition: Main functions: Agustín Markaide 250 Consumer Partner representatives and 250 • Drafting strategic and Employee Partner representatives, ratified at the Preliminary Consumer and management plans. Employee Meetings, respectively. • Approval and development Main functions: of implementation plans. • Monitoring and following up on • Approval of accounts, presentation and distribution of profits. collaborator activities. • Approval of strategic plans and annual management plans. • Partnership negotiation.

• Modification of the Articles of Association. • Instilling the cooperative • Election of members of the Governing Council. culture in the organization. VEGALSA General Director Joaquín González

Preliminary Employee Partners Preliminary Consumer Partners Meetings Meetings Annual informative meetings with employee part- Annual informative meetings with consumer part- ners to share the topics discussed at the General ners to share the topics discussed at the General General Director General Director General Director Sales Assembly and ratify delegates. Assembly and ratify delegates. Marketing of Appeals of Network of Social Director Director Javier Amezaga Rosa Carabel Iñigo Eizaguirre Beatriz Santos Eva Ugarte

16 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 17 1. EROSKI EROSKI 1.

Executive responsibility for Responsible and ethical management Our code of ethics economic, environmental and social issues o ensure that EROSKI’s activities and relationships are Our Code of Ethics is the main pillar of daily manage- According to our regulations, the General Assembly must Tconducted honestly and ethically, we have a Code of ment, which in practice corresponds to the following authorize any action that links the cooperative to any Economic-financial management Conduct that we share with our employees, partners and lines of action: member of the Governing Council, Supervisory Commis- suppliers and which is available to all stakeholders. As sion or Management, or any of their relatives up to the he achievement of economic goals, managed regards sanctions, we have the EROSKI S. Coop. Internal second degree of blood or family kinship. Likewise, among Tthrough ECOFIN, is supervised by the EROSKI S. Coop. Regime Regulations, which applies to the entire Group. the competences corresponding to the Audit and Compli- Audit and Compliance Committee, as delegated by the Include ance Committee is that of informing the Governing Coun- Governing Council and which is entrusted with continu- Generally speaking, to ensure the reputation and credi- ethical management in the main management cil of situations of conflict of interest that may be incurred ously examining and monitoring company information bility of our organization, we avoid activities that are not objectives. by directors and executives, according to reports from the and accounting. Through said Committee, the Internal aligned with our interests, comply with the rules we have Appointments and Remuneration Committee. Audit is responsible for providing a systematic approach established, collaborate with the competent authorities, Take on and contribute to the independent evaluation and improvement of the make good use of the organization’s assets and refuse to the continuous improvement of the levels of effectiveness and efficiency of risk management process- undue payments, treatment and gifts. social responsibility included in the legislation. Impact and risk management es and internal control systems. The results are assessed by the Governing Council and are subject to an annual EROSKI has confidential channels and means to consult Verify external audit. The annual accounts, together with the he Audit and Compliance Committee and the EROSKI or report any matter related to the Code of Conduct that the organization is behaving ethically through audit report, are approved by the General Assembly. S. Coop Internal Compliance Body are mainly responsi- and its procedures. There is an email address, telephone indicators to define areas of activity in need of T ble for identifying, evaluating and managing the impacts, number and a postal delivery form for such purposes. improvement. Business relationships and the promotion of the local risks and opportunities of an economic, environmental The head of the Compliance Office, through the Internal environment are the responsibility of Commercial Man- and social nature, the latter of which is the body ulti- Supervisory Body, is the person appointed by the Audit Set objectives agement, while institutional relationships depend on the mately responsible for ensuring compliance with internal and Compliance Committee of the Governing Council to to improve ethical management and prepare and General Secretary's Office. regulations related to managing risks that the organiza- receive, channel, track, report and document these notifi- adopt plans to achieve it. tion may face. cations and consultations. The Audit Committee supervis-

es the procedures established for receiving consultations Train and inform Social Management In addition, we have developed a "Criminal Risk Pre- and notifications and validates the response provided. all the people involved in the application of the management system adequately and promote the vention Plan, which is reviewed annually, and which he General Social Director is responsible for employ- adoption of good social responsibility practices. identifies the crimes most likely to be committed within Tee management. Through various departments, he the activities carried out at the EROSKI Group. This plan is responsible for the following areas, among others: Fight against corruption and Inform includes the entire EROSKI Group, except VEGALSA, which Prevention of occupational risks, labour relations and money laundering providers and subcontractors adequately of the has its own, and FORUM SPORT and Viajes EROSKI, which administrations, employment and talent development, hu- Code of Ethics and create mechanisms to transfer will be included in 2019. It indicates the departments or man resource organization and development and social knowledge about social responsibility. areas that could be most affected by potential crimes, management. The Department of Health and Sustainabili- nticorruption and anti-money laundering activities actions that would imply infringement of the regulations ty, which reports to the Marketing Department, is in charge Aare included in the implementation of the “Compli- Attend and prevention measures that must be implemented by of the Charity and Social Action Area, together with the ance” policy by the EROSKI Group. Since 2017, we have to external stakeholders (consumers, neighbourhood the risk groups, as well as the surveillance processes that social responsibility departments of the different Group had a Criminal Risk Prevention Plan that establishes the communities, Administration, clients, providers, etc.) will be developed for inspection or certification. companies. This task is supplemented by the work of the design of the prevention policy and defines the internal that look into our social behaviour. EROSKI Foundation in this field. supervisory measures that must be implemented. To this Regarding crimes against natural resources and the end, a Criminal Risks Prevention Manual has been drawn Communicate environment, certain risk actions are envisaged that up and includes our Code of Ethics, its rules and the fulfilment of its could involve different departments of EROSKI, as well as Environmental management objectives to society openly and effectively. prevention measures to prevent them and the specific • A list of the risk situations the Group may eventually controls implemented, which basically consist of report- ur commitment to the environment is managed face. ing systems between the different bodies of the Group. Ocross-sectionally through all the functional areas of • The establishment of action protocols against opera- We also have an environmental liability policy that has an the value chain. From Development and Logistics, which tions that entail a potential criminal risk. annual aggregate limit for all coverage of €10 million and report to the Appeals Director, to the Sales Director and • The necessary recommendations to design an a limit per claim for all coverage of €5 million. the Network Director, to the Department of Health and effective crime prevention policy, which also defines Sustainability, which reports to the Marketing Director. This the delegation and supervision model of the Group Prevention and management Within this context of prevention, the Governing Council is how we ensure that all the environmental aspects of the for reporting incidents, implementing measures or performs an in-depth analysis of general corporate risks organization are managed by the area that generates improving those already established, and reporting of conflicts of interest each year. In the Annual Corporate Governance Report them. The different forums (Health Committee, Marketing criminal behaviour to the Board of Directors. (section E), available on the EROSKI website, information is Committee, etc.) dedicated to making strategic and busi- e have established different mechanisms to prevent provided on risks (scope of the risk management system, ness decisions coordinate this work. In order to fulfil compliance obligations, an Internal Super- Wand manage conflicts of interest that may arise bodies responsible for the risk management system, risks visory Body has been implemented. This body received through the following internal regulations: the EROSKI S. that came to pass during the year, etc.). This is supplemented by the Department of Health and assistance from the Compliance Office, which is respon- Coop. Articles of Association, the Audit and Compliance Sustainability, the EROSKI Foundation with its campaigns, sible for managing and implementing the Criminal Risk Committee Regulations, the corporate Code of Conduct, and the social responsibility departments of the different Prevention Plan. the Internal Hiring Procedure and the Executive Articles. Group companies working to promote environmental awareness among the clientele.

18 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 19 1. EROSKI VEGALSA EROSKI 1. Code of Ethics

The Code of Ethics reflects the eth- ical principles and values that we VEGALSA Prevention and management apply in all areas of our activity and is supplemented by the Compliance of conflicts of interest management model Policies and Procedures created for that purpose. As regards corporate governance, t VEGALSA, we have a Conflicts of Interest Prevention APolicy, approved by the Board of Directors and aimed the Group companies follow the at directors, executives and employees. It includes a series guidelines of the parent company, of necessary measures to prevent, detect and sanction VEGONSA Agrupación Alimentaria, fraudulent acts and the use of VEGALSA functions and EROSKI S. Coop. S.A. Board of Directors resources for the benefit of the aforementioned groups, or their relatives or close friends. Conflicts of interest are owever, since EROSKI only has a 50% stake in VEGAL- •Javier Amezaga (Chairperson) managed by the Compliance Committee and, when so HSA, it does have its own governance model for some delegated, by the Compliance Section of the VEGALSA Legality: matters, even though it is very similar and agreed upon by •Rosa Mª Carabel (Board member) Legal Department established to offer assistance and Strict compliance with legislation and the Group. advice to the Committee. Likewise, every year the directors internal regulations. •Jorge González (Board member) sign a document acknowledging the absence of conflicts The Chairperson of the Board of Directors of VEGALSA of interest. Commitment: Agrupación Alimentaria is Javier Amezaga, the General To the health and safety of people. Director of Appeals of EROSKI. The Board of Directors is the •José Alonso (Board member) highest decision-making body of VEGALSA, which con- venes monthly for regular meetings. It authorizes decisions Maximum respect, equality and dignity regarding openings, closings and transfers of commercial Impact and risk management When dealing with all employees, establishments, investments exceeding certain amounts collaborators, partners, competitors (regulations), changes in the management team, etc., and other third parties related to the and annually sets the guidelines to draw up the Man- nder the framework of the internal supervision of the Company. agement Plan (qualitative objectives) and the annual Ucompany, at VEGALSA we have implemented two risk financial budgets. management systems: the Corporate Risk Management Responsible and ethical System and the Criminal Risks/Infractions Prevention and Objective criteria: The Board of Directors performs a self-evaluation once Control Programme (Compliance Plan). These systems For hiring and promoting employees. a year. Among the measures adopted as a result of this management at VEGALSA function independently, but in parallel and coordination. evaluation, it is worth noting the higher frequency of fol- They have their own management and supervision struc- low-up on matters deemed necessary and of monitoring ture, with both bodies created for this purpose, although issues that were previously not evaluated as thoroughly or maximum responsibility and the final decision lies with for which there was no specific treatment. t VEGALSA, the Compliance Committee, is respon- the Board of Directors. These bodies are the Risk Analysis Asible for monitoring compliance with the Code of Committee, which is responsible for corporate risks, and Transparency: According to its memorandum of association, the Board Ethics, policies and procedures. It is composed of three the Compliance Committee, which manages the criminal Objectivity and professionalism when of Directors delegates decisions to the General Director- members: the director of the Human Resources Depart- risks. carrying out activities and interactions ate so the company can function properly, except those ment, the director of the Corporate Area and an external with stakeholders. decisions that can not be delegated. Likewise, the Board lawyer. It also receives functional assistance from the With the frequency established in each case, the Board of Directors has granted powers of attorney to certain Compliance Section of the Legal Department. of Directors assesses and brings up issues to be included directors to perform given functions. in both the Corporate Risk Management System and the Good use of VEGALSA assets. We also have an e-mail address, telephone number and Compliance Plan, and offers judgement on how to mini- The General Director of VEGALSA is Joaquín González, specific paper forms to collect any reports from personnel mize certain impacts and the frequency with which they who meets on a fortnightly basis at the Management that have proof or suspect that a crime has been commit- must be reported. The Board of Directors has validated the Committee with the other managers to handle matters ted or that the provisions of the Code of Ethics or Compli- creation and management of both systems. It has also Privacy, data protectionand that are important to the company, whether they are ance Policies have been breached. approved due diligence regulations and processes. The confidential information. foreseen or occur suddenly during operations, to make Crime Prevention and Supervision Manual includes a de- decisions and follow up on them. At VEGALSA, we have six Compliance Policies: anticorrup- cision-making protocol that must be taken into account tion; hospitality and gifts; conflict of interest; purchases by all the bodies with decision-making power and a role Commitment to the environment. The Internal Council is the body that decides which and hiring; donations and sponsorships; and privacy and in creating the company’s intent. projects and matters the CEO presents to the Board of confidentiality. We are also currently preparing a safety Directors, and the Investment Committee analyzes the suit- policy. The Risk Analysis Committee reports twice a year to the ability of investments according to the business objectives Board of Directors and once a year to the Compliance and the Viability or Efficiency Plans. Committee, disclosing the risks and reporting on the issues of interest. The Compliance Section of the Legal Department provides a report twice yearly, prior to the Compliance Committee.

20 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 21 1. EROSKI EROSKI 1.

Association membership 102-13 Business field

As a cooperative and • Asociación Española de Grandes • Confederación Empresarios Galicia • Confederación de Empresarios de Empresas de Distribución (ANGED) (CEG) Navarra (CEN) consumer association • Asociación de Cadenas Españolas • Confederación Empresarios Coruña • Cambra de Comerç Barcelona de Supermercados (ACES) (CEC) Basque Country Spain Europe • Cámara de Comercio de Mallorca • Asociación Española de Codifi- • Asociación de Empresarios AGRELA • Grupo cooperativo MONDRAGON • Confederación Española de • European Community of cación Comercial (AECOC) • Círculo de Economía de Barcelona • Consejo Económico y Social Vasco Cooperativas de Consumidores y Consumer Cooperatives • Asociación de Empresarios del (CESV) Usuarios (HISPACOOP) (Euro Coop) • Asociación Empresarial de l’Hospital- Polígono de Sabón - Arteixo • Red Española del Pacto Mundial • Federación de Cooperativas de • Confederación Empresarial et y Baix Llobregat (AEBALL) Trabajo Asociado, Enseñanza, Española de Economía Social • Confederación de Empresarios de • Retail Forum for Sustainability Consumo y Crédito de Euskadi (CEPES) • Sociedad Económica Barcelonesa Orense (CEO) (ERKIDE) • Consejo Económico y Social de de Amigos del País (SEBAP) • Asociación de Empresas Vascas por • Elkar-lan S.Coop. – Sociedad para España (CES) • Confederación de Empresarios de la Sostenibilidad (IZAITE) la promoción de cooperativas • Consejo de Consumidores y • Foment del Treball Nacional Ferrolterra, Eume y Ortegal • Confederación de Cooperativas Usuarios • Basque Ecodesign Center de Euskadi (KONFEKOOP) • Consejo Consultivo de la Agencia • Asociación empresarial de comerci- • Federación Asturiana de Empresarios • Instituto Vasco de Consumo Española de Consumo, Seguridad antes de Menorca (ASCOME) (FADE) • Fundación AZTI (Kontsumobide) Alimentaria y Nutrición (AECOSAN) • Consejo Superior de Cooperativas • Agrupación Balear del Comercio • Asociación Empresarios Hostelería A • Fundación Basque Culinary Center de Euskadi (CSCE-EKGK) (ABACO) Coruña • Work Lan (Asociación sin ánimo de • 5 al día lucro para el fomento de empresas • Asociación de Comercios de • Asociación Polígono de o Ceao de la economía social) Alimentación de las Islas Baleares (Lugo) • ECOEMBES (ACAIB) • Club financiero de Vigo (Círculo de • ESADE (Universidad Ramon Llull) • Confederación Balear de Comercio Empresarios de Galicia) (CBC) • IESE (Universidad de Navarra) • Club financiero de A Coruña (Club • Federación Patronal De Empresarios Financiero Atlántico) • Escodi (Universidad de Barcelona) De Comercio De Baleares (AFEDECO) • Cámara de Comercio de Álava • Fundación Pasqual Maragall

• Confederación de Asociaciones de • Cámara de Comercio de Bilbao • Fundación Abadía de Montserrat Empresarios de Baleares (CAEB) • Fundación Impulsa Balears

• Sport Cultura Barcelona

22 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 23 1. EROSKI EROSKI 1.

102-7; 201-1; 201-4; 203-1; 203-2; 413-2 Economic performance Direct economic contributions to noteworthy stakeholders and areas

243 million 5.393 billion 4.698 billion clients rung up in turnover in net sales from distribution Employees State Clients EROSKI Group Income Statement €490 million €191 million €302 million

Extract in thousands of euros as of 31 January 2019 2018 2017 2016

Ordinary income 4,958,957 5,035,577 5,393,938 99.1% 90% 100% Net sales distribution 4,698,075 4,792,066 5,164,579 Wages, salaries Employee social contributions EROSKI Group and similar and taxes Other income 260,882 243,511 229,359 expenses

Operating profit (before impairment, disposal of 163,616 137,367 136,909 fixed and non-current assets)

Impairment, disposal of fixed and non-current assets -42,883 -20,848 5,837

Profit before financial expenses and taxes 120,733 116,519 142,746

Financial results -114,513 -64,631 -90,696

Profits/loss holdings from investments applying the -1,711 3,677 508 share method

Savings transferred through multiple Income tax -2,923 -32,106 -59,333 9% 1% 0.8% 0.1% commercial offers during the year Compensation Defined pension Taxes Income tax Net profit of discontinued operations 0 9,754 -16,025 plan contribu- tions Result of the financial year 1,586 33,213 -22,800

We generate wealth in our environment Suppliers The environment Society t EROSKI, not only do we distribute the profits generat- In this regard, it is worth noting that approximately 50% of €4.013 billion €17 million €10 million Aed through our business activity among the coop- our national business suppliers are small local producers, erative’s Employee Partners and the rest of the Group's since our purchasing and supply policy seeks to promote companies, but we also generate wealth directly for the a sustainable agri-food sector. different actors in our value chain. When it comes to generating positive economic impacts, at EROSKI, we are Another noteworthy element is the direct economic impact very aware of consumers, one of our main stakeholders or our activity as a distributor due to the employment we 85% 94% 87% Business suppliers Investments EROSKI Group as a consumer cooperative. Proof of this is that, during generate. The 30,048 EROSKI employees received a total of the past year, we gave more than €302 million back to more than €490 million in compensation for their perfor- our customers through personalized offers, campaigns mance, and the relevant state agencies were paid €190 and promotions. At the same time, we are aware that our million for the social contributions and taxes attributable to commitment to the environment must extend beyond our workforce, in addition to income tax and other taxes. the direct economic impacts that our activity generates and, therefore, we contributed almost €10 million in 2018 Likewise, protecting the environment and minimizing to social purposes through the different Group businesses any negative impact we might generate in it due to our and the EROSKI FOUNDATION. Consumer education and activity are always relevant elements to be taken into information, charity and the promotion of culture and account. That’s why we allocate more than €17 million a local settings are the fundamental pillars we base our year to investments aimed at reducing our environmental social commitment on. footprint and to preserving and protecting the planet's natural resources. Likewise, during 2018, the more than 19,000 suppliers of products and services we work with received around 13% €4.013 billion as a result of our commercial relationship. 15% 6% EROSKI FOUNDATION Service providers Expenses Contribution to minimizing environmental Contribution to social purposes and impacts and protecting and improving consumer education and information the environment.

24 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 25 1. EROSKI EROSKI 1.

Commitment to the health and safety of people

Since our foundation 50 years ago, hat’s why sustainable development criteria is com- Given our strong social nature and responsibility with the to Health and Sustainability. These commitments, estab- at EROSKI we have maintained our Tprehensively included throughout our organization, product, at EROSKI, we believe that the store, be it physical lished with the collaboration of more than 7,800 people, aligning our management and strategic plans with the or online, is the ideal place to promote a good, healthier mark the way for us in the coming years, serving as a road commitment to quality food, con- minimization and mitigation of negative impacts and the and more environmentally friendly diet. In 2017, we worked map to advance in the areas that really matter to both promotion of positive ones. Thus, with a proactive attitude, to express our commitments to society and the environ- consumers and society. stantly increasing our demands to we work cross-sectionally on the aspects of our activity ment, and in 2018 published EROSKI’S 10 Commitments offer a more sustainable product that may affect the natural environment and the stake- that meets the needs of our con- holders we interact with. sumers.

Commitment 1 Commitment 4 Commitment 7 Commitment 10 Engage in food safety Meet specific nutritional needs Help eating well at a Promote a healthier lifestyle reasonable price

We are committed to food safety, controlling the trace- We work so that people with specific needs can find ev- We promote information on health and sustainability ability of products and maintaining the cold chain of erything for their diet at our stores, expanding the diversity We improve the prices of the products needed for a bal- through channels such as the EROSKI CONSUMER mag- produce. We also have a preventive quality plan by which of our products and offering alternatives, such as our anced and responsible diet and we develop personalized azine and the website www.consumer.es. We also have we perform more than 11,000 product analyses and audit ordering service and online store. savings proposals for our partners, guaranteeing better a personalized counselling programme for EROSKI Club more than 300 suppliers every year. access to a balanced and sustainable diet. members and we promote the education of children and their families through our Healthy Eating and Habits Education Programme. Commitment 5 Commitment 8 Commitment 2 Encourage responsible Act clearly and transparently Promote a balanced diet consumption

We act with clarity and transparency, always counting on We believe in eating foods that make for a balanced We facilitate sustainable food, reducing the environmental the participation of partners, employees and clients, as diet, with promotions and prices that facilitate purchasing impact of our processes, stores and products. We also pro- well as other stakeholders. Additionally, we seek out max- them at our stores, providing professional advice from mote organic products and more sustainable production imum clarity and transparency in the information offered everyone who forms part of EROSKI and improving the processes, as well as the reduction of artificial additives. on our packaging. quality of our brands' products by reducing ingredients that are unhealthy when consumed in excess.

Commitment 9 Commitment 3 Commitment 6 Take good care of ourselves Prevent childhood obesity Offer more local products as workers We work to prevent childhood obesity by promoting and facilitating a balanced diet for children, giving priority to We contribute to the development of the social and the quality of our products and encouraging the con- economic environment of our stores, offering more than We promote training in health, wellbeing and responsible sumption of healthy products. Moreover, we will educate 20,000 local products through collaborations with 2,400 consumption with the aim of improving our employees’ 2 million children and their families about healthy living small producers. In addition, we promote the community’s quality of life, offering training, advice, activities, pro- habits by 2025. local culture through gastronomic events, tours of produc- grammes and tools for our staff and their families. tion facilities and by collaborating on the celebration of the most traditional holidays.

26 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 27 1. EROSKI EROSKI 1.

EROSKI works towards the EROSKI FOUNDATION

Sustainable Development Goals 102-12

o act in favour of sustainability, we dedicate at least consumers, carries out dissemination campaigns, publish- In a context in which our business activity has T10% of our profits to the Compulsory Contribution Fund es magazines and guides, offers scholarships and grants for Cooperative Education and Promotion and other and collaborates with social organizations. The Founda- an impact not just on a local but also a glob- public interest purposes. These economic resources are tion’s Board of Trustees guarantees that the Action Plan al scale, we believe it is important to align our channelled partially through the EROSKI FOUNDATION, an established each year is carried out under the principles entity founded in 1997 that operates on four main pillars: of impartiality, independence, transparency, efficiency commitments with the 17 Sustainable Develop- To coordinate these axes, the Foundation has a multidisci- and responsibility. ment Goals (SDGs) approved in 2015 by the plinary technical team that promotes actions in favour of Among other strategic lines and programmes, the United Nations. Foundation manages and promotes the Nutrition School programme and the publication EROSKI CONSUMER.

his 2030 Agenda was born with the fundamental business activities and strategy. Each year we reaffirm our Tpurpose of getting public and private organizations to commitment to these four points, which are inherent to join forces in working on the world’s greatest challenges the decisions we make in strategic planning and annual today: eradicating poverty, protecting the planet and en- management plans. Moreover, the Global Compact is a EROSKI FOUNDATION pillars of activity suring the prosperity of all. Our commitments are perfectly catalyst for the efforts of companies and organizations in aligned with our priority SDGs: health and wellbeing (no. 3) achieving the SDG. and responsible production and consumption (no. 12). At EROSKI, we’re working to help achieve the 17 global We believe the only way to achieve the global objective goals set for 2030 through our actions, with a positive of sustainable development is to work together with other impact on the planet. In the sections below, we show how economic, social and environmental agents. That’s why our lines of work respond to our commitments and this we are founding members of the Global Compact, an shared, universal agenda. international initiative proposed by the United Nations in 2002 to promote the implementation of 10 universally accepted principles that foster corporate social responsi- bility in the areas of human rights, business, employment standards, the environment and fight against corruption in 1 2 3 4

Consumer Educational, cultural Promotion of Research, education and and professional charity and aid. development and information. promotion, innovation in the especially in fields of consumerism, consumer matters food, environment and and commitments healthy living habits. to the local setting and environment.

Best management of EROSKI, awarded for the Best VEGALSA-EROSKI, awarded the Management of Corporate Social Cantabrian Award for Excellent corporate social Responsibility in the XI Edition of the Corporate Social Responsibility. responsibility Wine and Distribution Market Business Awards.

28 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 29 1. EROSKI EROSKI 1.

Relationship between the content of this report and our commitments and Sustainable Development Goals

Section Health and sustainability commitments Sustainable Development Goals

1 EROSKI 8: Act with clarity and transparency

2 “With you” business model and network 2: Promote a balanced diet 6: Offer more local products 7: Provide good food at a good price 8: Act with clarity and transparency 10: Promote a healthier lifestyle

3 Healthy eating 1: Commitment to food safety 2: Promote a balanced diet 3: Prevent childhood obesity 4: Cater to specific dietary needs 5: Promote responsible consumption 8: Act with clarity and transparency 10: Promote a healthier lifestyle

4 Employees 8: Act with clarity and transparency 9: Take care of our employees 10: Promote a healthier lifestyle

5 Value chain 6: Offer more local products 7: Provide good food at a good price 8: Act with clarity and transparency

6 Environment 5: Promote responsible consumption 8: Act with clarity and transparency 10: Promote a healthier lifestyle

7 Social action 5: Promote responsible consumption 6: Offer more local products 8: Act with clarity and transparency

8 Transparency 8: Act with clarity and transparency

30 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 31 “With you” business model 2 and network Committed to our customers 2. “With you” business model and network “With you” business model and network 2.

Our business and brands 102-2; 102-4; 102-6; 102-7 Total EROSKI GROUP stores Own-brand Franchises EROSKI’s desire to move forward in developing a multiformat 1,652 1,131 521 business model has allowed the organization to create a business network of 1,353 establishments linked to food, in Hypermarkets addition to 291 diversified business establishments including 54 56 2 travel agencies, gas stations, sport stores, opticians, insurance Supermarkets agencies and eight online stores. 783 1,278 495 Cash&Carry 19 19 -

Of these, 1,131 stores are owned by the EROSKI Group and Gas stations located in Spain, providing service to all types of clients, and are 49 50 1 managed by 30,048 employees. We also have 521 franchised stores, which are also present in two other countries: Andorra Opticians and the United Kingdom (Gibraltar). We would also highlight 13 13 - our growth on the Internet through different online stores over the past two decades. The section on transparency includes a Travel agencies list of our businesses with EROSKI Group companies. 140 162 22 FORUM SPORT stores 65 66 1 Online stores See table 2 of the appendix for compari- 8 8 - son indicators from previous years.

Total Viajes EROSKI has a business network of 162 agencies, FORUM SPORT employs 897 people. At the close of the EROSKI GROUP including Viatges Caprabo in Catalonia, as well as the year, it had a total of 66 sport equipment stores. Its busi- Supermarkets online offices www.viajeseroski.es and www.viatgescapra- ness network includes 13 stores specializing in sneakers Own-brand Franchises bo.com. In addition to its activity in the holiday sector, it and clothing for young people under the Dooers brand. 1,278 stands out due to its exclusive customer service for com- 783 495 panies in major cities – including Madrid and Barcelona – and its division specialized in the organization of con- EROSKI city ventions and congresses, Travel Air Events. Travel Air forms parts of the Guild of European Business Travel Agents 279 515 236 (GEBTA) and ITP (International Travel Partnership). CAPRABO 256 318 62 EROSKI centre 162 164 - Aliprox - 122 122 Familia 78 78 - EROSKI closed 2018 with 50 gas stations, strategically lo- EROSKI has a chain of 13 optician stores with the best cated next to its hypermarkets and supermarkets. EROSKI professionals, products, services and guarantees. Its opti- Onda gas stations maintain the cooperative's policy of offering cians offer a wide range of quality and designer products: - 64 64 its customers the best prices, easy payment options and prescription glasses, sun glasses, contact lenses, liquids discounts, so they can fill their tank under the best possi- and accessories, etc. The best products, the top brands on Rapid ble conditions. the market and the latest exclusive trends, with multiple - 9 9 advantages. Merca See table 3 of the appendix for comparison 8 8 - indicators from previous years.

34 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 35 2. “With you” business model and network

Travel Air, the EROSKI Viajes business division, Distribution of establishments by region and business type* Updates 102-10 won the EUSKALIT n 2018 we continued to move forward in our transfor- Advanced 27 Imation of supermarkets and hypermarkets to the "with 31 404 you" business model. We also added five new own-brand 119 Management Club 306 7 supermarkets and 37 franchised establishments to our 26 network. On the other hand, the EROSKI Móvil mobile Jury Prize for growth 304 phone business was transferred to Vodafone and the col- management. 52 66 laboration between the EROSKI Group and the DIA group was finalized to negotiate our own brands and manufac- turer brands, without affecting EROSKI’s commercial offer. 13 185 Moreover, Viajes EROSKI signed a collaboration agree- ment to include the Viajes EROSKI offer in the Gazte-Txarte- 7 la programme. As a result of this agreement, Viajes EROSKI will offer advantages to users of Gazte-Txartela, among 3 17 others, designing exclusive travel plans with significant economic benefits for them. 9 > 90 establishments 71 Own-brand Franchises > 30 establishments 1 2 <30 establishments 37 8 Supermarkets 1 1 FORUM SPORT

Own-brand establishments Franchised establishments Food Diversified Food Diversified 4 Travel businesses businesses businesses businesses Agencies 58 4 new EROSKI

Gas stations openings Hypermarkets Supermarkets Cash & Carry Gas stations Opticians Travel agencies – Sport Recreation own-brand Total Hypermarkets Supermarkets Gas stations agencies Travel – Sport Recreation Total franchises Total Andalusia 9 0 5 1 1 16 54 1 55 71 Andorra 0 7 7 7 5 Aragon 36 2 5 2 45 21 21 66 Supermarkets Asturias 1 10 1 2 5 7 26 1 1 27 Cantabria 1 8 1 5 4 19 9 3 12 31 Castile and León 1 21 1 9 12 44 6 1 1 8 52 Castile-La 5 4 2 2 13 4 4 17 Mancha Catalonia 1 239 1 3 1 245 59 59 304 Ceuta 0 1 1 1 Valencian 3 1 1 2 7 1 1 2 9 We’re expanding our franchise network Community Extremadura 0 1 1 2 2 3 Galicia 5 149 18 3 5 2 182 122 2 124 306 ROSKI continues to promote an At CAPRABO, the franchise business EROSKI stores and serves as a guide Gibraltar 0 2 2 2 Eexpansion plan for franchised grew by 20% in 2018 with 62 fran- for all franchise openings of the Balearic Islands 108 3 111 74 74 185 stores with the opening of 37 new chised supermarkets in total. brand. Canary Islands 1 1 0 1 franchised establishments in 2018 La Rioja 1 10 1 7 3 22 4 4 26 and the transformation of an ad- Together with the transformations The franchised stores range from Madrid 4 4 9 9 13 ditional 15 stores. The 52 inaugura- undertaken in the own-brand store 200 m² to 5,000 m² and include new Melilla 0 1 1 1 tions, which involved an investment network, these openings represent a models, such as the convenience Murcia 3 2 1 6 1 1 7 of €7.6 million, generated 308 jobs. strong promotion of the expansion store RAPID, which is spreading Navarre 2 55 4 1 14 6 82 27 10 37 119 of the "with you" business model throughout Catalonia and the Basque Country 21 147 19 9 78 25 299 93 12 105 404 that defines the new generation of Balearic Islands. Total 54 783 19 49 13 146 65 1,129 2 495 1 16 1 515 1,644

*This table does not include online stores . Recreation-Sport includes FORUM SPORT and Dooers. Travel Agencies includes holiday business and business division (Travel Air). See table 4 of the appendix for comparison indicators from previous years. EROSKI | ANNUAL REPORT 2018 | 37 2. “With you” business model and network “With you” business model and network 2.

Our “with you” business model A new generation of stores ur new "with you" business model aims to offer extra This model allows us to evolve and move forward in our Oquality and service to our customers, with health and relationship with Client Partners, offer a more attractive sustainability at the heart of our strategy, as reflected in commercial proposal and more efficient and state-of- t EROSKI, we’ve set the challenge of comprehen- our commitments. The "with you" business model stands the-art stores. The "with you” store is not just a physical Asively transforming our cooperative group’s business In 2018, out thanks to the specialization in produce, a wide range transformation, but, above all, a great cultural change in network over the next years, integrating the "with you” of products that offer greater freedom of choice and a our organization that involves placing consumers at the commercial model into all our supermarkets and hyper- we adapted solid commitment to local products. centre of it all. markets. Proof of such progress are the 45 supermarkets more than we remodelled in 2018. Our stores are increasingly more competitive and attrac- 45 supermarkets tive. We’re extending our model of self-management to to the “with you” each opening and transformation. We offer a complete, multi-channel customer experience through different model formats. All this to become our consumers’ first choice for Health and healthier and more sustainable food solutions. sustainability

We promote savings Differential Relationship with New ne of our commitments is to giving our customers ac- campaigns, such as “The VAT is on us" or "25% off your business Client generation Ocess to a balanced and sustainable diet at a good purchase" and we lowered the price on more than 1,000 appeal Partners stores price. In fact, offering products at the best price with the products in supermarkets and hypermarkets in our busi- best quality and service has been our mission since the ness network. The many personalized offers, campaigns beginning. Thus, with our focus on competitiveness and and promotions during the year translate to more than Promote a healthier and Promote healthier Become consumers’ first savings, in 2018 EROSKI held more than 253 huge savings €302 million in savings transferred to families. more sustainable diet and more sustainable habits choice for healthier and more sustainable food solutions

Wide EROSKI Openings and variety Club transformations EROSKI Club: Committed to our Client Partners

he launch of EROSKI Club has significantly strength- stations. Client Partners enjoy these savings as a balance Tened our relationship with the customer and revitalized available on their EROSKI Club card for future purchases. the figure of the cooperative’s consumer partner, placing The launch was a success: more than 142,000 Client Part- them at the centre of our decisions. More than 6 million ners and 53 companies, including 3,555 employees, are Savings Personalized Multiformat EROSKI, CAPRABO, and FORUM SPORT card holders are the already “Gold Company Partners". service centre of our business strategy, since they generate more than 70% of sales on average. It has also been one year since the launch of our new EROSKI Club credit card in collaboration with Master- Consumers receive more and more personalized savings Card and Santander Consumer Finance, with more than proposals, adapted to each Client Partner profile and the 243,000 clients. As a multi-card, it is possible to combine evolution of their consumption habits. EROSKI Club en- the advantages of the EROSKI Club programme and a sures the savings offered are relevant, without in any way credit card, in addition to offering a refund of 1% of total Local produc- Participation Self-manage- diminishing the quality of fresh food or our commitment to purchases paid outside of EROSKI, by transferring the tion ment local products and a wide variety for greater freedom of amount to the associated EROSKI Club card. In fact, in model choice. June 2018, we launched the new “More Promotions” plat- form on our website and the EROSKI app, with more than In 2018, EROSKI launched a pioneering programme for 60 restaurant, fashion, footwear and leisure brands that fixed universal savings of 4% on all purchases made by offer interesting discounts to our clients. In doing so, the the holders of the new EROSKI Club Gold card in its net- cooperative has transferred total savings of almost €2.5 Specialists in Customer Efficiency work of establishments, including fuel purchases at its gas million to EROSKI Club MasterCard holders. fresh produce information

38 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 39 2. “With you” business model and network “With you” business model and network 2.

