report 2003-2004 Sustainability - Grupo Eroski
Transcription
report 2003-2004 Sustainability - Grupo Eroski
Sustainability Report 2004 Sustainability report 2003-2004 Contents EROSKI SUSTAINABILITY REPORT 2003-2004 Contents 2004 sustainability report 1 About this report 5 page 04 page 41 5.1. 5.2 2 Letter from the Chairman page 06 3 Our organisation 3.1. 3.2. 3.3. 3.4. A year of advances. Generating wealth and well-being 5.3 5.4 5.5 Consumer vocation A driving force for economic and cultural development People Future generations: the Environment Society 6 Annexes page 08 An organisation for all of us Our interested parties Company structure Business Areas and Ensigns page 85 Annex I Correlation table with GRI requirements Annex II AENOR Validation Report Annex III Global Compact Progress Report 2004 Annex IV Social Action and 2015 Millennium Goals 4 A different way of doing things page 30 4.1 4.2. 4.3 2 Functional organisation Management of internal commitments Management of external commitments 1 About this report 1 About this report EROSKI SUSTAINABILITY REPORT 2003-2004 About this report About this report With this latest update of our sustainability report, we are continuing the work we began in 2002, consisting of providing information on the main actions we have carried out and the major indicators of Eroski's performance in the financial, environmental and social areas throughout the period 2003-2004. Firstly there is a description of our organisational model, to help the reader understand how we act and ultimately to evaluate the results obtained and their contribution to satisfying the requirements of the interested parties. Our aim is to give an accurate description of the commitments taken on with each of these interested parties, the fulfilment of these commitments, and the constant generation of value through the application of continuous improvement policies. As we aim to make all our communication with total transparency of information, we would of course be most willing to clarify, extend, comment on or respond to any additional queries you may have. We also attach the validation report issued by AENOR, for consultation purposes. Contact: Eroski Foundation Tel: 946 211699. info@fundacioneroski.es This report contains a balanced description of the Eroski Group's contribution in 2003 and 2004 to a more sustainable development of our planet. It has been drawn up in accordance with the recommendations of the 2002 Global Reporting Initiative Guidelines for sustainability reporting. Further information from www.eroski.es All information not included in this document is duly justified in Annex I. In most cases this refers to indicators which are either not applicable given the nature of our activity, or were not available while this report was being drawn up, in which case we shall be certain to include them in future editions. 4 2 Letter from the Chairman 2 Letter from the Chairman EROSKI SUSTAINABILITY REPORT 2003-2004 The World Commission on the Environment stated that "Sustainability is the ability of mankind to meet our present needs without compromising the ability of future generations to meet theirs" (Our common future, 1987). We could say that it is a question of guaranteeing a better quality of life for everyone, both now and for the generations to come. It consists of improving quality of life through t h e i n t e g ra t i o n o f t h r e e f a c t o r s , a l l interdependent: economic development, protection of the environment and social responsibility. We are witnessing the disappearance of the Baconian paradigm, accepted until the late twentieth century and which somewhat ingenuously took for granted that there was a natural link between scientific and human progress. We have since learnt that scientific advancement is neither a necessary nor direct synonym of well-being for all. We have also learnt that human beings need more than what mere market play alone can provide. We are witnessing a new era of social mobility, rejecting the causes of the unfair exclusion of others from the benefits of this market. Sooner or later, the businesses themselves will have to collaborate towards the disappearance of these causes and assume a model of sustainable development together with the community. The number of citizens who are concerned with the environment is growing; these are people able to foresee the long-term consequences of their behaviour and willing to act consistently. These are citizens who give their opinions and who assess and grant legitimacy to business behaviour, going beyond strict legal compliance. These citizens are not asking for greater power; they are asking for those who hold the power to do so responsibly. In Eroski's history, the vision of sustainable development formed an essential part of the company's founding values, exceeding the fulfilment of environmental regulations, legal requirements for staff management and the mere implementation of cleaner production concepts. Letter from the Chairman The Eroski Group is run on a peer-to-peer structural basis, an outstanding juridical and business organisation which embodies our values of social responsibility and marks our philosophy and identity. This is an organisation run by everyone for everyone, in which 12,298 workers are owners and key figures and a further 493,986 consumer members participate in education and information activities geared towards developing a healthy, environmentally friendly and solidarityorientated lifestyle. Our company has a peer-to-peer system of government with both workers and consumers on its Administration Council, to enable a combination of the sensitivities of both and bring the Group's strategy closer to the needs and expectations of society. Our vocation for attending and defending the consumers' rights and interests reaffirms our commitment to offering reliable products and services, practising solidarity with the community and being concerned with the environment. In this Sustainability Report, we assess our goals over the last three years and quantify our progress over this period, with the introduction of continuous improvement dynamics to the indicators of consumer vocation, our contribution to the development of the community and our commitment to the environment. This Report has been drawn up in conformity with the 2002 Global Reporting Initiative Guide, and it is a balanced, reasonable presentation of the economic, environmental and social activity of our organisation. Fortunately we are not alone on the path of sustainable development. We are accompanied by numerous businesses and social and citizens' groups who have a global vision of human activity, and incorporate these values to their vision and behaviour. Constan Dacosta 3 3 Our organisation Our organisation 3.1. An Anorganisation organisation of us 3.1. forfor all all of us 3.2. parties 3.2. Our Ourinterested interested parties 3.3. 3.3. Company Companystructure structure 3.4. Ensigns 3.4. Business BusinessAreas areasand and Ensigns Our organisation EROSKI SUSTAINABILITY REPORT 2003-2004 Our organisation We are a general consumer products and services distribution group and we aim for our products to be of top quality when they reach Spanish homes. We therefore guarantee the customer satisfaction commitment at all our centres. Our ethical management requires measurement, control and continuous improvement through indicators establishing our relationship with all the groups of interest. This Ethical Management Principle is inspired on our values, which are set out in the Code of Ethics and common to the whole of our organisation: COOPERATION The workers are the owners and key figures, and we consider Eroski as something belonging to us. We therefore feel directly responsible for its problems and successes, and they affect us in an immediate, personal way. SOCIAL RESPONSIBILITY At Eroski we aim to encourage development, not merely professional development but personal development as a whole, because if a person develops they are also developing the organisation at the same time, and this expanding spiral of evolution results in social advancement. Our activity extends to the group of people who carry it out, and it has a major influence on both our immediate environment - which we have a commitment to improving - and on the development of the Community. 