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ACTING RESPONSIBLY Contents 03 SCHWARZ GROUP PROFILE 04 Our Group and Our Locations 06 Shaping Change 08 Analysing our Priority Issues 10 Managing Sustainability 12 SUSTAINABLE PRODUCT RANGE 13 Environmentally Friendly Business with Strong Partners 14 Bringing Sustainable Consumption to the Society at large 16 ECONOMY– RESPONSIBLE GROWTH 17 Strong Market Position 18 Future-Oriented Stores 20 ENVIRONMENT – RESPONSIBLE VALUE CREATION 21 Conserving Resources 23 Valuing Recyclables 24 Supporting the Energy and Mobility Transition 26 SOCIAL COMMITMENT TO EMPLOYEES AND COMMUNITY 27 Our Staff 28 Raising Awareness 29 Joining Forces for a Good Cause 30 Legal Notice All information stated relates to the Schwarz Group 2018 fiscal year (March 2018 - February 2019). Any information that deviates from this is reported separately. 02 SCHWARZ GROUP PROFILE The Schwarz Group is one of the largest retailers in the world. We cover the lion’s share of the food retail value chain in house – from production through retailing to recycling. We endeavor to use and increase our ­influence­to­drive­forward­sustainable­development. Around employees 429,000Over stores 12 ,10 0 worldwide billion Over euros in turnover 100 03 Our Group and Our Locations GreenCycle Production GreenCycle, with its PreZero sales brand, is a The production companies Mittel- globally active waste management and recycling deutsche Erfrischungsgetränke (MEG), company belonging to the Schwarz Group. Bonback, Bon Gelati, and Solent belong to the GreenCycle uses its recycling expertise to contribute Schwarz Group. They produce own brand products to Schwarz Group’s plastic strategy. (beverages, chocolate, baked goods and ice cream) for Kaufland and Lidl. In addition, returned beverage bottles are recycled to create new ones in the group’s Kaufland­–­the­Full-range­Retailer own recycling and plastic processing plants. Kaufland operates over 1,300 stores in Germany and Eastern Europe, and also plans to open stores soon in Australia. It offers a total of Schwarz Dienstleistungen around 25,000 products in its large- scale stores, inclu- The Schwarz Group pools a variety ding 1,700 organic food items. As a full-range retailer, of services and offers them to all Kaufland offers its customers a wide range of food and its group divisions. These include operational and ad- non-food products. It also produces a significant part ministrative activities in Administration, IT and Central of its prepared meat products in its own meat proces- Services. sing factories. Lidl – the Discounter Lidl is present in 30 countries around the world, and currently operates 10,800 stores and over 160 goods distribution centers. On average, the assortment of Lidl includes 3,800 different products per year, of which an average of 250 are organic. As a discount supermarket, Lidl focuses on good quality for low prices. 04 Kaufland and Lidl Lidl Expansion of Kaufland or Lidl GreenCycle Production plants represented in more than 30 countries China USA Australia Hong Kong 05 Shaping Change As one of the world’s leading retailers, we shape the change neces- sary in those places we can actively make an impact: in production, in ­consumption­and­in­recycling­of­our­products.­We­are­taking­bold­action­ to­support­the­goals­of­the­global­agenda­for­2030.­In­pursuit­of­these­ goals we will set new industry standards. Leveraging­our­Influence The Schwarz Group is working together with its group divisons, customers and partners to drive the transition towards a sustainable society along its value chain. We make our contribution where we have the greatest leverage – in production, retail, consumption and recycling – in order to advance sustainable development in retail. Our Vision SDG­12­–­Ensure­sustainable consumption and production “Taking bold decisions patterns for sustainable transformation – Transitioning to a sustainable economy together, every day.” and lifestyle can only work if we change our consumption habits and produc- tion methods. To achieve this, we have to reduce our consumption of natural resources, as well as the quantity of waste and pollutants we generate along the entire value chain. As the third largest sector of the economy, retail is directly involved in how natural re- sources are processed and consumed. It is for this reason that the Schwarz Group focusses its sustainability efforts on Sustainable Development Goal (SDG) 12. 