Our omnichannel model is making progress Actively listening to our clients 102-21

ROSKI is making progress in its omnichannel proposal, models such as "Click&drive" and "Click&collect", which ersonalized customer service is one of the strengths of The consultancy firm Sotto Tempo Advertising organizes Ewhich seeks to serve clients where and when they allow consumers to place orders at any time through our PEROSKI’S transformational "with you" business model awards with consumer participation that were granted to wish through different store formats and different digi- online supermarket and pick them up on the same day that the cooperative is spreading throughout its business EROSKI as the Large Distribution Company with the Best tal channels, making tools that break down traditional while driving or walking home. As a result of our dedica- network, which allows for daily improvement and adapt- Customer Service for loyalty club members for the seventh barriers between online and offline channels available to tion, we have been recognized for the second year in a ing more efficiently to customers’ real needs. Moreover, year in a row. customers. An example of this is the update of the EROSKI row as the Best Online Supermarket of the Year, accord- continuously listening forms part of commitment no. 8 to App so that users can continue to enjoy its features more ing to the Business Awards. health and sustainability. The EROSKI Customer Service Department attends con- conveniently. For example, since June 2018, our EROSKI sumers in Spanish, Basque, Catalan and Galician, and is Club Mastercard holders can now pay for all their pur- We’ve also made progress in 2018 with the innovative In 2018, our Customer Service Department attended to available by phone, email and on the website www.eroski. chases with their mobile thanks to EROSKI Club Pay, a new concept of the omnichannel store for FORUM SPORT. This 413,499 people, with a 100% claim resolution rate, 95.3% es as well as the other websites for Group businesses and comfortable, safe and simple feature that improves the ex- new concept is now a reality with the opening in Vito- of which were resolved on the first contact. We fulfilled companies, in addition to social networks. perience for the more digital customer. Another update in ria of a new FORUM SPORT store model, which offers an our commitment to immediately respond to all doubts, 2018 was the launch at Christmas of the first augmented omnichannel shopping experience in which coherent suggestions and claims and, if they required any sort of reality experience as part of our EROSKI Club app, which communication is established with customers and all the handling, to do so within 24 hours at most. was used more than 17,000 times. We offer our partners channels they choose to use are available to interact with new, 3D interactive experiences that enhance our rela- the product, allowing them to go beyond simply acquiring tionship with them and encourage their digitalization. products. We also have an online supermarket that offers a faster and more efficient user experience. It also offers pick-up

Twitter Facebook Personalized, quality service 54,407 215,562 In 2018, we had followers followers

or EROSKI, our relationship with clients is a priority of with improved service in counter-assisted sales in such more than 2.5 million Fthe "with you" business model. This relationship has sections. In this sense, professional training and ongoing exchanges with users become a hallmark of the model's unique identity. At education are our pillars to strengthening our unique Instagram LinkedIn EROSKI, we’re committed to a more consumer-centred role as specialists in produce: more than 57,000 hours of and more than 93 business model that prioritizes the shopping experience produce training were given at schools in 2018. 14,364 18,661 million impressions followers and sets us apart thanks to our specialization in produce, followers

In order to take into account the concerns of different Moreover, at EROSKI we have 21 Consumer Committees groups and maintain our commitment to transparency, that structure the participation of their Client Partners, we also try to maintain additional channels with all of who debate, take a stance and define guidelines to them. Thus, in 2018 we addressed dozens of active listen- improve next-generation stores. ing initiatives with the participation of more than 13,000 people, in which we gathered their opinions, suggestions and recommendations to improve our business offer and our stores.

Data protection at EROSKI

We consider our clients’ personal data one of the most monitor compliance from risk analysis and management critical assets that we must protect. We therefore have a in a coordinated manner throughout the organization. data protection management system based on con- Proof of this is that we have had no data leaks or tinuous improvement that has its own methodology. We customer complaints.

40 | ANNUAL REPORT 2018 | EROSKI Healthy eating 3 Committed to consumers 3. Healthy eating Healthy eating 3 .

Our contribution to a healthy diet

SDG Line of work EROSKI Commitments Key data 2018

The health and wellbeing of con- formed by professionals specialized in different disciplines sumers is our raison d'etre and, related to health, nutrition, food and the culinary and gastronomic arts, provides scientific, expert and indepen- 17,902 analytical controls of products and services therefore, we carry out numerous dent evidence for our proposal from an enriching external perspective. We complement this advice with the sugges- Food 1 Food lines of work to provide our cus- supplier audits tions and concerns that consumers transmit to us through safety safety 294 tomers with a healthier life. continuous listening and the cooperative’s participation channels. 1,816 point of sale and platform audits hese fall under the framework of our commitments At EROSKI, we are committed to a commercial offer based Tto health and sustainability and are aligned with the on products that guarantee a safe and balanced diet. Sustainable Development Goals linked to health and well- In 2018, we reduced fats, sugars and salt in about 300 2 Balanced being (no. 3), quality education (no. 4) and responsible products, thus improving their nutritional profile to make We reduced salt, fats and sugars in diet production and consumption (no. 12). them healthier. We also believe that our contribution to EROSKI brand products: 296 prod- the health and wellbeing of the population is to offer ucts in 2018 Currently, one of the most important challenges we must products that are suitable for people with specific dietary 3 Prevention of childhood obesity tackle is preventing certain health problems linked to needs such as individuals with coeliac disease, whom we Balanced Since 2013, we have removed eating habits, such as obesity. Therefore, a balanced diet collaborate with closely. and 946,177 kg of fats, 483,709 kg of 5 Responsible consump- and healthy lifestyle habits play a fundamental role in sustainable sugar and 68,276 kg of salt individual and collective wellbeing. To ensure that our diet tion health and nutrition proposals respond to the needs and We have added the 8 Clear and transparent priorities indicated by the scientific community, we have Nutri-Score label: advanced communication on the EROSKI FOUNDATION Scientific Committee, which nutritional information that helps health and guides us in establishing mid- and long-term strategies consumers eat better for our commitment to healthy eating. This advisory body, sustainability

More than 540 gluten-free own- brand products 4 Specific dietary needs Specific Collaboration agreement with the Basque Coeliac Association to dietary 8 Clarity and transparency offer a 20% needs in communication on discount on certain gluten-free health and sustainability products

3 Prevention of Healthy childhood obesity 460,401 schoolchildren partici- eating pated in the initiatives promoted and habits 10 Training and by the from education on health EROSKI Nutrition School childhood and sustainability

Approximately 50 millions visits to Information 10 Training and www.consumer.es on heath and education on health sustainability and sustainability 193,000 monthly readers of EROSKI CONSUMER

EROSKI | ANNUAL REPORT 2018 | 45 3. Healthy eating Healthy eating 3 .

Food safety Analytical controls of products and services 102-11; 416-1; 416-2

Rigorously applying quality and safety e double-check the quality of our products and In the case of non-compliance, corrective actions are re- standards to products and services is one Wservices thanks to exhaustive daily analytical quired by the supplier and monitored once the deviation controls, in addition to those carried out by suppliers and has been effectively eliminated. If it entails a food safety of our basic pillars of action. manufacturers. In 2018, 17,902 analytics were conducted risk, we apply the precautionary principle and withdraw it throughout the entire EROSKI Group, 96% of which yielded from sale immediately. satisfactory results. There are three different types of analytics: he EROSKI Quality Management ket comply with all the food safety TModel is structured as a set of guarantees. We are convinced that Chemical: To guarantee the absence or presence of guidelines, processes, procedures our model offers an optimal way to appropriate amounts of substances relevant to health and tools that, in relation to each achieve a high level of competitive- and safety. other throughout the entire value ness, while at the same time guar- chain, ensures the products we mar- anteeing the defence of consumer Microbiological: To guarantee both the absence rights and interests. of pathogens, as well as the hygiene and freshness of products and cleanliness of facilities.

Genetic: To identify animal and plant species and detect genetically modified organisms. Point of sale and platform audits

As part of our continuous improvement process, we work e guarantee quality and hygiene at all our points of to perfect the service offered to our clients by establish- Wsale and logistics platforms through an exhaustive ing appropriate corrective measures to resolve incidents Analyses performed in 2018, sorted by programme protocol of quality audits. In 2018, 1,313 audits were con- identified during the audits. ducted and included the following controls: Analytic programmes Analyses performed Analytic programmes Analyses performed

Oils 293 Non-food 1,085 Maintenance of Microbiological Food alert man- Trans-fatty acids 28 GMO 40 the cold chain quality of prod- agement system and quality ucts. and product Acrylamide 362 Pathogens 376 in the supply recall. Aflatoxins 43 Pesticides 307 chain. Water 50 Nutritional plus 26

Allergens 73 Meat preparations 1,985

Basic 120 Ecological products 4

Hygiene and Traceability Quality control Campylobacter 95 Fish chemistry 6 cleaning at systems for all systems and Fuel 154 Complaints 37 facilities. products. tools. Produce comparison 19 Natur meat waste 80

Surface control 3,234 Emerging risks 3

Drugstore and cosmetics 202 Sannia 114

EROSKI benefits 367 Cooking section 184

Useful life studies 918 SeleQtia 71

Gluten 208 Sulfites in thawed products 9

Supplier audits Ice 189 Sushi stores 108

Egg Lactose Milk 12 Heavy metals 52 All the processes and systems used by supplier compa- detected. Once implemented, the audit is repeated to Eggs 21 Mineral oils 23 nies are adapted to the product and process require- ensure the measures have been implemented correctly Ham moisture 76 Cut fruit 53 ments established by the brand. Likewise, we promote and to certify the supplier if they pass. Species identification 64 Generic brand produce 58 compliance with quality and safety standards at the In 2018, we audited 294 production plants of our own- European level, such as the International Food Standard brand suppliers. A total of 83% of all our audited suppliers Launch 16 Natur fruit physical chemistry 53 certificate. In the case of produce, our standard is even successfully passed the evaluation. The remaining 17% Milk 36 Control of listeria on surfaces 1,597 more rigorous, given the special importance of its produc- applied the necessary corrective measures or lost their High risk facilities 1,500 Surface control in stores 439 tion, conservation and transport conditions. EROSKI supplier certification. Additionally, we audited 48 production plants of manufacturer brand suppliers, with Handling 2,841 Juice 215 As regards audits, we create action plans so that suppliers 77% satisfactory results. Plant microbiology 21 Total 17,902 can implant corrective measures to eliminate any deviations Honey 18 Total unsatisfactory analytics 806 Bivalve molluscs 17 % unsatisfactory analytics 5%

46 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 47 3. Healthy eating Healthy eating 3 .

Balanced and sustainable diet

Healthier, more balanced products 102-11 Nutritionally improved products

t EROSKI, we get involved in the Our historic and renewed commit- In addition to implementing them, n our unwavering commitment to health, we go be- obesity. We are committed to ensuring the products of our Acomposition of all our products ment to improving the nutritional we strive to communicate these Iyond guaranteeing the food safety of the products we brands easily fit into a balanced diet and favour healthy in order to continuously improve value of our products fits perfectly improvements to consumers by market. We work on a daily basis to offer more balanced eating habits. To do this, we constantly review and improve their nutritional profile. This search for with the 2020 Collaboration Plan for including relevant information on and healthier options, in line with commitment no. 2 to their technical specifications according to the recommen- more balanced products has led us Improving the Composition of Food our product labels. promote a balanced diet and no. 3 to prevent childhood dations established by health experts. to reduce the presence of nutrients and Drinks and Other Measures associated with the most common which we signed and is included in In doing so, we move forward in our pathologies in our society, such as the Nutrition, Physical Activity and commitment to promoting a bal- cardiovascular diseases and obesi- Prevention of Obesity (NAOS) Strat- anced diet, offering solutions and ty. Thus, since 2013, we’ve removed egy of the Spanish Agency for Food making affordable products that Reformulated products available in 2018 946,177 kg of fats, 483,709 kg of and Nutrition (AESAN). It is aimed have a positive impact on consum- sugar and 68,276 kg of salt from at reducing the median of added ers’ quality of life. our products. sugars, saturated fats and salt by around 10% by 2020. 215 58 23 182 Additionally, more than a decade ago we decided to improve the fat But we are not just looking to re- products products products products profile of all our food and produce, duce ingredients that do not favour eliminating partially hydrogenated a balanced diet, but to promote the vegetable fats (a source of trans presence of those that sometimes fats) and in 2018 we took yet an- have lower levels than recommend- RICH IN other step along this same line and ed. We therefore include in our LOW LOW LOW committed to eliminating palm and offer products enriched in calcium, FAT SUGAR SALT FIBRE coconut oil by 2020. omega 3 and fibre.

More natural diet

n response to concerns expressed sure that by the start of 2019 there it continues to increase, as it may Iby consumers, under commitment would be no bisphenol A any of our eventually result in microorganisms no. 5 (to promote more natural and purchase receipts. that are resistant to medication. Us- sustainable food) we have included ing antibiotics rationally is essential multiple lines of work to make it eas- We also collaborate with our to the fight against such resistance. ier to enjoy a more natural diet and produce suppliers to eliminate That’s why our brand EROSKI Natur life. Thus, we continue to innovate in post-harvest fungicides from selects chickens raised without developing products without certain fruit and vegetable crops and to antibiotics and that have animal additives, antioxidants, preservatives encourage the use of more natural, welfare certification. and artificial sweeteners. We also alternative methods to conserve apply this commitment to health produce. EROSKI Natur stone and innovation to other non-food prod- citrus fruit are an example of our ucts, such as hygiene and personal work in this area. care. Currently, our brand products are "free of" BHA-BHT antioxidants, Moreover, at EROSKI, we’re working parabens, triclosan, transgenics on a plan to eliminate and reduce and artificial colours. Moreover, we antibiotics from EROSKI Natur prod- closely follow scientific debates on ucts, as we are aware that resis- certain substances and include any tance to antibiotics is on the rise in relevant contributions in the design Europe due to excessive use in the of our products and packaging. In process of raising animals. This could 2018, for example, we worked to en- lead to general health problems if

48 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 49 3. Healthy eating Healthy eating 3 .

Information on the nutritional content and balance of products 416-2; 417-1 Main characteristics of the Nutri-Score

At EROSKI, we know that the infor- (no sugar, low fat, no salt, etc.), pictograms that make Nutri-Score labelling is a graph or traffic light that classifies Consumers can thus compare similar foods when shop- mation we offer to consumers is it easier to identify allergens, and nutritional information packaged foods with five letters and colours according ping or compare the nutritional quality of different brands systems, such as the Nutri-Score traffic light. We also per- to their nutritional composition, from green (healthiest) to of the same product. We chose this system after various valued as an essential element form periodic technical sheet compliance checks. Thanks red (lower nutritional quality). The healthiest ones have an studies have shown its effectiveness as compared to other in the defence and protection of to these tasks, in 2018 we detected 16 non-conformities A and a dark green colour, and the least, an E and a dark methods. across the 1,385 checks performed, all of which were orange colour. their interests, since it’s the only corrected after contacting the supplier and requesting way they can make decisions that the product composition be corrected. If missing Each product will have the colour and associated letter information results in a health risk, the product is immedi- that correspond to its content in sugars, saturated fats, accordingly. ately withdrawn from sale. These reviews and our exercise salt, calories, fibre and proteins per 100 grams. in listening to consumers allow us to optimize the way we hat’s why, in addition to carrying out various initiatives include information on labels so that it is easier to under- Tto improve the nutritional quality of our products, as stand. part of commitment no. 8 to promoting a healthy lifestyle, we also offer comprehensive, complete and truthful in- Apart from labelling, we also work to improve the informa- formation about product content and the importance of tion in brochures, store posters and our web page. Thus, maintaining a healthy diet. we have adapted our advertising of children's products to the Code of self-regulation of food and drink advertising On the one hand, we comply with applicable legislation aimed at minors, obesity prevention and health (PAOS on labelling for each product type and, on the other, with Code), which is also included in the NAOS strategy of the Nutritional traffic light the demands of our own brand. We therefore include Spanish Food Security and Nutrition Agency. additional information, such as health-related properties The Nutri-Score complements the nutritional traffic light that has been available on our own-brand NUTRI-SCORE labelling: New products since 2007. nutritional information system he nutritional traffic light makes it easy to monitor the Tamount of calories, fats, sugars or salt in one’s diet for any health reasons (diabetes, hypertension, overweight, irst, we were pioneers in adopting the nutritional traffic etc.). You can see how much a single portion of the food Flight. In 2018, we also became trailblazers in including has of that particular nutrient, and easily interpret if that Nutri-Score labelling on our own-brand products. amount is low, moderate or high.

In 2018, after listening to more than 10,000 Client Partners, Because of its usefulness in making healthier purchases, we created this nutritional information model, which is this colour system is always located on the front of unique on the market and allows consumers to easily see packaging and provides information about the amount the overall nutritional value of each product and com- of calories and the four most relevant health-related nu- pare it with other similar products to make better choices, trients (fat, saturated fat, sugar and salt) for a portion size. without losing the detailed information per nutrient Moreover, under each nutrient is the percentage of daily provided today by the nutritional traffic light. A total of 86% intake that its represents (reference intake or RI). We use a of survey respondents supported the proposal to add the daily diet of 2,000 kcal as a reference. Nutri-Score to the nutritional traffic light. The first products to include the Nutri-Score were launched in January 2019, For children’s foods, we use a 1,800 kcal diet. The colour and, throughout the year, this label will be included on all system shows whether a portion of that food provides our own-brand products. a low (green), medium (yellow) or significant (orange) amount of each nutrient. This makes it easier to combine In doing so, EROSKI has become the first to include this food and not exceed the recommended intake of each advanced nutritional labelling, recently validated by the nutrient, in pursuit of a more balanced diet. Ministry of Health, and which is expected to be imple- mented on a general basis within a year.

50 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 51 3. Healthy eating

Nutrition report based on purchases

ROSKI Club has a pioneer health programme that offers free personalized Einformation and incentives for a healthier and more balanced diet and purchases to all our Client Partners. In 2018, 25,000 people used our nutrition in- EROSKI and Chef formation service based on their purchases registered on the EROSKI Club card. CAPRABO cooking This report offers a detailed and personalized analysis of how household pur- chases correspond to the Mediterranean diet recommendations. The goal is to workshops guide customers on food, quantities and frequency of consumption that both they and other members of the family need to maintain a balanced diet. It now Every year, we offer hundreds of work- also provides information on the calories and nutrients in their shopping basket shops in our stores, where we give cook- with recommendations and comparisons to help make improvements. ing lessons to children and adults. These recreational and educational initiatives This personalized nutrition information service by EROSKI has been awarded in are an ideal channel to promote a the XI NAOS Strategy Awards, for the category of Best Business Initiative, which healthier lifestyle and foster local prod- makes us the company with the most NAOS awards for our commitment to ucts among our Client Partners. healthy eating. 3. Healthy eating Healthy eating 3 .

Specific dietary needs 413-1

Through commitment no. 4, e are specially sensitive to the specific dietary needs EROSKI tackles its desire to Warising from diseases such as coeliac disease, allergies or food intolerances. Therefore, we maintain fluid assist consumers with specific communication with the different entities and groups that dietary needs, so our product represent them, such as the Spanish Federation of Coeli- ac Associations (FACE) and the Spanish Diabetes Federa- offer is safe and sufficient for tion (FEDE). We can thus get to know their demands and concerns on a first-hand basis and expand our range of regular purchases, without being foods in response to their requests. We also collaborate overpriced. with these entities to raise awareness and visibility of such diseases through various awareness campaigns.

Additionally, at EROSKI we made the decision to improve and clarify product labelling as regards allergens more than a decade ago. Thus, in addition to complying with Royal Decree 2220/2004 on allergen declarations, we offer additional information by including the warning texts required in separate messages on the labels in an easily visible way to indicate the potential presence of traces of allergens. In 2018, we had 541 own-brand gluten-free, 63 lactose-free, 27 milk-free and 7 egg-free products.

EROSKI brand products for groups with special needs Collaboration agreement with the Basque Coeliac Association 541 63 27 7 products products products products In May 2018, the EROSKI Foundation At EROSKI, we are also committed By 2019, we plan to extend the signed a collaboration agreement to continuing to improve our offer of agreement to other coeliac asso- with the Basque Coeliac Association gluten-free products, which currently ciations in other regions, so that (EZE) to work together to improve includes more than 3,000 products, more and more territories can take SIN SIN SIN SIN food shopping conditions for peo- 2,500 from top brands, and 541 advantage of this collaboration. lactosa leche huevo ple with coeliac disease who have guaranteed gluten-free EROSKI specific dietary needs. products. Of these, 10 are new foods specifically for coeliacs that Under this agreement, EROSKI offers substitute wheat with other ingredi- gluten-free lactose-free milk-free egg-free a 20% discount to EZE members on ents such as corn, rice or gluten-free every purchase of certain gluten-free oatmeal. We highlight the message products, both of own-brand prod- "gluten free" in red on the label of ucts and specific manufacturers each product so that it is easy to of gluten-free products. This allows identify. families with at least one coeliac member to save more than €300 per Thanks to our agreement with EZE, year. More than 1,460 people benefit- these new product additions will be ed from this agreement in 2018. tested by their members.

54 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 55 3. Healthy eating Healthy eating 3 .

Healthy eating and habits

from childhood 413-1 “Energy to grow” Education Programme on Healthy Food and Habits (PEAHS) At EROSKI, we believe that educating and informing citizens is essential to them maintaining a balanced and healthy diet. In The primary objective of the programme is to make stu- he Eating School was created after the success of dents aware of the importance of following a balanced this regard, through commitment no. 3 we promote a diet that T"Energy to grow", our Education Programme on Healthy diet and leading a healthy lifestyle. prevents childhood obesity by providing access to healthier Food and Habits an initiative launched in 2012 by the EROSKI Foundation to curb the growing childhood obesity A total of 460,401 schoolchildren from 3,192 primary edu- products and educating children to have a better diet. rate in Spain. cation centres all over Spain participated in the last edi- tion. Since its beginnings, 28.5% of centres in Spain have energiaparacrecer.escueladealimentacion.es participated in the programme. We aspire to train more than 2 million schoolchildren and their families by 2025.

Eating School The programme consists of 10 class sessions and three practical workshops: his EROSKI Foundation initiative began in 2013 with the with children's participation so they can learn about Tgoal of promoting a balanced diet and healthy habits good eating habits in a fun way. among citizens. It is a meeting point for health and edu- cation professionals, parents, schoolchildren and all other www.escueladealimentacion.es citizens committed to improving their diet and lifestyle. Class sessions: To develop the Education Programme on Healthy Food The Eating School offers up-to-date and quality informa- and Habits and other initiatives of the Eating School, such In 2018 we updated a portion of the ability of the planet. In addition to The content was prepared by a tion taken from scientific research and knowledge. The as the Health Passport, we have also collaborated with educational materials we created in new activities and memory units, we scientific committee formed by challenge we have defined is to “move together towards a regional governments and different organizations related the four official languages (Spanish, have included videos made in col- professionals in medicine, nutrition healthier and, therefore, happier society". With the Eating to health and responsible consumption. Basque, Galician and Catalan) on laboration with two new agri-food and dietetics, psychopedagogy and School we install spaces for educational games at events a balanced diet and healthy habits producers, Fribasa and Conservas pedagogy. UNICEF, WWF, the Spanish so that schools can teach it during Arroyabe, with the aim of strength- Heart Foundation and the Basque school hours. With these materials, ening the criteria for developing Culinary Centre also participated in students are educated about a a healthy diet that includes local this project. balanced diet, healthy lifestyle hab- products. its, local products, diets from other parts of the world and the sustain-

Practical workshops:

During three practical workshops, students experience what they have learned in a real and everyday environment. Visit to a local or regional agri-food producer or Visit to a store: manufacturer: Cooking class:

Schoolchildren review nutrition label- In a fun and educational way, This consists of preparing and cook- ling on real products and determine students learn the importance of ing all the meals for one whole day where they fit on the food pyramid. local food production as a main with the guidance of a professional Together with the person running source of value in terms of environ- from the Basque Culinary Centre, a the workshop, they learn to fill their mental, cultural and social sustain- world reference in gastronomy and shopping basket with healthy choic- ability. In 2018, Fribasa and Arroyabe cuisine. es and build a food pyramid. Conservas joined the list of local producers who have collaborated in the programme from the start: Barrenetxe, Gomiztegi, Lacturale, UDAPA and Nusi.

56 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 57 3. Healthy eating Healthy eating 3 .

CAPRABO Education programme Main indicators of EROSKI Group education programmes for the 2017/2018 school year

n Catalonia, our Healthy Eating Education Programme habits during the early years of life with a course aimed I“Good choices, healthy choices” by CAPRABO celebrat- at schoolchildren between 2 and 3 years old, which is ed its 10th anniversary in 2018. It is aimed at teaching the result of collaboration between CAPRABO and the 406,401 3,196 children to eat healthy and encouraging them to adopt cooperative Encís. participating participating balanced nutrition habits, accompanied by a nutrition schoolchil- schools professional. To do so, awareness tasks are carried out in New developments in 2018 include new material for stu- dren the classroom and practical tasks are done at supermar- dents, aimed at raising awareness of sustainable develop- kets, where students are taught how to fill a shopping bas- ment, responsible consumption and zero hunger, among ket with healthy options. A contest is also held in which, other topics. The programme has also been adapted to a together with their families, students create a meal plan digital format to cover more centres and facilitate access for a whole day and commit to practising good family to information. habits. 991 76 77 visits to work- cooking classes visits to Moreover, the programme encourages healthy eating shops at 202 at 9 stores in the local EROSKI stores Basque Country suppliers and Navarre VEGALSA-EROSKI Education programme

n Galicia, our healthy eating education programme Society for the Study of Obesity (SEEDO). This initiative, in Iled by VEGALSA-EROSKI is carried out through the which VEGALSA-EROSKI collaborates and which has been “Visit your supermarket” and “Math at your supermar- considered an “event with exceptional public interest” by ket” programmes, as well as the “Eat right, live healthy” the Spanish Government, is aimed at stopping and revers- programme, under the framework of the national project ing the obesity epidemic in our country. “Obesity prevention. Lighten your load,” led by the Spanish

“Visit your supermarket” “Math at your supermarket” “Eat right, live healthy”

The objective is to foster healthy During the visit to the store, students With this project, a commitment to habits, responsible behaviour, the perform calculations, estimations, food and healthy lifestyles is fostered promotion and defence of consum- observations, data collection, etc. in through assorted initiatives and er right and interests. teams. They choose a healthy break- training collaborations: Sannifiestas fast, then work as a cashier and later in Galician schools, the workshops The EROSKI Foundation analyze with their monitor whether “Dálle valor ao peixe”, bread and VII Meeting of the the purchase meets the established cheese workers and healthy eating Nutrition School Education Programme requirements and is healthy. workshops, both for children as well as seniors and suppliers. The Rewarded “Obesity Prevention. Lighten your ince 2009, the EROSKI Foundation has promoted Load” awareness campaign, Led by Smeetings between health professionals and citizens The work done by "Energy to grow" has the Spanish Society for the Study of with health concerns and needs. The objective is always been recognized on numerous occa- Obesity, also stands outs. to offer a space for reflection on relevant issues related to sions. In 2018, the EROSKI Foundation the population’s health. Education Programme received the In 2018, we held the VII Meeting of the Nutrition School, award for the best Business Initiative under the title "Appetite is in the brain; how to develop granted by the Spanish Nutrition healthy eating habits in our children", which experts in Academy. It was also a finalist in the IX the field of nutrition, science and psychology attended to Joint Responsibility Awards in the cate- analyze the importance of nutrition at early ages together gory of responsible communication for with EROSKI Club members. the best comprehensive communica- tion strategy.

58 | ANNUAL REPORT 2018 | EROSKI 3. Healthy eating Healthy eating 3 . Information on health

and sustainability 413-1

Print edition: Digital edition: www.consumer.es With commitment no. 10, we seek to educate consumers Approximately to facilitate a healthy and sustainable life, offering truthful, Nutrition 164,000 million 50 guide visits: independent, practical and simple information products monthly readers visits in 2018 in 2018 and actively collaborating to improve the health and 11 million sustainability of their purchases. fruit More than 10 million ROSKI CONSUMER is an EROSKI Group information project that 4,600 fish and Ewe have been carrying out for more than 40 years with this recipes seafood same objective. 6.5 million Through this communication channel, we aim to educate and vegetables inform consumers about issues related to nutrition, food safety 14 million and health, as well as the environment, charity, pets, babies, the visits to the nutrition economy, etc. It involves a large group of collaborators such as web channel technical staff, journalism, design and programming professionals, and also receives collaboration from several entities such as the Federation of Spanish Diabetics, the Spanish Heart Foundation, the Azti-Tecnalia Technology Centre and the Spanish Association Mobile apps: 11 channels of Primary Care Paediatricians. The EROSKI CONSUMER information with specialized project is available in four languages: Spanish, Catalan, Basque content and Galician. Recipes App: 594,107 2018 was a year of renovation for EROSKI CONSUMER, as we moved forward in the way we offer content, introducing graphic downloads 16 specialized innovation and design, but without renouncing our identity: rigour guides and impartiality of useful and practical content for consumers. Camino de Santiago App: In its print edition, distributed throughout Spain free of charge, the publication has an annual circulation of 725,539 copies. It is 173,035 also available online at www.consumer.es and receives nearly downloads 50 million visits per year. The website has a section with useful in- Social Networks formation on the Camino de Santiago, another section with more than 4,600 recipes and 16 specialized guides on topics related to News App: health, nutrition, lifestyle, culture and the environment. In line with 36,000 1,300 this commitment to new technologies, we also offer three mo- 8,762 followers followers bile apps for recipes, the Camino de Santiago and news, which downloads include the latest EROSKI CONSUMER articles. We are also present on Twitter on Google+ on Twitter, Facebook, Google+ and YouTube.

In 2018, EROSKI CONSUMER published seven shopping guides aimed at helping consumers understand different categories of products so that, with greater knowledge, they can make better 46,000 21,000 choices: potatoes, cocoa powder and cream, lasagne, gazpacho followers followers and salmorejo, cookies, pulses and nougat. In addition, two arti- cles were published in the "In-depth research" section on allergies on Facebook on Youtube and dairy products with unknown added value. Adding up to more than 775,000 Adding up to downloads more than 100,000 followers

60 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 61 Employees 4 Committed to responsible and inclusive employment 4. Employees Employees 4.

Inclusive commitment model 413-1

A socially responsible company 414-1 The management of people in our nd this translates into an element that distinguishes Athe EROSKI Group from other distribution companies: organization is characterized by the a proactive attitude and strong commitment to the proj- mong others, our mission includes two •Complying with legislation and current labour and fact that we are employees as well ect, which is reflected in our performance at all levels of Aimportant aspects: cooperative regulations, as well as EROSKI’S specific the organization. commitments. as owners: 9,796 EROSKI staff mem- •The creation of a business project and model that • Implementing an effective ethical management As part of our continuous improvement process, in 2018 includes people and promotes their personal and system. bers are Employee Partners (32.6% we underwent a company health diagnosis to identify professional development. • Continuously improving the organization’s ethical of the total staff), which makes up areas for improvement, for which we will establish specific • A commitment to protecting consumers and the behaviour. actions in 2019. environment, helping to improve the communities in • Supporting and respecting international human participants in the company’s co- which we act, as an expression of our social responsi- rights. operative management. The employment we generate follows our management bility. model and commitment to the workforce, clientele and Our Articles of Association, Internal Cooperative Regime society itself, and that is why we strive to create stable and For EROSKI, social responsibility is a value shared by the Regulation and Ethical Management Manual set forth quality employment. In this regard, it should be noted that entire organization and falls under the direct responsibility our commitments in employment matters, both for our 75.9% of the employment generated by EROSKI in 2018 of the Chairperson. By integrating ethical management own employees and for subcontractors and suppliers. The was on the basis of permanent contracts. As regards qual- into our main management objectives, we can fulfil our following principles are included among them: ity employment, at EROSKI, we work in the following fields commitments to: to make this concept a reality.

Wage solidarity, thus tightening the gap between the We reject and do not We reject and do not We provide a safe and salary range of the best paid and those 1 practice child labour. 2 practice forced or com- 3 healthy work environment. with the lowest remuneration. pulsory labour.

We respect freedom of We reject and do not We reject and do not use Gender 4 association and the right 5 practice discrimination of 6 bodily, mental or physical to collective bargaining. any type. punishment or coercion equality, or verbal abuse on our with the support of our own employees. Equality Observatory. We ensure compliance We reimburse employees We implement a man- 7 with legislation on working 8 pursuant to legal regula- 9 agement system that Work-life balance, hours and holidays. tions for each sector, en- ensures compliance and through timetables and schedules suring that in addition to internal communication of that balance work and family life as meeting their basic needs, the regulation principles. best as possible. they have the option of discretionary spending.

Health and safety, by promoting a healthy and safe environment through compliance with safe work rules and procedures and the continuous training of our All of our suppliers are subject to these requirements and In addition, we reaffirm our commitment to labour and workforce. our business relationship with them is dependent on their human rights with our Spanish Network of the Global Professional development, compliance with human and labour rights. We conduct Compact membership. EROSKI was one of the founding encouraging comprehensive profession- a special follow-up of suppliers at the greatest risk, which members in 2002 and has participated since then in this al progress through training and internal are those belonging to the textile and non-food product initiative to implement basic principles of behaviour and education. sectors located in Asia. action in the areas of human rights, labour rights, the en- vironment and the fight against corruption in the compa- ny’s daily strategy and operations. Internal participation and communication, so that Employee Partners can make contribu- tions to the organization’s management and to establish fluid, bidirectional communication.

64 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 65 4. Employees Employees 4.

Our 10 essential employment values Main indicators 102-8; 102-41; 401-1

Total number of employees

30,048 EROSKI Group 32.6% employees 9,796 employee partners an estimated 3,301 employees in our network of franchised stores 23,360 women - 78%

6,688 men - 22%

See Table 5 of the appendix with indicators for comparison with previous years.

Total number of employees in each region

486 386 9,804 5,127 1,643 352 6,213

653 927

We promote participation. Dynamism to adapt to changes and promote 299 1 6 innovation. 2,461

We promote personal and professional devel- Customer-focused to adapt and anticipate 164 2 opment through the improvement of knowl- 7 their needs. 429 4 edge, skills and abilities.

Sense of belonging: We’re proud to be part We continuously improve working conditions to 3 of EROSKI and we seek out areas for improve- 8 guarantee an adequate quality of life. ment. 210 518 We promote bidirectional information and External solidarity to give back to society. 4 communication within the organization. 9 72 Thanks to our internal solidarity, we prioritize Employees aspire to the highest level of profes- the collective over the individual and the long- 5 10 sionalization term over the short-term.

See Table 6 of the appendix with indicators for comparison with previous years.

66 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 67 4. Employees Employees 4.