8 CONSUMER VALUE Eroski's genuine consumer service vocation means the consumer is the most important aspect of our business project, and we adopt a policy of transparent, two-way communication, with a commitment to defending the consumers' rights and interests and with the provision of safe, healthy, environmentally friendly products. PARTICIPATION The active involvement of the workers in the project is the factor behind the origin and growth of our organisation. People are a guarantee of success for those to whom we gear our results and goals for improvement and advancement. INNOVATION We consider that constant renewal and the continuous search for new options in all our spheres of action is an essential condition for both our progress as a business and for adequately responding to the expectations our activity generates in society and for our consumers. EROSKI SUSTAINABILITY REPORT 2003-2004 Our organisation The Eroski Group therefore defines the lines of action for its mission for the reference period of this 2003-2004 Sustainability Report as follows: - Obtaining profits that will enable us to grow and generate wealth, and distributing them within a framework of cooperation and involvement in society. - Providing solutions to meet the needs of the different consumers through constant innovation. - Contributing to an improvement in the quality of life of the community in which we work, committing ourselves to the defence of consumers' rights, concern for the environment and promotion of economic and human development. - Creating a project and business model that will integrate people and encourage their personal and professional development. - Attaining leadership positions on the Spanish market. In line with our main strategic ideas, the entire organisation is involved in a philosophy whose guideline for the decision-making process is Social Responsibility. The entire organisation's commitment to making ethical management part of the Management's goals, including continuous improvement within the principles of Social Responsibility and checking it by means of indicators, has enabled us to obtain and maintain the SA 8000:2001 Standard certification. We are the first distribution company in Spain and the second in Europe to obtain this certification. Our activity as a socially responsible company develops our sustained commitment to respecting human rights and working with respect for the basic rights of the consumers, workers, suppliers and community. This commitment extends throughout the whole of 9 our chain of values, bringing the entire organisation together in the application of Social Responsibility policies in all its areas and business lines, in order to contribute to the sustainability of the society of which we form a part. 10 EROSKI SUSTAINABILITY REPORT 2003-2004 Nº of Certifications and acknowledgements Nº of Friends of the Eroski Foundation Nº of Eroski-Network card users Commercial network Investment (thousands of euros) Sales (thousands of euros) Profit (thousands of euros) 5,379 18 9,854 875,000 271,815.06 1,955 5,121,582.12 89,387.23 2002 900,000 580,540 7,374 18* 99,854 945,947 509,304.56* 1,556* 5,203,771.86* 108,394.48* 2003 9,789* 1,400,000 1,181,499 8,824 19 137,396 1,006,526 357,193.51 1,790 5,582,124.53 129,920.00 2004 Our organisation Nº of analyses and audits 334,000 10,785 48 13 How we do it Guarantees Confidence Nº of participants in the Idea Sana EROSKI activities (courses, counsellors, etc) 9,074 41 13 What we do Commitments Improving the quality of life Nº of local products 36 13 Growth Differentiation Healthy consumption Stable relationships Nº of shops with regional sections Individual regional campaigns Innovative offer Agreements with suppliers Proximity and development Customer loyalty Communication Promotion of local products and culture Management participation Nº of consumer members Nº worker members 9,793 7,985 516,675 13,079 7,419 7,297 341,333* 10,868* 6,864* 7,727 356,590 12,298 Nº of issues of Idea Sana EROSKI each year Company life The Eroski Group Management. Our progress in fulfilling our sustainable development goals. Consumer vocation A driving force in development A group geared towards people Level of participation on boards: consumer members worker members 11 EROSKI SUSTAINABILITY REPORT 2003-2004 Eroski Group Management. Our progress in fulfilling our sustainable development goals 3.27 2002 153,000 2003 159,124* Our organisation 2004 246,390 3.34 23.6 33.8 How we do it Twice-yearly people satisfaction survey 7,488,000 What we do Hours of training 569,097 Satisfaction Belonging 20.2 24.5 211,200 345,500 Quality of work 8,748,000 134.74 543,211 135 A group geared towards people % Eroski Natur products with environmental criteria 85,560 240,000 1,706.44 Hypermarket energy consumption 15,086,614 (Joules per m2 and hour) Packaging consumption (packaging/fresh sales) 162.58 598,540 Waste recycled (kilograms) 12.2 15.2 32,500 121,250 100 6,021.18 Meat Participants in environmental campaigns Participants in solidarity campaigns 50 1,526,20 1,187,543 Fruit and vegetables Consumer awareness-raising Nº of suppliers in e+5 programme 2,083,47 5,138,47 101,779* Eco-efficiency Involvement in product life cycle Social Action donations (thousands of euros) 802,311 Product donation programme Fair Trade sales 128.57 Solidarity 4,485,73 180,303 Recognition Encouraging healthy habits Social action Consumer-orientated campaigns (thousands of euros) 480,809 Experiencing values 120,200 Commitment to Environmental the Environment management Social action and solidarity Activities with workers and consumers * Data affected by Consum S.Coop. leaving the sphere of action of the Eroski Group. Our organisation EROSKI SUSTAINABILITY REPORT 2003-2004 3.1 An organisation for all of us The legal nature of the Eroski Group has marked our philosophy and identity since we first started out, setting us apart from the rest. Based on a cooperative model, it is structured on a peer-topeer basis and has the following characteristics: Owner/workers and key figures: The Eroski Group is owned by its 12,298 workers, and we are also the key figures in its management. Our share in the Group's capital, management and profits means we have a share in the project as a whole and are involved in running the organisation, receiving all the necessary in-company communication and training to be able to take part in the decision-making processes and perform our duties, always acknowledging each person's degree of autonomy and responsibility. The consumer members: 493,986 people are Member Friends of the Eroski Foundation and they participate in education and information activities for encouraging a healthy, environmentally friendly and solidarity-minded lifestyle. They are independently involved in managing the organisation, and can take part in the decision-making processes and in gearing the business to meet their needs and expectations, receiving to this end periodical, accurate and transparent information on how all the areas and business activities are progressing. Peer-to-peer running: The Administration Council is the ultimate management authority, and it is made up of workers and consumers, which guarantees compliance 12 with the company's needs and expectations in the decision-making process. The participation of workers and consumers enables the sensitivities of both of these groups to be combined, and brings the group's strategy closer to its surroundings, including them for greater satisfaction. Re-investment of surplus: We dedicate 10% of the profit obtained each year to social action and to activities for the defence of consumer interests and promotion of consumer rights, with a view to healthy, quality consumption. At the same time, social awareness and commitment to society have added a sense of responsibility to our relationships with our interested parties, which means establishing continuous communication channels and integrating their needs and expectations within our organisation's goals, in order to satisfy them and generate sustainable value. To guarantee its transparency and