06 Our Commitments To underpin the strategic focus on SDG12, the Schwarz Group is cooperating with its different business units and subsidiaries, to achieve the SDG 12 targets relevant to the group’s business. It has set the first milestones towards the ambitious goals as follows: Sustainable­Raw­Materials SDG 12.2 Zero Waste SDG 12.5 We are conducting a systematic analysis until 2020 in order to We will reuse, recycle or recover a significant percentage of the set sustainable goals for our most relevant raw materials. waste generated in the company by 2025. Food Waste SDG 12.3 Empowerment SDG 12.8 By 2025, we will significantly reduce food waste in our own We will empower and support all of our employees in sustainably production and retail in all countries and will enable customers performing their jobs by 2022, and continue to do so thereafter. to do the same. We will provide our customers with greater transparency on the We will reduce food waste for selected raw materials along the social, environmental and health-related effects of our product offe- supply chain. ring, enabling them to make conscious decisions, by 2025. Chemicals SDG 12.4 We will strive to achieve healthy and environmentally friendly use of chemicals in production of our own brands by 2030. 07 Analysing our Priority Issues The­Schwarz­Group­surveyed­its­stakeholders­in­2018­on­relevant­sustainability­ issues­to­serve­as­the­basis­for­its­corporate­social­responsibility­(CSR)­focus.­ The­key­issues,­that­were­identified,­indicate­the­aspects­on­which­our­stake- holder groups expect transparency. The materiality assessment thus constitutes the­basis­for­Schwarz­Group­reporting. Materiality Process with an SDG Focus Step 1: Determining relevant issues Step 3: Surveying stakeholder The 17 Sustainable Development Goals (SDGs) with 169 targets The Schwarz Group surveyed more than 1,100 individuals from served as the basis for the materiality assessment the Schwarz Group our relevant stakeholder groups on the materiality of the selected concluded in 2018. Together with external experts, the Schwarz Group issues, online in May 2018. The survey sample included employees, initially pared these issues down to 80 company and industry-relevant business partners and banks. With a response rate of 33 percent, goals divided into 17 categories. Combining these with two expanded the Schwarz Group obtained results that represent the sustainability categories, animal welfare and product quality/safety, yielded 19 issues that the stakeholders consider the most important. categories with a total of 45 individual issues available for impact assessment. Step 4: Identifying key issues The final step involved superimposing the results of the impact Step 2: Assessing impact assessment and the stakeholder survey on all stages of the value In order to analyze the Schwarz Group’s impact on its environment, chain. This step identified six key issues: waste and chemicals, the group’s SDG achievement status was compared to the group’s climate protection, economic development, water and oceans, value creation. The Schwarz Group used the Bertelsmann Stiftung resource efficiency and health management. These six issues were SDG Index to analyze the targets relevant to specific countries, identified as having the greatest need for action in the countries in based on their implementation status. Those targets with achie- which the Schwarz Group operates. vement status rated as below average were then compared in a subsequent step with value creation or Schwarz Group sales in the countries concerned. Such comparisons enabled determination of the issues on whose improvement the Schwarz Group potentially has the greatest influence through its core business. More than 08 360 Banks Scientific Managers community Associations and Schwarz Group Business policymakers stakeholders partners NGOs Customers Employees stakeholders participated in the survey. 360 09 Managing­Sustainability Business­success­and­social­responsibility­are­inseparable­principles­for­the­ Schwarz­Group.­This­attitude­is­firmly­rooted­throughout­the­group­in­our­­corporate­ principles.­The­implementation­of­CSR­is­tailored­to­the­specific­environment­ of each devision. A joint committee in which all group divisions are represented ­ensures­a­group-wide­exchange­of­ideas. Our­corporate­principle­on­sustainability: “We assume economic, social and ecological responsibility in our daily activities.” Managing­Sustainability­Effectively KPIs and Measures at a Glance The requirements for effective CSR management are just as varied Group-wide transparency with regard to CSR measures and KPIs as the Schwarz Group’s areas of activity – from production, through is essential for comprehensive sustainability management. These retail, to recycling. The group divisions separately manage their constitute the central elements of reporting for internal and external sustainability activities in line with their individual environments for stakeholders. this very reason. The Schwarz Group has set out the CSR ma- nagement requirements in a central framework in order to ensure The Schwarz Group has
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