Number of employees per contract type, classified by gender, age range and professional category Number of employees per contract type in each region

362 288 124 1,236 98 4,065 406 7,104 1,311 2,700 263 470 66 7,902 183 714 1,311 213

233 22,802 7,246 89 1,978 Permanent contracts Temporary contracts 493 76% 24% 344 137 4 85 27 Age Age 0

5.2% <30 1,179 42.4% <30 3,073 70.0% 30-50 15,963 47.0% 30-50 3,408 194 24.8% >50 5,660 10.6% >50 764 456 16 62 Permanent contracts 52 21 Temporary contracts 18,125 4,675 2,235 2,013 women men women men 79.5% 20.5% 72.2% 27.8%

Professional classification Professional classification Due to temporary replacements, the temporary workforce is: By professional category 2018 % By professional category 2018 %

Director 36 0.2% Director 0 0.0% 32% 27% Administrator 492 2.2% Administrator 77 1.1% in the summer, at Christmas, Manager 3,010 13.2% Manager 120 1.7% 9,567 people 8,190 people

Technician 1,039 4.5% Technician 71 1.0%

Professional 16,719 73.3% Professional 6,933 95.7%

Supervisor 1,506 6.6% Supervisor 44 0.6%

See Tables 8 and 9 of the appendix with indicators for comparison with previous years of total values and combined variables (gender, age and category professional category).

68 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 69 4. Employees Employees 4.

Number of employees by type of workday, categorized into gender, age range and professional category Number and rates of new hires by gender and age range

2,453 new employees 8.2% Age

375 <30 174 1,377 30-50 275 198 >50 54 Age 18,155 11,893 <30 1.8% Full-time Part-time 30-50 5.6% 60% 40% 1,950 503 >50 0.9% women men Age Age 8.4% 7.6% 11.3% <30 2,048 18.5% <30 2,204 66.9% 30-50 7,953 62.9% 30-50 15,963 See table 11 of the appendix with indicators for comparison with previous years. 25.8% >50 4,690 14.6% >50 1,735

Number of contracts in each region Employees promoted 12,680 5,475 10,680 1,213 women men women men 27 31 928 69.8% 30.2% 89.8% 10.2% 183 272 25 353 Professional classification Professional classification 55 65

By professional category 2018 % By professional category 2018 % 29 326 260 Director 36 0.2% Director 0 0.0% promotions 0.9% Administrator 492 2.2% Administrator 114 1.0% 7 11 32 Manager 3,010 13.2% Manager 390 3.3% 195 women - 0.8% Technician 1,039 4.5% Technician 158 1.3% 8

Professional 16,719 73.3% Professional 11,111 93.4% 98 65 men - 1.0% 3 Supervisor 1,506 6.6% Supervisor 119 1.0%

See table 10 of the appendix with indicators for comparison with previous years of total values.

70 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 71 4. Employees Employees 4.

Number and rate of turnovers (exiting employees) by gender and age range Number of dismissals by gender, age range, Collective bargaining and professional category

979 518 turnovers dismissals 3.3% Age

70 <30 40 415 30-50 148 228 >50 78 Age <30 0.4% 100% 30-50 1.9% 713 266 of employees who are not members >50 1.0% women men 380 138 of the cooperative are covered by a women men 3.1% 4.0% collective agreement 73.4% 26.6% (69% of entire workforce)

Staff who are not members Age of the cooperative 20,506 Number of turnovers in each region 6.76% <30 35 70.85% 30-50 367 22.39% >50 116

11 0 167 40 131 6 Professional classification 257 19 16 By professional category 2018 %

Director 1 0.2% 160 8 Administrator 10 1.9%

Manager 52 10.0% 90 7 6 Technician 5 1.3%

Professional 418 80.7% 1 Supervisor 32 1.0% 57

3

72 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 73 4. Employees Employees 4.

The 6 pillars of responsible employee

management Average remuneration of the Board of Directors by gender

Wage solidarity 102-34; 102-35; 102-36; 102-37; 102-38; 102-39; 202-1; 405-2 pay gap €112,973 8% €105,293 €114,652 n line with its cooperative val- lishing remuneration in the coopera- On the other hand, in the external Iues, EROSKI S. Coop. applies the tive, once the tasks, capacities and sphere, wage solidarity implies that principle of wage solidarity through- competences required for each job the remuneration of the Board of out the entire organization, which have been assessed. For its part, the Directors is between 68% and 73% internally translates into a narrow Appointments and Remuneration lower than the market value. Thus, pay gap between posts with less Committee proposes the remuner- during 2018, total remuneration of responsibility and senior manage- ation policy of senior management the Chairman and the members of ment. More concretely, the salary to the Governing Council. the Board of Directors was, in total, range in 2018 was 8.29. Thus, the €835,523. This differs greatly from Average remuneration by gender and professional category Average remuneration by gender ratio between the total amount Remuneration at EROSKI is public, the reality of IBEX 35 companies, in and age range received by the person with the equal between men and wom- which average remuneration per highest compensation and the me- en and depends on the position director is almost seven times that dian compensation of all other staff and not on other factors such as which a member of the EROSKI EROSKI S. Coop. in the cooperative is 7.64. This ratio seniority or individual negotiation. Board of Directors receives on Pay is considerably different from IBEX In addition, to attract and retain average. Likewise, the members of Director Administrator Supervisor Professional Manager Technician Age gap 35 companies, where, according the necessary human resources, the Governing Council, our highest 71,502 44,396 31,033 16,730 22,597 30,331 16,905 <30 16,428 -3% to 2017 data, the highest ranking the principle of external competi- governing body, do not receive any 19,065 30-50 25,234 24% executives received an average of tiveness is applied, thus adapting fixed or variable remuneration for 74,706 46,960 31,346 18,617 23,041 30,954 19,209 >50 27,046 29% 86 times higher remuneration than remuneration to the most gener- this work (except the costs of travel- Pay 4% 5% 1% 10% 2% 2% the average pay of the rest of the alized levels across companies ling to meetings of said body). gap workforce. in the sector. Thus, in the case of the supermarket agreement, the The Evaluation Committee, appoint- minimum basic salary is 30% higher ed by the Board of Directors and the than the minimum interprofessional he reference remuneration by professional category in to the historical evolution of the remuneration indices. The Social Council, is in charge of estab- salary in Spain. Tthe cooperative is equal between men and women. gap is expected to gradually decrease with the natural The pay gap is due to the unequal distribution in number renewal of the employees within the cooperative and of people according to gender in the different levels of the stronger presence of women in positions of greater responsibility within the same professional category and responsibility within the same professional category. EROSKI S. Coop. Other companies

Salary range in the cooperative 8.29 11.96

Ratio of total annual compensation of the highest paid 7.64 9.91 Other company groups person by the organization to the median total annual Pay compensation of the rest of employees Director Administrator Supervisor Professional Manager Technician Age gap 52,363 51,867 28,625 15,894 21,334 29,760 Percentage increase between 2017 and 2018 of total annual From 1.45% to 2.97% 1% basic salary increase in 14,879 <30 15,826 6% compensation all companies except 86,664 55,526 32,174 16,720 23,373 33,114 17,068 30-50 20,880 18% FORUM SPORT, which Pay 17,387 >50 25,923 33% 40% 7% 11% 5% 9% 10% ranged from 0.18% to 1%. gap

Ratio of average remuneration of members of the Board of 3.70 4.52 Directors and Executives to the rest of employees All remuneration data are calculated with 100% of working hours. Ratio of the basic salary to the minimum +53% +30% interprofessional salary

74 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 75 4. Employees Employees 4.

Equality 405-1 Equality indicators

t EROSKI, we consider equal opportunities between of the cooperative’s Employee Partners make up this body, s an example of our commitment to equality, women Likewise, women also make up the majority of members in Awomen and men a basic and strategic principle which has six areas of work: use of language, elimination Amake up 78% of our workforce and occupied 71% of corporate governance bodies. In 2018, equality was also in the organization’s management. Ending inequality of physical and health barriers, elimination of social barri- positions of responsibility in 2018, which is much higher reached in the highest governing body of EROSKI S. Coop, involves a process of change directly related to our ers, personal and professional development and work-life than the industry average. Moreover, EROSKI S. Coop has the Governing Council. cooperative and egalitarian culture. In this regard, EROSKI balance. had a Board of Directors with equal presence of women is governed by the principle of non-discrimination, as and men since the beginning of 2017. set forth in its founding articles of association, not just as In addition, we have a whistleblower channel and, since regards gender, but also race, sexual orientation, religious 2015, a confidential advisory service to avoid potential beliefs, political opinions, nationality, social class, disability cases of workplace harassment and to channel any inci- or any other characteristic that could cause it. dent that may arise. Distribution of employees across professional categories by gender and age range

To this end, we have had a Commission for Equality since In 2018, we periodically monitored the 2017-2020 Strategic 2005 responsible for preparing and periodically updating Plan for Equality and updated the internal and external the EROSKI Diagnosis and Plan for Gender Equality, and selection process, adding an express commitment to 36 569 3,131 the Equality Observatory, a tool to ensure compliance with equal opportunities. Director Executives Manager this principle throughout the organization. Representatives

Other noteworthy actions taken during 2018 include:

33% - 12 67% - 24 55% - 313 45% - 256 55% - 313 45% - 256 Celebrating Women's Day Education to promote equality Partnerships women men women men women men Age Age Age • Free breakfast to raise awareness We launched the Forklift School, an • Celebration of a "Women and so- <30 0.0%·······0 <30 5.6%· 32 <30 3.7%· 115 and celebrate on March 8. action aimed at promoting the employ- cial change” day, addressed from 30-50 63.9%···23 30-50 59.2%· 337 30-50 71.4%· 2,236 • Posters throughout the network of ability of women in traditionally more an internal, external and intergen- >50 36.1%···13 >50 35.2%· 200 >50 24.9%· 780 stores. masculinized roles at EROSKI. 12 women erational perspective. The confer- • Internal and external advertising received training. ence, which 300 people attend- of the event through the Nexo ed, brought together women who magazine and weekly newsletters. exercise their feminine leadership and work for a healthier, fairer, more equal and equitable world. 1,111 23,652 1,549 Professional Supervisor They reflected on the responsibility Technician of adults in transmitting equality to younger generations of women in all areas of life.

• Participation in the Inclusive Markets, Social Networks, Equality Employer round table, organized by the Spanish Red Cross on October 25, 2018 in Logroño. 81% - 19,064 19% - 4,588 59% - 910 41% - 639 55% - 614 45% - 496 • Participation and sponsorship of women men women men women men the health table organized by Age Age Age the Women Entrepreneurs and <30 17.0%· 4,010 <30 2.6%· 41 <30 4.9%· 54 Executives of Biscay. The table 30-50 63.0% ·14,899 30-50 71.6%· 1,109 30-50 69.0% ·767 >50 20.0% ·4,743 >50 25.8%· 399 addressed the revolution of new >50 26.1% ·290 technologies applied to health, with a focus on women.

• Participation in the "A Coruña in black against sexist violence" See Table 13 of the appendix with indicators for data on the number of employees by gender, age range, and professional category combined. awareness campaign of the Concello de A Coruña.

EROSKI | ANNUAL REPORT 2018 | 77 4. Employees Employees 4.

Distribution of the governing bodies by gender and age range Work-life balance indicators 401-3

General Assembly Delegate Committee Governing Council Social Council

s regards work-life balance, EROSKI offers more Moreover, EROSKI also deals with the particularities of its Aleave than established by legislation and promotes employees’ other personal projects, offering the possi- environments and work schedules that allow for work-life bility of reducing their work schedule without manifest balance. For example, in 2018, 13.2% of employees worked cause and maintaining the right to recover their full a reduced schedule or took a leave of absence due to work schedule once the reduction period has ended, or legal guardianship or family care matters. granting voluntary temporary leave with job reservation for collaborative projects with NGOs or other personal development plans. Last year, 926 people benefited from reduced working hours or voluntary leave. 75.5% 24.5% 85.3% 14.7% 50% 50% 75.5% 25.0% women men women men women men women men Age Age Age Age <30 0.8% <30 0.8% <30 0.0% <30 0.0% 30-50 73.5% 30-50 70.9% 30-50 75.0% 30-50 68.8% >50 25.7% >50 28.3% >50 25.0% >50 31.3%

Distribution of parental leave by gender

See Table 35 of the appendix for data on the number of people in the governing bodies by gender and age range. Total

Total no. of people who took parental leave in 2018 484 131 615

Total no. of people who took returned to work in 2018 after completing 267 98 365 Work-life balance parental leave

Rate of return to work (% of people who returned after completing 77.6% 83.1% 79.0% ne area our Equality Plan is focused on is work-life bal- leave in 2018) Oance. In this regard, the actions we’ve taken in 2018 have been aimed at: No. of people who continue at EROSKI 12 months after returning 394 121 515 from parental leave in 2017 • Extending recovery leave for hospitalization or surgery of relatives, without the need for said surgery to involve overnight Retention rate (% of people who continue at EROSKI 12 months later) 79.6% 74.2% 78.3% stays.

• Extending leave due to death of second and third degree relatives.

• Adding paid leave to care for premature children or new- borns who must remain hospitalized after childbirth that is better than the provisions of the Workers' Statute. Distribution by gender of employees with reduced Distribution of employees with leave of absence by working hours by cause gender and according to cause

3,333 - 97.6% 273 - 95.8% Legal guardianship Legal guardianship 82 - 2.4% 12 - 4.2% 203 - 95.3% 43 - 81.1% Family care Family care 10 - 4.7% 10 - 18.9% 71 - 85.5% 568 - 67.4% Voluntary Voluntary 12 - 14.5% 275 - 32.6%

Women Men Women Men

78 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 79 4. Employees Employees 4.

Occupational health and safety Health surveillance 403-2

Occupational risk prevention 403-1; 403-4 t EROSKI, we have health surveillance through a As for professional contingency, we also review and co- Athird-party prevention service responsible for the ordinate all the cases considered occupational illnesses following types of medical examinations: hospitalization, with the insurance companies. t EROSKI, we are committed to protecting and Health surveillance is carried out by external prevention periodic examinations depending on the risk of the improving the health of our workforce, carrying out services, although up until October 2018, EROSKI S. Coop. A position, following long absences, mandatory for specific proactive work in the area of health and safety. We act in was responsible for this speciality within its Joint Prevention positions, during pregnancies and medical assessments the fields of prevention, training and promotion of health; Service. of sensitive staff. we continuously improve our occupational risk prevention systems and integrate them into the overall management Additionally, employees participate in identifying risks and of the company. improvements in working conditions by making proposals to the Health and Safety Committees (which operate in Rate of occupational accidents We have two of our own Occupational Risk Prevention Ser- different areas, from the workplace itself to the entire or- 4x10-8 vices with a joint nature, one for CAPRABO and the other ganization) and other bodies of company representation, serious workplace ac- for the remaining Group companies. They deal with the in which all EROSKI employees are represented by their 33.9 minor accidents cidents with leave for following specialities: safety at the workplace, industrial delegates and where all the topics related to occupation- with leave for every million every million hours hygiene and ergonomics and applied psychosociology. al health and safety are covered. hours worked worked

70% 30% 50% 50%

Causes: 5.0 workplace accidents 42.7% in itinere with leave Overexertion for every million hours worked 11.2% Falls from the same level or different level

10.9% 70% 30% Cuts women men

35.2% fatalities due to occupational Other causes accidents or diseases Material agent:

41.2% Food, glass, plastic or packaging 0 1 cardiac arrest women men 9.0% Occupational risk prevention measures: Metal products and tools Throughout 2018, we took actions to prevent occupational risks in the workforce, among which the following stand out: 7.4% Forklifts or similar

Review and update of Internal prevention Emergency drills, Training. 42.4% the prevention plans of audits and scheduled with and without evacua- Basic courses on preven- Other the different Group com- inspections. tion, at the work centres. tion and specific training panies, as well as general The latter are conducted on occupational risks and risk assessments. by the centre’s inspec- emergency situations tion teams, which also were provided.

carry out a follow-up of See Table 14 of the appendix with the proposed corrective indicators for comparison with actions to reduce and previous years. improve any abnormalities detected.

80 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 81 4. Employees Employees 4.

Number of minor accidents in each region Rate of workplace absenteeism

23 334

6.8% women 358 21 2 6.2% 231 103 60 workplace absenteeism 2,497,43 h 249 109 hours of absence due to illness, 5 57 3 363 occupational illness and 25 occupational accident/ 4.2% men 5 0 60 theoretical hours of work 270 93 485,697,87 h 21 4 2,983,380 hours 36 43 17 of absenteeism

See Table 15 of the appendix with indicators for comparison with previous years. 25 11 4 15 209

4 0 14 1 116 93 Rate of occupational illness 1 33 1 0 93% 23 10 Overall total: women 1,536 minor accidents 1.3 occupational illness with 5 7% leave for every million hours 462 1,074 men women men worked 3 2 *The two serious accidents occurred in Galicia, one involving a woman and one involving a man. Accidents of indirect EROSKI employees at platforms 37 minor accidents of external staff Rate of training in occupational risk prevention

Causes of occupational accidents Material agent 43.8% 28,376 hours Initial Knocks or blows against vehicles Forklifts or similar of ORP training 9.7% 24.3% 29.7% Handling work 0.94 hours equipment Overexertion Food, glass, plastic or packaging Types of of average ORP training 9.4% per employee training Work instructions 24.3% 13.5%

Objects falling during handling Pallet 37.1% Other training programmes 10.8% 8.1%

Other causes Other material agents

40.5% 48.6%

82 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 83 4. Employees Employees 4.

Professional development 404-1; 404-2 Average hours of training of EROSKI employees by gender and professional category ostering the personal and professional development of Fthe EROSKI team is one of the three pillars of the 2020 Strategic Plan, which establishes the training of people as one of the keys to competitive improvement. By training our staff, we seek to create high performance work teams, encourage professional growth and foster a cooperative culture of self-management. 6.3 7.0 Therefore, in 2018 we invested almost €2 million in 207,000 hours of training our employees. Training programmes 6.9 were once again focused on leadership and the profes- Average training hours sionalization of produce staff. In addition to training, we’ve per employee maintained our commitment to a talent programme to develop potential within the organization. 12.1 Technician

15.715.5

Noteworthy training programmes in 2018 included: 11.9 Manager Fresh product school Orain Campus

In 2018, we continued with the butchery, fish shop, bakery, Education and development space within the EROSKI 9.6 5.8 deli and greengrocer training programmes. To do so, we Talent and Management Development Model to promote used the management tools and training centres devel- innovation, leadership, the cooperative spirit and profes- 56 oped in previous years, as well as 50 monitors. More than sionalism, which are all necessary elements to tackle the 5.1 Director 457 people participated in 57,224 hours of training. challenges our organization faces. The campus has four Professional schools (Business and Marketing, Network, Genius and Ingenuity, and Social and Occupational). 61 57.8 5.0 4.5

Customer service programme SUMMA

This programme is focused on optimizing the training of Since 2015 this project has been aimed at developing 17.4 our advanced in-store customer service staff. In 2018, we the managerial and organizational management skills Supervisor gave 3,835 hours of training in this area. of Employee Partners, in collaboration with Mondragon Unibertsitatea. Special attention is given to the profession- al promotion of women in responsibility and management 16.9 15.6 12.4 positions. In 2018, 11 people received 1,211 hours of Administrator training.

8.9 12.2

See table 17 of the appendix with indicators for comparison with previous years.

84 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 85 4. Employees Employees 4.

Professional promotion 404-3 Franchisees

n addition to training, another element that defines employee management ll openings of franchised super- To strengthen our support for Our network of franchised EROSKI Iat EROSKI is promotion, understood to be a natural process in the professional Amarkets currently comply with franchisees, we have agreements stores employees an estimated life of all employees based on professional training and quality of performance. the new "with you” business model with Cajasur and Kutxabank to 3,301 people. In this regard, in 2018, 0.9% of our workforce was promoted, which corresponds promoted by the cooperative. offer special financing conditions. to 260 people, 75% of which were women. Likewise, we are still part of the Thus, Employee Partners who want Spanish Confederation of Young their own business can benefit Entrepreneurs Associations (CEAJE), Number and percentage of employees with periodic performance and professional development evaluation from our programme “Franchise offering them support to promote with you”, through which we offer entrepreneurship. specialized training, services and personalized benefits, as well as We also demand that franchisees advanced tools for managing their comply with their employees’ labour 7,043 women stores, as well as the backing of a and human rights, just as all our 9,102 77% brand as trusted as EROSKI. suppliers must commit to. people 2,059 men evaluated 33% Promoting the cooperative culture of self-management

49% 30% ur cooperative culture stems from our interest in pro- Kreating with you Omoting a higher degree of autonomy across teams of people of all of professionals at each of our stores. We work to provide The fifth edition of the Krea Corporative Awards acknowl- subject to employees all the tools they need to achieve self-management. It’s edged EROSKI centres that, in addition to revalidating the the philosophy behind our “with you” business model. trust of our clients through daily effort, have innovatively evaluation designed and implemented their own initiatives and ideas Professionals at every store form an independent team that help to further strengthen the principles and pillars that that, working from the perspective of the owner rather best define us. In 2018, we celebrated that, for the first time, than the employee, participates in designing and orga- CAPRABO was one of the teams to receive an award. nizing their work, making the "with you" store unique. They 49% 47% 30% 31% make their own decisions in many areas: women men women men • Internal management: schedules, work shifts, day-to-day work organization, holidays, free days, leave, etc. • Their store’s value proposition, management of local and regional ranges, adaptation to the market and local com- petitors, social involvement activities with the community, etc.

Number of people evaluated and percentage of total number of employees by professional category and gender: All this drives the entire team’s internal commitment to a business project that becomes theirs, which in turn strengthens the group as a whole.

women men

3 - 25% 9 Director 6 - 25%

35 - 11% 96 Administrator 61 - 24%

386 - 42% 646 Supervisor 260 - 42%

5,766 - 30% 6,947 Professional 1,181 - 26%

523 - 22% 986 Manager 463 - 66%

330 - 54% 418 Technician 88 - 18%

See table 18 of the appendix with indicators for the number of employees subject to evaluation and table 19 for comparison with previous years.

86 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 87 4. Employees Employees 4.

Job placement and social innovation

Internal Communication s a consumer cooperative, EROSKI is a collective proj- professional training and facilitates their subsequent Aect focused on consumers and society. Therefore, we placement at our points of sale. In 2018, in collaboration are committed to the integration of people in disadvan- with 86 entities, more than 450 people were trained. Of The EROSKI cooperative model is characterized by a high NEXO taged situations and at risk of social exclusion. To this end, these, more than 120 were hired by EROSKI upon comple- degree of employee involvement throughout the orga- Online publication, updated daily, offering information through occupational training agreements with public tion of the training programmes. nization. To make this possible, we have a management on all areas of the company, with an emphasis on the employment services and different organizations such as model that favours active listening and continuous com- economic, corporate and commercial data on which the the Red Cross, we establish annual training programmes Among the various job placement initiatives carried out in munication – key elements to ensure the transparency EROSKI “with you” model is based. We also publish regular and non-work internships for groups with greater difficul- 2018, the following are noteworthy: and motivation of our staff and to facilitate quality work. Nexo monographs. ties regarding job placement. This allows them to receive

We’ve prepared the 2018 Internal Communication Plan NÉCTAR with the participation of around 4,500 Employee Partners Monthly magazine focused on new EROSKI brand launch- who attended the annual meeting of the entire collective es, explaining the organoleptic characteristics, quality Commitment-to-hire courses Dual training Non-work internships in groups of 150, led by senior management. and packaging of new products. The magazine also deals During 2018, six courses were offered We began dual training in June 2018. We’ve exceeded 37,000 hour of with information related to EROSKI’S strategic pillars. with a commitment to hire, through Currently, three students are benefiting non-work internships at CAPRABO and Communication at EROSKI extends to the individual at all which 56 contracts for 93 students from a one-year training and learning EROSKI, with a total of 491 students levels of the different businesses and is adapted to the La Parrapla were signed, representing a 56% contract, which allows them to com- in 2018. Of these, 86 were hired upon characteristics of each of the companies that make up Monthly newsletter addressed to headquarters offering a recruitment rate. bine their studies with internships. They completing their internship. This rep- the group. collection of the most relevant company news. are receiving professional develop- resents a 72% increase compared to As a new development in 2018, ment in the area of travel sales. 2017. That is why we have different tools and publications to Corporate intranets CAPRABO began offering courses with strengthen and promote fluid communication between These offer professionally useful and socially interesting a commitment to hire. employees and the organization: content. Moreover, some intranets, such as Forumnet at FORUM SPORT, also function as document repositories. The possibility of exchanging information and cooperating across teams makes them fundamental tools for internal communication.

Social training and integration

n 2018, we collaborated with 41 organizations that work Iwith people from disadvantaged groups or at risk of so- cial exclusion, such as the Red Cross, Asociación Zabalt- zen sartu, Fundación Ilundain and Koopera. A total of 391 people participated in these courses, 75 of which were hired by the organization upon completion.

Programa Inserta by the Fundación ONCE

ROSKI is one of the 64 leading companies in Spain that We are also, on the one hand, committed in the social Eforms part of the Inserta Programme and Forum by the sphere to the training and employability of groups that Fundación ONCE. As an Inserta company, we express our present difficulties for job placement. commitment to social responsibility, diversity and disabil- ity, as well as our desire to comprehensively integrate On the other hand, at the EROSKI Group, we work in social this variable in our value chain and the corporate social innovation to integrate people with different abilities responsibility policies we create, thereby improving our through different projects. In collaboration with social competitiveness The Fundación ONCE collaborates with economy organizations and other entities with social us to develop projects that empower the employment of purposes, we have projects in our portfolio to expand people with disabilities and improve their quality of life, the creation of employment for people with disabilities in thus optimizing all the innovation, differentiation and value franchised supermarkets in other regions. creation opportunities that these projects offer us.

EROSKI | ANNUAL REPORT 2018 | 89 4. Employees Employees 4.

Inclusive products Distribution of people with disabilities by gender and age group and professional category

n 2018, EROSKI began collaborating with Lantegi Batuak This company, with employees with disabilities represent- Ion their "Naia” project to sell salads and 100% fresh ing 80% of its staff, supplies products such as vegetable organic vegetables, as part of their commitment to social creams and mixed fruit purées marketed under the Gali- development and sustainability. The cooperative offers two fresh brand. of the first references to be marketed in 29 of its establish- Total ments in the Basque Country: the batavia salad and the In 2017, at CAPRABO we began selling Muntanyola See table 20 of the appendix with indicators for comparison mixed salad. This new brand of ready-to-eat salads and cheeses and Urpina wines produced by the Fundación <30 7 18 4.6% 11 <30 with previous years by gender and professional category. fresh, organic vegetables are produced in collaboration AMPANS at our supermarkets. With more than 50 years of with different ecological farms in Biscay. experience, this organization works to promote education, PROFESSIONAL 7 18 4.6% 11 PROFESSIONAL quality of life and the job placement of people with intel- This initiative is a new addition to those already launched lectual disabilities, mental illness or who are in a situation 30-50 140 246 63.2% 106 30-50 by VEGALSA-EROSKI and CAPRABO. of vulnerability. Specifically, 10 people with intellectual disabilities work at Muntanyola Cheese, producing 14 ADMINISTRATOR 1 2 0.5% 1 ADMINISTRATOR At VEGALSA-EROSKI we are committed to training and varieties of goat, buffalo, cow and sheep milk cheese. hiring people with disabilities through the projects such PROFESSIONAL 125 221 56.8% 96 PROFESSIONAL as the vegetable brand We, La Alegría de la Huerta, launched in 2016 in collaboration with Asociación Down MANAGER 9 12 3.1% 3 MANAGER Coruña or the 2017 agreement with the firm Freshcut of Vigo to include its fifth range of products in our aisles. TECHNICIAN 2 3 0.8% 1 TECHNICIAN

SUPERVISOR 3 8 2.1% 5 SUPERVISOR Inclusive supermarkets >50 88 125 32.1% 37 >50 DIRECTOR 1 0.3% 1 DIRECTOR

t GUREAK and EROSKI, we have consolidated our This model has also been extended to CAPRABO: in 2017, ADMINISTRATOR 2 0.5% 2 ADMINISTRATOR Aproject for the social inclusion and job placement we opened the first supermarket in Catalonia run entirely of people with disabilities with the inauguration of a new by people with disabilities. It was inaugurated last year SUPERVISOR 2 8 2.1% 6 SUPERVISOR supermarket in Vitoria, managed entirely by people with and has a staff of 12 people aged 21 to 59 years old. disabilities. Three years ago we started a pioneering social The store is part of a social innovation project for the PROFESSIONAL 78 100 25.7% 22 PROFESSIONAL innovation initiative with the hope of spreading it. The posi- job placement of people with disabilities that promotes, tive outcome of former experiences confirms the compet- through direct contact with the public, visibility in society itiveness of our franchised store model, open to be shared of diverse skills and abilities. MANAGER 5 10 2.6% 5 MANAGER with entrepreneurs, cooperatives and social economy companies with the aim of creating employment and TECHNICIAN 3 4 1.0% 1 TECHNICIAN wealth in our environment and advancing the diversifica- tion of social employment. Total 235 389 154 Total Value chain 5 Committed to our suppliers 5. Value chain Value chain 5. Efficient and collaborative The keys to Optimization of sales Optimization of sales value chain improving and supply processes and supply processes to achieve greater to achieve greater our business efficiency throughout the efficiency throughout the competitiveness value chain. value chain. In 2018, we continued working on To achieve an increasingly broader range of more per- sonalized products that offer greater savings, our value are: our commitment to comprehen- chain is open to manufacturers brands, our own brand and the enormous diversity of locally produced foods in sive innovation and optimization the vicinity of all our stores. We strengthen the diversity of of the value chain, the develop- the agri-food productive fabric to create a sustainable local sector thanks to the shared commitment of EROSKI ment of new store models and a and our clientele. In addition, we continue to maintain our new way of interacting with cus- commercial alliances to improve our consumer proposal in terms of value and price. tomers, imbued with the "with you” Innovation in More suitable and Diversity of our agri- spirit that inspires our day to day. We seek to build the most efficient value chain from the collaborations with competitive prices thanks food productive fabric maximum satisfaction of our customers so we can con- suppliers and leading to commercial alliances to promote small local tinue to innovate at all levels of the supply chain and in food organizations. and the management of producers. logistics management. Thanks to our advanced platforms, ur goal is not only to guide the organization towards we have managed to automate a large part of distribu- multiple promotions and Othe stores, but to also guide our main collaborators, tion, as in the case of Elorrio (Biscay) and Zaragoza, or the personalized offers. our suppliers, toward them. automated processes for preparing fruit and vegetable orders in Mallorca.

EROSKI value chain

Supplier EROSKI

Production Transport Storage Transport to Automated logistics Store distributor Segmented marketing

Forwarded Forwarded without Online Click & Drive Distribution store to without stock stock web app Click & Collect Automated order Automated system Aisle restocking Supplied directly to store Home delivery

New products R&D projects Supplier Supplier Continuous adaptation of commercial formats Partner Partner

Trade collaboration - Marketing Management by categories, customer solutions

Self-management of Business negotiation Partnerships Shopping centres teams in store AECOC AECOC Administrative management Standards Standards Administrative management

Social responsibility Social responsibility Client Partners Customers

Brand Local Own manufacturer supplier brand supplier supplier

94 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 95 5. Value chain Value chain 5.

Our brands Our suppliers 102-9; 102-10; 204-1

n 2018, our own brand turned 41. Since its beginnings, the promise “Responsible Flavour”, in accordance with n an activity such as commercial distribution, in which the corresponds to companies located within Spain. In addi- IEROSKI brand products have grown and become part EROSKI’s fifth commitment to our environment through re- Iprice, quality and rapid availability of products have be- tion, we work to promote local consumption by collaborat- of the family. We thus continue working to offer more and sponsible consumption of fresh and tasty products with a come increasingly more important to consumers, proximity ing with local and regional suppliers, which accounts for more higher quality products that help save. In 2018, we guaranteed source and process traceability, among other to suppliers, both geographically and when it comes to ap- more than 50% of our commercial supply chain in Spain. updated the design of EROSKI Basic packaging and we advances. We have added a total of 201 new products to proaching joint initiatives, has become a critical element. repositioned our brand of produce EROSKI Nature under our own-brand range. As part of this strategic plan, we are developing a General At EROSKI, we work with more than 11,000 commercial Supplier Collaboration Plan that covers all areas of our and service suppliers, which generated more than €4 organization and is fully aligned with our 10 commitments billion in economic transactions in 2018. This translates to health and sustainability. This plan is based on three pil- into the marketing of more than 107,000 different items lars: CLIENTS (we emphasize the needs of our consumers); No. of own-brand 2018 2017 during the year. Our commitment to the national produc- HEALTH (one of our main levers in the strategic plan) and references tion system is clear since 98% of spending on suppliers EFFICIENCY (we are clearly committed to logistics) EROSKI SeleQtia 199 196 The best of the best. Products tested by the Basque Culinary Centre.

EROSKI 2,798 2,752 Wide range of products for everything you need with the Number of commercial and service suppliers per country best value for money guaranteed.

EROSKI Sannia 132 141 Nutritionally balanced and improved products as compared to market equivalents or averages, with 25% less salt, 30% less fat and sugar and/or 30% less saturated fat. Also rich in fibre, Omega 3 and phytosterols, with full flavour for the best price.

EROSKI Natur 398 369 Produce with full flavour, total traceability and controlled quality, extracted from the best sources at the best time.

Belle 449 426 Dermatologically tested cosmetic, hygiene and personal care products without parabens or triclosan at the best price.

EROSKI Basic 362 342 Ordinary, everyday consumer products with all the quality guarantees of EROSKI at the best price.

Visto Bueno 2,126 1,739 In-house design clothing and footwear with the best value 2018 2018 2018 for money. Spain 11,029 Belgium 12 Poland 2

Bangladesh 11 Thailand 2 Romester 408 489 In-house design sports clothing and equipment with the China 70 best value for money. France 63 Denmark 10 Taiwan 2

Portugal 51 Norwegian 9 Cyprus 1

Ecron 403 53 Electronic devices and appliances with different United Kingdom 33 Andorra 6 South Korea 1 levels of functionality and the best value for money. Germany 20 Vietnam 5 India 1

Holland 20 Pakistan 4 Indonesia 1

Italy 16 Switzerland 4 Israel 1

USA 13 Greece 2 Singapore 1

Ireland 12 Luxembourg 2 Sweden 1

There were no significant changes to the supply chain in 2018. Total suppliers: See Table 21 of the appendix with indicators for comparison with previous years. 11,405

96 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 97 5. Value chain Value chain 5.

AgeCore, the biggest Our suppliers’ social European trading centre responsibility 414-1 Fair trade Social responsibility

n a highly competitive environment in which raw mate- ustainability, understood as the balance of economic, ROSKI was the first distribution company in Spain to in- s explained in the section on employees, all our sup- Irial markets are global and big, leading brands operate Ssocial and environmental aspects, is also key in the se- Eclude fair trade products in its commercial offer and we Apliers are subject to the international requirements of on a global scale, at EROSKI we work to strengthen our lection of the companies that make up our supply chain. are recognized by Fairtrade International as a legitimate social responsibility at work. Thus, our business relationship alliances in the international market. We therefore require that our suppliers maintain responsi- operator for the import and distribution of these products with them is dependent on their fulfilment of human and ble employee management and we empower those that with their own brand. The range of fair trade products that labour rights. Additionally, we have internal regulations These are determining factors that support our competi- implement environmental management systems in their we market consists of coffee, cocoa, tea and sugar, as that promote measures to prevent all types of corrupt tive positioning and allow us to offer new savings opportu- companies. well as various certified textile products. activity in the management of suppliers and contractors. nities to consumers. Fairtrade International products have supply chain The AgeCore trading centre constitutes the largest Eu- certification, from producers to final consumers, which ropean purchasing alliance, formed by EROSKI, the ITM guarantees compliance with the social, economic and Group (France), EDEKA (Germany), COLRUYT (Belgium), environmental criteria of fair trade: salaries for a dignified CONAD (Italy) and COOP (Switzerland). In addition to be- life, rejection of child labour, gender equality, labour rights ing independent companies, they share a long-term stra- and respect for the environment. tegic vision. Their objective is to offer European consumers a wider range of products for greater freedom of choice and better prices, while expanding business opportunities for our suppliers.