management ethics, the Eroski Group's Corporate Government is based on three Codes of Good Government, known by and accessible to the entire organisation via the intranet. These are the The Statute of Directors and Council Members, the Internal Rules of Procedure and the Internal Rules for the Administration Council and Governing Council. Our organisation EROSKI SUSTAINABILITY REPORT 2003-2004 GOVERNING COUNCIL · 6 worker members and 6 consumer members on the Counci. Half of them must be renewed every two years. · Monthly meetings with the General Management and the Consumer Management. · Functions: Election of the Cooperative Chairman. Annual ratifiction of the Managing Director. Chairmanship of the General Assembly. Establishing the Rules of Procedure. Representation and exercise of rights before Courts, Tribunals and State Organisations. Investment of available funds, subscriptions of contributions and issues of bonds and securities. GENERAL MEETING · Governing body presided by the Governing Council. · Annual meeting for approval of accounts, management plan, presentation of results and ratification of constituents proposed by the Governing Council. PREPARATORY MEETINGS Annual Informative Meetings for the workers and consumers for the election of the representatives for the General Meeting. COMPANY COUNCIL (*) CONSUMER COUNCIL · The Governing Council's advisory body for the · The Governing Council's advisory body for the workers. · Chairpersons are elected from each Executive Committee. · They put forward 6 Council Members to the Assembly, to make up 50% of the Governing Council. · The Cooperative Chairman and the Consumer Manager participate in an advisory capacity. consumers. · Chairpersons are elected from each Local Committee. · They put forward 6 council members to the General Assembly to make up 50% of the Governing Council. · The Cooperative Chairman and the Consumer Manager participate in an advisory capacity. EXECUTIVE COMMITTEES LOCAL COMMITTEES · Organised by regions. · Delegates are elected by the worker members. · They elect the Company Council members. · Organised by regions. · Delegates are elected by the consumer members. · They elect the Consumer Council members. Worker Members 12,298 owner workers Consumer Members 356,590 consumer members (*) As stipulated in Art. 59 of the Statutes, the Company Council is a competent body that can contribute to the suitable management of matters regarding worker members. Its work includes: 1. Drawing up the annual labour regulations 2. Presiding the Preparatory Meeting of the worker members 3. Carrying out the counselling and informative functions of the Governing Council 13 How we do it Promoting local products and culture Agreements with suppliers Healthy consumption Commitments Satisfaction / Belonging Participation in management Proximity and development Stable relationships Improving quality of life Guarantees and Confidence Feeling of solidarity FAMILY Our organisation FUTURE GENERATIONS EROSKI SUSTAINABILITY REPORT 2003-2004 What we do Growth / Differentiation Life in society Eco-efficiency Communication / Customer loyalty Quality of working life Customer awareness-raising Offering innovating products Environmental management Social action Living out values Involvement in product life cycle Encouraging healthy habits Activities with workers and consumers CONSUMERS 3.2 Our interested parties 14 PEOPLE SUPPLIERS ALLIANCES SOCIETY CUSTOMERS INSTITUTIONS OPINION LEADERS Our organisation EROSKI SUSTAINABILITY REPORT 2003-2004 We are people Day by day, Eroski's aim is to increase the participation and involvement of the owner members, and to increase our commitment through systems of evaluation, communication and empowerment geared towards encouraging management collaboration. At Eroski, people are an end, not a means. We form the base that withstands the organisation, as owners and key figures. Our degree of participation, the result of our commitment and our two-way internal communication all form part of: · Our management and objectives. · Our company capital and our profits. The owner worker growth tendency is counteracted in relative terms by the absolute reduction occurring in 2003 after Consum S.Coop. left the sphere of the Eroski Group. · Our prominence in the company and business life, via the company authorities. Evolution of owner workers 2000 - 2004 year 2004 12,298 2003 10,868 2002 13,079 2001 11,897 2000 10,675 7,000 8,000 9,000 10,000 The consumers We are the result of nine consumer cooperatives having joined together, and we have maintained this close relationship with the consumers, earmarking 10% of our annual profit to our commitment to them and to our surrounding environment. The consumers are key figures: they take part in the decision-making process within the Governing Council, and they are informed of the results of the measures taken. We study how we can satisfy their needs and expectations through efficient personalised attention, establishing various channels of communication. Our commitment is in the provision of guaranteed 15 11,000 12,000 13,000 14,000 healthy consumer articles at competitive prices and in an education and information programme to help them develop healthy, environmentally friendly, solidarity-minded habits. We share these interests with the Eroski Foundation Member/Friend, a figure who represents the cooperative's consumer members, those who participate in the business management and decision-making processes, and with the friends of the Foundation who are interested in collaborating with Eroski's educational and solidarity-orientated initiatives. The Member Friends are key figures in the Idea Sana EROSKI programme, and they are regularly sent information on the Eroski Foundation's activities and programmes for environmental and solidarity awareness-raising. EROSKI SUSTAINABILITY REPORT 2003-2004 Our organisation The Eroski Foundation This is a participative, constantly evolving organisation which furthers the development of Eroski's values in the community. It is particularly committed to guaranteeing the ethics and transparency of all matters affecting the consumers. There are three main parts to its mission: informing consumers, promoting sustainable development, and solidarity actions. Financial contributions to the Foundation enable us to carry out consumer-orientated action, conduct information campaigns, publish magazines and guides, provide grants and subsidies, collaborate with Third World aid organisations and stage solidarity campaigns for the donation of food, toys, school books, etc. The people mainly involved in this action are the consumers, and the aim is to provide a better quality of life for everyone. The Foundation is run by a Board of Trustees with representatives from the companies making up the Eroski Group, the consumers, and a group of experts who provide knowledge on matters such as health, the environment, solidarity and new technologies. It also has a large cross-disciplinary technical team who remain close to the consumers, developing a social and human project always mindful of their needs. This project consists of designing and drawing up an annual Management Plan with proposals for the members and friends, Consumer Information campaigns, informative products, solidarity, international cooperation and sustainability initiatives, Research Grants and Subsidies, an annual call for backing involvement in International Cooperation, Sponsorships and the Product Donation Programme. Our Suppliers Our suppliers are directly involved in the value chain, making our joint action programmes an essential tool for cooperation. Eroski particularly favours trade of fresh produce, entering into agreements with local manufacturers and trade unions who guarantee the sufficient financial stability to maximise the quality of their products. 