AgeCore's global turnover is €140 billion and it conducts business in eight European countries (Germany, Belgium, Spain, France, Italy, Switzerland, Poland and Portugal). The alliance is also a meeting point for allies to seek syner- gies through the exchange of knowledge in areas such as sustainable consumption, quality management, store formats and collaboration programmes with small local producers. 5. Value chain Value chain 5.

Efficient logistics Kortederra A Coruña Etxebarri o offer coverage and service to the more than 1,600 EROSKI Amorebieta Elorrio Group establishments we have a logistics network with 23 of T Sigüeiro Vitoria Agurain Thanks to our advanced our own platforms, although in total our trucks transit through platforms, we have managed some 40 logistics platforms, including others that belong to Imarcoain external companies. In total, they represent more than 360,000 Vigo Orense Bekolarra Porriño Castejón to automate a large part of m2 of warehouse space, from which we distribute up to 1 million Benavente Zaragoza distribution, as in the case of boxes daily. We seek to build the most efficient value chain from Abrera Elorrio (Biscay) and Zaragoza the maximum satisfaction of our customers so we can continue to innovate across all links of the supply chain and in logistics Barcelona and the automated processes Hospitalet management. Thanks to our advanced platforms, we have man- for preparing fruit and vegetable aged to automate a large part of distribution, as in the case of orders in Mallorca. Elorrio (Biscay) and Zaragoza and the automated processes for San Agustín de Guadalix preparing fruit and vegetable orders in Mallorca.

Ciempozuelos Menorca With the aim of continuing to optimize our supply chain process- es, and in line with the "with you” business model proposal, in Son Morro 2018 we worked on improving the freshness of our products: we Picasent want our consumers to recognize EROSKI as one of the supply chains with the best quality produce. We are also working with Ibiza local suppliers to offer produce from local producers at our stores. This has meant redesigning current transport routes and defining new flows aimed at this new service model. Bailén Other significant lines of action to improve logistics efficiency Murcia include the implementation of a new supply system that makes it possible to reduce stock and the withdrawal and automation of low rotation products at the Sigüeiro platform.

Málaga

Produce Dry/fresh/frozen foods

Dry foods Dry/fresh foods

Frozen foods Fresh/frozen foods

Non-food Transit shuttles

Transport platforms

Restructuring our platform map

e remain focused on restructuring our platform map the other hand, we need to redesign the map of Catal- Win areas where most of our business is concentrated. onia's platforms. One of the cornerstones on which the We will create new, modern and efficient facilities that transformation of the CAPRABO logistics network is based will allow us to meet the potential future demands of our is the construction of a new distribution platform for fresh customers (openings, range growth, unit service, e-com- produce in El Prat de Llobregat (Barcelona). With a sur- merce, more local products, etc.). Specifically, we believe face area of close to 24,000 m2 and an estimated invest- there are two regions where we must act in the short- and ment of €20 million, the project, which started in 2018, will mid-term. On the one hand, we are going to restructure be fully operational in 2020. This new platform forms part the map of fresh product platforms in the North and, on of CAPRABO’S comprehensive competitiveness plan.

EROSKI | ANNUAL REPORT 2018 | 101 5. Value chain Value chain 5.

Committed to offering

Collaboration project more local products 204-1 with suppliers

he philosophy and basis of the collaboration project the supplier-EROSKI relationship. Therefore, in the 2017- ommitment no. 6 places special emphasis on contrib- marketing channel to distribute their goods, which has a Twith suppliers remains the same, since we are con- 2020 Strategic Plan, we are focusing projects on one of Cuting to the development of the social and economic high impact in terms of employment, rural development vinced of the strengths and benefits demonstrated since these three areas: efficiency, collaborative demand and environment of our stores by marketing local products and and maintenance of natural landscapes. it was started in 2014. We have continued working on collaboration. We have made the following progress in the promoting the culture of each area. the items we defined at the time, focusing our efforts on collaboration plan in 2018: On the other hand, consumers find fresher, more sustain- the aspects that can offer the greatest mutual benefit to The possibility of having a diverse production sector able, healthier and higher-quality products at EROSKI. In focused on sustainable development through SMEs of fact, the source of food is increasingly more important to the primary sector are the most relevant factors in our our customers since local products also reflect the partic- Progress in the EDI Project, relationship with the local agri-food world: committing ularities of each region, traditional ways of doing things, to increase efficiency in our platforms and to this diversity, creating collaborative environments and preserved native varieties, unique recipes, etc. That’s why, at reduce billing incidents. EDI is a system that working with a large number of suppliers is in our "coop- EROSKI, we give them a leading role in our commercial pro- makes it possible to exchange standardized erative genes”. This strategy offers several benefits. On the posal and actively contribute to enhancing the local offer, documents between the computer systems one hand, small production companies have the EROSKI thus avoiding the standardization and trivialization of food. of commercial relationship members: manu- facturing companies and distributors.

Expansion of refrigerator shelves: Number of business suppliers and local producers in each region in 2018 both in Madrid and Zaragoza.Automation of the Efficient Order tool. No. of business suppliers · No. of small local producers % of regional supplier as compared to total number of business suppliers We continue working internally to extend pick-ups at the source to more suppli- 4,272 business suppliers ers, both for own-brand suppliers as well as manufacturer brands and all businesses. 2,493 local suppliers

Review of useful life criteria in cases that guarantee the requirements demanded by 94·72 our consumers. 77% 84·63 444·278 75% 63% 440·285 196·154 Improvement in the cross-docking 67% 79% flow (without stock) at our Ciempozuelos 85·62 platform. 73% 186·101 948·503 Review of the reception process at the 54% 53% platform to improve our unloading efficiency 155·99 and the wait times of our suppliers. 64%

346·45 189·155 13% 82%

276·91 33% 76·63 179·130 83% 73%

133·77 Meeting points with suppliers 58% 347·237 s an additional lever within the axis of collaboration, held a meeting with our suppliers to present our 2017- 68% Awe continue to hold forums with our suppliers where 2020 Strategic Plan and the main logistics projects we we share the evolution of the main key indicators, the have in place for the next four years. 86·60 status of joint projects and new projects. In May 2018, we 70%

2·2 100% 6·6 See Table 22 of the appendix with 100% indicators for comparison with previous years. 102 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 103 5. Value chain Value chain 5.

Collaboration with local Products with an exclusive source agri-food producers as a differentiating factor

EROSKI’s commercial policy maxi­ Cider with Euskal Sagardoa mizes local economies, creates Another distinctive element in our relationship with sup- n our effort to offer clients local products of the highest quality, pliers and producers is the establishment of long-term Iat EROSKI we included PGI and PDO in our commercial offer designation of origin wealth in the environment and con- cooperation agreements. In 2018, we reached a total of some time ago. These certifications identify foods whose quality or by EROSKI SeleQtia tributes to agri-food, economic and 1,540 agreements with SMEs and cooperatives to add special characteristics are due, fundamentally or exclusively, to the new local-regional products into our commercial offer. Of geographical environment from which they come, both as regards At EROSKI, we have continued moving social development. all our local/regional references, 808 are for the produce nature and human factors. Moreover, in the case of PDO foods, they forward in our commitment to local prod- sections and 732 for food sections. These new additions are guaranteed to have been transformed and prepared in the ucts and launched our first own-brand ore than half of EROSKI’s 4,200 business suppliers in generated more than €11 million in sales. Moreover, we designated geographic area. cider with Euskal Sagardoa D.O. under the MSpain are small local producers. EROSKI coordinates continue to renew and generate new collaboration gourmet brand EROSKI SeleQtia. The coop- this collaboration with its suppliers on the basis of the three agreements with sector organizations for the promotion We currently have more than 2,000 products with PDO or PGI: erative is thus the first distribution chain to main commitments to action with local agri-food SMEs. of local foods, protected designations of origin (PDO) more than 1,500 wines, 130 cheeses, 100 canned vegetables, oils, puts its brand on a quality cider certified and indications: legumes and rice, 300 meat products and 100 fruits and vegeta- with the Euskal Sagardoa seal. 1. Offer the products of small production companies bles. Our commitment to this type of product in our own brand is to consumers. clear through the 2018 addition of eight new cheeses and 75 wine 2 . Develop commercial management adapted to references with PDO and 15 canned vegetables, 1 fruit and 1 sweet micro-enterprises, SMEs and Cooperatives. references with PGI. 3 . Collaborate on plans for their professionalization and business growth. Promotion of local products

ROSKI’S objective of promoting local products also ex- In 2018, we launched 40 local campaigns to publicize Etends to our efforts to disseminate and promote the cul- and promote food from all our geographies, prioritizing Innovation project to revi- Introducing the brand Boví We met once again in 2018 tural, culinary and gastronomic values inherent to them. the regions where our stores are located. This commercial talize legume consumption Balear Natur with the tuna fleet to work While our offer of local products has steadily increased in dynamism is, in large part, focused on fresh, seasonal and production towards sustainability recent years, at EROSKI we are also involved in promoting products that are especially important to consumers. the consumption of these local foods as a way of main- At EROSKI, we continue to promote We participated in a meeting at taining our culinary culture, economy and landscapes. In 2018, EROSKI, HAZI, GARLAN and the consumption of local products the technological centre for marine Leartiker signed a collaboration and establish agreements with and food research AZTI in Dario agreement to implement an innova- producers of the Balearic Islands. (Biscay) that brought together the tion project that revalues legumes Creating the brand Boví Balear Na- Spanish tuna fleet and the sector produced in the Basque Country tur represents a significant change associations ANABAC and OPAGAC and promotes consumption thereof in the sale of beef, since almost to analyze the evolution of their as a healthy and sustainable food everything that can be found at agreement to increase the amount among new generations: they have our centres in the Balearic Islands is of tuna caught using the most sus- committed to revaluing and boost- 100% local. The source of this meat tainable fishing gear and establish ing local production of legumes can be traced. new steps. through the diversification of innova- tive products. The importance of this collaboration is visible in the periodic meetings we Meeting points with hold with local agri-food producers, suppliers from the Basque Agreement to market and where we update the shared strat- Country and Navarre promote the pink tomato egy to promote the diversity of the primary sector. We held separate meetings with suppliers in both the Basque Coun- In 2018, EROSKI and the Association try and Navarre, with more than 300 of the Pink Tomato of Barbastro small producers in the first and more signed an agreement to develop than 150 in the second. The coop- and promote this crop. This is the erative sells nearly 2,000 and 1,500 first time that the cooperative has products, respectively, thus maintain- signed an agreement with this ing its commitment to sustainability association, which produces its pink and small producers. tomato in the area of Oscense de Barbastro under the national brand name “Tomate rosa de Barbastro” [“Pink tomato of Barbastro”]. 5. Value5. Value chain chain Value chain 5.

VII Edition of the BCC-EROSKI Saria Award CAPRABO Local Product Chef CAPRABO regional “A comida é vida” campaign Fairs programme at VEGALSA-EROSKI The BCC EROSKI Saria award, organized by the Basque Culinary Cen- VEGALSA-EROSKI tre and EROSKI, aims to recognize culinary creations that emphasize Throughout year at CAPRABO we Chef CAPRABO welcomed the At VEGALSA-EROSKI we carried receives the “Mardelaxe” award gastronomic innovation of traditional local food. Specifically, it rewards promoted different fairs with the presentation of the V Gastronomic out a campaign to promote local chefs who promote and use varieties and species that form part of aim of bringing the work of small Conference of Calçot de Valls, as products with the Galicia Calidade VEGALSA-EROSKI won first place in the the cultural and gastronomic richness of the different regions of Spain. producers closer to their customers. well as another edition of the Xató certified quality guarantee seal. We “Mardelaxe” awards of the Laxe Brotherhood We thus promoted products from Route to promote and spread the launched a new advertisement, This edition placed special emphasis on health, sustainability and of Fishermen in recognition of the support it Vallés, Camp de Tarragona, l'Anoia tradition and different preparations highlighting the Galician culture culinary innovation, demonstrating a social commitment to the gives to enhancing artisanal coastal fishing and Maresme. of a dish originating from different and way of life and featuring the producers and the preservation of the biodiversity of species, varieties products thanks to its purchases at the Catalan regions, such as the Alt region’s best products, as well as and flavours. Galician markets of Laxe, Burela, Celeiro, A Penedès, Baix Penedès and Garraf. numerous promotion and tasting Coruña, Malpica, Marín and Vigo. activities to spread awareness of Oriol Casals of the restaurant Teòric in Barcelona was the winner in local Galician products. 2018. Xabier Blanco of the restaurant Summum of Las Palmas de Gran Canaria won second place and Carolina Sánchez and Iñaki Murua of the restaurant Ikaro in Logroño won third place.

VII Local Product Trade Fair “Productes de Sa Nostra Terra” in Zaragoza Campaign in the Balearic Islands

In 2018, together with regional sup- Like every year, we launched the pliers of Aragon, we organized the “Productes de Sa Nostra Terra” cam- VII Local Product Trade Fair in Zara- paign to promote items produced, goza, with the aim of publicizing manufactured and packaged in and highlighting the characteristics the Balearic Islands. In the past year, of local products and promoting turnover of these local products consumption thereof. In addition to exceeded €85.7 million in the the exhibition and tasting of numer- Balearic Islands, representing a 9.5% ous local products, the award for increase as compared to sales fig- the EROSKI CONTIGO Most Innova- ures for the previous year. Moreover, tive Aragonese Product Award was in 2018, other campaigns targeting also delivered at the fair. It went to local Balearic products were also the company Biosurya SL, supplier carried out, such as the promotion of eco-friendly vegetarian products. of the Balearic lamb, empanadas Furthermore, EROSKI gave a special and robiols during Holy Week, and award to Casa Matachín–Aves the promotion campaigns for Nobles y Derivados, manufacturers PGI sobrasadas of Mallorca and and specialists in pre-prepared llonguets. poultry products, in recognition of its long-standing relationship with EROSKI.

EROSKI | ANNUAL REPORT 2018 | 107 6. Environment

Environment 6 Committed to protecting the environment

108 | ANNUAL REPORT 2018 | EROSKI 6. Environment Environment 6. Commitment to environmental

sustainability 307 Environmental policy 102-11

In line with commitment no. 5 to t EROSKI, we work to ensure compliance with the ap- his commitment is comprehensively integrated minimizing our impact on climate change, protecting and Aplicable legislation in all areas of action. But, we also Tthroughout the organization by an environmental making sustainable use of natural resources, managing promote responsible consumption, make a continuous effort to improve the identification, policy that aligns respect for the environment and social waste with circular economy models and preserving bio- we work to improve the design characterization and minimization of the main negative welfare with our strategic objectives. The policy is aimed at diversity. The basic principles of our policy are: impacts and the optimization of the positive impacts that and execution of our activity to be our activity has on the environment. For this, we consider all the phases in which we might affect the environment more environmentally friendly and in our activity as distributors. That is, from manufacturing Maintain a proactive Prevent pollution by stan- Base the environmental man- foster actions to better protect the products with suppliers to managing end waste gener- attitude that, in addition to dardizing our environmental agement system on the con- ated at homes and our own facilities. This global vision of ensuring compliance with management in such a way tinuous improvement of the environment. This model of be- our impacts on the environment is aimed at acting with- current environmental reg- that allows us to monitor, aspects that are most relevant haviour towards our environment is, out transferring the impacts from one phase to another, as well as transmitting our commitment to protecting the ulations, leads us to make measure, and prevent or for the organization. To do this, in turn, one of the principles of our environment to all our stakeholders. increasingly more demand- reduce the environmental we set quantifiable objectives organization’s Code of Conduct. ing commitments. impact associated with our and assign the necessary activity. resources to achieve them.

Include the environment as a Promote an attitude of collab- Establish fluid communication variable in the research and oration and participation by channels with authorities, local development of the products everyone to achieve sustain- communities, industry organiza- and services we offer, seeking able development. For this, it is tions, suppliers and consumers out profitability of the environ- essential to train and educate that guarantee permanent mental actions we implement people at all levels of the and transparent dissemination and identifying new opportu- organization. of the impacts of our activity, Extraction of nities for negotiation. as well as the resources and raw materials technologies we use to mini- mize them.

Collaboration with environmental

Production Storage and institutions and organizations and packaging distribution of products

o create this environmental policy we receive support Along these same lines, we are part of Izaite, the Associa- Tfrom expert environmental organizations and collabo- tion of Basque Companies for Sustainability. This non-profit ration agreements with other companies that, like EROSKI, organization promotes training and dissemination of seek to carry out their activity in a sustainable fashion. information on sustainable development and favours the creation of alliances between administrations, training Thus, since 2007 we have collaborated with the World centres and companies with a shared commitment to Wildlife Fund for Nature (WWF) as a world expert in sustainability and social responsibility. environmental conservation. Our joint actions include updating our sustainability policy for seafood products We also have an alliance of this kind as members of the Reuse, recycle In-store and promoting more responsible consumption through Basque Ecodesign Centre, where private companies and recovery business our Nutrition School. and the Ihobe Basque Public Company of Environmental Management collaborate on the conceptualization and We are also part of the European Retail Forum, a vol- execution of innovative ecodesign projects, together with untary platform for the exchange of best practices in the University of the Basque Country (UPV-EHU) and lead- sustainability between companies and organizations in ing international knowledge centres. the distribution sector in Europe. Sharing our experiences and learning from those of other entities promotes the es- tablishment of new improvement actions that will reduce Use at home the environmental footprint of our sector and improve the information our consumers have on this matter.

110 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 111 6. Environment Environment 6.

Main indicators

Materials 301-1 Energy 302-1; 302-2; 302-3; 302-4

Materials used in our own-brand products and packaging as reported to collective systems of extended producer responsibility 2018 consumption 823,553,489 kWh -4% less than 2017 2,964,793 GJ

Non-renewable fuel 34% -1% 278,116,806 kWh of all energy compared to 2017 1,001,220 GJ consumed 2,457 tons 101tons 0.013 tons Containers and packaging Batteries Oil 1% Other Non-renewable: 15% more than 2017 Steel 312 35% Platforms Plastic 818 Aluminium 49 Other 55 1% Gas Natural Supermarkets Total: 1,235 4% 9,976,723 Kwh of total consumption 0.011tons 1,280 tons 35,916 GJ 63% of non-renewable fuel Renewable: Compact fluorescent light Electrical and electronic Hypermarkets Ceramics 5 bulbs devices Paper/cardboard/wood/cork 1,107 Glass 110 -1% Total: 1,222 25% 2017 Purchased at source See table 23 of the appendix with indicators for comparison with previous years.

Paper used for advertising and at Number of bags according to Diesel 75% 96% Distribution to store EROSKI company headquarters 301-1 Reused logistics containers 301-3 type sold at checkout line 268,140,083 Kwh of total consumption 965,304 GJ of non-renewable fuel

5,137 tons 20% 4,944,741 tons Paper 144,225,762 Hypermarkets Reused pallets Bags Advertising brochures 4,809 -6% Magazines 318 AENOR certified 5% Other compared to 2017 Headquarters 11 reusable plastic bags 83,004,198 See Table 25 of the appendix with indicators for comparison 9% Platforms with previous years. Tote bags, Electricity Advertising: with recycled, 545,436,683 Kwh 66% reusable plastic 1,431,930 Advertising: all paper is PEFC certified 41,862,959 tons 1,963,572 GJ 66% of all energy con- (Programme for the Endorsement of Recycled plastic boxes Supermarkets sumed Forest Certification schemes) to ensure Reusable it comes from sustainably managed charity bags 221,122

forests. See Tables 26 and 27 of the appendix with indicators for comparison with previous years and kWh value for each business or logistics type. Bags with more than 55% EROSKI Consumer and EROSKI Club: The percentage of breakage varies recycled plastic 164,823 Energy consumption 302-2 All paper is FSC® certified (Forest Stew- between 0.3% and 30% depending 0.18 kWh/€ ardship Council), guaranteeing responsi- on the type of logistics container. All Paper bags 16,569 outside the organization net sales ble forest management. breakages together only accounts for 10,708,575 kWh 2% of logistics packaging. Compostable bags 339,545 Headquarters paper: Energy intensity 634.34 kWh/m2 38,551 GJ We use eco-efficient paper with a lower Diesel consumed during work See Table 25 of the appendix with indicators Single-use plastic ratio at EROSKI commercial surface area grammage and the FSC seal and EU for comparison with previous years. bags 59,047,575 trips by road Ecolabel. See Table 28 of the appendix with indicators for comparison with previous years.

112 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 113 6. Environment Environment 6.

Refrigerants consumed to Waste 306-2 Water consumption 303-1 compensate for leaks 301-1; 305-1

t EROSKI, we develop reverse logistics processes, from cases the manager directly collects the waste from our es- Aour stores to our platforms, in order to ensure the tablishments. The data presented in this report correspond The water consumed at our stores, platforms and head- All the refrigerants consumed by EROSKI in 2018 to waste generated by our activity is managed properly and to the waste generated at our food businesses collected quarters is drawn from municipal drinking-water supply compensate for leaks have a zero ozone depletion the environmental impact of the waste transport phase by through reverse logistics or an external manager. networks, which directly manage the collection and potential (substances not included in Appendices the authorized manager is minimized. However, in some purification of distributed water. A, B, C and E of the Montreal Protocol).

951,375 m3 50.63 tons Non-hazardous waste Hazardous waste 47,181 tons 37 tons Water extraction by source of refrigerants consumed 20% Hypermarkets 3% 38,460 R-449A Recycling 6% Platforms 23% R-448A Total waste generated 5% Other 3,920 4,801 37 47,218 tons Recycling 16% Dump Recovery Other

69% Supermarkets 11% R-407A Recycled waste Recovered organic waste See Table 31 of the appendix with indicators for comparison 46% 38,497 tons 4,801 tons with previous years. R-442A

35,234 92% 2,328 Paper and cardboard 2,110 48% See Table 32 of the appendix with indicators for Fish 44% Discharges and spills 306-1; 306-3 comparison with previous years. Meat The wastewater we generate is treated at wastewa- ter treatment plants in the municipalities where we conduct our business. An estimated 941,861 m3 of wastewater was generated in 2018. EROSKI complies 244 with legislation on prevention and management 2,424 5% 38 Bread 80 of uncontrolled discharges and spills and did not 6% 291 1% 370 178 2% detect any significant ones in 2018. Plastic Fruits and Products with environmental 1% 1% 0% Yoghurt vegetables Wood Porex Other certification

See Table 29 of the appendix with indicators for comparison with previous years. 3 We include the preservation of terrestrial and marine 941,861 m biodiversity as an objective in our commercial offer. Waste collected from clients for recycling by type of wastewater generated Non-hazardous waste Hazardous waste 608 tons 1,676 tons · 1,100 eco-friendly products · 361 counters and 7 logistics platforms for MSC certified fish. 1,490 · 100% of our canned tuna complies with ISSF principles. Electrical and · 398 EROSKI NATUR products that have certification 604 electronic such as Global G.A.P. for comprehensive production or Textiles devices animal welfare. · 53 products with FSC® or PEFC seal.

92 22 Batteries Light bulbs 4 and energy and Coffee sources fluorescent 72 pods lights Used oil

See Table 30 of the appendix with indicators for comparison from previous years.

114 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 115 6. Environment Environment 6.

Centres located in biodiversity hotspots Greenhouse gas emissions

304-1 and EROSKI’S carbon footprint 305-1; 305-2; 305-3; 305-4; 305-5; 305-6

f our more than 1,100 establishments in Spain, 86 are It should be noted that there are provinces and regions in Type of GHG emissions and sources included in this report: Olocated in areas affected by the following protection which much of their territory is considered a biodiversity figures: hotspot, such as Galicia or the Balearic Islands. EROSKI always complies with environmental and biodiversity • ENP (Protected Conservation Areas) legislation when it comes to locating and building its • IBAS (Important Areas for the Conservation of centres. It also works to minimize its environmental impact Birds and Biodiversity in Spain) and promote measures that preserve biodiversity, such as • Red Natura 2000 (LIC, ZEC and ZEPA) sustainable fishing. • Biosphere reserves • IEZH (Spanish Inventory of Wet Area) Gases:

CO2 CH4 N2O HFCs

Direct emissions: Indirect emissions:

Scope 1: Scope 2: Scope 3*: Fuel consumption during Power generation for own use Fuel consumption during logistical transport by road. work trips by road and plane; diesel consumed during road Coolant leaks in refrigerator transport for logistics and work systems. trips; drinking water consump- tion; paper consumption at Natural gas combustion at headquarters, advertising and own facilities. magazines.

Number of protection figures that affect the location of the same centre:

*Indirect emissions under scope 3 are a result of EROSKI’S etc.), but this report includes only a small portion of them 1 activities but from sources that it does not own or have any due to the data available. We plan to continue expanding control over. In total, there are 15 categories (items and the activities included under scope 3 of EROSKI’S carbon 2 services purchased, waste generated, use of products sold, footprint in the coming years. 3

4

116 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 117 6. Environment Environment 6.

Greenhouse gas emissions - EROSKI’S carbon footprint

GHG emissions intensity at EROSKI: Intensity of greenhouse gas emissions 2018 2017 g CO eq/€ net sales 135.0 176.4 2 135.0 g CO eq./€ 2 634,441 488.7 kg CO2 eq./m 2 kg CO eq/m2 commercial surface area 488.7 623.0 commercial surface area net sales 2 tons Scope 1 CO2 eq./year See Table 33 of the appendix with indicators for comparison with previous years. g CO2eq/€ net sales 36.6 39.9

2 kg CO2eq/m commercial surface area 132.3 141.1 Scope 2 (mix of sellers)

Scope 1 Scope 2 g CO2eq/€ net sales 32.5 45.0 Indirect emissions due to electrical consumption Direct emissions 2 kg CO2eq/m commercial surface area 117.6 160.8 kg CO eq. 152,722 kg CO eq. 171,796 2 2 Scope 3 Natural gas Platforms g CO2eq/€ net sales 66.0 90.9 1,834 · 1% 14,429 · 9% 2 kg CO2eq/m commercial surface area 238.7 321.1 Other businesses Road transport 7,429 · 5% 67,954 · 40% Hypermarkets Reduction of 29,866 · 20% 2018 vs. 2017 Comments greenhouse gas emissions Refrigerants Supermarkets 102,008 · 59% Direct emissions (scope 1) -10% 100,998 · 66%

Indirect emissions due to electrical Consumption and the mixed seller emission factor -30% consumption (scope 2) were reduced

This reduction is mainly due to lower water Other indirect emissions (scope 3) -29% consumption.

See Table 34 of the Appendix with indicators for comparison with previous years. Scope 3 Other indirect emissions

309,923 kg CO2 eq.

Water 280,656 · 91% Diesel transport (from the well to the tank) 15,370 · 5% Paper consumed at EROSKI headquarters, brochures and magazines 9,870 · 3%

Business trips (combustion emissions) 3,412 · 1%

Diesel on work trips (from the well to the tank) 614 · 0%

See Table 33 of the appendix with indicators for comparison with previous years.

118 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 119 6. Environment Environment 6.

Environmental improvement measures 308-1

n accordance with our environmental policy and the sumption, no. 6 to offer more local products and no. 10 to Imost relevant environmental aspects associated with facilitate a healthier and more sustainable lifestyle. These our business activity, at EROSKI, we have lines of work improvement actions affect different stages of our produc- based on continuous improvement that align with our tion process, which is why we also involve actors outside strategic objectives. A large part of these are included our organization to the extent that they can contribute to in commitment no. 5 to promote more responsible con- reducing our environmental footprint.

Belle Natural: COSMOS Natural Wood products from sustainable forests certified cosmetics his guarantees that the wood used to produce our Products Tstationery products or garden furniture come from n 2018, we launched the first range of COSMOS Natural legal and sustainable logging. In 2018, we marketed 53 Icertified cosmetics by our own brand. It consists of 16 stationery, garden furniture, cleaning and hygiene articles t EROSKI, we believe it is essential to collaborate with products that cover the basic needs of a daily hygiene with the FSC or PEFC seal. We also use paper with FSC Aresponsible suppliers that share our commitment to and beauty routine, marketed under our brand Belle certification for our own-brand butchery products. sustainable development in order to include the environ- NATURAL. mental factor in our offer. As part of commitment no. 5, we ensure that all processes, from the production source The entire new range is certified as natural cosmetics to store operations, to all the processing and handling, according to the COSMOS standards and is certified by reduce their environmental impact. This includes eradi- the prestigious international body ECOCERT. This standard cating post-harvest phytosanitary treatments, certifying regulates everything from the preparation and production our fishmongers with sustainability labels, monitoring the of each ingredient to packaging, labelling and environ- Ecological products use of antibiotics, implementing practices that guarantee mental management, among other aspects. animal welfare and promoting ecological ranges. EROSKI Natur: Responsible flavour Thus, it requires the use of formulation parameters in which e strive to offer food from ecological agriculture n 2018, we changed the promise of our brand of pro- the raw materials used must be previously certified, as well Wand livestock, as it represents a production model We have three fundamental lines of work so our customers Iduce, EROSKI Natur, to “Responsible flavour”. In selecting as their manufacturing process. The entire new range has that guarantees the best environmental practices. This can enjoy more environmentally friendly products: guar- products and suppliers, we demand not just differential been certified with at least 98% natural ingredients or model avoids the use of synthetic chemical substances anteeing the sustainable source of products, promoting quality to ensure they are tasty but additional require- from a natural origin, such as shea butter, plant extracts, and artificial additives and promotes the preservation local products and local consumption, and ecodesign of ments as well to ensure they are produced following more macadamia nut oil or flower and fruit extracts such as of biodiversity and natural resources and respect for packaging and products of our own brands. environmentally friendly practices. jasmine and guava, among others. Likewise, and while it animal welfare. In 2018, our offer included 1,100 organic is not required by the standard, 5% of Belle NATURAL prod- products certified with different labels, among which the Our brand EROSKI Natur has received animal welfare cer- ucts come from an ecological source. European logo stands out. tification for free-range chicken, Duroc pork and Ternasco lamb from Aragon. Moreover, the chickens are raised with- out antibiotics, which helps prevent potential resistance to medications for consumers. We have also added certifications that guarantee the Committed to animal welfare Certified sustainable origin food has been produced following more environmentally friendly processes. For example, all fresh fish is certified by MSC® (Marine Stewardship Council), broiler fish has the • The number of barn eggs that we • EROSKI Natur chicken also has • We’ve included GlobalG.A.P. certi- GlobalG.A.P seal. of aquaculture, fruits and vegetables market in our stores already makes Certicar certification, which refers fication of aquaculture on EROSKI or decades, we’ve worked to offer consumers healthier also have the GlobalG.A.P seal. of agricultural production up around 35% of eggs sold at our to characteristics of the breeding Natur farmed fish, which has spe- Fand more sustainable alternatives. or an integrated production seal. We have also eliminated stores. At EROSKI, we’re committed system and animal welfare. It is a cific and demanding requirements post-harvest treatments in our citrus and stone fruits, thus to raising this percentage to 100% slow-growing chicken – 56 days regarding the animal welfare of fish, Some milestones in this trajectory are removing CFC reducing consumption of raw materials and the gener- of eggs sold in the entire network of minimum –, raised in an exten- both while raising them and during aerosols in 1989, as they are harmful to the ozone layer, ation of waste. Moreover, we have expanded our range stores by 2024. sive indoor system with a smaller transport and slaughter. and guaranteeing that none of our own-brand products of produce with quality options in categories that, until number of birds per square meter contain transgenics since 2004. Along this same line, for now, did not include the brand, such as bakery items and • We have included a new animal for greater space and freedom years we have had certifications, labels and brands that eggs. The latter come from free-range chickens raised on welfare certification on our Duroc of movement. As regards their ensure the sustainable source of our products. Some of farms where they can move freely and have access to the pork, sold throughout our business feeding, they now eat whole grains. the most significant among them include: outdoors. network under the EROSKI Natur Their food is 100% vegetarian and brand. All the pigs come from consists of at least 50% corn. More- farms certified in animal welfare over, the EROSKI Natur chicken by AENOR with strict standards in farms have received Certicar animal welfare principles such as certification according to the food, accommodation, health and "Specific conditions for certifica- natural behaviour. tion in animal welfare of broiler chickens" developed by Neiker based on the Animal Welfare Indi- cators (AWIN) methodology, at the premium level.

120 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 121 6. Environment Environment 6.

Sustainable fish at EROSKI Achievements in sustainable fishing in 2018

ith the objective of continuing to work to conserve working towards sustainable fishing together with interna- In 2017, we became the first retail distribution chain in Wbiodiversity in the seas and oceans through the tional organizations of reference. The sustainable fishing Spain to pass the MSC audit of the chain of custody for rational use of marine resources, in 2016 we agreed on policy is founded on 11 principles that encompass both fresh fish. MSC sustainable fishing certification audits both the EROSKI sustainable fisheries policy. In response to the good practices already established and the challenges the fishery and the companies involved in the entire pro- commitments made in this area, in 2018 we continued that we set for the future. cess of handling fish so that traceability and good prac- tices are guaranteed throughout the chain of custody. In 2018, we renewed our MSC chain of custody for fresh fish certification and also added the seal to our commercial Principles and commitments of the EROSKI sustainable fishing policy range of frozen fish and seafood. With the launch of frozen hake, we now have 11 frozen fish and seafood references with the blue seal throughout our business network. We ex- Sustainable fishing Including sustainable Selling products exclu- pect the commercialization of MSC certified fish to reach equipment and fish in our fishing resources in our sively from authorized 2 million kilos by 2020. commercial offer commercial offer. fisheries and fishing In 2018, we became the first distribution chain in Spain grounds. to pass the GlobalG.A.P. certification for the aquaculture chain of custody audit, which certifies that the species bred in this way and sold in our fish shops have been pro- duced in a safe and sustainable fashion. Thus, there are already 361 fish counters in our stores that sell seabream, corbina, sea bass and turbot with the GGN seal.

Respecting minimum Promoting the use of Promoting sustainable, In addition to our commitment to guarantee the sus- sizes and proactivity sustainable fishing gear MSC certified products tainable source of our entire range of canned tuna, we to establish minimum among supplier compa- for extractive fishing. also require it be caught using only the most responsible sizes larger than those nies. fishing equipment: Responsible Tuna Fishing, without FAD, required. MSC and Fishery Improvement Project. To this end, we have reached an agreement with our suppliers so that they double the amount of tuna caught using this equip- ment, reaching 40% in two years. We are moving forward with our plan for the conservation of fishing grounds and to offer our customers more sustainable consumption Sustainability in Empowering local guilds Selecting suppliers that options. At EROSKI, we only work with suppliers that have the value chain and suppliers closer to comply with and respect included in their sustainable fishing policy a provision stores. the fundamental rights of that rejects tuna from countries that have received a employees according to yellow warning card from the European Union for failing Convention 188 of the Inter- to comply with the measures approved by regional fishery national Labour Organiza- organizations and for not establishing measures to end Reducing the environ- tion on fishing. illegal fishing. mental impact of the fishing distribution activity.

+2,000 tons of sustainable Transparency and Transparent labelling Consumer information and governance and communication with education in the field of fish with MSC and GlobalG.A.P. consumers. sustainable fishing. seals purchased in 2018 Active listening and col- Governance system, with laboration with the entire efficient supervision and au- fishing sector and other dit measures that reinforce stakeholders. the implementation of this sustainable fishing policy at EROSKI.