16 Our collaboration affects the design and setting of product standards, subsequently controlled by the laboratory and the Quality System department, and internal management policies geared towards achieving social responsibility, with the crossintegration of all our Social Responsibility policies. This aspect is of particular importance since we obtained the SA 8000:2001 Standard. Our organisation EROSKI SUSTAINABILITY REPORT 2003-2004 We work together and also form a business relationship for defending workers' rights and practicing solidarity and protection of the Environment. In the same line, in 1999 we initiated a project for the diagnosis and gradual implementation of environmental management systems with the aid of the e+5 Programme, organised by Fundación Entorno in collaboration with the Ministry of Science and Technology, with the participation of over a hundred of our own brand suppliers. Strategic alliances Aware of the needs and expectations of our consumers, we form alliances with experts in the design and creation of products and services, and this is fundamental for innovation and continuous improvement of an offering which will provide maximum satisfaction for all our customers. This collaboration must tend towards extending our corporate principles and values, in addition to the main models, management processes and best practices. The organisation's Management Forum and Functional Committees play an essential role here in the diffusion of our philosophy and our allies' participation in its practical development. Our society Our influence on society goes beyond people's contribution as a vehicle for ethics. With 10% of our annual profits set aside for societyal concerns, we contribute to the sustainable development and welfare of our environment. Within this endeavour, the Eroski Foundation is a point of encounter for citizens aware of consumer rights, the protection of the environment and the nurturing of solidarity. It is an organisation that assumes society's objectives as its own and works to see them fulfilled, establishing channels for communication and dialogue with the various interested parties. 17 Eroski is a strategic ally of certain nongovernmental organisations, collaborating with human and financial resources and as a communication channel by means of social and environmental awareness campaigns, designing and defining solidarity-minded codes of conduct. Our customers For Eroski, concern for our customers goes above and beyond the purchasing process whereby we offer them products and services of guaranteed quality. We also offer them the all-round Idea Sana EROSKI ("EROSKI Healthy Idea") education and information programme to enable them to practice responsible consumption and develop healthy, environment-friendly and solidarity-minded habits. For those who wish to further their relationship with Eroski, we offer the possibility of contributing to our endeavour as Member Friends of the Eroski Foundation. We send them the latest information on our activities and encourage them to take part in the various environmental awareness and solidarity programmes. Institutions Administration and Public Compliance with legislation and our commitment to human rights and safeguarding the environment brings us closer to the business fabric and public administrations, as we are working with a common goal. We work on a permanent basis with the various administrations, local, regional and national, providing solutions, collaborating on the creation of laws and actively participating in improving the work standards of companies in different areas. This involves taking part in debate and opinion forums for awareness raising and nurturing of Social Responsibility policies geared towards welfare and sustainable development, as is described below in the section on our external commitments. Our organisation EROSKI SUSTAINABILITY REPORT 2003-2004 Opinion leaders Our endeavour to satisfy society's needs and the integration of this within our objectives, which we achieve by listening open-mindedly to all the interested parties, enables us to take our place alongside opinion leaders on an international level. Our participation in business, sector, consumer, social and Social Responsibility forums enriches our culture while enabling us to exchange knowhow and experience. Future generations Our human rights defence policies, protection of the environment and solidarity with the community all testify to our concern for meeting the basic needs of future generations. We are developing innovating policies with the aim of going beyond legal requirements and benefiting and safeguarding the present and future community. In this way we are integrating the concept of sustainable development described in the United Nations Bruntland Report. Family We commit ourselves to Eroski as people, with a view to becoming key figures and coparticipants, as the integration of our own personal objectives is also one of the organisation's concerns. Policies for conciliating work and personal life (flexi-time, voluntary leave, etc.), equality of rights of common-law and marital unions, sex equality, and our participation in the decision-making process is the guarantee of our welfare, as defined by the World Health Organisation. Eroski's rapport with its interested parties, groups with whom it maintains channels of communication, has varied to adapt to the evolution of the organisations themselves and of the environment in which they work. The high degree of commitment we have attained over the years has been maintained over time as a result of our excellent rapport and close communication and collaboration. Consumers and people are the first agents to whom we gear our search for solutions. This change in our rapport concerns the expectations placed in us by society, the local community, our suppliers, our team of professionals, investors, governments and society in general, and it is therefore of great importance to establish two-way channels of communication that will guarantee a sincere and enriching dialogue with each of the parties involved. 18 19 MEJORANDO INTERLOG SEDE magazine ADUNA magazine NEXO magazine MEANS Publication geared towards hypermarket managers giving information on good practices and interesting business improvement initiatives. Magazine with news exclusively affecting the platforms. Information on projects, good practices, interviews and news from the Eroski Group's central offices. An in-company magazine with information on the cooperative, start-ups, profits, goals, projects, acknowledgements and occupational safety. An in-company magazine covering all areas of the company, with particular attention given to financial and company data. What are our aims? Twice-monthly Twice-monthly Quarterly Twice-monthly Twice-monthly Frequency Customers Society Consumers Opinion Leaders Hypermarket managers. Platform workers Eroski S.Coop. members Prominent members For Our organisation Idea Sana EROSKI magazine Consumer information magazine that aims to make people's lives easier, with suggestions, advice, ideas and information on food and nutrition, sport and health, the environment and solidarity, with the aim of promoting a healthy, environmentfriendly lifestyle. A point of encounter in our commercial network for supporting environmental and social awareness-raising campaigns and personally communicating our initiatives. Permanent. Comprehensive leaflets which customers and consumers can take away with them, containing the information provided in our campaigns and with a summary of the content of all the information activities. Information and awareness-raising activities at our points of sale regarding environmental and solidarity issues encouraging consumers to adopt lifestyles that are beneficial to society and their environment. Quarterly Permanent Monthly Weekly Customers Society Consumers Opinion Leaders Customers Society Consumers Opinion Leaders Customers Society Consumers Opinion Leaders Customers Society Consumers Opinion Leaders Customers Society Consumers Opinion Leaders Central office workers Idea Sana EROSKI schools Idea Sana EROSKI forums Idea Sana EROSKI stands EROSKI Idea Sana collectables Idea Sana EROSKI campaigns Conferences given by specialist consumer motivators who inform the consumers on issues of interest such as "Television and well-being", "New technologies in the home", "The importance of music", "Lifestyle and happiness", etc. Meetings held at EROSKI establishments where information is provided on food and nutrition, food handling, leisure and free time, sport and health, the environment, domestic matters, etc. EROSKI SUSTAINABILITY REPORT 2003-2004 TOP-DOWN COMMUNICATION 20 MEANS What are our aims? 11 issues per year Frequency Consumers For Our organisation Consumer EROSKI magazine Consumers Society Opinion Leaders Consumers Daily Consumers Society Opinion Leaders Leading publication with rigorous and very useful information on our daily lives, dealing with important issues such as health, well-being, food, home economics, the environment, new technologies, leisure, culture, etc. It includes comparative analyses of both food and non-food products. Daily Consumers Society Opinion Leaders 2 per year 11 issues per year Consumers Society Opinion Leaders Special issues on well-being, food, sport, education and health, amongst many other subjects. (Past issues: Fruit, All about Baby, Vegetables, the Route of Santiago de Compostela and Taking better Care of Older People.) 2 per year Consumers Society Opinion Leaders Consumer EROSKI practical guides 1 or 2 per year Consumers Society Opinion Leaders 20 news items daily The digital Consumer EROSKI magazine is an electronic version of the printed magazine, supplemented with extended data and information and updated daily. Permanent Team of people Consumers Society Opinion Leaders Practical Guides in digital version to correspond to those published in printed format. Each recruitment Consumers Internet newssheet, updated daily, with items of day-to-day interest and three channels on "Home Economics", Nutrition and D.I.Y.. A guide for new members, detailing our organisation's values, mission statement and basis for management. Occasional Information channels on Food, Property, Your Rights, Travel, Technology, Economy, D.I.Y., Motoring, Education, Science, the Environment, Health, Solidarity and Food Safety. Welcome manual For reinforcing environmental awareness and encouraging environmentally friendly consumption and waste disposal. The web platform www.consumaseguridad.com deals with food safety from a rigorous and informative scientific and technical perspective. On-line courses developing themes of general interest for consumers (Past issues: "Stopping smoking", "Buying a home" and "Learning to learn?") Special features on Food, Property, Your Rights, Travel, Technology, Economy, D.I.Y., Motoring, Education, Science, the Environment, Health, Solidarity and Food Safety. Waste collection centres www.consumer.es EROSKI EROSKI SUSTAINABILITY REPORT 2003-2004 TOP-DOWN COMMUNICATION 21 "Freshometer" Executive committees Local committees Suggestion box Assessment interviews Noticeboards This is an Eroski Foundation initiative consisting of a macro opinion poll for measuring consumer attitudes and perceptions regarding issues of consumption, confidence in foods, prices, etc. Measurement of customer satisfaction with the fresh products on offer at the hypermarkets. Main mechanism for measuring the company atmosphere of the Group. Company body in which all the cooperative's workers are represented through a delegate elected from the members of each work area, shop or business. These are bottom-up and top-down communication channels. Monthly meetings at which consumers assigned to the different shops carry out monitoring and control of how the Education and Promotion Fund (EPF) is being managed as part of the 10% of our profit earmarked for society. Permanent channel for gathering a variety of information and requests from both workers and customers, enabling us to detect opportunities and threats and work towards continuous improvement. System for assessing work through a personal interview enabling us to evaluate people's personal and professional achievements, to establish and agree on work areas and objectives and to gather contributions from the person assessed. It is a quantitative and qualitative measurement for a better evaluation of work. A space where information of interest to the people of our organisation is posted. Yearly Yearly Yearly Twice-yearly Monthly Monthly Permanent Yearly Constantly used Frequency Consumer Members Prominent Members Consumers Consumers Consumers Team of people Prominent members Prominent members Team of people Consumers Team of people Team of people For Our organisation Consumer barometer A study whose first results were obtained in 2003 and which aims to measure customers' perception and confidence with regard to our guarantee commitment and inform of product health and safety and personal attention. The survey is made by ensigns, evaluating aspects such as price, range, services, fresh produce (variety and quality), commitment to the environment and overall evaluation of our own brands. Yearly Consumer Members Prominent Members What are our aims? Consumer value survey Preparatory Meetings are held once a year to attend to and comply with the worker members' and consumer members' right to information. The General Management inform of the profits, data, initiatives and rulings for each financial year, thus providing the members with direct, clear, dynamic information and enabling them to participate. Yearly MEANS Preparatory meetings before General Meeting* Point of encounter with the participants on the education and information programme Idea Sana EROSKI. They are organised with a view to our customers being able to actively participate in our organisation. Satisfaction survey Eroski Foundation Member Friend Meetings EROSKI SUSTAINABILITY REPORT 2003-2004 TOP-DOWN COM. BOTTOM-UP COMMUNICATION 22 PRISMA (Intranet) Information bulletins Eroski Foundation Report Environmental Report Company Council Report Statistical staff report Social and Labour Report Minutes of the meetings PRISIO Customer service line Cooperative activity MEANS Internal information channel providing the workers with access to a large amount of information and utilities via the private network, with a simple, dynamic and attractive layout. Information of general interest made available to the members of the organisation through the channels established to this effect (e-mail, notice boards, Intranet, etc.), as frequently as required. Annual report summarising developments in the Eroski Group Foundation's three areas of action: protection and defence of consumer rights, defence of sustainable development and solidarity commitment. Contains the Eroski Group's environmental action principles, and the results implemented with their different scopes and management systems. Periodical report published by the ultimate representative body of the worker members of the Eroski Cooperative Society, and describing its work throughout the year. Report analysing people-related aspects and variables through the use of indicators and significant data, periodically processed and evaluated. Report analysing the major aspects and variables relating to the people in the company. Report drawn up after a meeting, to include the agreements concluded in the meeting, the names of the participants and the date and place it was held. Eroski's institutional rapport plan for optimising negotiation with institutional leaders with a strategic decisionmaking capacity, in order to strengthen the Group's corporate image and its contribution to socio-economic development, so that decisions made by institutions which could affect the Group are known about in advance, and to transmit the values and virtues of our company model. An information service and channel of communication with consumers, through which Eroski receives concerns, complaints and suggestions. Approaching and getting to know the consumers in order to protect their rights. We are attached to the Consumer Arbitration Boards of the Community of Madrid, the Regional Community of Navarre (as a distribution company and consumer association), the Valencian Community, the Region of Murcia and the Basque Country. We also contribute to defining and executing the management plans of the Senior Council of Cooperatives of the Basque Country, the Consumer Consultative Commission of the Basque Country, the Board of Consumers of Madrid and the Confederation of Cooperatives of the Valencian Community. What are our aims? Permanent Permanent Permanent Yearly Yearly Yearly Yearly Yearly Each meeting Permanent Permanent Periodically, depending