122 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 123 6. Environment Environment 6.

“Ugly fruit and vegetables” against food waste New range of more environmentally friendly bags

ccording to the UN Organization for Food and In 2018, the campaign was carried out in 560 establish- t the end of 2018, we began to progressively replace AAgriculture, one third of food produced in the world ments of our business network, including 79 CAPRABO Aour current single-use bags with compostable bags is wasted. At EROSKI, as part of our commitment to the centres and franchises. The Balearic Islands joined this made from plant-based materials. This type of bag has sustainability of the agricultural sector and against food edition for the first time, with the participation of 14 also been included in our online shopping service. In waste, we have opted to sell fruits and vegetables consid- transformed stores. In total, 1,055 tons of "ugly" fruits and addition, the AENOR certified reusable bag has been ered “ugly” due to their appearance or size. vegetables were sold in 2018 throughout the network. replaced by a bag containing at least 55% recycled plastic to enhance a circular economy. Likewise, we also included a new FSC-certified paper bag from a sustainable origin in the range, as a result of listening to our customers. These are all in addition to our existing reusable raffia bags, made with recycled plastic, and the Ecodesign packaging and products charity bag, which combines protecting the environment with social purposes. 1.341 billion single- ince the creation of our own brand, we have been containers, which, in some cases, also entails economic Along this line, at CAPRABO, we have added a pioneer- Sworking at EROSKI to improve the packaging of our savings derived from the optimization of the production ing initiative: the first pilot test of substituting single-use use plastic bags products. In 2008, we began including environmental and logistics phases. plastic bags at the cash register and store sections with avoided thanks to criteria in their design, such as selecting materials from a compostable bags. The #projecteCERES is an initia- sustainable source that favour recyclability or reducing In 2018, we worked on defining our plastics strategy and tive of the Ellen MacArthur Foundation and part of the our reusable bags the amount of raw materials used for their manufacturing took on the following commitments to fight against plastic Circular Economy 100 programme. This project is aimed and packaging. These actions encourage the reduction pollution: at taking advantage of the fact that businesses will of the global environmental impact of packaging and use compostable bags to promote organic collection. The project involves the coordination of compostable plastic manufacturers, the distribution sector and public administrations responsible for collecting and recycling organic waste. Through this measure, 10,000 reusable bags for weighing fruit and vegetables were distributed to families, which has saved 250,000 conventional single-use plastic bags. Reduce tons of sin- Reduce single-use plas- Promote reusable bags. gle-use plastics by at tics, also by eliminating least 20% by 2025. plastics in single-use ob- jects that are not pack- aging, such as dishes or cutlery. Strengthening the #PorElClima community

ince 2017, we have been part of the #PorElClima community, which is a meeting place Sfor all the actors (companies, public administrations, NGOs, media, and individuals) that are already working #PorElClima with the aim of guaranteeing compliance with the Paris Agreement against climate change that corresponds to our country. Moreover, as members of this community, we are committed to carrying out a plan to reduce green- house gas emissions. Ensure that all own-brand Be more transparent: adapt Increase the sale of bulk containers are 100% our systems to disseminate At the beginning of 2018, porelclima.com, a platform aimed at becoming the main fruit and vegetables in recyclable, overpackag- data on all the own-brand national offer of responsible products and services, was launched. At porelclima.com, you our stores. ing has been eliminated containers we put into circu- can find both responsible goods and services from large or medium-sized companies and container weight has lation in coming years, and and different green products and services that are growing exponentially in our country. been reduced as much the impact that our mea- as possible by 2025. sures will have to reduce our plastic footprint on an annual basis.

124 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 125 6. Environment Environment 6.

Logistics Efficiency and sustainability as pillars of our new transport model Lean&Green: Towards sustainable logistics 1 2 3 4 5

e received the award for the Lean&Green project • Reorganization of non-food platforms by selling stores Wby the Association of Manufacturers and Distributors to other distributors. (AECOC). With this certificate, the EROSKI Group leads the • Reorganization of platforms in the central/southern Lean&Green platform together with 15 other companies region by selling stores to other distributors. Closure of in the consumer sector. The objective of Lean&Green is the Mercamadrid platform. to create a network of leading companies in the field of • Elimination of the Larrabetzu platform for route optimi- sustainable logistics to increase their savings capacity zation.

and reduce their CO2 emissions by at least 20% in five • Reorganization of northern platforms. years. This award certifies that we have presented the • Refurbishment of the fleet: elimination of vehicles prior Waste, containers Logistical packaging Product action plan to reduce the percentage between 2015 and to Euro III. and packing ready for reuse 2020. Lean&Green is the largest European collaboration • Addition of semi-trailers to the fleet. platform especially aimed at reducing emissions associat- • 25 x 25 m trucks added to the fleet. ed with the supply chain. • Vehicles powered by compressed natural gas (CNG) or liquefied gas (LNG) added to fleet. In the last four years, it has managed to reduce transport • Night-time unloading procedures. 1 More efficient supply process: 4 Reverse logistics: emissions by 14%, which translates to more than 11,000 • Changes to loading procedures for fresh pallets. • Improved demand planning. • Objective: manage and recover waste generated in tons of CO2 equivalent emissions through the following • Changes in loading criteria for ex work activity. actions: • Increased truck fill. • Continuous optimization of the purchase transport stores. This measure forms part of our zero waste goal as • Optimization of routes and order isolation. model at source. it allows the collection and treatment of all organic and • Training in ecological driving techniques for drivers of • Concentration and simplification of our platform map. inorganic by-products for proper recycling. the EROSKI road transport network. • Implementation of the transport manager system, which • Purchase of green energy. optimizes the planning and tracking of routes and the 5 Optimization of urban logistics: loading of goods. • Collaboration with suppliers to optimize their use of • Night-time unloading, use of multi-purpose lanes or vehicles. dynamic reservation of unloading spots to minimize the impact on the urban environment. 2 Less polluting vehicles and driving: • As regards noise pollution, the night-time distribution model includes centralized supplying of the product to • Renewal of the fleet with vehicles adapted to the new stores at night. Sound emission levels at night are more anti-pollution regulations of the European Union Euro 6. restrictive than during the day. To meet these levels • Use of fuel additives that can reduce greenhouse gases during loading and unloading operations, the distribu- by up to 40%. tion model includes a series of measures adopted in • Promotion of electric vehicles. different areas. On the one hand, the facilities are to be • Use of vehicles with more optimal loading, such as city adapted: closure systems, segmented alarms, acoustic trailer. insulation, etc. Likewise, the necessary equipment is tak- • Use of vehicles that run on liquefied petroleum gas for en into account, such as forklifts, silent pallet racks and fuel. curb ramps. On the other hand, the personnel involved • Outfitting of vehicles with certain electronic devices that in silent work protocols are trained and educated, differ- favour more efficient driving. entiating between the protocols for each work position: • Training in ecological driving techniques. daytime store staff, night staff and delivery personnel. Lastly, to correct any deviations, internal audit processes 3 More sustainable platforms: are included to detect them and verify compliance with the work protocols established at the operating points of • Use of LED lighting, motion detectors, temperature sale. Many of these measures are defined in collabora- robots and natural light to improve energy efficiency of tion with the municipalities to ensure their suitability. platforms. • Installation of solar panels for an electricity supply with a lower environmental impact. • Reduction in the amount of packaging materials used.

126 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 127 6. Environment Environment 6.

Eco-efficient shops Circular economy

The renovation and expansion of neutral CO2 balance. To achieve this, we carry out R+D+i We handle waste management and recov- the EROSKI business network to projects at our stores. The zero emissions store of Oñati ery from the prevention and integration of a (Gipuzkoa), which renewed its ISO 50001 energy certifi- circular economy model. adapt it to our “with you” models cation in 2018, is a significant example of this. The good also includes improvements in practices learned in these stores are being implemented As one of our basic pillars of action to reduce our environ- • We recycle 100% of the cardboard, plastic, paper and in other establishments across our business network. mental impact, we focus much of our efforts on prevent- wood generated at our facilities. To do so, we collect the construction and management in ing, managing and recovering the waste we generate. different materials discarded at our stores and collab- accordance with environmental Our renewed model improves energy efficiency through orate with different integrated management systems new and efficient cooling, air conditioning and lighting Minimizing waste authorized for their treatment. criteria. systems and equipment. Energy efficiency is part of the • We reuse logistics packaging in our distribution opera- zero waste management that makes the “EROSKI with you” We work to minimize the waste generated from our activity tions. co-innovation has characterized EROSKI stores from the store a leader in sustainability and environmental policy. by using ecodesign for our own-brand products, promot- • We make it easier for consumers to recycle their waste. Estart. Proof of this was the implementation more than We extend this new energy model to all supermarkets and ing produce close to their expiration date and donating To do so, we make recycling points available at our 20 years ago of the first national environmental man- hypermarkets openings and renovations. food suitable for consumption that cannot be sold to stores to collect batteries, electrical appliances, lamps, agement system with ISO 14001 certification at our Artea people at risk of social exclusion through the “Zero waste" clothing, household oil and ink, among other used hypermarket in Leioa (Biscay). Our goal is to have self-suf- programme. In 2018, we became members of the Basque products. ficient supermarkets with renewable energy and reach a platform against food waste to join efforts with other ac- tors in the value chain to minimize food waste. CAPRABO participated once again in 2018 in the Euro- pean Week for Waste Reduction, with the aim of raising Along this same line, we also encourage our customers to awareness about the importance of working together in adopt measures such as using reusable bags to reduce the reduction of waste, the reuse and recycling of materi- Sustainable construction and equipment the number of plastic bags thrown out each day. In 2019, als based on concrete actions and the dissemination of we will progressively add reusable mesh bags to the pro- information campaigns. We are committed to designs and equipment that consume duce section to minimize consumption of single-use bags. less energy and have a lower environmental impact. A few examples of the measures we have implemented are: Waste management and recovery

At EROSKI, we take responsibility for properly managing LED lighting and recovering the waste generated at our facilities Use of refrigerants with a low global and stores by promoting recycling and reuse as priority All the light fittings are latest generation LEDs that turn on warming potential treatments. From the perspective of a circular economy, Recycling coffee pods through an automated mechanism that optimizes use we promote reverse logistics processes, from stores to and minimizes light pollution at night. This type of light fitting We use refrigerants that combine zero ozone layer de- platforms and suppliers, which allow correct reuse and We continue to move forward in our commitment to can be recycled and does not contain polluting materials pletion potential, low global warming potential and high recycling of organic and inorganic waste generated. This making it easier for consumers to adopt more sustain- such as mercury, lead or tungsten. In addition to this mea- energy efficiency. Additionally, in 2018 we installed the implies not only minimizing the amount of waste but also able consumption patterns, which is why we launched sure, we have included the installation of floating screed Intelligent Detection system to detect leaks at 27 centres avoiding the consumption of virgin materials in other a coffee pod recycling project. It is a pilot initiative that and both thermal and acoustic insulation at the facilities. in order to minimize emissions of these gases as much as production processes. we have started in stores in the Basque Country, Na- possible. varre and the Balearic Islands, making us the first major Refrigeration equipment Organic waste distributor in Spain to install collection points for coffee Climate control Through reverse logistics and authorized managers, we pods of any material and brand. The environmental measures applied to refrigeration collect the organic waste generated at our stores for use equipment are mainly based on the installation of a For optimal climate control, the energy model includes as raw material in the manufacture of meat and bone We have installed specific containers at our points of

negative CO2 refrigeration unit and a positive R134, which the installation of a roof top system with acoustic insula- meal and animal oil, as well as animal feed. sale where customers can drop off used coffee pods. represent important energy savings and run on environ- tion specific to homes and a heat recovery system for the This is a reverse logistics process that includes sending mentally friendly gases. This installation also includes a sales room, in addition to acoustic screens for the cooling Inorganic waste the capsules collected from each store to the plant floating condensation system that reduces electricity chamber. Climate control is part of the management As producers of our own brand, we report the packaging, where the authorized PLS POOLING manager then consumption. system, which regulates temperature, humidity and air electrical devices, batteries, oils and light fittings of our collects them for treatment and recycling. The coffee quality through a remote system that monitors for incidents products each year to the collective systems of extended and biodegradable pods are converted into fertilizer The refrigeration equipment is made up of state-of-the-art that increase electricity consumption. The installation has producer responsibility, such as Ecoembes or Ecovidrio. for mushroom or fungus substrates and other compost, units with glass doors that prevent the store aisles from networks analyzers to control consumption integrated in its These entities guarantee the proper recovery and man- and the plastic and aluminium are recycled and melt- cooling and guarantee better conservation of the products own analysis programme, developed by the EROSKI energy agement of waste generated from the use of our prod- ed to generate new plastic and aluminium containers, by keeping them at the strict temperature they must be team. This system registers operational alarms when electri- ucts. Thanks to the recycling of the containers we report to respectively. In 2018, we collected more than four tons kept at. This also contributes to customer wellbeing in stores. cal consumption deviates from the expected amount. Ecoembes, we have avoided more than 1,178 tons of CO2 of coffee pods at the 15 pilot stores. equivalent emission in one year.

128 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 129 6. Environment Environment 6.

Consumers Inform Act

At EROSKI, we are aware that everyone can contribute to EROSKI CONSUMER environmental Get Active + Programme protecting the environment by choosing a sustainable channel We participated in the initiative “Get Active +" by the and responsible consumption model. We aim our efforts Provincial Council of Biscay, based on the international We have a specialized environmental channel at www. at informing consumers and increasing their knowledge programme Global Action Plan, which seeks to promote consumer.es to inform people about sustainable through awareness campaigns and pedagogical content citizen participation in favour of environmental sustainabil- consumption habits. We provide content on nature, urban published on our web platforms and other information ity through the development of good consumption habits. environments, natural parks, and energy and science, resources. In line with this objective, we also promote and Thus, we collaborated together with six other Basque among other topics. The channel receives more than carry out collaborative initiatives with clients, employees entities on the programme that has managed to involve 250,000 monthly visits. and institutions. 2,302 homes, 80 centres and 43,204 schoolchildren since 2012. Upon analyzing the effects of training, we have seen EROSKI Nutrition School average annual savings of 16% in energy consumption at We have a specific unit on sustainability in the Healthy participating schools. Raise awareness Eating and Habits Education Programme of the EROSKI Nutrition School, which the WWF also provides content for. Charity bag campaign with WWF “Earth Hour” Thanks to this unit, we educated 406,401 schoolchildren EROSKI and WWF collaborated on a charity campaign for For the eighth consecutive year EROSKI joined the "Earth about sustainability, sustainable food production and the conservation of forests and the recovery of degraded Hour" campaign promoted by WWF with the support of sustainable nutrition during the 2017/2018 school year. ecosystems. EROSKI donated the €22,500 raised through the United Nations. It is a symbolic blackout and part of Moreover, our website www.escueladealimentacion.es the sale of our charity bag to this nature conservation the largest global initiative to protect the environment. The includes content about how to prevent food waste. organization. This is the sixth year we have donated all the theme of 2018 was "Connect and turn off the light". profits from the sale of the €1 charity bag at our stores. “Give nature her colour back” Since its launch in 2013, the cooperative has sold more than 1 million charity bags and the profits obtained have “Step by step” environmental programme Through this initiative we encourage children to take care of the environment in our drawing contest "Give nature gone to numerous organizations such as the Red Cross, VEGALSA-EROSKI participated once again in 2018 in her colour back" at VEGALSA-EROSKI stores. The only Unicef, Oxfam Intermon and Save the Children, among "Camiño a Camiño", the environmental programme requirement was to for participants to let their imagina- others. by the Council of Vigo to promote activities to care for tion run wild and draw a form of ecological transport and improve our environment. In latest edition, the funds for the VEGALSA-EROSKI eco-patrole. Among the awards donated were allocated to alleviate the consequences of Animal conservation projects in two handed out were a bicycle and 10 tickets to the Mar- natural reserves in Álava the fires that devastated the region of Vigo. celle Natureza Zoo. With the proceeds from the sale in 2018 of reusable plastic jars as an alternative to glass, we donated €5,000 “A tree, a story” “Join in on responsible consumption. – which the Department of the Environment of the Álava At VEGALSA-EROSKI, we continue to promote the Reduce, reuse, recycle.” Forest Department matched with an additional €5,000 value of environmental sustainability among Galician In 2018, we collaborated with the HISPACOOP campaign – to a conservation project for the sand martin in two schoolchildren through our project “A tree, a story”. under the slogan “Join in on responsible consumption. reserve in Álava. Through this action, we are committed to With this initiative, we seek to share our commitment to Reduce, reuse, recycle”, which aims to inform, educate enjoying the holiday while still fulfilling our commitment the natural environment with our little ones through a and raise consumer awareness about the importance of to environmental sustainability and caring for our natural short story contest and by getting them involved in the responsible consumption, so that they reduce food waste, environment. reforestation work we perform each year in the vicinity reuse resources and recycle waste generated at home. of our establishments. In 2018, we replanted 30 species This campaign is part of the project "Management of of oak and chestnut trees in the vicinity of the EROSKI waste, food waste and responsible consumption" funded hypermarket in Noia. by the Spanish Agency for Consumption, Food Safety and Nutrition within the Ministry of Health, Social Services European Week for Waste Reduction and Equality. The initiative was carried out simultaneously in different EROSKI stores located in Cantabria, La Rioja, 2018 at CAPRABO Navarre and the Basque Country. At CAPRABO, we joined the 2018 European Week for Waste Reduction through different awareness actions to promote “Get involved in a sustainable Saint John” the reuse and recycling of clothing and shoes to minimize VEGALSA-EROSKI joined the campaign promoted by waste generated at dumps. the Department of the Environment of the A Coruña City Council "Get involved in a sustainable Saint John,” the objective of which was to reduce the generation of waste while celebrating this holiday. We contributed to this initiative by making a special paper bag with a design in tribute to Saint John that we gave to customers for free at checkout. A total of 27 establishments in the A Coruña met- ropolitan area participated in this measure, in which a total of 61,000 biodegradable paper bags were distributed.

130 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 131 Social action 7 Committed to our citizens 7. Social action Social action 7.

Our contribution to the community 413-1 Charity initiatives 413-1

Since the start, at EROSKI we have carried out diverse social actions to International cooperation effectively contribute to making a

more just and supportive society. t EROSKI, we believe that charity must cross borders Aand, therefore, our campaigns also focus on the urgent needs of those who are further away. e consider charity a fundamental principle under For the people that form part of EROSKI, it is a point of Wwhich we conduct our activity and, therefore, we pride to have had so many collaboration agreements dedicate 10% of EROSKI’S profits to the EROSKI Foundation with associations, NGOs and social entities over the to develop social activities. In this way, we support actions course of 2018, as well as to have carried out more than Toy collection Emergency either of our own initiative or through the establishment of 15 campaigns promoting consumer involvement. campaign with the campaign for the collaboration agreements with third parties for the social and cultural development of our environment. Moreover, Financial contributions in 2018 totalled €8,500,199 Red Cross tsunami in Indonesia at EROSKI we make financial donations to social purposes, distributed across the following fields of social action: reaching more than €8 million in 2018. For two days in December, our Thanks to the solidarity of EROSKI clients were able to participate in and its clients, we raised €30,000 in a campaign to collect non-warlike the emergency campaign for vic- and non-sexist toys. All the dona- tims of the tsunami in Indonesia in tions were destined to covering the October, organized in coordination needs of children of families at risk with UNICEF. The funds were allocat- of social and economic vulnerability ed to providing drinking water and that can not afford to purchase toys. sanitation to prevent epidemics Culture, International Other and provide adequate health and leisure and cooperation charity nutrition. local setting €283,668 campaigns €418,306 €253,586

Product delivery Cooperative Food charity Disabilities Support programme volunteer programme €6,507,679 and mental for families illness For yet another year, we have As part of EROSKI’S principles of €863,862 continued donating non-food cooperation and charity, we have €173,098 consumption items (toys, footwear, been collaborating for more than clothing, school supplies and a decade with MUNDUKIDE, an optical products, among others) to organization focused on the devel- children in Latin America through opment of vulnerable populations the Children of the World Federation, in the third world. We help dissemi- an organization that works for sus- nate information about its projects tainable human development and through our EROSKI CONSUMER international cooperation. In 2018, magazine and the website www. donations reached €169,200. consumer.es. We also participate in the “Cooperative volunteer pro- ONCE-Galicia We were given the ONCE-Galicia gramme for social transformation” 2018 Charity Award for the compa- Charity star that MUNDUKIDE carries out togeth- Charity Award for ny category in recognition of the er with the Lanki de Mondragon numerous projects and initiatives in For the fourth consecutive year, Unibertsitatea Research Centre and VEGALSA-EROSKI the field of social and environmental EROSKI held its “Charity star” Christ- the Landless Workers’ Movement commitment and the promotion of mas campaign. Thanks to EROSKI of Brazil. Four EROSKI employees healthy eating and living habits that and VEGALSA-EROSKI customers, have already volunteered, providing we have carried out in recent years. €63,000 were raised in 2018 from the knowledge about distribution and sales of the star. They were allocated marketing to promote the socioeco- to helping children through UNICEF nomic and cooperative develop- and the EROSKI Foundation, as this ment of the central region of the was the cause consumers voted for. state of Paraná.

134 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 135 7. Social action Social action 7.

Food charity Charity card “Zero waste” programme

n line with our objective to raise consumer awareness ince 2009, at EROSKI, Cáritas Bizkaia and Laboral Kutxa, t EROSKI, we continue in the fight against food waste awareness campaigns to inform and educate our cus- Iabout the urgency of overcoming issues related to Swe have given meal vouchers to people receiving Aby following an action protocol that guarantees the tomers in conjunction with the donations. To this end, we covering basic needs in our setting, we have organized assistance from Acogidas de Cáritas Bizkaia to be re- safety of food products and produce donations that, use EROSKI CONSUMER to share knowledge, resources campaigns that allow our customers to get involved in deemed at our establishments. In addition to providing when in perfect consumption conditions, we withdraw and practical tools to rationalize customer purchases, food charity actions. the necessary infrastructure for this charity initiative, the from our aisles to meet our commitment of maximum make the most of them and minimize food waste at home, EROSKI Foundation and Laboral Kutxa also financially con- freshness and good packaging appearance. We ensure with the subsequent savings that this entails for both soci- tribute to the resources Cáritas Bizkaia has for this project. that donations are kept in the cold chain at the entity ety and the families' economy. At VEGALSA-EROSKI, we also give meal vouchers to the receiving them and we maintain the same guarantees Charity campaigns with social emergency programme of the Xunta de Galicia. during their transportation and storage until the food is For the “Zero waste” programme, EROSKI collaborates with consumer involvement consumed. many social organizations, such as food banks, Caritas, With the aim of standardizing access to basic needs etc. In 2018, EROSKI and its clients donated more than with keys that do not just provide assistance but are also The allocation criteria and final delivery of these products 4,928 tons of food to the most disadvantaged groups. This integrating and form part of broader social inclusion to the recipient corresponds to more than 100 social enti- translates to 9,747 personal meals donated. processes for people in or at risk of exclusion, in 2018 we ties throughout Spain with which we have signed collabo- n 2018, we celebrated 22 years of collaboration with the consolidated the implementation of the rechargeable ration agreements. EROSKI S. Coop has been acknowledged with the Espiga ISpanish Food Banks Federation (FESBAL), to which we charity card. This card replaces paper vouchers and has de Oro Award, the highest award given by the Spanish donate food collected during two large charity campaigns allowed this food charity initiative to be extended to other The programme is also aimed at promoting responsible Federation of Food Banks to organizations that stand out organized each year at our stores: “Operation Kilo”, in June, regions such as Aragon, the Balearic Islands, Galicia and consumption, which is why we hold several consumer for their collaboration in redistributing food surpluses. and the “Big Food Collection”, in November. These foods the Basque Country. This system, which several associa- are go to individuals with financial difficulties and at risk of tions such as the Red Cross and municipalities such as social exclusion in each community. In 2018 we continued Vitoria or Zaragoza have already joined, makes the tool with the two existing modalities: the traditional physical even more dignified for these families, as well as more delivery of products and collection via vouchers, which al- modern and simple. lows food banks to receive the products they consider most necessary at any time. We also relaunched the “Zampakilos solidario” campaign at VEGALSA-EROSKI. 1,523 tons We joined the first Week Moreover, CAPRABO and the Red Cross worked together for of food donated against Food Waste Goal, #ZeroHunger the sixth consecutive year on the "No Child without Food!" during Operation Kilo campaign to help feed children, a charity initiative that rais- and the Big Food es funds to pay for food grants for children at risk of social +4,928 tons In 2018, we joined the first Week At EROSKI, we joined the #ZeroHu- exclusion. En 2018, they allocated 12 food grants. Collection of food donated Against Food Waste, an initiative nger campaign launched by the coordinated by the Association United Nations Organization for through the Zero of Large Consumer Companies Food and Agriculture, for World Food Waste programme (AECOC), held for the first time in Day on October 16. Spain, with the aim of raising aware- ness, encouraging and motivating This initiative falls under SDG no. 2 consumers to use tools within their and aims to make society aware reach to reduce the amount of food that a world with zero hunger is that is thrown away. We launched possible by 2030. But to achieve this, workshops, competitions and online we must all get involved, not just raffles at our stores and shared governments and the world’s large 9,747 personal good practices with the aim of rais- institutions. meals donated ing consumer awareness against food waste.

136 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 137 7. Social action Social action 7.

Collaborations with people with disabilities Skin cancer awareness campaign or illnesses

e work with the Spanish Association Against Cancer ware of the daily challenges people with disabili- social entities in the field of disabilities and various diseas- Wevery year to raise awareness about skin cancer. Aties or special needs must face, at EROSKI we work es. In 2018, we allocated more than €100,000 in financial During the campaign, our supermarkets hosted stands shoulder to shoulder with the organizations that repre- contributions to this type of action, which was distributed where advice was given on how to sunbathe carefully sent them and collaborate to improve their wellbeing across both national reference associations and others and the basic rules of how to check skin for potential and quality of life. focused on local groups. warning signs. We also offered informative talks to our CAPRABO employees. Sponsoring projects and initiatives in this area is also a fundamental part of our social action and is developed by signing numerous collaboration agreements with

Some of the associations we collaborate with:

ACAMBI - Asociación de Cáncer de Mama de Bilbao ADEMBI - Asociación de Esclerosis Múltiple de Bizkaia AECC - Asociación Española Contra el Cáncer AEFAT - Asociación Española Familia Ataxia Telangiectasia ALCER - Asociación para la Lucha Contra las Enfermedades Renales ANADI - Asociación Diabetes Navarra ASPANAFOHA - Asociación de Padres de Niños con Cáncer de Álava ASPANOGI - Asociación de Padres de Niños Oncológicos The Kosta Trail for diabetes and VEGALSA-EROSKI with de Gipuzkoa kidney disease rare and chronic diseases ASVIDIA - Asociación de Diabéticos de Bizkaia BENE - Asociación de Afectados y Familiares por Thanks to the participation of more than 4,600 people in We joined the campaign “This could be magic thanks to Enfermedades Neurológicas de Bizkaia the 13th edition of the Kosta Trail, FORUM SPORT, Salomon you", promoted by the Galician Federation of Rare and COCEMFE - Confederación Española de Personas con and Laboral Kutxa donated €14,400 to the Biscay Diabe- Chronic Diseases to help support the care needs of peo- Discapacidad Física y Orgánica tes Association and the Biscay Association for the Fight ple who suffer from this type of disease (and their families) EM Euskadi - Fundación Vasca de Esclerosis Múltiple against Kidney Diseases. The donation will go to helping in Galicia. Our customers were able to purchase a charity Eugenia Epalza those affected by diabetes to learn in a practical way sweet at 15 of our stores for the symbolic price of €1. EUSKAL GORRAK - Federación Vasca de Asociación de about the benefits and challenges of practising sports in VEGALSA-EROSKI contributed an additional 6% to the total Personas Sordas their daily management of the disease and to supporting amount raised, bringing the final figure to €1,900. FEDE - Federación Española de Diabetes patients suffering from kidney diseases. FEKOOR - Federación Coordinadora de Personas con Discapacidad Física y Orgánica de Bizkaia FEGEREC - Federación Gallega de Enfermedades Raras y Crónicas The WOP Foundation and EROSKI The fight against breast cancer FEM - Fundación Esclerosis Múltiple together to cure neurodegenera- ONCE EUSKADI EROSKI participated once again in 2018 in different wom- WOP – Walk On Project tive diseases en's races organized in Spain by the Spanish Association Against Cancer. Moreover, for the fourth year in a row, at Under the collaboration framework between EROSKI and VEGALSA-EROSKI we held the “Ready to win!” campaign The Walk On Project (WOP) Foundation, we organized a with the aim of raising funds for this association, and we series of activities for clients, who could increase the num- distributed information brochures about detecting breast ber of minutes spent researching a cure for neurodegen- cancer and habits to reduce the risk of developing it. erative diseases just by participating. More than 51,096 minutes were earned. Thanks to customers’ involvement, EROSKI was able to give the WOP Foundation a cheque for €30,658.

138 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 139 7. Social action Social action 7.

Other charity campaigns Promoting culture, leisure and local settings

ur campaigns go beyond food charity: they provide romoting EROSKI’S more local initiatives aims to favour Osupport to vulnerable groups and promote commit- Pthe welfare of people close to our business network ment to the environment through consumption habits and to emphasize local tradition and culture. that favour the preservation of natural resources.

Promotion and dissemination of local languages Sports material VEGALSA-EROSKI Emergency Campaign t EROSKI, we consider local languages an essential most important event on the calendar in this area. At the donations from charity recipe book for floods in Mallorca Apart of the cultural heritage of the communities in same time, we collaborate on the main holidays of the FORUM SPORT for the Red Cross our setting, which is why we work continuously to promote Basque language, such as Herri Urrats, Ibilaldia, Araba Eu- and disseminate them. skaraz, Kilometroak, Nafarroa Oinez and the Basque Public School holiday, in which 10,824 people participated in FORUM SPORT donated 179 pairs of Thanks to the sale of 15,000 copies The national charity campaign we The initiative we carried out with Elhuyar Fundazioa to the Nutrition School events that the EROSKI Foundation shoes to the Red Cross of Biscay to of a cookbook with healthy dishes organized after the terrible flood- develop a search engine in Basque stands out. This R&D organized during them. be distributed among users of their at affordable prices titled Let’s eat at ing that affected the Mallorcan project, which the University of the Basque Country also projects in a situation of vulnerabili- home today: healthy and affordable municipality of Sant Llorenç raised collaborates on, is focused on developing a much more We also value the culture and language of Galicia and ty. In 2018, we also donated 8,943 ki- recipes prepared by the best chefs €140,000 thanks to the solidarity advanced search engine in Basque than existing ones. By join all the initiatives closely linked to the Galician society. los of sports equipment to Koopera, in Galicia, €30,000 were raised for of EROSKI and its customers. The integrating it into our online platform, we have managed For example, as in previous years, in 2018 we continued valued at €22,219. This material was social inclusion projects of the Red money was channelled to the Sant to simplify and improve the possibility of browsing through supporting the celebration of Galician Literature Day. given to users of Cáritas, Koopera Cross in Galicia. Twenty Galician Llorenç authorities so it could be EROSKI CONSUMER magazine documents. It is also worth stores as second-hand objects or chefs participated in this collab- allocated in full to families affected mentioning our annual participation in major events in These actions are related to the continuous effort we treated as waste and sent to recy- oration initiative between the two by the floods. this language, with sponsorships linked to the Basque make for the EROSKI CONSUMER magazine to be avail- cling or energy recovery. entities, and it was carried out in Book and Disc Fair of Durango (Durangoko Azoka), the able in Spanish, Basque, Galician and Catalan. Autoservicios Familia, EROSKI Hyper- markets and EROSKI Supermarkets in Galicia.

Leisure and culture

ikewise, we work to bring culture to consumers through Support for families Lvarious sponsorships, such as the Musikaire cultural festival, which takes place each year in Elorrio, where our headquarters are located.

ROSKI has collaboration agreements with entities such that concern them most during pregnancy, delivery and On the other hand, well aware of the importance of sport Eas Fanoc and Familia XL, among others, to support throughout the first years of baby's life. This initiative is in today's society and in leading a healthy life, we also large families. Aware of the particular needs of this type of supported by organizations such as the Federation of support sports activities organized nearby. Moreover, in family, since 2012 CAPRABO has offered special advan- Midwifery Associations of Spain, the Spanish Association 2018 we contributed €224,000 through the CAPRABOSport tages through the gold customer status (and the My of Midwives and the paediatrician Dr. J. Mateu Sancho. A Programme, distributed among 118 amateur clubs with Club CAPRABO Gold Card) together with all its additional total of 120,505 people have already visited the website, the aim of promoting healthy habits, such as sports. benefits. Moreover, 5% of their purchases is transformed with more than 358,175 page views. into euros and added to the balance of their card. During In the Basque Country, we collaborated on popular 2018, a total of 13,292 large families benefited from At VEGALSA-EROSKI, we have also taken another step races such as Herri Krosa and Santurce rowing. Likewise, €804,694 in savings. in helping families since joining the "Tarxeta Benvida" at FORUM SPORT, as we have been doing annually, we Programme of the Government of Galicia in 2016. With organized the Kosta Trailen Bizkaia, a mountain race with a This initiative is in addition to the existing aid programme this programme, shoppers who show their card when charity facet that includes routes for the whole family and for families called "Welcome Baby". In 2018 we delivered checking out at our network of Familia, EROSKI/Center for people who love riding. 1,358,000 baskets, as well as discounts and promotions and EROSKI Hypermarkets receive a direct discount of on products designed for baby’s first year of life. The 2.5%. In 2018, €59,168 were transferred to families through programme is complemented by the online tool Welcome this initiative. Midwife, where parents can find answers to the issues

140 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 141 Transparency 8 Committed to clarity and truthfulness 8. Transparency Transparency 8.