on the Arbitration Board Frequency Team of people Team of people Team of people Prominent members Consumer members Team of people Team of people Team of people Team of people Team of people Opinion creators, Public Admin., Allied investors and Strategic Members Consumers Opinion creators Consumers For Our organisation www.fundacioneroski.es Web Platform where the activities of the Eroski Foundation are described and the Friends of the Foundation can access specially reserved information. This is information of general interest regarding health, safety, solidarity and the environment, as well as exclusive services regarding education, forums and consultations. Permanent Team of people Consumers Society Opinion leaders www.eroski.es Website for notifying of the organisation's activities as a distribution group and informing of specific business actions geared towards satisfying consumer needs, offering products and services which assure healthy, guaranteed consumption. EROSKI SUSTAINABILITY REPORT 2003-2004 BOTTOM-UP COM. HORIZONTAL COMMUNICATION Our organisation EROSKI SUSTAINABILITY REPORT 2003-2004 3.3 Company structure We are a distribution group for general consumer products and services. The group was created in 1990 when nine consumer cooperatives joined forces. Through our different alliances with other companies, we have become a major distribution group bringing together companies from a variety of origins and conditions and which has achieved great expansion throughout Spain, sharing corporate values. Today, other companies such as Supera, Udama, Vegalsa and Mercat have also joined our group, working in the supermarket format, and EROSKI is now the brand with the most centres in Spain. UDAMA Udama, a company totally incorporated to the Eroski Group, is the leading supermarket chain in the Aragón region, with over 54 supermarkets and 12 franchise establishments under the name of Aliprox. It has also consolidated its position in Andalucía with more than 72 shops, including supermarkets and franchise establishments, making it a reference brand for the consumer in this region. SUPERA Supera, a subsidiary of the Unión de Detallistas Españoles S.Coop. (the Unide Group), has become incorporated to the group on a large scale with 49 supermarkets, enabling the expansion of our commercial network in the Community of Madrid and the regions of Extremadura, Castilla-León and Castilla-La Mancha. 23 VEGALSA Vegalsa, a family supermarket group with 182 establishments in the Galicia region, now bears the Eroski ensign with a participation of 50%. MERCAT Mercat, a leading name in the Balearic islands, heads the commercial offer in this area with 129 supermarkets, giving it a major share of the market. In the international sphere in 2004 we consolidated an alliance with the French group Les Mousquetaires, thus taking our first step towards international expansion by becoming integrated with a joint purchase management platform with a view to the future joint development of skills and businesses. The Mousquetaires group has a network of 4,000 establishments in different European countries, positioning it as the second biggest distributor in France and the fifth in Europe. It is an outstanding negotiator with international producers, and has some 112,000 collaborators at present. At the same time, we have been managing strategic alliances with a view to facilitating the integration of new members and thus consolidating our top world distribution ranking over the next few years. Our organisation EROSKI SUSTAINABILITY REPORT 2003-2004 3.4 Business areas and ensigns During 2004 we made the decision to provide our visual identity and brand design with a new look, with a design based on the brand name EROSKI, in the interests of a more standardised image that will be more readily identified by the interested parties. As a result, the internal structuring of the management and operation of each division is no longer significant for the consumers who already know us by our trademark: EROSKI. The series of Eroski Group brand names is structured as follows : Under the umbrella of the Eroski Group, wellestablished and expanding throughout Spain, we operate in different business areas that have been created on the basis of our knowledge of the food area and our close relationship with our consumers. We wish to satisfy their needs to the full, and with this in mind we have diversified our activities, both functionally and geographically, to include other complementary services. 24 The Eroski Group is also present in France with a total of 38 establishments. Our geographical distribution, which can be consulted on our website www.eroski.es, is growing for all our lines of business and has reached the figures described in the summary of our commercial network: Our organisation COMMERCIAL NETWORK TABLE 2004 EROSKI SUSTAINABILITY REPORT 2003-2004 Start-ups Total EROSKI 8 74 EROSKI/Center 20 489 Spain 157 EROSKI/City EROSKI Service Stations 7 38 EROSKI Travel Agencies 32 208 FORUM-SPORTLAND Sports Shop 8 31 IF Perfumeries 26 172 ABAC Leisure and Culture 1 2 22 CASH RECORD Food Service 1 6 Total Spain 103 1,199 France Hypermarkets 3 Supermarkets 18 Service Stations 17 Total Own network 1,237 Aliprox and other franchises 19 TOTAL GROUP 122 Food distribution This is the Group's main and most traditional activity. Our establishments cover a full range of shopping centres, hypermarkets, supermarkets and self-service franchises. 553 1,790 our establishments which we nurture. Also during 2004 we have made major investment in infrastructure and improvement of the services we provide, consolidating the process of development begun in previous Our leadership as regards fresh produce, consumer information and value for money, together with the promotion of regional products, are some of the characteristics of 25 years, particularly as regards IT systems and the logistics chain. The aim of this is to contribute to improving the satisfaction of our now over 200 million customers. Our organisation EROSKI SUSTAINABILITY REPORT 2003-2004 Branching out The Eroski Group has successfully keyed in to the consumers' new trends and requirements, and we now also run a thriving line in travel agencies, perfumeries, sports shops, leisure and culture, real estate, service stations, opticians and stand solutions. All these services aim to complete our already wide distribution service in the food domain. Viajes Eroski travel agencies are much more than just good prices. Our line of leisure and relaxation holiday travel agencies, with 207 establishments functioning in 2004, focuses its efforts on increasing the number of offices and restructuring its commercial model with a view to directly involving its customers in designing their own holidays. In this way we continue to offer a high quality product, recognised by the ISO 9000 and Spanish tourism Quality Q certifications. Travel Air specialises in business travel and is characterised by its high degree of specialisation, transparent management and full international cover. Perfumeries. At present the chain includes 172 points of sale, following the acquisition of the Aragon chain Dyper and Brisas, the leading perfumery chain in the Asturias region, and the great expansion effort that has given rise to the In Faradis chain. In 2003 this chain standardised its image and brand all over Spain. Leisure and sport. We have a total of 31 shops plus a virtual establishment, whose shareholders include 56 sports professionals from different areas. Under the name of Forum and Sportland, located in shopping centres and city high streets respectively, these establishments offer multi-specialist sports products classified into 18 different departments. Leisure and culture. A new style of shop specialising in leisure and culture, under the name of Abac and created as an appealing space with a non-sexist and non-violent recreational/educational and cultural offer for free time. It contains bookshops, stationers, educational toys, handicrafts, fine arts, music, multimedia and an activities workshop. 