Specific communication mechanisms and key matters 102-40; 102-42; 102-43; 102-44 Our stakeholders and concerns identified for each stakeholder group 102-44

Stakeholder Specific communication mechanisms Key matters and concerns Our activity generates impacts on different stakeholders and vice Clients and Client Customer service (at store, by phone and on website) Marketing and labelling Partners EROSKI Club magazine CAPRABO Sabor magazine Competitiveness in the market Occupa- versa. These people, groups, collec- Customer satisfaction studies tional health and safety Customer feedback programmes Anticorruption tives and organizations are very Internal stakeholders Promotional brochures Materials EROSKI Club app Effluents and waste important to us, since there exists Newsletters Food waste mutual interaction and cooperation Employment that we have strengthened and Consumers EROSKI Consumer magazine and www.consumer.es Marketing and labelling Occupational Consumer Employee Employees Nutrition school (www.escueladealimentacion.es) health and safety worked on over the years. Partners Partners (non-partners) Nutritional Survey of the Spanish Population (ENPE) Awareness Energy campaigns (health, charity and environment) Public institutions Local communities and organizations that safeguard the interests of consumers Customer safety herefore, understanding them and involving them in (Kontsumobide, Council of Consumers and Users, AECOSAN, etc.) Product traceability our activities and decisions is basic in developing our T Press notes and conferences Accessibility social responsibility and monitoring our impact. The cur- Market presence rent complexity and dynamism of the social and business context has made taking on a solid commitment to them Employees Publications: Nexo, Néctar, La Parrapla, intranets Occupational health and safety essential to understanding their expectations and chal- (Prisma, ForumNet), protocols, headquarters memos Customer safety lenges. Thus, in 2018 we have reviewed our stakeholders External stakeholders Evaluation interviews Employment Work culture surveys Work-life balance and updated our relationship with groups that: Audits (Code of Ethics) Anticorruption Whistleblower channel Effluents and waste • Have a direct or indirect impact on our organization Employee Shareholders’ bodies Economic management Clients and Consumers Suppliers partners Welcome manual Governance and ethical management • Are affected by our activities, services Client Employee mechanisms Restructuring the business network or products Partners Matters inherent to employees and consumers

• Are interested in our activity Franchises Financial Governments Consumer Shareholders’ bodies Matters inherent to consumers entities partners Newsletters and Consumer Partners We therefore differentiate between internal stakeholders, Client Partner and consumer mechanisms or rather, groups or people who are an integral part of the Suppliers Supplier service publications: Nexo Logística Anticorruption EROSKI Group, and external stakeholders, which ranges EROSKI Agreements with SMEs Regulatory compliance from our customers to governments and social entities. Investors Non-profit Media Cooperation agreements Customer safety sector Industry round tables Product traceability Promotional campaigns for local products Economic performance Audits (Quality control, etc.) Permanent and occasional forums

Financial Corporate Governance Report Anticorruption entities/ Annual accounts Regulatory compliance Investors Consolidated notes and press conferences Economic performance CNMV and EROSKI websites: Personal data protection Innovation

Franchises “With you in franchises programme Customer safety Direct communication with staff Accessibility from the Franchise Department of the Anticorruption General Network Director Regulatory compliance Occupational health and safety Acquisition practices

Governments Collaboration agreements Accessibility Meetings with public representatives Anticorruption Business and consumer cooperative associations Product traceability (ACES, ANGED, AECOC, etc.) Materials Unfair competition

Non-profit sector Meetings with representatives from different organizations Anticorruption and other social EROSKI FOUNDATION Scientific Committee Effluents and waste agents Universities: grants, scholarships Regulatory compliance NGOs: collaboration agreements, sponsorships, conferences, Emissions stands, etc. Food waste Customer safety

144 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 145 8. Transparency Transparency 8. Principles of

preparing the report 102-45; 102-46; 102-48; 103-1

t EROSKI, we work to improve and expand the perfor- reports and which we have supported for more than a de- The absence of environmental or social information for Of these companies, the following are owners of estab- Amance information we present to our stakeholders cade as a member of its GOLD Community. By applying some of these companies is due to the fact that they do lishments for the different businesses that we presented in each year as part of our commitment to transparency the criteria and principles of the GRI standards, we seek not have employees or direct activity with consumers, so Chapter 2 ("with you” business network and model): inside and outside the organization. Therefore, we have to ensure that the quality of the report and its content they do not generate any impacts on these non-financial prepared this report based on the standards of the Global are aligned with the expectations of our stakeholders, in aspects. Moreover, information is included about EROSKI Reporting Initiative (GRI), an independent institution addition to making it possible to compare the different Foundation actions regarding standard GRI-413 in local founded in 1997 and which serves as the most widely indicators to our results in coming years and reports pre- communities. used reference framework in the world for sustainability sented by other organizations.

HYPER­ SUPER­ GAS LEISURE TRAVEL ONLINE Scope of the report COMPANY MARKETS MARKETS STATIONS AND SPORT AGENCIES OPTICIANS STORES EROSKI, S.COOP. he companies for which data are reported in this they do not all have an impact on every non-financial CECOSA HIPERMERCADOS, S.L. report are affected by Act 11/2018 on Non-Financial aspect reported herein. The following table presents the EQUIPAMIENTO FAMILIAR Y T Information and Diversity. These are the 27 companies in- breakdown of companies in the consolidated financial SERVICIOS, S.A. cluded in the consolidated financial statements, although statements, grouping them by material aspects reported. CECOSA SUPERMERCADOS, S.L. GESTION DE HIPERMERCADOS

CAPRABO EISA, S.L.U. SUPERMERCADOS PICABO, S.L.U FORUM SPORT, S.A. VIAJES EROSKI, S.A. CAPRABO, S.A. FINANCIAL SOCIAL LABOUR VEGO SUPERMERCADOS, S.A. ASPECTS AND DATA ENVIRONMENTAL PRODUCT-CLIENT COMPANY PROTECTION ASPECTS ASPECTS EROSKI, S.COOP. CECOSA HIPERMERCADOS, S.L. EQUIPAMIENTO FAMILIAR Y SERVICIOS, S.A. CECOSA DIVERSIFICACIÓN, S.L. CECOSA SUPERMERCADOS, S.L. GRUPO EROSKI DISTRIBUCIÓN, S.A. GESTION DE HIPERMERCADOS CAPRABO EISA, S.L.U. SUPERMERCADOS PICABO, S.L.U PARQUE MARITIMO JINAMAR, S.L. FORUM SPORT, S.A. VIAJES EROSKI, S.A. CENTRAL DE SERVEIS CIENCIES, S.L. CAPRABO, S.A. SOCIEDAD FRANQUICIAS EROSKI CONTIGO, S.L. EROSKI HIPERMERCADOS, S.COOP. ALCAMUGA, S.A.U. CECOSA INSTITUCIONAL, S.L. CECOSA GESTIÓN, S.A. DESARROLLOS COMERCIALES DE OCIO E INMOBILIARIOS DE ORENSE, S.A. SOCIEDAD DE AFILIADOS EROSKI CONTIGO, S.L. JACTUS SPAIN, S.L. INMOBILIARIA RECARÉ, S.A.U. GESPA FORUM, S.C.P. APORTACIONES FINANCIERAS EROSKI, S.A. VEGONSA AGRUPACIÓN ALIMENTARIA, S.A. VEGO SUPERMERCADOS, S.A. MERCASH SAR, S.L.

146 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 147 8. Transparency Transparency 8. High Anticorruption Socio-economic Market presence and environmental Innovation compliance Materiality Analysis 102-49 Product traceability Marketing and labelling Personal data protection n 2018, at EROSKI, we updated and improved on the the environment or society. Those considered relevant are Materials Effluents and waste I2017 materiality analysis. This materiality analysis is con- reflected in the materiality matrix. ducted in order to determine which aspects are relevant Employment Occupational when reflecting the economic, environmental and social Thus, to identify potentially material issues, the following health and safety impacts of the organization, influencing the decisions of were taken into account: Medium the stakeholders, or generating an impact on the economy, Indirect economic impacts Economic performance Acquisition Energy Accessibility practices Training and education Diversity and equal Customer Bibliographic sources,among Market information, mainly from Internal and external information opportunities safety which the following stand out: GRI publications by companies in the concerning the organization and Standards and sectoral supple- sector and/or the EROSKI supply its stakeholders, as a result of focus Non-discrimination ments, Governance & Accountabil- chain. groups and surveys conducted with

ity, Principles of the United Nations the staff, consumers, partners, sup- Low Global Compact, in addition to Act pliers, the non-profit sector, public Market competitiveness 11/2018 on Non-Financial Informa- administrations, financial services tion and Diversity. and investors and the media. Public policy Unfair competition

Emissions Social and Local communities* environmental Food waste evaluation of suppliers Biodiversity Consumer education Human rights Water assessment Below, we have chosen some of the relevant aspects for EROSKI and our stakeholders. In 2018, we conducted Atmospheric pollution Employee-company relations Customer internal (relevant to EROSKI) and external (relevant to Client management health stakeholders) analyses to understand the degree of im- portance of the topics identified. Freedom of association and collective bargaining For the most part, the consultation method used was an Social inclusion and placement online survey for stakeholders (external perspective) and Work-life balance for people with responsibilities in the decision-making process at EROSKI (internal perspective). These groups include the Board of Directors, staff, franchises, Client Part- ners, consumer partners, NGOs, suppliers, public adminis- Low Medium High tration, financial services and media. This process involved direct consultation, as well as extending the scope of consultation to a greater number of people. We believe the results obtained thus allow a better response to the Environmental management The material topics are those included in the shaded expectations of the different stakeholders. Responsible commitments, policies and management areas as well as those marked by an * due to their relationship and importance in EROSKI’s activity. Subsequently, responses were weighed according to the Employment and labour relations importance of each stakeholder group for EROSKI and Customers, consumers and product responsibility reviewed and validated to ensure that the materiality reflects the performance of the organization in a reason- able and balanced manner in terms of sustainability, both Financial aspects Environmental Aspects Social/labour/product-client aspects for its positive and negative impacts. Economic performance Materials Employment Market presence Effluents and waste Occupational health and safety Last, the materiality matrix was created, thus identifying Anticorruption Energy Diversity and equal opportunities material aspects for the organization. Innovation Emissions Non-discrimination Socio-economic and Food waste Marketing and labelling environmental compliance Accessibility Acquisition practices Customer safety Social and environmental evalua- Customer health tion of suppliers Personal data protection Human rights assessment Product traceability Local communities

148 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 149 8. Transparency Transparency 8.

List of materials aspects and coverage thereof 102-46; 103-1

Material Location of impact EROSKI’s Reason for its materiality Material Location of impact EROSKI’s Reason for its materiality aspect involvement aspect involvement

Economic Inside and outside Direct and indirect The organization’s economic management has a big Employment Inside and outside Direct Employment stability and quality are essential in an organi- performance the organization impact on the entity’s various stakeholders. It affects the (GRI 401) the organization zation such as EROSKI, in which there are more than 30,000 (GRI 201) number of jobs generated, the purchase of products and direct employees, many of whom are also owners of the services, the business network, the business strategy, debt cooperative. management and the distribution of profits, among other Occupational Inside Direct Employees represent one of our priority stakeholders; aspects. health and the organization therefore, promoting their health and safety and preventing Market presence Outside Direct and indirect An organization such as ERSOKI, which seeks to promote safety occupational risks is a fundamental aspect of the organi- (GRI 202) the organization the development of the setting in which it operates, must (GRI 403) zation. have a hiring and salary policy that promotes local devel- Diversity and Inside and outside Direct Establishing non-discrimination policies and promoting an opment. equal opportuni- the organization inclusive work environment based on diversity, multicultural- Acquisition Outside Direct The volume of purchases and the number of suppliers we ties Non-discrim- ism and equal opportunities between women and men. practices the organization have might potentially represent a significant impact on the ination (GRI 204) development of local suppliers in the setting in which we (GRI 405-406) operate. Human rights Inside and outside Direct Applying human rights criteria in operations and significant Anticorruption Inside and outside Direct Ethical and responsible business behaviour is a priority for assessment the organization investment agreements and contracts and training staff in (GRI 205) the organization our stakeholders: we take measures to fight against corrup- (GRI 412) human rights policies and procedures. tion and bribery. Local Outside Direct Actively participating in society through social action Innovation Inside and outside the Direct Innovation in the design and improvement of products and communities the organization programmes that contribute to the economic and social organization services allows us to continue increasing the safety and (GRI 413) development of the communities where we operate. quality of our offer. Customer safety Inside and outside Direct and indirect As a food distribution company, ensuring the quality and Materials Inside and outside the Direct and indirect The manufacture, use and disposal of containers and pack- (GRI 416) the organization safety of all products together with our suppliers is critical (GRI 301) organization aging can have a significant impact on the environment. for the organization. Therefore, optimizing the consumption of materials and Customer health Inside and outside Direct and indirect Offering healthier products adapted to special diets is key using more sustainable ones and in smaller quantities is the organization in responding to the needs of our customers. The high rates fundamental to our customers and society in general. of obesity and excess weight in Spain mean that access to Energy Outside Direct and indirect Promoting energy efficiency and using renewable energy healthier and more balanced products is a priority for soci- (GRI 302) the organization is a priority to our reduce environmental impact and avoid ety. Moreover, the increase in food allergies and the needs the use of fossil fuels. of groups such as coeliacs requires that our stores have suitable food to meet their needs. Emissions Outside Direct and indirect The impact of greenhouse gas emissions on human health (GRI 305) the organization and the climate is one of the major environmental issues of Marketing and Inside and outside Direct and indirect Labelling products with information about their charac- today and is highly relevant to our different stakeholders. labelling the organization teristics (ingredients and nutritional content, consumption (GRI 417) safety, container recyclability, etc.) is key to the health of Effluents and Outside Direct and indirect Reduction of waste and dumping generated is vital to con- our customers and the environment and is part of EROSKI’s waste the organization serving the environment. Therefore, minimizing the ecolog- commitment to transparency. (GRI 306-1, ical impact thereof through reuse, recycling or other uses Applying ethical criteria and responsibility in marketing 306-2) (circular economy) must be an objective of all of society. communication, differential attention and individualized Food waste Inside and outside Direct and indirect Developing initiatives and actions to prevent and avoid marketing is highly relevant to our customers. (GRI 306) the organization food waste is an especially important aspect in the food Personal data Inside and outside Direct Guaranteed personal data protection is not just a legal sector. On the one hand, reducing waste lowers inefficient protection (GRI the organization obligation but also a demand of our clients and an EROSKI or unnecessary food production and, on the other hand, 418) commitment. has a positive social impact through distribution of those foods to people at risk of exclusion. Product Inside and outside Direct Ensuring the traceability of the supply chain across all traceability the organization processes and levels is vital to preventing and monitoring Socioeconomic Inside and outside Direct Legal compliance in socioeconomic and environmental (GRI 416) any negative impacts, thus reducing risks in areas such as and environmen- the organization matters is necessary to guarantee we do not generate health or the environment. tal compliance negative impacts related to sustainability. Non-compliance (GRI 307 and can also entail economic and administrative sanctions, as Accessibility Outside Direct Providing universal access to our centres and facilities 419) well as a risk to our reputation. the organization for people with disabilities is fundamental to many of our clients. Environmental Outside Direct and indirect Responsible management of the supply chain, including assessment of the organization social, environmental and ethical criteria, promotes the suppliers implementation of liability policies, not only in our entity but Social throughout the value chain. assessment of suppliers (GRI 308-414)

150 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 151 8. Transparency Transparency 8.

Additional information about the calcula- tion of the indicators presented in this report 102-46; 103-1

Indicator Scope Calculation method/comments Indicator Scope Calculation method/comments

Data regarding EROSKI Group The total number of direct employees and employee partners is an Energy intensity (GRI EROSKI Group Indicators used to calculate relative energy consumption in the organiza- direct employees average of the data recorded during the last month of the 2018 financial 302-3) tion: (GRI 102-8, 405-1) year (January 2019). • Commercial surface area: 1,298,274 m2 (as of 31 January 2019) • Net sales: €4.698 billion. The percentages of type of contract, working day, age, gender and pro- Reduction of energy EROSKI Group 2017 was selected as the reference year to present reductions in fuel con- fessional category correspond to data as of January 31, 2019 (end of year consumption sumption in transport and energy, as that was when we published our first financial year). These percentages were applied to the total number of (GRI 302-4) GRI sustainability report. employees reported (30,048). Water extraction by EROSKI Group Consumption for the 2018 fiscal year was calculated based on recorded Turnover numbers and rates correspond to employees who left the organi- source drinking water expenses. The average price of water applied as a conver- zation voluntarily, were dismissed, retired or passed away. (GRI 303-1) sion factor was €2.87/m3, which was calculated based on the prices of a sample of invoices from different companies or businesses with water Data regarding EROSKI Group Data are reported from EROSKI S. Coop. and the other Group companies, consumption. There is no record of all the sources from which the different remuneration separated by remuneration differences. The data provided correspond to municipalities that supply EROSKI extract water. (GRI 102-34, 102-35, the 2018 calendar year. We used gross expected consumption data for 102-36, 102-37, 102-38, EROSKI S. Coop and gross yearly remuneration data for other companies. Biodiversity EROSKI Group Information source: Ministry for Ecological Transition. Franchised stores were 102-39, 202-1, 405-2) Gross expected consumption is the sum of net remuneration and Personal (GRI 304-1) not taken into account. Income Tax withholdings (not including Social Security contributions). Water dumped EROSKI Group An estimated 99% of the water dumped corresponds to drinking water Data on the evolution of the Cooperative can be extracted from reports consumed. from previous years. Regarding the Group, we have not analyzed such Waste discarded by EROSKI Group Data on batteries, light bulbs and electrical and electronic devices corre- records. As we began working with these data in 2018, from next year clients spond to the 2018 calendar year. onward we will begin to see the evolution.

Direct GHG emissions EROSKI Group • Characterization factors for global warming potential (kg CO2eq/kg CO2,

The data used in comparisons with the IBEX 35 companies were taken (scope 1) (GRI 305-1) kg CO2eq/kg CH4, kg CO2eq/kg N2O, HFC emitted): from Report: Evolution good governance indicators in IBEX 35 companies during - GWP100 of the IPCC 2013 (Source: CML - (Institute of Environmental Sci- 2017. Fundación 1.o de Mayo; January 2019. ences, University of Leiden), August 2016). - For refrigerant mixtures, the corresponding characterization factor was Data regarding acci- EROSKI Group Data corresponding to the 2018 calendar year. calculated taking into account its composition (% of each HFC) and the dents and occupa- CML GWP100-IPCC 2013 emission factors (August 2016). tional risk prevention • CO2 emission factors for natural gas and diesel in transportation (Source: training (GRI 403-2, Emission factors. Record of carbon footprint, compensation and carbon diox- 404-1) ide absorption projects 2018. MAPAMA; 2019): - 0.203 kg CO /kWh net calorific value. Reused logistics con- EROSKI Group Data for pallets and plastic boxes used during the 2018 financial year at 2 tainers (GRI 301-3) (food area) EROSKI, CAPRABO and VEGALSA platforms. - 0.901 kWh PC net/kWh higher calorific power.

• The CH4 and N2O emission factors for natural gas correspond to the 2006 Energy consumption EROSKI Group There are no data on electricity consumption broken down according to IPCC Guidelines for national greenhouse gas inventories (Stationary inside the organization use. Conversion factors used in the calculation: combustion. Table 2.4). (GRI 302-1) • Conversion of kilowatt-hour to megajoule: 1 kWh = 3.6 MJ. • Consolidation approach for emissions: operating control. • Fuel consumption in transport operations (source: EROSKI’s own esti- Indirect GHG emissions EROSKI Group • CO emission factor according to the national mix (source: Agreement mates according to fleet). 2 • Conversion of litres of diesel to gigajoules (source: Emission factors. from power generation on results. The electricity source guarantee and labelling system related (scope 2) (GRI 305-2) to the energy generated in 2018. CNMC; 2019): - 0.41 kg CO eq/kWh Record of carbon footprint, compensation and carbon dioxide absorption 2 • CO emission factor based on mix of businesses (Source: calculated projects. MAPAMA; 2018): 2 - Density of diesel: 832.5 kg/m based on the percentage consumed by EROSKI in each business and - Calorific value of diesel: 343 GJ/t the environmental impact factors of the CNMC in 2018 for each busi- ness): Energy consumption EROSKI Group Conversion factor used in calculations: - 0.28 kg CO2/kWh. outside the organiza- • Average diesel consumption on work trips by road: 5.68 l/km. (Source: • Consolidation approach for emissions: operating control. tion (GRI 302-2) Average consumption of type M1 vehicles in 100 km, available in the IDAE database).

152 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 153 8. Transparency Transparency 8. Formal complaint and claim mechanisms

Indicator Scope Calculation method/comments here are different channels through which complaints or claims can be sent to EROSKI in relation to the three Other indirect EROSKI Group • CO emission factor for diesel in transport (Source: Standard EN 16258 as T 2 dimensions of sustainability. GHG emissions set out in the Guide on calculating the carbon footprint of freight forwarding Specifically: (scope 3) 2017. AECOC; 2018): (GRI 305-3) - 3.24 kg CO eq/l of diesel (cradle to grave) In the "from the well to the 2 Customer claims, complaints tank” factor, 2.67 kg CO2/l of diesel is subtracted from direct emission.

• CO2 emission factor for trips by plane: estimated based on the 2017 emissions calculated with the ICAO calculator. and suggestions 3 • For CO2 emissions from water consumption, the 0.298 kg CO2/m , factor was used, which comes from the Tap Water process life cycle analysis ustomers may contact EROSKI customer service at a telephone number (946 211 234), an e-mail address {Europe without Switzerland}| tap water production, conventional treat- C944 943 444, from Monday to Saturday from 9 am to ([email protected]) and a form that can be ment from the Ecoinvent database at SIMAPRO. 10 pm or fill out the form available at www.eroski.es/con- delivered physically. • For CO emissions from paper consumption, the following factors were 2 tacto. Should they wish to contact CAPRABO, they may do used, according to the processes indicated in the Ecoinvent database in so at 932 616 060 during this same timetable, or visit the The head of the Compliance Office reports the com- SIMAPRO: website: plaints received through the whistleblower channel and - Office paper material: 1.095 kg CO eq/kg (Paper, woodfree, uncoated 2 www.miclubCAPRABO.com/atencion-cliente the Social Department to the Auditand Compliance Com- {RER} | market for | Cut-off, S) mittee of the Governing Council. The Audit Committee - Advertising brochures: Lightweight coated paper and glossy paper: FORUM SPORT has a phone number available during the supervises the procedures established for receiving con- 1.108 kg CO eq/kg (Paper, woodfree, coated {RER}| market for | Cut- 2 same hours, 944 286 618, as well as the following email sultations and notifications and validates the response off, S) Offset recycled paper: 1.157 kg CO eq/kg (Adaptation of Paper, 2 address: [email protected]. Complaints/claims provided. We also have a specific protocol to handle woodfree, uncoated {RER}| paper production, woodfree, uncoated, can be registered through any of these channels and are cases of sexual and gender-based harassment at the at non-integrated mill | Cut-off, U) Printing paper: 0.788 kg CO eq/kg 2 managed with by corresponding supervisors within the workplace. It is initiated by a request for intervention by (Adaptation of Sulfate pulp {RER}| production, elementary chlorine free organization to offer a solution/compensation as quickly the alleged victim through their boss, the regional head of bleached | Cut-off) as possible. human resources, or a member of the Social Council. An - Magazines: 2.328 kg CO eq/kg (Printed paper, offset {CH}| offset print- 2 instructing commission is established to open the corre- ing, per kg printed paper | Cut-off, U) sponding confidential investigation file. Once finalized, the GHG emissions See scope of direct Indicators used to calculate relative energy consumption in the organiza- Complaints related to instructing commission issues a report with conclusions, intensity and indirect GHG tion: which is sent to the Department of Human Resource so (GRI 305-4) emissions (scopes • Commercial surface area: 1,298,274 m2 (as of 31 January 2019) contractual or legal that the proposed measures may be taken. 1, 2 and 3) • Net sales: €4.698 billion. compliance Waste EROSKI Group The waste generated by EROSKI presented in this report is treated by spe- (GRI 306-1, 306-2) cialized managers, selected based on the criterion that they be recycled otifications or requests related to regulatory or Supplier service and recovered in most cases. Ncontractual breaches are sent to the corresponding There is no information available on solid urban waste collected by munic- centre or area or directly to the EROSKI Legal Department. upplier Service provides support in accounting and ipal services. In the latter case, depending on the subject matter, the Sfinancial matters. It informs users about the status CAPRABO manages, in general, its organic waste through municipal waste Legal Department forwards the document to the corre- of invoices, due dates, payments or charges issued by services, except at its stores in Navarre, where it has a reverse logistics sponding management area to obtain a response. On EROSKI. Should suppliers use this channel to communicate service. The data corresponding to Navarre are also included in the data this basis, the Legal Department draws up the response concerns or problems related to other issues, they are provided in this report. according to Administrative Procedure Law. Moreover, any redirected to the corresponding persons or departments. actions aimed at correcting the breach reported in the Food donated through EROSKI Group The data correspond to the 2018 calendar year. A conversion rate of €1 = 1 This service is also available for concerns from business claim are implemented, where applicable. the “Zero waste” kg was used for calculating tons. managers handling an incident with a supplier or who programme require information about the status of an account.

EROSKI CONSUMER Full magazine An average of 2.5 readers per magazine was estimated, with a monthly Suppliers can contact the service either by phone (from magazine readers circulation circulation of 111,680 copies. Customer claims, 8:30 am to 1:30 pm and from 3:00 pm to 4:00 pm) or by e-mail. The e-mail inbox is reviewed and managed within complaints and two days maximum, depending on the time of year (just suggestions before payments, for example). Suppliers can also join the website available to them for free where they can access the status of invoices, charges, etc. To assess the or complaints or claims related to administrative or effectiveness of the service, we generate statistics on the Fjob matters, you can contact the Social Department number of calls received per period and time slot, calls through the regional head of human resources or by answered, unanswered and received in time slots without contacting the person responsible for staff management. service. Moreover, the number of e-mails received and the For complaints related to breaches of the Cooperative date thereof is monitored so as not to incur delays with Code of Conduct or the Criminal Risks Plan we have suppliers.

154 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 155 Transparency 8.

GRI content index (102-55) Material topic

Universal standards GRI 102: General content

GRI Content Page Direct response/Omissions Standard

1. Profile of the organization

102-1 Name of the organization 10 Activities, brands, 102-2 10, 11, 34 products and services 102-3 Location of headquarters Barrio San Agustín, s/n. 48230. Elorrio, Biscay 102-4 Location of operations 34, 186 102-5 Ownership and legal form 10 102-6 Markets served 11 102-7 Size of the organisation 10, 24, 35 67, 152, Information about employees 102-8 182, and other workers 188- 190 102-9 Supply chain 97, 194 2017 Data: From EROSKI: EROSKI franchises: Significant changes to the 1 Hypermarket 1 Hypermarket 102-10 organization and its supply 37, 97 4 Supermarkets 46 Supermarkets chain 1 Gas station 1 Travel agency 7 Sports equipment stores Precautionary principle 47, 48, 102-11 or approach 111 102-12 External initiatives 28 102-13 Membership of associations 22 2. Strategy Statements from senior executives 102-14 4 responsible for decision-making Key impacts, risk Confidential information. The map of risks and impacts has 102-15 and opportunities been reviewed throughout 2018. 3. Ethics Values, principles, standards 12, 182, 102-16 and code of conduct 184 4. Governance 102-18 Governance structure 14-17 102-19 Delegation of authority 14 Executive responsibility for econom- 102-20 14 ic, environmental and social issues Consultation with stakeholders 102-21 about economic, environmental 41,184 and social issues Composition of the highest 14-17, 102-22 governing body and its committees 184 Chairperson of the highest 102-23 14, 184 governing body Appointment and selection 102-24 14 of the highest governing body

EROSKI | ANNUAL REPORT 2018 | 157 8. Transparency Transparency 8. Material topic

GRI GRI Content Page Direct response/Omissions Content Page Direct response/Omissions Standard Standard 102-25 Conflict of interest 21, 184 To facilitate comparison with previous years, the 2017 data Duties of highest governing body published in the previous report for the following issues 102-26 in selecting objectives, values and 14, 15 have been modified: strategy • energy consumption (diesel) in transport and the corre- sponding GHG emissions since we were able to expand Collective knowledge of the 102-27 14, 183 102-48 Restatements of information 146 the scope to include VEGALSA-EROSKI gas stations. highest governing body • Refrigerant consumption and the corresponding GHG Performance evaluation 102-28 14-17 emissions since we were able to expand the scope to of the highest governing body include platforms, CAPRABO and VEGALSA. Identifying and managing • Total emissions of scope 3 to also include emissions for 102-29 economic, environmental and 14, 184 water and paper consumption. social impacts On economic issues, new material topics are included: Efficacy of risk Market presence (derived in part from the previous mate- 102-30 19 management processes rial topics of competitive and sustainable prices), Acquisi- tion practices (called “local purchase” last years), Social Review of economic, environmental 102-31 18 and environmental assessment of suppliers and assess- and social issues ment of human rights. Indirect economic material impacts This report containing non-financial information has been are no longer included. approved by the Governing Council while preparing the Role of the highest governing body In environmental topics, “Materials” is included as a new 102-32 annual accounts and by the General Assembly of EROSKI. Changes in reporting 148 in preparing sustainability reports 102-49 material issue (in 2017 it was called packaging and The VEGALSA Board of Directors has also approved the ecodesign of products and packaging) and “Biodiversity” annual accounts with non-financial information. is no longer included. Communication of critical As for social issues, Accessibility, Personal Data Protection 102-33 14-17 concerns (included under “Customer management” in 2017) and Confidential information. Critical concerns reported to product traceability have become material issues; “Health- Nature and number of all the Governing Council are recorded in the minutes of the ier products” from 2017 are included in “Customer health”; 102-34 critical concerns corresponding sessions and are not published outside the and “Consumer Training” and “Products adapted to special organization. diets” are no longer material issues. 102-35 Remuneration policies 74, 152 102-50 Reporting period 2018 Financial Year: February 1, 2018 to January 31, 2019 Process for determining 102-51 Date of most recent report June 28, 2018, corresponding to the 2017 financial year 102-36 74, 152 remuneration 102-52 Reporting cycle Annual Involvement of stakeholders 74, 152, Contact for questions regarding 102-37 102-53 [email protected] in remuneration 184 the report 102-38 Total annual compensation ratio 74, 152 Declaration of reporting This report was prepared in accordance with the GRI stan- 102-54 Ratio of the percentage increase in accordance with GRI Standards dards: Essential option 102-39 74, 152 of total annual compensation 102-55 GRI content index 157 5. Stakeholder engagement 102-56 External verification 102, 104 102-40 List of stakeholders 144 Collective bargaining 67, 182, 102-41 Standards topics agreements 183 GRI 200: Economic issues Stakeholder identification 102-42 144 and selection GRI 201: Economic performance Approach to stakeholder Explanation of the material topic 146,150- 102-43 144-145 103-1 engagement and its boundary 152 Key topics and Management approach and its 102-44 144-145 103-2 24-25,146 concerns raised components Assessment of the management 6. Reporting practices 103-3 24-25 approach Entities included in consolidated 102-45 146 Direct economic value generated 24-25, 83, The EROSKI Group consolidated financial statements are financial statements 201-1 and distributed 184 available at www.cnmv.es. Defining report content and topic 146, 150, 102-46 boundaries 152 Some EROSKI S. Coop employee partners make contribu- tions to a Lagun Aro social pension plan according to their 102-47 List of material topics 148-151 Defined benefit plan obligations anticipated gross consumption. The amount contributed 201-3 and other retirement plans is variable. Moreover, CECOSA and PICABO Supermarket employees contribute €300,000 annually to established contribution plans.

158 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 159 8. Transparency Transparency 8. Material topic Material topic

GRI GRI Content Page Direct response/Omissions Content Page Direct response/Omissions Standard Standard Financial assistance received All EROSKI Group operations were analyzed when pre- 201-4 24-25 from the government paring the Criminal Risk Prevention Plan, except VEGALSA, GRI 202: Market presence which has its own plan, and FORUM SPORT and Viajes EROSKI, which will be included in 2019. Explanation of the material topic 103-1 150-151 The corruption risks identified are related to the selection and its boundary and hiring processes of suppliers, contractors, commercial Operations assessed for Management approach and its 205-1 partners and external collaborators; business relationships 103-2 74-75 risks related to corruption components involving suppliers and competitors in defence of free Assessment of the management competition in markets where the EROSKI Group is present; 103-3 74-75 approach the delivery, receipt or promise of payments, gifts or undue attention to any public or private person or entity with the EROSKI S.Coop.: There is a 53% difference between the intention of obtaining or maintaining business or other interprofessional minimum salary in 2018 (€13,303) and benefits or advantages. comparable anticipated consumption with the least paid Ratio of standard entry level wage 74-75, 202-1 employment market of the cooperative (€15,769). In 2018, all EROSKI Group staff were informed about the to local minimum wage 152 Communicating and training Other companies: There is a 30% difference between Criminal Risks Prevention Plan, the whistleblower channel 205-2 about anticorruption policies the basic salary of the EROSKI supermarkets agreement and the existence of the Supervisory and Compliance and procedures (€13,414) and the minimum interprofessional salary. Body. Specific training will be provided in 2019. Information not available. The place of residence of Confirmed incidents of corruption 205-3 In 2018, there were no confirmed cases of corruption. Percentage of senior executives employees before being hired by EROSKI is not recorded; and actions taken 202-2 hired from the local community we only record the place of residence throughout the GRI 300 Environmental topics duration of the contract. GRI 301: Materials GRI 203: Indirect economic impacts Explanation of the material topic Management approach and its 103-1 150-151 103-2 24-25 and its boundary components Management approach and its Infrastructure investments 103-2 110-112 203-1 24-25 components and services Assessment of the management Significant indirect economic 103-3 110-112 203-2 24-25 approach impacts Data on packaging materials and products included in GRI 204: Acquisition practices the report correspond exclusively to the materials reported Explanation of the material topic to Collective Systems of Extended Producer Responsibility 103-1 150-151 and its boundary (ECOEMBES, ECOTIC, ECOPILAS, SIGAUS and AMBILAMP). 112, 115, Materials used by There is no centralized information on the quantity and Management approach and its 301-1 183-184, 103-2 97-98 weight or volume type of materials used in the more than 107,000 different components 195-196 articles marketed (including manufacturer's brands). How- Assessment of the management 103-3 97-98 ever, we are working to collect data on EROSKI brand approach packaging materials in our systems and At EROSKI, we consider local suppliers those who have an to provide such information in future reports. address in the region in question and provided referenc- Some of the packaging for EROSKI brand products contain es of regional or local products in 2018. These references Proportion of spending recycled materials (meat and fish trays, egg cartons, etc.) 204-1 97, 103 include those marketed only in that region (local con- on local suppliers However, there is no centralized information available on sumption). Locations with significant operations are those the quantity and type of materials used in the more than 301-2 Recycled input in which there are EROSKI Group stores. That is, where we 107,000 different articles marketed (including manufac- carry out our business activity. turer's brands). We are working to collect details of EROSKI GRI 205: Anticorruption brand packaging materials in our systems and to provide Explanation of the material topic such information in future reports. 103-1 150-151 and its boundary Reclaimed products 112, 152, 301-3 The Criminal Risk Prevention Plan includes the entire EROSKI and packaging materials 183,196 Management approach and its 103-2 18 Group, excluding VEGALSA, which has its own, and FORUM GRI 302: Energy components SPORT and Viajes EROSKI, which will be included in 2019. Explanation of the material topic 103-1 150-151 Assessment of the management and its boundary 103-3 18 approach Management approach and its 103-2 110-112 components Evaluation of management 103-3 110-112 approach 113, 152, Energy consumption inside 302-1 183,184, the organization 196 Energy consumption outside 113,152, 302-2 the organization 183-184

160 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 161 8. Transparency Transparency 8. Material topic Material topic

GRI GRI Content Page Direct response/Omissions Content Page Direct response/Omissions Standard Standard 113, 153, GRI 306: Effluents and waste 302-3 Energy intensity 183, 197 Explanation of the material topic 103-1 150-151 Reduction of energy 113, 152, and its boundary 302-4 consumption 183-184 Management approach and its 103-2 111-115 GRI 303: Water components Management approach and its Assessment of the management 103-2 110-112 103-3 111-115 components approach 110-112, 115, 150, 303-1 Water extraction by source Total water discharge by quality 198 306-1 154, 183, and destination Water sources significantly There is no record of any source significantly affected by 184 303-2 affected by water extraction water extraction for EROSKI’S consumption. 114, 150, The used oil collected from customers corresponds only to Waste by type and disposal 154, 183, 303-3 Recycled and reused water Water is not recycled or reused in the organization. 306-2 VEGALSA-EROSKI. Coffee pods correspond to the 15 pilot method 184, 197, GRI 304: Biodiversity stores in the Basque Country and the Balearic Islands. 198 111, 115, Management approach and its 115,183- 103-2 116, 121- 306-3 Significant spills There were no significant spills in 2018. components 184 122 The transport and handling of hazardous waste is carried Operational sites owned, Transport of 306-4 183-184 out by authorized managers. EROSKI does not import or leased, managed in or hazardous waste export hazardous waste directly overseas 304-1 adjacent to protected areas and 116, 183 There is no record of discharges that represent 5% or more areas with high biodiversity value Water bodies affected by water 306-5 183-184 of the annual average volume of the body of water or outside protected areas discharges and/or run-off correspond to specially sensitive or protected areas. Significant impacts of activities, This information is not available beyond 304-2 products and services on GRI 307: Environmental compliance the products with an environmental sustainability seal. biodiversity Explanation of the material topic 103-1 150-151 No habitat has been restored or protected in and its boundary 304-3 Protected or restored habitats relation to our activity. Management approach and its 103-2 111-112 IUCN Red List species and national components Work is being done to provide information on this indicator 304-4 conservation list species with habi- Assessment of the management in future reports. 103-3 111-112 tats in areas affected by operations approach GRI 305: Emissions There are no records of fines or significant non-financial sanctions for non-compliance with environmental laws or Explanation of the material topic Non-compliance with environmental 103-1 150-151 307-1 regulations in 2018. Sanctions are considered significant and its boundary lawsand regulations when qualified as "very serious" by the Administration that Management approach and its 103-2 111-115 issues them. components GRI 308: Supplier environmental assessment Assessment of the management 103-3 111-115 Explanation of the material topic approach 103-1 150-151 and its boundary 115, 117, Direct GHG emissions 305-1 153, 183- Management approach and its (scope 1) 103-2 94-95 184, 199 components 117, 153, Assessment of the management 94-95, Indirect GHG emissions 103-3 305-2 183-184, approach 122 from power generation (scope 2) 199 New suppliers that There are 86 suppliers of EROSKI Natur and ecological Other indirect GHG emissions 111-113, have passed evaluation products that had to meet environmental criteria 305-3 308-1 120 (scope 3) 199 and selection filters according to when being selected. They represent 4% of all business environmental criteria suppliers. 111-113, 305-4 GHG emissions intensity 200 GRI 400: Social topics 117, 154, GRI 401: Employment 305-5 Reduction of GHG emissions 183-184, Explanation of the material topic 103-1 150-151 200 and its boundary Emission of ozone-depleting 117, 183- The organization of working hours varies according to the 305-6 substances (ODS) 184 activity and its location (headquarters, shop, platform, etc.). In any case, it is Management approach and its 103-2 64-66 stipulated in the corresponding regulations (Workers' components Statute, Collective Agreement, Internal Regime Regulations of EROSKI S.Coop.).