26 Our organisation EROSKI SUSTAINABILITY REPORT 2003-2004 Services for the customers at our centres Opticians. We now have five opticians providing personalised advice and eye tests for all our customers. Service stations. We have 38 service stations in 11 Autonomous Communities, providing a quality product at more competitive prices. Their motto is fill up, pay and get on the road as quickly and as comfortably as possible. Online purchases: Eroski is now offering its food customers in Vitoria, Greater Bilbao and Pamplona the possibility of acquiring all the products normally on sale in a supermarket (over 6000 different products) through an online service at competitive prices and with a quality guarantee on both products and service. Real Estate: This is a comprehensive service including notary transaction, registration and property structuring, an improved commercial service and a better purchase guarantee, with a wide range of possibilities as regards places, location and property format. Our real estate sales include promotions on the Andalusian coast, the Mediterranean coast, La Rioja, Cantabria, Burgos and the Costa Daurada, with a maximum guarantee of quality and professionalism at a very competitive price. Soluciones is the commercial space located within the Eroski hypermarkets of Artea, Pamplona, Abadiano and El Boulevard, offering contract products and services: - Financial products: Mortgage loans and Personal loans. - Insurance: Car, Home, Health, Life, Accident and Temporary Disability. - Real Estate: Private promotions and housing developments both on the coast and inland. - Issue of Eroski-Red cards. 27 EROSKI SUSTAINABILITY REPORT 2003-2004 Our organisation Own brands The guarantee of food quality and safety for our own brand products, in addition to each particular product's compliance with intrinsic standards of composition and characteristics, is our philosophy for guaranteeing the consumers' rights and offering reliable, objective information for healthy, solidarity-minded and environmentally friendly consumption. The specific characteristics of our own brand products are listed on the packaging and labels and in information leaflets, aiding consumers to decide what to buy: Eroski: Our own brand products include double-checked food quality and a safety guarantee as part of their characteristics. They also include our commitment to the environment and adapt to different situations, as we have expanded the general range to respond to society's requirements: non-animal tested personal hygiene products, eggs with Omega 3, special milk, Delta del Ebro rice, designation of origin wine, organic nougat, eco vegetable preserves, etc. So, we are working to cater for the basic needs of all types of customer with the guarantee and competitiveness that are our trademark, satisfying 6 million homes and deepening our commitment to top quality, health, useful information and unbeatable prices. Eroski NATUR: This category offers consumers high quality meat, fruit and vegetables, guaranteeing an optimum product selection and striving for excellence of origin and taste. We offer 100% Spanish meat from farms with whom we permanently collaborate and with strict control of rearing conditions, and fruit and vegetables from the best integrated production cultivation areas, harvested at optimum ripeness and with rigorous monitoring of key standards to guarantee excellent taste. We also guarantee total traceability from origin right to the point of sale. The brands Romester for sports material, Visto bueno for textile products and Ecron for domestic appliances and image and sound equipment complete the range exclusively sold in our establishments and for which we guarantee compliance with all the specific UNE standards. 28 4 different way way AA different of doing doing things things of 4.1 Functional organisation 4.2. Internal commitment management 4.3 External 4.1 Functionalcommitment organisation management 4.2. Management of internal commitments 4.3 Management of external commitments A different way of doing things EROSKI SUSTAINABILITY REPORT 2003-2004 4.1 Functional Organisation The Eroski Group manages and directs its main business, the distribution of general consumer goods and services for the home, from its main offices, with top-level PRESIDENT Supermarkets MANAGING DIRECTOR ALLIED COMPANIES management, functional offices and business management providing the necessary support for carrying out our activity. Hypermarkets Technical bureau Commercial Social Supera Coord Vegalsa AGRO-FOOD 30 Udama Andalucía Economic/Financial Travel Agencies Udama Aragón Corporate Assets Guarantee Legal/Fiscal Sofides NEW BUSINESSES Development Computers and Systems Mercat Company Management CORPORATE MANAGER Corporate Planning Consumption Logistics General Secretary Sport and leisure Horeca Legal Advisor President's Deputy Manager Perfumeries Leisure and Culture Promotion Mass Catering Fruit and Vegetable production Dairy products Animal food Ready-cooked dishes The Governing Council is the governing, management and representative body of the Cooperative Society, subject to the General policy agreed on at the General Meeting. Its legal representative is the Chairman of the Governing Council and also the Chairman of the Cooperative. must be ratified annually by the Governing Council. The ultimate executive body is the Board of Directors, consisting of the Business Units and functional area managers. This Board elects the Group's Managing Director, whose appointment The Annual Eroski Corporate Management Report includes the ownership and company administration structure and can be consulted at our website www.eroski.es. The management function is governed under the principle of free choice and confidence. The corporate values, which it undertakes to transmit, the operational practices and the management profile are specified in the Management Statute. A different way of doing things EROSKI SUSTAINABILITY REPORT 2003-2004 4.2 Internal Commitments The Eroski Group's mission statement includes two relevant aspects, amongst others: The creation of a project and business model that involves people, encouraging their personal and professional development. Commitment to defending consumers and the environment, "contributing to improving the community in which we work, as an expression of our social responsibility. The EFQM general management model The Eroski Group applies a management model based on the principles of the European Foundation for Quality Management (EFQM). This enables us to evaluate the quality of our management and adopt measures for improving all the areas and business units. This global model, based on both horizontal and vertical management systems, sets specific goals, plans of action, instructions and control and monitoring tools that guarantee the application of the commitments taken on by our organisation, favouring the overall management system. So, for example, we identify the Global Compact principles referring to human 31 rights, labour regulations, the environment and anti-corruption, and develop them in accordance with our work model. The implementation of this system has focused our efforts and resources and based our management on the satisfaction of our customers and workers and on economic efficiency, through continuous improvement. To d a t e w e h ave o b t a i n e d 2 E F Q M management quality excellence model Silver Q certifications, for the Elorrio general goods platform (2002) and the Amorebieta fresh produce platform (2004), and we are continuing to work on extending the model to the entire organisation. EROSKI SUSTAINABILITY REPORT 2003-2004 A different way of doing things Quality Management System The best way for us to attain a high competitiveness level and ensure defence of consumer rights and interests is to be committed to the quality and safety of our products and services, from their production right down to their consumption in the customers' home, and the provision of rigorous, reliable information. Quality management is a basic mainstay of the work we do. We have therefore implemented exhaustive controls to guarantee safety and hygiene throughout the whole of the chain: · Manual of Food Alert and Product Recall for quality reasons, to guarantee safety and the criteria on which Eroski applies the principle of precaution at all times. · Initial certification and analytical monitoring audit for suppliers of Eroski brand products. We guarantee traceability and control of the quality standards as regards the freshness and healthiness of our products, with continual advancement regarding defence of the consumers' rights and interests and of the environment. In this way we fully comply with the satisfaction of what we define as Consumer Value, a priority objective for Eroski. · Quality management systems in accordance with the ISO 9001 Standard for the receipt, storage, cold chain maintenance, despatch and transport of the products to the points of sale. · Hazards Analysis and Critical Control Points (HACCP) at the points of sale for daily checking of product condition, cold chain maintenance and hygiene and cleanliness of the installations. · Periodical analysis of the microbiological quality of the products and the hygiene of the surfaces on which the fresh produce is handled. · Periodical internal and external audits for checking quality control systems and tools. · Traceability systems for fresh produce. 