162 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 163 8. Transparency Transparency 8. Material topic Material topic

GRI GRI Content Page Direct response/Omissions Content Page Direct response/Omissions Standard Standard Assessment of the management GRI 405: Diversity and equal opportunities 103-3 64-66 approach Explanation of the material topic 103-1 150-151 67-68, and its boundary New employee hires 401-1 183-184, Management approach and its and employee turnover 103-2 64-66, 74 190 components Benefits for full-time There is no difference in the benefits offered Our establishments comply with legislation on accessibility 401-2 employees that are not given to to employees based on their type of working day. criteria. All openings and renovation projects are approved part-time or temporary employees Evaluation of management by the competent authority that verifies it. Moreover, our 103-3 64-66, 74 401-3 Parental leave 79 approach model includes improvements for people with reduced GRI 402: Labour relations mobility: lower scales in the produce section, information desks with height recess and special carts for the disabled. Management approach and its 103-2 64-66 Diversity in governance 76, 152, There are no individuals with disabilities on the Governing components 405-1 bodies and employees 183, 192 Council (highest governing body) or the Board of Directors. The process of social dialogue with non-partner coopera- Ratio of basic salary and tive employees is set out in the Workers' Statute to negoti- 74-75, All direct EROSKI employees work in 405-2 remuneration of women ate collective agreements, collective dismissal programme, 152 Spain etc. to men In the case of Employee Partners, the communication GRI 406: Non-discrimination Minimum notice periods regarding model is established in the Articles of Association and the Explanation of the material topic 402-1 103-1 150-151 operational changes Internal Regulations Regime, as presented in Section 1 on and its boundary Management Model. Management approach and its There is no general fixed time period specified for notifica- 103-2 64-66, 74 components tions regarding operational changes since this depends Assessment of the management on the type of change. But in general the notice period 103-3 74 must be reasonable and sufficient. approach GRI 403: Occupational health and safety No cases of discrimination were recorded in the organiza- tion in 2018. Explanation of the material topic 103-1 150-151 All our suppliers have to accept the requirements of the and its boundary International Labor Organization to maintain a business Incidents of discrimination and Management approach and its 406-1 relationship with EROSKI. 103-2 80 corrective actions taken components We perform surveillance audits of our suppliers through our Assessment of the management purchasing centre in Asia. In 2018, we collected data from 103-3 80 approach 26 audits in China and Bangladesh. They were found to Workers representation in formal comply with the BSCI and SMETA standards. 403-1 joint management–worker health 80 GRI 407: Freedom of association and collective bargaining and safety committees Management approach and its 103-2 64-66, 74 Types of and ratesof injury, Days lost rate: Omitted. Information not available. It is components occupational diseases, lost days, 81, 152, not possible to calculate the rate of days lost because 403-2 All our suppliers have to accept the requirements of the and absenteeism, and number of 191, 192 absentee hours due to common illness and occupational International Labor Organization to maintain a business Operations and suppliers in which work-related fatalities disease are not counted separately. relationship with EROSKI. the right to freedom of association Workers with a high rate or risk of 407-1 We perform surveillance audits of our suppliers through our 403-3 and collective bargaining may be diseases related to their activity purchasing centre in Asia. In 2018, we collected data from at risk Health and safety topics 26 audits in China and Bangladesh. They were found to 403-4 covered in formal agreements 80 comply with the BSCI and SMETA standards. with trade unions GRI 408: Child labour GRI 404: Training and education Management approach and its 103-2 64-66, 74 Management approach and its components 103-2 150-151 components All our suppliers have to accept the requirements of the 84-86, International Labor Organization to maintain a business Average hours of training 404-1 152, 183, Operations and suppliers at sig- relationship with EROSKI. per employee per year 192 408-1 nificant risk for incidents of child We perform surveillance audits of our suppliers through our labour purchasing centre in Asia. In 2018, we collected data from Programmes for upgrading employ- 84,86, 26 audits in China and Bangladesh. They were found to 404-2 ee skills and transition assistance 183 comply with the BSCI and SMETA standards. programmes GRI 409: Forced or compulsory labour Percentage of employees receiving Management approach and its 404-3 regular performance and career 84-86 103-2 64-66, 74 development reviews components

164 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 165 8. Transparency Transparency 8. Material topic Material topic

GRI GRI Content Page Direct response/Omissions Content Page Direct response/Omissions Standard Standard All our suppliers have to accept the requirements of the GRI 414: Supplier social assessment International Labor Organization to maintain a business Explanation of the material topic 103-1 150-151 Operations and suppliers at relationship with EROSKI. and its boundary 409-1 significant risk for incidents of We perform surveillance audits of our suppliers through our Management approach and its forced or compulsory labour purchasing centre in Asia. In 2018, we collected data from 103-2 65 components 26 audits in China and Bangladesh. They were found to Assessment of the management comply with the BSCI and SMETA standards. 103-3 65, 68 approach GRI 410: Security practices All our suppliers have to accept the requirements of the Management approach and its 103-2 64-66, 74 International Labor Organization to maintain a business components New suppliers have passed relationship with EROSKI. The security service is subcontracted. 65, 98, Security personnel trained in human 414-1 selection filters according to We perform surveillance audits of our suppliers through our 410-1 We do not have information about training in human 182-183 rights policies and procedures social criteria purchasing centre in Asia. In 2018, we collected data from rights that security personnel receives. 26 audits in China and Bangladesh. They were found to GRI 411: Rights of indigenous peoples comply with the BSCI and SMETA standards. Management approach and its We perform surveillance audits of our suppliers through our 103-2 64-66, 74 components Negative social impacts on the purchasing centre in Asia. In 2018, we collected data from 414-2 There are no records of violation of the rights of indigenous supply chain and actions taken 26 audits in China and Bangladesh. They were found to peoples by an EROSKI supplier company in 2018. All our comply with the BSCI and SMETA standards. suppliers have to accept the requirements of the Interna- GRI 415: Public policy tional Labor Organization to maintain a business relation- Incidents of violations involving Management approach and its 411-1 ship with EROSKI. We perform surveillance audits of our 103-2 14 rights of indigenous peoples components suppliers through our purchasing centre in Asia. In 2018, Contributions to political parties No financial contributions were made to political we collected data from 26 audits in China and Bangla- 415-1 and/or representatives parties in 2018. desh. They were found to comply with the BSCI and SMETA standards. GRI 416: Customer health and safety Explanation of the material topic GRI 412: Human rights assessment 103-1 150-151 and its boundary Explanation of the material topic 103-1 150-151 Management approach and its and its boundary 103-2 47-51 components Management approach and its 103-2 64-66, 74 Assessment of the management components 103-3 47-50 approach Assessment of the management 103-3 64-66, 74 approach Assessment of the health and 416-1 safety impacts of the product 47-51 All our suppliers have to accept the requirements of the and service categories International Labor Organization to maintain a business relationship with EROSKI. Incidents of non-compliance There were no fines or significant non-financial sanctions Operations subject to human rights 412-1 We perform surveillance audits of our suppliers through our concerning the health and safety for non-compliance with consumption laws or regulations review or impact assessments 416-2 47-51 purchasing centre in Asia. In 2018, we collected data from impacts of the product and service in 2018. Fines are considered significant when qualified as 26 audits in China and Bangladesh. They were found to categories "very serious" by the Administration that issues the sanction. comply with the BSCI and SMETA standards. GRI 417: Marketing and labelling Significant investment agreements Explanation of the material topic All our suppliers have to accept the requirements of the 103-1 150-151 and contracts that include human and its boundary 412-3 International Labor Organization to maintain a business rights clauses or that underwent relationship with EROSKI. Management approach and its human rights screening 103-2 50-52 components GRI 413: Local communities Assessment of the management 103-3 50-52 Explanation of the material topic approach 103-1 150-150 and its boundary EROSKI includes the mandatory labelling information Management approach and its 54, 56, 60, according to existing legislation on all of its products. 103-2 components 134 For example, on foods it includes the list of ingredients, Requirements for product and Evaluation of management 54, 56, 60, 417-1 allergens, nutritional information, best before or expiration 103-3 service information and labelling approach 134 dates, batch, special storage and use conditions, where applicable, etc. On its own-brand products it includes Operations with local community 54, 56, 60, additional information such as the nutrition traffic light. 413-1 engagement, impact assessments, 64, 134- and development programmes 135 Operations with significant actual 413-2 or potentialnegative impacts on 24-25 local communities

166 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 167 8. Transparency Transparency 8. Material topic

GRI Content Page Direct response/Omissions Standard Content index of Act 11/2018 on In 2018 there were 3,458 claims related to incorrect labelling (misleading information/incorrect prices, etc.), Non-financial Information and Diversity which represents 8.59% of the total number of complaints Incidents of non-compliance received. 417-2 concerning product and service 50-52 There were no fines or significant non-financial sanctions information and labelling Standard used Page/Direct response for non-compliance with consumption laws or regulations in 2018. Fines are considered significant when qualified as Business model "very serious" by the Administration that issues the sanction. GRI 102-2 Activities, brands, products and services Response in GRI table Incidents of non-compliance In 2018, there were 2,372 claims related to marketing 417-3 concerning marketing communication (offers, promotions etc.), which represents GRI 102-4 Location of operations Response in GRI table communications 5.89% of the total number of complaints received. Description of the GRI 102-6 Markets served Response in GRI table GRI 418: Customer privacy group’s business GRI 102-15 Key impacts, risks and opportunities Response in GRI table model Explanation of the material topic 103-1 150-151 GRI 102-7 Scale of the organization Response in GRI table and its boundary Management approach and its GRI 102-45 Entities included in consolidated financial statements Response in GRI table 103-2 20 components Information about environmental issues Assessment of the management 103-3 20 GRI 103-2 Management approach and its components Response in GRI table approach Policies GRI 103-3 Evaluation of the management approach Response in GRI table Substantiated claims concerning 418-1 breaches of customer privacy and There were no customer data leaks during the year. GRI 102-15 Key impacts, risks and opportunities Response in GRI table losses of customer data GRI 102-11 Precautionary principle or approach Response in GRI table GRI 419: Socioeconomic compliance Main GRI 102-30 Effectiveness of risk management processes Response in GRI table Explanation of the material topic risks 103-1 150-151 and its boundary GRI 201-2 Financial implications and other risks and opportunities We do not currently have due to climate change an analysis. We will perform Management approach and its 103-2 18-21 one in 2019. components GRI 102-15 Key impacts, risks and opportunities Response in GRI table Assessment of the management 103-3 18-21 approach GRI 102-29 Identifying and managing economic, Response in GRI table environmental and social impacts There were no fines or significant non-financial sanctions Non-compliance with laws for non-compliance with social or economic laws or 419-1 and regulations in the social regulations in 2018. Fines are considered significant when GRI 102-31 Review of economic, environmental Response in GRI table and economic area qualified as "very serious" by the Administration that issues and social issues the sanction. GRI 102-11 Precautionary principle or approach Response in GRI table General GRI 102-30 Effectiveness of risk management processes Response in GRI table GRI 102-29 Identifying and managing economic, Response in GRI table environmental and social impacts

GRI 102-11 Precautionary principle or approach Response in GRI table GRI 307-1 Non-compliance with environmental laws Response in GRI table and regulations (CCAA)

GRI 103-2 Management approach Response in GRI table GRI 302-4 Reduction of energy consumption Response in GRI table GRI 302-5 Reductions in the energy requirements of products Response in GRI table and services Pollution

GRI 305-5 Reduction of GHG emissions Response in GRI table GRI 305-7 NOx, SOx and other significant air emissions Noise and light pollution 121

168 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 169 8. Transparency Transparency 8.

GRI 103-2 Management approach Response in GRI table Emissions 305 GRI 305-1 Direct GHG emissions (scope 1) Response in GRI table GRI 305-2 Indirect GHG emissions from power Response in GRI table GRI 301-1 Materials used by weight or volume Response in GRI table generation (scope 2)

Circular Economy GRI 301-2 Recycled input materials used Response in GRI table GRI 305-3 Other indirect GHG emissions (scope 3) Response in GRI table and waste GRI 301-3 Reclaimed products and packaging materials Response in GRI table prevention and management GRI 303-3 Recycled and reused water Response in GRI table GRI 305-4 GHG emissions intensity Response in GRI table GRI 306-1 Water discharge by quality and destination Response in GRI table Measures taken GRI 102-15 Key impacts, risks Response in GRI table GRI 306-2 Waste by treatment type and method Response in GRI table to adapt to the and opportunities GRI 306-3 Significant spills Response in GRI table consequences of climate Materials 301 GRI 103-2 Management approach Response in GRI table GRI 103-2 Management approach Response in GRI table (with view towards GRI 300) change Climate change

GRI 301-1 Materials used by Response in GRI table GRI 201-2 Financial implications and other risks Response in GRI table weight or volume and opportunities due to climate change GRI 305-5 Reduction of GHG emissions Response in GRI table GRI 301-2 Recycled input materials used Response in GRI table Reduction goals GRI 103-2 Management approach Response in GRI table established GRI 301-3 Reclaimed products and packaging Response in GRI table voluntarily for the mid-term Energy 302 GRI 102-2 Management approach Response in GRI table and long-term (with view towards GRI 302 Energy) to reduce GHG emissions and GRI 302-1 Energy consumption within the Response in GRI table measures Sustainable use organization (energy from renewable or implemented of resources non-renewable sources) for this purpose Measures taken GRI 103-2 Management approach Response in GRI table to preserve or GRI 302-2 Energy consumption outside the Response in GRI table restore organization biodiversity

GRI 302-3 Energy intensity Response in GRI table GRI 304-3 Habitats protected or restored Response in GRI table Water 303 GRI 303-1 Water withdrawal by source Response in GRI table GRI 304-1 Operational sites owned, leased, Response in GRI table GRI 303-2 Water sources significantly adversely Response in GRI table managed in or adjacent to protected areas and affected by water collection areas of high biodiversity value outside protected areas.

GRI 303-3 Recycled and reused water Response in GRI table Protection of biodiversity

Impacts GRI 304-2 Significant impacts of Response in GRI table caused by activities, products and services activities or on biodiversity operations in protected areas GRI 304-4 IUCN Red List species and national Response in GRI table conservation list species with habitats in areas affected by operations

Information about social and employee issues GRI 103-2 Management approach and its components Response in GRI table

Policies GRI 103-3 Evaluation of the management approach Response in GRI table

GRI 102-35 Remuneration policies Response in GRI table

170 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 171 8. Transparency Transparency 8.

GRI 102-15 Key impacts, risks and opportunities Response in GRI table Average remuneration of GRI 102-35 Remuneration Response in GRI table Main directors and executives, policies risks GRI 102-30 Effectiveness of risk management processes Response in GRI table including variable remuneration, GRI 102-36 Process for Response in GRI table allowances, compensation, payment determining remuneration Total number GRI 102-7 Scale of the organization Response in GRI table to long-term pension savings systems (for management and distribution and any other payment broken approach) down by sex of employees GRI 201-3 Defined benefit by gender, age, plan obligations and other country and retirement plans professional GRI 102-8 Information on employees Response in GRI table category and other workers Not included in GRI: Informa- 68-69 tion broken down by gender. GRI 405-1. Diversity in governance bodies Response in GRI table Implementation of work Not included in GRI There is currently no specific and employees disconnection measures measure available to en- courage work disconnection since it was not included in the management plan. However, we will work on it in coming years and report Total number GRI 102-8 Information on employees Response in GRI table on it in the corresponding and distribution and other workers non-financial statement. of employment Employees with disabilities GRI 405-1. b) Percentage of Response in GRI table contract types employees per employment category for each of the Annual average Not included in GRI 62-67 following diversity categories of permanent, (iii. Vulnerable groups). temporary Organisation of working time GRI 102-8. c) Total number Response in GRI table and part-time of employees by type of contracts by employment contract gender, age (full-time or part-time) and professional and gender. classification GRI 401. Management Response in GRI table Employment Number of GRI 401-1. b) Total number and rate of employee Response in GRI table approach 103-2. dismissals by turnover during the period subject to the gender, age report, grouped by age, gender, region Number of absenteeism hours GRI 403-2 Types of injury and Response in GRI table and professional (only related to dismissals) Work rates of occupational injury, category organization occupational diseases, lost days, and absenteeism, and number of work-related fatalities (section a) Not included in GRI: Number of dismissals by 67 professional category Measures designed to facilitate work- GRI 401-3 Parental Response in GRI table life balance and encourage joint leave Average remu- There is no GRI indicator that completely fits: infor- 68-69 responsibility by both parents. Not included in GRI: 70-73 neration and its mation must be provided on average remuner- management approach evolution ation by gender, age and professional category regarding other work-life grouped by and the evolution thereof (comparison with balance measures gender, age and previous year). To calculate this, total salary paid professional cat- in cash and remuneration in kind must be taken egory or equal into account, so the calculation must include the value benefits referred to in GRI 401-2.

Pay gap GRI 405-2 (Ratio of remuneration of women 68-69 to men) would not be enough to report on this aspect.

Remuneration of equal or average GRI 202-1 Ratio of standard Response in GRI table jobs in society entry level wage to local minimum wage

172 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 173 8. Transparency Transparency 8.

Health Occupational health and safety GRI 103-2 Management Response in GRI table Universal accessibility for GRI 103-2 Management Response in GRI table and safety conditions approach (with view towards disabled people approach (with view towards GRI 403 Healthy and safety) Accessibility GRI 405 Diversity and equal Work accidents GRI 403-2 Types of injury and Response in GRI table opportunities and GRI 406 (frequency and severity) rates of occupational injury, Non-discrimination) GRI 403-3 Employees with a high occupational diseases, lost Measures taken to promote equal GRI 103-2 Management Response in GRI table rate or risk of diseases related to days, and absenteeism, and treatment and opportunities approach (with view towards their activity number of work-related between men and women. GRI 405 Diversity and equal fatalities (section a) opportunities)

Response in GRI table Equal Opportunities Plans GRI 103-2 Management Response in GRI table approach (with view towards GRI 405 Diversity and equal opportunities and GRI 406 Occupational illness GRI 403-2 Types of injury and Response in GRI table Non-discrimination) (frequency and severity) rates of occupational injury, Measures implemented to GRI 103-2 Management Response in GRI table occupational diseases, lost promote employment approach (with view towards days, and absenteeism, and GRI 401 Employment) number of work-related fatalities (section a) GRI 404-2 Programmes for Response in GRI table upgrading employee skills GRI 403-3 Employees with a Response in GRI table and transition assistance high rate or risk of diseases programmes related to their activity Equality Protocols against sexual and GRI 103-2 Management Response in GRI table gender-based harassment approach (with view towards Organization of social dialogue, GRI 102-43 Approach to Response in GRI table GRI 405 Diversity and equal including procedures for informing stakeholder engagement opportunities and GRI 406 and consulting with staff (related to trade unions and Non-discrimination) and negotiating with them collective bargaining) Integration and universal GRI 103-2 Management Response in GRI table GRI 402-1 Minimum notice Response in GRI table accessibility of people with approach (with view towards periods for operational disabilities GRI 405 Diversity and equal changes opportunities and GRI 406 Non-discrimination) GRI 403-1 Workers representa- Response in GRI table tion in joint health and safety Policy against all types of GRI 103-2 Management Response in GRI table committees discrimination and, where approach (with view towards appropriate, diversity GRI 405 Diversity and equal Social Percentage of employees covered by GRI 102-41 Collective Response in GRI table management opportunities and GRI 406 relations collective bargaining agreements in bargaining agreements Non-discrimination) each country Not included in GRI: broken GRI 406-1 Incidents of Response in GRI table down by country discrimination and corrective Balance of collective bargaining GRI 403-1 Workers representa- Response in GRI table actions taken agreements, specifically in the area tion in joint health and safety Information about respect for human rights of occupational health and safety committees GRI 103-2 Management approach and its components Response in GRI table GRI 403-4 Health and safety Response in GRI table topics covered in formal agreements with the legal GRI 103-3 Evaluation of the management approach Response in GRI table representation of employees GRI 410-1 Security personnel trained in human rights policies Response in GRI table Policies and procedures Policies implemented in the GRI 103-2 Management Response in GRI table field of training approach (with view towards GRI 412-2 Training of employees in human rights policies GRI 404 Training and and procedures education) GRI 404-2 Programmes for Response in GRI table GRI 102-15 Key impacts, risks and opportunities Response in GRI table upgrading employee skills Main Training and transition assistance risks programmes GRI 102-30 Effectiveness of risk management processes Response in GRI table Total number of hours of training by GRI 404-1 Average annual Response in GRI table professional category training hours per employee

Not included in GRI: total 74-75 training hours.

174 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 175 8. Transparency Transparency 8.

Application of due diligence GRI 103-2 Management Response in GRI table Measures implemented to prevent GRI 103-2 Management Response in GRI table procedures in human rights approach (with view towards corruption and bribery approach (with view towards GRI 412 Assessment of hu- GRI 205 Anticorruption) man rights) - If the entity presents 205-2, GRI 414-2 Negative social it also covers this legal impacts on the supply chain requirement and measures taken Measures to fight against money GRI 103-2 Management Response in GRI table Prevention of risks of violation of GRI 103-2 Management Response in GRI table laundering approach (with view towards human rights and, where appropriate, approach (with view towards GRI 205 Anticorruption) measures to mitigate, manage and GRI 412 Assessment of Contributions to non-profit GRI 103-2 Management Response in GRI table Corruption repair potential abuses committed human rights) foundations and entities approach (with view towards and bribery GRI 412-1 Operations Response in GRI table GRI 205 Anticorruption) subject to human rights GRI 201-1) Direct economic Response in GRI table review or impact value generated and dis- assessments tributed (Investments in the GRI 410-1 Security personnel Response in GRI table community) trained in human rights GRI 203-2 Significant indirect Response in GRI table policies and procedures economic impacts GRI 415-1 Contribution to Response in GRI table Reported cases GRI 102-17 Mechanisms for political parties and/or repre- Human Rights of violations of human rights advice and concerns about sentatives ethics (reports received and Information about the company resolution) Policies GRI 103-2 Management approach and its components Response in GRI table GRI 103-2 Management Response in GRI table approach (with view towards GRI 412 Assessment GRI 103-3 Evaluation of the management approach Response in GRI table of human rights) GRI 411-1 Rights of Response in GRI table GRI 102-15 Key impacts, risks and opportunities Response in GRI table indigenous peoples Main risks GRI 102-30 Effectiveness of risk management processes Response in GRI table GRI 419-1 Non-compliance Response in GRI table with laws and regulations in the social and economic Impact of the company’s GRI 203-1 Infrastructure Response in GRI table area activity on local employment investments and services and development supported Promotion and compliance with the GRI 103-2 Management Response in GRI table provisions of fundamental ILO treaties approach (with view towards GRI 203-2 Significant indirect Response in GRI table related to freedom of association GRI 406 Non-discrimination; economic impacts and the right to collective bargain- 407 Freedom of association GRI 204-1 Proportion of Response in GRI table ing, eliminating discrimination from and collective bargaining; 408 spending on local suppliers the workplace, eliminating forced or Child Labour; 409 Forced or Company commitments GRI 413-1 Operations Response in GRI table compulsory labour and effectively compulsory labour and 412 with local community abolishing child labour. Human Rights Assessment) to sustainable development engagement, impact assessments, and Information related to the fight against corruption and money laundering development programmes GRI 103-2 Management approach and its components Response in GRI table GRI 413-2 Operations with Response in GRI table significant actual or potential GRI 103-3 Evaluation of the management approach Response in GRI table Policies negative impacts on local communities GRI 205-2 Communicating and training about anticorruption poli- Response in GRI table cies and procedures GRI 102-15 Key impacts, risks and opportunities Response in GRI table

GRI 102-30 Effectiveness of risk management processes Response in GRI table Main risks GRI 205-1 Operations assessed for risks related to corruption Response in GRI table

176 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 177 8. Transparency Transparency 8.

Impact of the company’s activity on GRI 203-1 Infrastructure Response in GRI table Included in purchasing policy for GRI 103-3 Management Response in GRI table local populations and territory investments and services social and gender equality and approach (with view towards supported environmental issues GRI 308 and GRI 414) GRI 203-2 Significant indirect Response in GRI table Considered in relationships with sup- GRI 102-9 Supply Response in GRI table economic impacts pliers and subcontractors concern- chain GRI 413-1 Operations with Response in GRI table ing their social and environmental GRI 103-3 Management Response in GRI table local community engage- responsibility approach (with view towards ment, impact assessments, GRI 308 and GRI 414) and development GRI 308-1 New suppliers that Response in GRI table programmes have passed evaluation and GRI 413-2 Operations with Response in GRI table selection filters according to significant actual or potential environmental criteria negative impacts on local communities GRI 308-2 Negative envi- Relationships with actors in the local GRI 102-43 Approach to Response in GRI table ronmental impacts on the community and type of dialogue stakeholder engagement supply chain and measures with them (related to community) taken GRI 413-1 Operations with Response in GRI table GRI 407-1 Operations and Response in GRI table local community engage- suppliers in which the right to ment, impact assessments, freedom of association and and development collective bargaining may programmes Sub-contracting be at risk Membership or sponsorship actions GRI 102-13 Membership Response in GRI table and suppliers GRI 409-1 Operations and Response in GRI table of associations suppliers at significant risk for GRI 203-1 Infrastructure Response in GRI table incidents of forced or com- investments pulsory labour and services GRI 414-1 New suppliers Response in GRI table supported have passed selection filters GRI 201-1) Direct economic Response in GRI table according to social criteria value generated and dis- tributed (Investments in the community) GRI 414-2 Negative social impacts on the supply chain and measures taken Supervision and audit system and GRI 308-1 New suppliers that Response in GRI table results thereof have been assessed accord- ing to environmental criteria GRI 308-2 Negative environmental impacts on the value chain and actions implemented GRI 414-2 Negative social impacts on the value chain and actions implemented

178 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 179 8. Transparency Transparency 8.

Consumers Measures for consumer health GRI 103-2 Management Response in GRI table and safety approach (with view towards Table of Contents of the Global Compact GRI 416 Costumer healthy and safety) he following table presents the GRI indicators in this re- GRI aspect. Following the table of contents, it is possible to T port that offer more relevant information on compliance assess EROSKI’s degree of progress regarding the aforemen- with the 10 Principles of the Global Compact, in addition to tioned principles. GRI 416-1 Assessment of the Response in GRI table that contained in the management approaches of each health and safety impacts of the product and service categories GRI 416-2 Incidents of Response in GRI table Principles of the Global Compact Most relevant GRI standard non-compliance concern- Safety practices: 410-1 1. Businesses should support and respect the ing the health and safety Rights of indigenous peoples: 411-1 Human protection of internationally proclaimed human impacts of the product and rights assessment: 412-1 Local communities: rights within their sphere of influence. service categories 413-1, 413-2 Human Rights GRI 417-1 Requirements for Response in GRI table product and service 2. Businesses should make sure they are not Human rights assessment: 412-3 Supplier social information and labelling complicit in human rights abuses. assessment 414-1 Claims systems, complaints received GRI 102-17 Mechanisms for Response in GRI table Collective bargaining agreements: 102-41 and resolution thereof advice and concerns about 3. Business should uphold the freedom Labour relations: 402-1 ethics (reports received and of association and the effective recognition Freedom of association and collective bargain- resolution) of the right to collective bargaining. ing agreements: 407-1

GRI 103-2 Management Response in GRI table 4. Businesses should uphold the elimination approach (with view towards Forced or compulsory labour: 409-1 of all forms of forced and compulsory labour. GRI 416 Costumer healthy and safety) GRI 418-1 Substantial com- Response in GRI table Labour 5. Businesses should uphold the effective plaints related to breaches of Child labour: 408-1 abolition of child labour. customer privacy and losses of customer data. Information about employees: 102-8 Market presence: 202-1, 202-2 6. Businesses should uphold the elimination of Benefits obtained in each country Not included in GRI: 24 Employment: 401-1, 401-3 discrimination in respect of employment Verified together with Training and education: 404-1, 404-3 and occupation. Tax Information Diversity and equal opportunities: 405-1, 405-2 Taxes on profits paid Not included in GRI: Response in GRI table Non-discrimination: 406-1 Tax Verified together with Material: 301-1, 301-2, 301-3 information Tax Information Energy: 302-1, 302-2, 302-3, 302-4 Public subsidies received GRI 201-4 Financial assis- Response in GRI table 7. Businesses should support a precautionary Water: 303-1 tance received from the approach to environmental challenges. Emissions: 305-1, 305-2, 305-3, 305-4, 305-5, 305-6 government Effluents and waste: 306-1, 306-2, 306-3, 306-4, 306-5 Material: 301-1, 301-2, 301-3 Energy: 302-1, 302-2, 302-3, 302-4 Environment Emissions: 305-1, 305-2, 305-3, 305-4, 305-5, 305-6 8.Businesses should undertake initiatives to Effluents and waste: 306-1, 306-2, 306-3, 306-4, promote greater environmental responsibility. 306-5 Environmental compliance: 307-1 Supplier environmental assessment: 308-1 Energy: 302-4 9. Businesses should encourage the develop- Emissions: 305-1, 305-2, 305-3, 305-4, 305-5, 305-6 mentand diffusion of environmentally friendly Effluents and waste: 306-1, 306-2, 306-3, 306-4, technologies. 306-5 Values, principles, standards and code of con- 10. Businesses should work against duct: 102-16 Anticorruption corruption in all its forms, including Anticorruption: 205-1, 205-2, 205-3 extortion and bribery. Public policy: 415-1

180 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 181 8. Transparency Transparency 8.

Indirect economic impacts: 203-2 Diver- Table of contents of the Sustainable Reduced sity and equal opportunities: 405-2 Development Goals inequalities

Sustainable cities Indirect economic impacts: 203-1

he following table presents the GRI indicators in this to that contained in the management approaches of each and communities T report that offer more relevant information on compli- GRI aspect. Following the table of contents, it is possible to ance with the Sustainable Development Goals, in addition assess EROSKI’s actions regarding the SDG. Emissions: 305, 305-1, 305-2, 305-3, Acquisition practices: 204-1 305-6 Responsible Materials: 301-1, 301-2 Effluents and waste: 306, 306-1, 306-2, consumption and SDG GRI Standard Energy: 302-1, 302-1, 302-2, 302-3, 302-4 306-3, 306-4 production Water: 303-3 Environmental compliance: 307 Market presence: 202-1 Marketing and labelling: 417-1 No poverty Indirect economic impacts: 203-2 Energy: 302-1, 302-2, 302-3, 302-4 Local communities: 413-2 Emissions: 305, 305-1, 305-2, 305-3, 305-4, Climate action 305-5, 305-6 Economic performance: 201-1 Effluents and waste: 306 Indirect economic impacts: 203-1, 203-2 Zero hunger Environmental compliance: 307 Rights of indigenous peoples: 411-1 Biodiversity: 304-1, 304-2, 304-3, 304-4 Local communities: 413-2 Emissions: 305, 305-1, 305-2, 305-3, 305-4, Indirect economic impacts: 203-2 Life bellow water 305-5 Good health and Emissions: 305-1, 305-2, 305-3, 305-6 Effluents and waste: 306, 306-1, 306-3 well-being Effluents and waste: 306-1, 306-2, 306-3, 306-4 Environmental compliance: 307 Occupational health and safety: 403-2, 403-3 Biodiversity: 304-1, 304-2, 304-3, 304-4 Emissions: 305, 305-1, 305-2, 305-3, 305-4, Collective knowledge of the highest governing body: Quality Life on land 305-5 102-27 education Effluents and waste: 306, 306-3, 306-5 Training and education: 404-1 Environmental compliance: 307

Indirect economic impacts: 203-1 Ethics: 102-16 Safety practices: 410-1 Composition of the highest governing Employment: 401-1, 401-3 Governance: 102-21, 102-22, 102-23, Supplier social assessment: 414-1 body and its committees: 102-22 Training and education: 404-1, 404-3 102-24, 102-25, 102-29, 102-37 Public policy: 415-1 Gender Appointment and selection of the Peace, justice and Diversity and equal opportunities: Anticorruption: 205-1, 205-2, 205-3 Envi- Customer health and safety: 416-2 equality highest governing body: 102-24 strong institutions 405-1, 405-2 ronmental compliance: 307-1 Marketing and labelling: 417-1, 417-2 Economic performance: 201-1 Non-discrimination: 406-1 Non-discrimination: 406-1 Customer privacy: 418-1 Market presence: 202-1 Supplier social assessment: 414-1 Child labour: 408-1 Socioeconomic compliance: 419-1

Water: 303-1, 303-2, 303-3 Indirect economic impacts: 203-2 Partnerships for Clean water Biodiversity: 304-1, 304-2, 304-3, 304-4 and sanitation Effluents and waste: 306-1, 306-2, 306-3, 306-5 the goals

Economic performance: 201-1 Affordable and Indirect economic impacts: 203-1 Ener- clean energy gy: 302-1, 302-1, 302-2,302-3, 302-4

Occupational health and safety: 403- 1, 403-2, 403-3, 403-4 Profile of the organization: 102-8 Training and education 404-1, 404-2, Stakeholder engagement: 102-41 404-3 Economic performance: 201-1 Diversity and equal opportunities: Market presence: 202-1, 202-2 Indirect 405-1. 405-2 Decent work economic impacts: 203-2 Materials: Non-discrimination: 406-1 and growth 301-1, 301-2, 301-3 Freedom of association and Energy: 302-1, 302-2, 302-3, 302-4 collective bargaining agreements: Water: 303-3 407-1 Employment: 401-1, 401-3 Child labour: 408-1 Labour relations: 402-1 Forced or compulsory labour: 409-1 Supplier social assessment: 414-1

Industry, innovation Economic performance: 201-1

and infrastructure Indirect economic impacts 203-1

182 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 183 8. Transparency Transparency 8.

Appendix

INDICATOR TABLES. COMPARISON WITH PREVIOUS YEARS

Table 1. Wealth distributed by EROSKI to our stakeholders Table 2. Number of EROSKI Group stores and franchises by business type Table 3. Number EROSKI Group supermarkets and franchises by brand Table 4. Distribution of establishments by region and business type in 2017 Table 5. Number of employees by gender Table 6. Total number of employees by region Table 7. Number of employees by gender and contract type Table 8. Number of employees with a permanent contract by gender, age range and professional category Table 9. Number of employees with a temporary contract by gender, age range and professional category Table 10. Number of employees by gender and type of working day Table 11. Number and rate of new hires in 2017 and 2016 Table 12. Number and rate of new hires in 2017 and 2016 (exiting employees) Table 13. Distribution of employees by gender, age range and professional category Table 14. Rate of occupational accidents Table 15. Rate of workplace absenteeism Table 16. Occupational illness Table 17. Average hours of training of EROSKI employees by gender and professional category Table 18. People subject to performance evaluation in 2018 Table 19. Percentage of employees receiving regular performance and career development reviews in 2017 Table 20. Number of employees with a disability by professional category Table 21. Number of business and service suppliers per country Table 22. Number of business suppliers and local producers per region Table 23. Materials used in our own-brand products and packaging reported to Collective Systems of Extended Producer Responsibility Table 24. Paper used in advertising, magazines and at the EROSKI company headquarters Table 25. Reused logistics containers Table 26. Energy consumption within the organization Table 27. Distribution of energy consumption by use (%) Table 28. Energy intensity ratio Table 29. Waste by type and disposal method Table 30. Waste collected from clients for recycling Table 31. Water extraction by source Table 32. Refrigerant consumed to compensate for leaks Table 33. Greenhouse gas emissions – carbon footprint Table 34. Reduction and intensity of greenhouse gas emissions Table 35. Distribution by gender and age range of the governing bodies

184 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 185 8. Transparency Transparency 8.

Table 1. Table 3. Wealth distributed by EROSKI to our stakeholders Number of EROSKI Group supermarkets and franchises by brand In millions of euros 2018 2017

EROSKI employees 490 493 2018 2017 2016

Wages, salaries and similar expenses 99.1% 98.7% Total Own-brand Franchises Total Own-brand Franchises Total Compensation 0.8% 1.3% EROSKI/city 515 279 236 500 285 215 479 Defined pension plan contributions 0.1% 0.1% CAPRABO 318 256 62 320 268 52 322 State 191 224 EROSKI/center 164 162 2 161 159 2 159 Employee social contributions and taxes 90% 78% Aliprox 122 0 122 140 0 140 151 Income tax 1% 14% Familia 78 78 0 78 78 0 79 Taxes 9% 8% Onda 64 0 64 73 0 73 74 Environment 17 11 Rapid 9 0 9 7 0 7 5 (aimed at minimizing environmental impacts and protecting and improving the environment) Merca 8 8 0 0 0 0 5 Expenses 6% 7% TOTAL 1,278 783 495 1,279 790 489 1,269 Investments 94% 93% Suppliers 4,013 4,102 Business suppliers 85% 87% Table 4. Service providers 15% 13% Distribution of establishments by region Customers 302 260 and business type in 2017 (millions of euros transferred through the multiple commercial offers carried out during the year) Society 10 12 (aimed at social purposes and consumer education and information) Distribution of establishments by region and business type EROSKI Group 87% 78% 2017 EROSKI Foundation 13% 22% Own-brand establishments Franchised establishments Total

Food Diversified Total Food Diversified Total businesses businesses own- businesses businesses franchises Table 2. brand Number of EROSKI Group stores and franchises by business type 102-4

2018 2017 2016 Hypermarkets Supermarkets Cash&Carry Gas stations Opticians agencies Travel FORUM SPORT Hypermarkets Supermarkets agencies Travel FORUM SPORT

Total Franchises Own-brand Total Franchises Own-brand Total Andalusia 10 7 3 1 21 51 1 52 73 Hypermarkets 56 2 54 61 3 58 79 Andorra 8 8 8 Supermarkets 1,278 495 783 1,279 489 790 1,269 Aragon 36 2 5 2 45 21 21 66 Cash&Carry 19 0 19 19 0 19 19 Asturias 1 10 1 2 5 5 24 1 1 25 Gas stations 50 1 49 50 0 50 60 Cantabria 1 8 1 5 4 19 8 3 11 30 Opticians 13 0 13 16 0 16 20 Castile and 1 21 1 9 12 44 5 2 1 8 52 Travel agencies 162 16 146 159 19 140 160 León FORUM SPORT Sports Castile-La 66 1 65 59 1 58 52 5 4 2 2 13 4 4 17 equipment stores Mancha Online stores 8 0 8 8 0 8 9 Catalonia 2 247 1 3 1 254 1 56 57 311 TOTAL 1,652 516 1,137 1,651 512 1,139 1,837 Ceuta 1 1 1 Valencian 4 3 1 2 10 1 1 11 Community *Travel agencies include holiday and company travel (Travel Air). Extremadura 1 1 2 2 2 4 Galicia 5 149 18 3 5 1 181 128 1 129 310 Gibraltar 2 2 2 Balearic 109 2 111 74 74 185 Islands

186 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 187 8. Transparency Transparency 8.

Table 7.

Distribution of establishments by region and business type Number of employees by gender 2017 and contract type 102-8 Canary 1 1 1 Islands Variation 2018 2017 2016 La Rioja 1 10 1 7 3 22 4 4 26 2017-2018 (%) Madrid 4 4 8 8 12 Permanent 22,802 23,273 25,828 -2.1% Melilla 0 1 1 1 % permanent 76% 76% 78% Murcia 3 3 1 7 1 1 8 Women 18,127 18,484 20,568 -2.0% Navarre 2 54 3 1 14 6 80 27 2 29 109 Men 4,675 4,789 5,260 -2.4% Temporary 7,246 7,228 7,344 0.2% Basque 21 146 17 10 78 21 293 89 9 98 391 Country % Temporary 24% 24% 22% TOTAL 58 790 19 50 16 140 58 1,131 3 489 19 1 512 1,643 Women 5,233 5,306 5,437 -1.4% Men 2,013 1,922 1,907 4.5% TOTAL 30,048 30,501 33,172 -1.5% *Travel Agencies include holiday business and business division (Travel Air).

Table 8. Table 5. Number of employees with a permanent contract by gender, Number of employees by gender 102-8 age range and professional category 102-8

2018 2017 2016 Director Administrator Manager Technician Professional Supervisor Women 23,360.47 (78%) 23,790 (78%) 26,005 (78%) Men 6,688 (22%) 6,711 (22%) 7,157 (22%) W M W M W M W M W M W M Total 30,048 30,501 33,162 <30 years 0 0 6 7 3 1 0 0 1,611 575 1 0 Estimated no. of employees at franchises 3,301 3,315 3,044 30-50 years 0 0 86 3 324 6 128 12 6,885 421 86 3 Employee partners 9,796 10,017 11,352 >50 years 0 0 11 1 44 12 9 10 1,480 139 6 23 EROSKI S. Coop. Partners 8,202 8,127 TOTAL 0 0 103 11 371 19 137 22 9,976 1,135 93 26

Table 6. W = Women M = Men

Number of employees by region 102-8

2018 2017

Andalusia 518 671 Aragon 927 925 Table 9. Asturias 486 473 Number of employees with a temporary contract by gender, Cantabria 386 414 age range and professional category 102-8 Castile-La Mancha 429 422 Castile and León 653 663 Director Administrator Manager Technician Professional Supervisor Catalonia 6,213 6,355 W M W M W M W M W M W M Valencian Community 164 247 <30 years 0 0 15 14 6 15 20 11 1,952 1,034 4 2 Extremadura 4 95 30-50 years 0 0 24 9 23 30 19 9 2,625 659 9 2 Galicia 5,427 5,317 >50 years 0 0 8 7 26 20 5 8 491 172 6 21 Balearic Islands 2,461 2,439 TOTAL 0 0 47 30 55 65 44 28 5,068 1,865 19 25 Canary Islands 72 77 La Rioja 353 368 W = Women M = Men Madrid 299 278 Murcia 210 216 Navarre 1,643 1,633 Basque Country 9,804 9,908 TOTAL 30,048 30,501

188 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 189 8. Transparency Transparency 8.

Table 10. Table 13. Number of employees by gender Distribution of employees by gender, age range and type of working day 102-8 and professional category

2018 2017 2016 Director Administrator Manager Technician Professional Supervisor

Full-time 18,155 17,933 19,281 W M W M W M W M W M W M % full-time 60% 59% 58% <30 years 0 0 16 16 73 42 37 17 2,683 1,327 22 19 Women 12,680 12,514 13,486 30-50 years 9 14 221 116 1,783 453 455 312 12,521 2,378 721 388 Men 5,475 5,419 5,795 >50 years 3 10 76 124 572 208 122 168 3,860 883 186 213 Part-time 11,893 12,568 13,881 Total 12 24 313 256 2,428 703 614 497 19,064 4,588 929 620 % part-time 40% 41% 42%

Women 10,680 11,276 12,519 W = Women M = Men Men 1,213 1,292 1,362 TOTAL 30,048 30,501 33,162

Table 14. Table 11. Rate of occupational accidents 403-2

Number and rate of new hires in 2017 and 2016 401-1 2018 2017 2016

2017 2016 Causes of occupational accidents Overexertion 42.7% 47.3% 49.7% Women Men 2017 Rate Women Men 2016 Rate Falls from the same or different level 11.2% 11.7% 10.8% <30 years 302 117 1.4% 400 131 1.6% Cuts 10.9% 10.2% 9.7% 30-50 years 532 171 2.4% 24 7 0.1% Other causes 35.2% 30.8% 29.7% >50 years 51 10 0.2% 177 78 0.7% Material agent Total by gender 885 298 601 216 Food, glass, plastic or packaging 41.2% 42.6%* Rate by gender 3.7% 4.5% 2.3% 3.0% Metal products and tools 9.0% 7.2% 7.4% TOTAL 1,183 3.9% 817 2.5% Forklifts or similar 7.3% 6.9% 6.3% Other material agents 42.4% 43.3% 41.0% Table 12. Rate of minor workplace accidents with leave** 33.9 32.2 29.7 Number and rate of turnover 2017 and 2016 Women 70% Men 30% (exiting employees) 401-1 Rate of serious workplace accidents with leave 4x10-8 29.7 Women 50% 2017 2016 Men 50% Women Men Rate Women Men Rate Rate of workplace accidents in itinere with leave 5.0 5.4 4.8 <30 years 80 48 0.4% 468 115 1.8% Women 70% 30-50 years 627 150 2.5% 147 52 0.6% Men 30% >50 years 151 60 0.7% 38 34 0.2% fatalities due to occupational accidents or diseases Total by gender 858 258 653 201 Women 0 0 0 Employee turnover rate by gender 3.6% 3.8% 2.5% 2.8% Men 1*** 0 0 TOTAL 1,116 3.7% 854 2.6%

*This was called “boxes and objects” in 2017 **Injury rate corresponds to number of accidents per million hours worked ***Cardiac arrest

190 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 191 8. Transparency Transparency 8.

Table 15. Table 18. Rate of workplace absenteeism People subject to performance evaluation in 2018

Professional category Women Men Total 2018 2017 2016 Director 12 48 60 Rate of workplace absenteeism 6.2% 5.8% Administrator 102 187 289 Women 6.8% 6.4% 5.9% Supervisor 776 525 1,301 Men 4.2% 3.8% 3.6% Professional 11,567 2,370 13,937 Absenteeism hours 2,983,380,30 Manager 1,145 1,015 2,160 Women 2,497,682,43 Technician 768 207 975 Men 485,697,87 TOTAL 14,370 4,352 18,722

Table 16. Table 19. Occupational illness 403-2 Percentage of employees receiving regular performance and career development evaluation in 2017 2018 2017

Rate of occupational illness 1.3 1.2 2017 2016 Women 93% 96% Professional category Women Men Women Men Men 7% 4% Director 36% 92% 40% 36% Administrator 51% 56% 39% 32% Table 17. Supervisor 75% 69% 59% 61% Average hours of training of employees by gender Professional 48% 41% 40% 36% Manager 58% 58% 55% 52% and professional category 404-1 Technician 79% 79% 65% 73% TOTAL 79% 21% 79% 21% Variation 2018 2017 2016 2017-2018 (%) Total Women Men Total Women Men Total Total Women Men Average Table 20. 6.9 6.3 7.0 6.8 1% training hours Number of employees with a disability by professional category Director 56 61.0 57.8 54.3 76.6 44.8 32.9 3% -20% 29% Administrator 12.4 8.9 12.2 19.8 19.5 19.9 16.8 -37% -54% -39% 2018 2017 Supervisor 17.4 16.9 15.6 17.4 19.7 14.3 8.5 0% -14% 9% % with disability with % with disability with Professional 5.1 5.0 4.5 4.9 5.1 4.0 5.2 4% -2% 12% Total Women Men Total Women Men respect to total respect to total Manager 11.9 9.6 5.8 12.0 12.9 8.8 11.3 -1% -25% -34% Director 1 0 1 0.3% 0 0 0 0.0% Technician 12.1 15.7 15.5 13.8 15.4 11.8 13.8 -12% 2% 32% Administrator 4 1 3 1.0% 2 0 2 0.5% Manager 22 14 8 5.7% 25 16 9 6.3% Technician 7 5 2 1.8% 9 7 2 2.3% Professional 339 210 129 87.1% 343 216 127 86.2% Supervisor 16 5 11 4.1% 19 7 12 4.8% TOTAL 389 398

*Distribution by age range was not included in 2017.

192 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 193 8. Transparency Transparency 8.

Table 21. Table 22.

Number of commercial and service suppliers per country 102-9 Number of business suppliers and local producers per region 2018 2017 2016

Spain 11,029 10,079 9,050 2018 2017 2016

China 70 83 93 Business Local Business Local Business Local %* %* %* France 63 66 67 suppliers producers suppliers producers suppliers producers Portugal 51 42 33 Andalusia 347 237 68% 361 244 68% 405 281 69% United Kingdom 33 33 21 Aragon 155 99 64% 155 93 60% 148 88 59% Germany 20 15 10 Asturias 94 72 77% 96 75 78% 103 80 78% Holland 20 17 11 Balearic Islands 189 155 82% 194 155 80% 194 154 79% Italy 16 14 16 Canary Islands 86 60 70% 91 63 69% 99 60 61% USA 13 7 5 Cantabria 84 63 75% 94 71 76% 102 77 77% Ireland 12 5 7 Castile and 186 101 54% 210 129 61% 285 197 69% León Belgium 12 16 16 Castile-La Man- Bangladesh 11 13 9 179 130 73% 203 151 74% 223 169 76% cha Denmark 10 10 7 Catalonia 948 503 53% 975 530 54% 983 539 55% Norwegian 9 7 7 Ceuta 2 2 100% 5 5 100% 5 5 100% Andorra 6 5 45 Valencian Com- 276 91 33% 288 114 40% 309 120 39% Vietnam 5 5 4 munity Pakistan 4 6 5 Extremadura 76 63 83% 78 64 82% 74 59 80% Switzerland 4 4 6 Galicia 440 295 67% 444 298 67% 542 299 66% Thailand 2 2 1 La Rioja 85 62 73% 89 65 73% 94 67 71% Luxembourg 2 1 1 Madrid 346 45 13% 354 52 15% 352 56 16% Greece 2 1 1 Melilla 6 6 100% 5 5 100% South Korea 2 3 2 Murcia 133 77 58% 136 81 60% 148 94 64% Poland 2 1 0 Navarre 196 154 79% 202 154 76% 196 149 76% Taiwan 1 0 0 Basque Country 444 278 63% 453 293 65% 457 284 62% India 1 1 1 TOTAL 4,272 2,493 4,433 2,642 4,719 2,778 Indonesia 1 1 0 Cyprus 1 1 0 Israel 1 0 1 *Percentage of regional suppliers as compared to total number of business suppliers. Singapore 1 0 0 Sweden 1 0 0 Table 23. Canada 0 1 1 Materials used in our own-brand products and packaging Slovakia 0 1 1 Tunisia 0 1 reported to collective producer responsibility systems 301-1 TOTAL 11,405 10,440 9,422 2018 2017 2016 Variation (Tons) (Tons) (Tons) 2017-2018 (%) The 2018 data also includes service provider information for VEGALSA-EROSKI Containers and packaging 2,457 2,868 3,119 -14% and, therefore, the data are not comparable. Non-renewable 1,235 1,210 1,449 2% Steel 312 239 294 30% Aluminium 49 45 37 10% Other 55 26 7 112% Plastic 818 900 1,111 -9% Renewable 1,222 1,658 1,670 -26% Ceramics 5 5 5 3% Paper/cardboard/wood/cork 1,107 1,570 1,486 -30% Glass 110 83 179 33% Batteries 101 69 100 46%

194 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 195 8. Transparency Transparency 8.

Compact fluorescent light bulbs 0.011 0.0005 0.001 2.279% Oil 0.113 0.5 4 -77% Table 27. Electrical and electronic devices 1,280 1,341 1,477 -5% Distribution of energy consumption by use (%)

Table 24. 2018 2017 Paper used in advertising, magazines and Natural gas Hypermarkets 63% 61% at the EROSKI company headquarters 301-1 Supermarkets 1% 3% Platforms 35% 36% 2018 2017 2016 Variation (Tons) (Tons) (Tons) 2017-2018 (%) Other 1% 0% Advertising brochures 4,809 4,707 4,949 2% Diesel Magazines 318 290 369 10% Purchased at source 25% 38% Headquarters 11 11 12 -4% Distribution to store 75% 62% TOTAL 5,137 5,008 5,330 3% Electricity Hypermarkets 20% 22% Supermarkets 66% 63% Table 25. Platforms 9% 9% Other 5% 6% Reused logistics containers 301-3

2018 2017 2016 Variation (units) (units) (units) 2017-2018 (%) Table 28. Reused pallets 4,944,741 5,490,795 4,911,481 -10% Energy intensity ratio at EROSKI 302-3 Recycled plastic boxes 41,862,959 41,823,759 42,889,880 0.1%

2018 2017

Table 26. kWh/m2 commercial surface area 634.34 575.00 Energy consumption within the organization 302-1 kWh/€ net sales 0.18 0.16

Variation 2018 2017 2017-2018 (%) Table 29. Non-renewable fuel (kWh) 278,116,806 279,835,108 -1% Natural gas (kWh) 9,976,723 8,707,115 15% Waste by type and disposal method 306-2 Hypermarkets 6,303,455 5,320,657 18% 2018 2017 Variation Supermarkets 146,106 243,781 -40% (Tons) (Tons) 2017-2018 (%) Platforms 3,475,140 3,107,443 12% Non-hazardous waste 47,181 40,749 16% Other 52,023 35,234 48% Recycling 38,460 32,638 18% Diesel (kWh) 268,140,083 271,127,993 -1% Dump 3,920 3,614 8% Purchased at source 68,158,438 70,864,197 -4% Recovery 4,801 4,498 7% Distribution to store 199,981,645 200,263,796 0% Hazardous waste (tons) 37 58 -36% Electricity (kWh) 545,436,683 577,596,444 -6% Recycling 37 58 -36% Hypermarkets 106,664,813 126,809,642 -16% Total waste generated 47,218 40,807 16% Supermarkets 360,707,898 366,678,551 -2% Platforms 51,531,373 50,879,535 1% Other 26,532,600 33,228,716 -20% Total energy consumption (kWh) 823,553,489 857,431,552 -4% Non-renewable fuel (GJ) 1,001,220 1,007,407 37% Natural gas (GJ) 35,916 31,346 15% Diesel (GJ) 965,304 976,061 -1% Electricity (GJ) 1,963,572 2,079,347 -6% Total energy consumption (GJ) 2,964,793 3,086,754 -4%

*The information has been reexpressed due to changes in the scope of diesel consumption in transport for 2017 only. Therefore, data for 2016 is not included in the table since it is not comparable.

196 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 197 8. Transparency Transparency 8.

Variation Table 32. 2018 2017 2017-2018 (%) Refrigerant consumed to compensate for leaks 305-1 Recycled waste 38,497 % 32,696 % 18%

Paper and cardboard 35,234 92% 29,898 91% 18% Variation 2018 2017 Plastic 2,424 6% 2,052 6% 18% 2017-2018 (%) Wood 370 1% 273 1% 36% R-407A 11% POREX 291 1% 263 1% 11% R-442A 46% 43% 7% Other 178 0% 210 1% -15% R-449A 3% 18% -83% Recovered organic waste 4,801 % 4,497 % 7% R-448A 23% 5% 360% Meat 2,110 44% 1,900 42% 11% Other 16% 34% -53% Fish 2,328 48% 2,278 51% 2% TOTAL (tons) 50.63 63.79 -21% Bread 244 5% 233 5% 5% Yoghurt 80 2% 54 1% 48% Fruits and vegetables 38 1% 32 1% 19% Table 33.

Greenhouse gas emissions – carbon footprint 305-1; 305-2; 305-3

Table 30. 2018 2017 Variation Tons CO eq. % Tons CO eq. 2017-2018 (%) Waste collected from clients for recycling 306-2 2 2 Direct emissions (Scope 1) 171,796 191,364 -10% 2018 2017 2016 Variation Natural gas 1,834 1% 1,601 15% (Tons) (Tons) (Tons) 2017-2018 (%) Road transport 67,954 40% 68,711 -1% Non-hazardous waste 608 625 637 -3% Refrigerants 102,008 59% 121,052 -16% Textiles 604 625 637 -3% Indirect emissions through electricity Coffee pods 4 consumption (Scope 2, average emission 223,629 248,366 -10% factor Spain) Hazardous waste 1,676 1,736 1,729 21% Hypermarkets 43,733 20% 54,528 -20% Electrical and electronic devices 1,490 1,559 1,529 23% Supermarkets 147,890 66% 157,672 -6% Batteries and energy sources 92 95 108 -3% Platforms 21,128 9% 21,878 -3% Light bulbs and fluorescent lights 22 13 16 73% Other businesses 10,878 5% 14,288 -24% Used oil 72 69 76 4% Indirect emissions through electricity Total 2,284 2,361 2,366 14% consumption (Scope 2, average emission 152,722 215,433 -29% mix of businesses) Hypermarkets 29,866 20% 47,897 -38% Table 31. Supermarkets 100,998 66% 138,500 -27%

Water extraction by source 303-1 Platforms 14,429 9% 16,485 -12% Other businesses 7,429 5% 12,551 -41% Variation Other indirect emissions (Scope 3) 309,923 435,639 -29% 2018 2017 2016 2017-2018 (%) Work trips (combustion emissions) 3,412 1% 3,133 9% Location Diesel transport (from the well to the tank) 15,370 5% 11,119 38% Supermarkets 69% 67% 59% 3% Diesel work trips (from the well to the tank) 614 0% 554 11% Hypermarkets 20% 21% 26% -1% Water 280,656 91% 411,222 -32% Platforms 6% 6% 9% 0% Paper consumed at EROSKI headquarters, 9,870 3% 9,612 3% Other businesses 5% 6% 6% -3% brochures and magazines TOTAL (m3) 951,375 1,065,815 1,763,459 -12% TOTAL** 634,441 842,436 -25%

*Water consumption for FORUM SPORT was included in 2018, but not in previous financial years. *The information has been reexpressed due to changes in the scope of diesel consumption, coolants and categories of scope 3 in transport only for 2017. Therefore, data for 2016 is not included in the table since it is not comparable. **Emission factor for electricity from the mix of businesses

198 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 199 8. Transparency Transparency 8.

Table 34. Reduction and intensity of greenhouse gas emissions 305-4; 305-5

Intensity of greenhouse gas emissions 2018 2017

Total

g CO2eq/€ net sales 135.0 175.8 2 kg CO2eq/m commercial surface area 488.7 621.0 Scope 1

g CO2eq/€ net sales 36.6 39.9 2 kg CO2eq/m commercial surface area 132.3 141.1 Scope 2 (mix of businesses)

g CO2eq/€ net sales 32.5 45.0 2 kg CO2eq/m commercial surface area 117.6 158.8 Scope 3

g CO2eq/€ net sales 66.0 90.9 2 kg CO2eq/m commercial surface area 238.7 321.1

Variation Reduction of GHG emissions Comments 2017-2018 (%) Direct emissions (Scope 1) -10% Consumption and the mix of Indirect emissions through electricity consumption -29% businesses emission factor (Scope 2) were reduced This reduction is due mostly to Other indirect emissions (Scope 3) -29% lower water consumption.

Table 35. Distribution by gender and age range of Governing Bodies

<30 years 30-50 years >50 years Governing bodies Total Number % Number % Number % General Assembly 249 2 1% 183 73% 64 26% Delegate Committee 354 3 1% 251 71% 100 28% Governing Council 12 0 0% 9 75% 3 25% Social Council 16 0 0% 11 69% 5 31%

Women Men Governing bodies Total Number % Number % General Assembly 249 188 76% 61 24% Delegate Committee 354 302 85% 52 15% Governing Council 12 6 6 50% 50% Social Council 16 12 4 75% 25%

200 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 201 8. Transparency Transparency 8.

Verification in accordance with Act 11/2018 on Non-financial Information and Diversity

Datos de la organización: EROSKI, S.COOP.

Declaración de Verificación de AENOR para con domicilio social en: Bº SAN AGUSTIN, S/N. 48230 - ELORRIO (BIZKAIA) Representantes de la Organización a efectos de estado de la informacion no EROSKI, S.COOP. financiera: D. ALEJANDRO MARTINEZ BERRIOCHOA en cargo de DIRECTOR DE SALUD Y SOSTENIBILIDAD relativa al estado de información no financiera consolidado EROSKI, S.COOP. tuvo la responsabilidad de reportar su estado de información no conforme a la Ley 11/2018 correspondiente al ejercicio anual financiera conforme a la Ley 11/2018. La formulacion del EINF así como el contenido finalizado el 31 de Enero 2019 del mismo, es responsabilidad de los Administradores de EROSKI, S. COOP. Esta responsabilidad incluye asimismo el diseño, la implantación y el mantenimiento del control interno que se considere necesario para permitir que el EINF este libre de incorrección material, debida a fraude o error, asi como los sistemas de gestion de los que se obtiene la informacion necesaria para la preparacion del EINF. EXPEDIENTE: 1995/0227/GEN/11

EROSKI, S.COOP. (en adelante la compañía) y sociedades del estado consolidado ha encargado a AENOR llevar a cabo una verificación bajo un nivel de aseguramiento Objetivo limitado del estado de información no financiera (en adelante EINF), conforme a la Ley 11/2018 por la que se modifica el Código de Comercio, el texto refundido de la El objetivo de la verificación es facilitar a las partes interesadas un juicio profesional Ley de Sociedades de Capital aprobado por el Real Decreto Legislativo 1/2010, de e independiente acerca de la información y datos contenidos en el estado de 2 de julio, y la Ley 22/2015, de 20 de julio, de Auditoría de Cuentas, en materia de información no financiera de la organización mencionado, elaborado de conformidad información no financiera y diversidad (en adelante, la Ley 11/2018), para el con la Ley 11/2018. periodo de verificación de sus actividades, ejercicio anual finalizado el 31 de Enero de 2019, incluidas en el EINF formulado en fecha 30 de abril de 2019, el cual es parte de esta Declaración. Alcance de la Verificación

AENOR, de conformidad a la citada Ley, ha realizado la presente verificación al ser El EINF incluido en el INFORME DE ESTADO DE INFORMACIÓN NO FINANCIERA un prestador independiente de servicios de verificación. 2018 consolidado formulado en fecha 30 de abril de 2019 y sociedades incluidas en los estados consolidados y relacionadas en anexo de esta declaración de EROSKI, En este sentido, AENOR ha realizado la presente verificación bajo los principios de S.COOP. y SOCIEDADES DEPENDIENTES (GRUPO EROSKI) integridad, independencia, ética, objetividad, competencia y diligencia profesional,

confidencialidad y comportamiento profesional que se exigen en base a las

acreditaciones que dispone, dentro de los ámbitos de aplicación generales de las Normas ISO/IEC 17021-1:2015 e ISO 14065, y particulares, como la Acreditación Materialidad otorgada por la Convención de Naciones Unidas para el Cambio Climático (UNFCCC) para verificación y validación de proyectos de Mecanismos de Desarrollo Limpio Para la verificación se acordó considerar discrepancias materiales aquellas (MDL). omisiones, distorsiones o errores que puedan ser cuantificados y resulten en una diferencia mayor al 5% con respecto al total declarado. AENOR, tal y como requiere la citada Ley, declara que no ha participado en procesos anteriores a la verificación del EINF.

AENOR INTERNACIONAL S.A.U. C/ GÉNOVA 6, 28004 MADRID AENOR INTERNACIONAL S.A.U. C/ GÉNOVA 6, 28004 MADRID Página 1 de 5 Página 2 de 5

202 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 203 8. Transparency Transparency 8.

Criterios Conclusión

Los criterios e información que se han tenido en cuenta como referencia para Basado en lo anterior, en nuestra opinión, no hay evidencia que haga suponer que realizar la verificación han sido: el estado de información no financiera incluida en la MEMORIA 2018 GRUPO 1) La ley 11/2018 de 28 de diciembre, por la que se modifica el Código de EROSKI. Estado de Información no Financiera formulado en fecha 30 de abril de Comercio, el texto refundido de la Ley de Sociedades de Capital aprobado por 2019, y para el ejercicio anual finalizado el 31 de enero de 2019, no proporcione el Real Decreto Legislativo 1/2010, de 2 de julio, y la Ley 22/2015, de 20 de información fiel del desempeño de EROSKI, S.COOP. en materia de julio, de Auditoría de Cuentas, en materia de información no financiera y responsabilidad social conforme a la Ley 11/2018. En concreto, en lo relativo a diversidad. cuestiones ambientales, sociales y relativas al personal, incluida la gestión de la igualdad, la no discriminación y la accesibilidad universal, los derechos humanos, 2) Norma ISAE 3000 (revisada), relativa a encargos de aseguramientos distintos lucha contra la corrupción y el soborno y la diversidad. o de la revisión de la información financiera histórica

3) Los criterios establecidos por la iniciativa mundial de presentacion de informes En Madrid a 21 de Mayo de 2019 de sostenibilidad en los standares GRI cuando la organización haya optado por este marco internacional reconocido para la divulgacion de la informacion relacionada con su responsabilidad social corporativa.

AENOR se exime expresamente de cualquier responsabilidad por decisiones, de inversión o de otro tipo, basadas en la presente declaración.

Proceso de verificacion realizado

Durante el proceso de verificación realizado, bajo un nivel de aseguramiento limitado, AENOR realizó entrevistas con el personal encargado de recopilar y preparar el estado de informacion no financiera y revisó evidencias relativas a:

• Actividades, productos y servicios prestados por la organización • Consistencia y trazabilidad de la informacion aportada, incluyendo el proceso seguido de recopilacion de la misma, muestreando información sobre la reportada • Cumplimentacion y contenido del estado de informacion no financiero con el fin de asegurar la integridad, exactitud y veracidad en su contenido

AENOR INTERNACIONAL S.A.U. C/ GÉNOVA 6, 28004 MADRID AENOR INTERNACIONAL S.A.U. C/ GÉNOVA 6, 28004 MADRID Página 3 de 5 Página 4 de 5

204 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 205 8. Transparency Transparency 8.

Report independently reviewed according to GRI standards

ANEXO

RELACION DE SOCIEDADES INCLUIDAS EN EL ESTADO DE INFORMACION NO FINANCIERA VERIFICACIÓN DE LA MEMORIA DE SOSTENIBILIDAD

EROSKI, S.COOP. CECOSA HIPERMERCADOS, S.L. EQUIPAMIENTO FAMILIAR Y SERVICIOS, S.A. CECOSA DIVERSIFICACIÓN, S.L. CECOSA SUPERMERCADOS, S.L. GRUPO EROSKI DISTRIBUCIÓN, S.A. GESTION DE HIPERMERCADOS CAPRABO EISA, S.L.U. VMS-2019/0017 SUPERMERCADOS PICABO, S.L.U

PARQUE MARITIMO JINAMAR, S.L. AENOR ha verificado la Memoria de la organización FORUM SPORT, S.A. VIAJES EROSKI, S.A. CENTRAL DE SERVEIS CIENCIES, S.L. CAPRABO, S.A. SOCIEDAD FRANQUICIAS EROSKI CONTIGO, S.L. EROSKI, S.COOP. EROSKI HIPERMERCADOS, S.COOP. ALCAMUGA, S.A.U. TITULADA: MEMORIA 2018. ESTADO DE INFORMACIÓN NO FINANCIERA. CECOSA INSTITUCIONAL, S.L. Conforme con: Estándares GRI CECOSA GESTIÓN, S.A. DESARROLLOS COMERCIALES DE OCIO E INMOBILIARIOS DE ORENSE, S.A. Opción GRI aplicada: Esencial SOCIEDAD DE AFILIADOS EROSKI CONTIGO, S.L. Proceso de Verificación: Para conceder este Documento de Verificación, AENOR ha comprobado la JACTUS SPAIN, S.L. adecuación de la memoria a lo requerido por GRI y ha trazado los datos e INMOBILIARIA RECARÉ, S.A.U. información contenidos en dicha memoria. GESPA FORUM, S.C.P.

APORTACIONES FINANCIERAS EROSKI, S.A. Fecha de emisión: 2019-05-21 VEGONSA AGRUPACIÓN ALIMENTARIA, S.A. VEGO SUPERMERCADOS, S.A. MERCASH SAR, S.L

AENOR INTERNACIONAL S.A.U. C/ GÉNOVA 6, 28004 MADRID Página 5 de 5 AENOR INTERNACIONAL, S.A.U Rafael GARCÍA MEIRO Génova, 6. 28004 Madrid. España Director General Tel. 91 432 60 00.- www.aenor.com

206 | ANNUAL REPORT 2018 | EROSKI EROSKI | ANNUAL REPORT 2018 | 207 Transparency 8.

This Sustainability Report was prepared in accordance with the 2016 Global Reporting Initiative Standards, the essential option. The content of the Report has been verified by AENOR. For any queries or suggestions about this report, contact us at [email protected] Printed on paper with FSC® (Forest Stewardship Council®) seal, which guarantees it is sourced from responsibly managed forests.

EROSKI | ANNUAL REPORT 2018 | 209