32 Our own laboratory is a key element for the Product Quality Department, which forms part of the Consumption Area and is accountable to the General Management. It is accredited in accordance with the UNE-EN ISO/IEC 17025:2005 Standard Conformity assessment. Requirements for the competence of testing and calibration laboratories, which assures the reliability, legal value and traceability of the results. It also functions as a reference laboratory in charge of certifying the sub-contracted laboratories that much pass a control of their installations and work practices. A different way of doing things EROSKI SUSTAINABILITY REPORT 2003-2004 The Eroski Group Laboratory: Work programmes We perform a variety of studies at our laboratory, most of them in combination with other analyses for more rigorous results, to check that the foods comply with the legal parameters and, sometimes, to issue a verdict on their quality. In the Chemical unit, data is obtained on composition, quality and the presence of undesirable substances. The Microbiology division studies any possible contamination of the products from microorganisms which could be hazardous (pathogens). The recently-created Genetics unit tests various aspects such as product authenticity and food safety (see chapter 5.1. "Consumer Vocation" for information on the new analytical procedures that have been incorporated). · Comparative Analyses. Published in the Consumer EROSKI magazine, these are a comparative assessment of the value for money of the main brands of a product. · Selection of Eroski products. Previous analysis among suppliers of the minimum requirements for the launch of an Eroski brand product. · Control of Eroski products. Monitoring of Eroski brand products to check the agreed quality level is being maintained. · Detection of genetically modified organisms (GMOs). Analysis for fulfilment of our commitment to the exclusion of transgenics from Eroski brand products. · Complaints. The analytical procedure required for investigating the origin of customer complaints and preventing them from occurring again. · Regional awards. Selection of the winning product in the special call-up for regional suppliers we hold yearly. Chemical Unit · Control of products manufactured in our production centres. Analytical control in our meat processing centres, distribution headquarters and Olilan oil bottling plant. 33 Microbiology Unit: · Microbiology campaigns. Assessment of the state of freshness and checking for any contamination through handling or the presence of pathogens, throughout the entire commercial network. · Life span determination. Definition of the life span of perishable products. Sub-contracted analyses: Eroski Natur meat residue plan. It is guaranteed that there are no traces of illegal fattening agents or drug residues. · Plan for control of phytosanitary residues in Eroski NATUR fruit and vegetables. To guarantee there are no traces of phytosanitary and pesticide residues in amounts exceeding half of those permitted by law. · Hygiene monitoring at the centres and platforms. Study of the degree of contamination of surfaces and utensils at the centres and platforms, to assess their microbiological state and the suitability of the cleaning products. · Control of non-food products. Specialist laboratories are required for the analysis of non-food products such as drugstore, cosmetics and bazaar products. EROSKI SUSTAINABILITY REPORT 2003-2004 To achieve leadership in technological innovation for the introduction of new procedures guaranteeing healthy, quality consumption, Eroski supports and collaborates with technological innovation centres as part of the food area R+D Plan, which involves us in a growing number of new projects, detailed below in section 5.1. Consumer Vocation. Ongoing projects are as follows: - Development of PCR food analysis techniques with the Gaiker Technology Centre. This analysis uses the PCR technique to identify DNA fragments. It can be used to detect pathogenic microorganisms and identify transgenic species and ingredients in foods. A different way of doing things to combat pests and disease, reducing to the utmost the environmental impact of agricultural production and derived contamination. - Improving the quality and lifespan of ready-cooked foods, with the AINIA Technology Centre. Research and improvement project for new materials and packaging technologies. - Food chain assurance, in collaboration with Mondragon University. A study on the monitoring and improvement of cold storage units at the points of sale, and on the installation of discontinuous cooling systems guaranteeing cold chain maintenance. - Implementation of integrated production techniques for vegetablegrowing, with the Neiker Technology Centre. Biological pest control procedures Ethical Management System As an indication of our control and awareness-raising work, we are committed to our workers throughout the whole of the production chain. Respecting and safeguarding human rights is a priority objective for Eroski and is shared throughout the organisation, with a view to assuring people's physical, psychological and social well-being everywhere we operate. For this reason we have obtained certification in accordance with the SA 8000:2001 Standard. Our responsibility entails internal monitoring and monitoring of our suppliers, particularly the most critical producers, for whom we have designed a future plan which will make use of external audits to guarantee gradual compliance with the criteria established in the SA 8000:2001 Standard. We have formally undertaken to implement an Ethical Management System, which will be 34 a guideline for managing the work with our interested parties, both internal and external. The monitoring of this system is led by an Ethics Committee consisting of the General Management, Consumer Management, Social Responsibility Management, Social Management and Purchase Management departments, and this is an indicator of our high degree of commitment with achieving its aims. A different way of doing things EROSKI SUSTAINABILITY REPORT 2003-2004 Its implementation is carried out through a Management Team, whose aim is to achieve continuous improvement of the indicators governing our relationship with our suppliers (working conditions, occupational health and safety, etc.), our prominent workers (participation, integration of different groups, training, voluntary turnover rate, remuneration, people satisfaction), our consumer partners (new members joining each year, assessment survey, participation index), society, and the surrounding environment. Every year, the members of the Ethics Committee perform an internal audit using a self-assessment tool created by the Danish Ministry of Social Affairs and adapted for use with our organisation. At the same time we also have an annual external audit carried out. Occupational Risk Prevention System. Attention to people in all our areas and business units is complemented with an occupational risk prevention system that complies with current legislation and provides for systematic measures to be taken, identifying areas for improvement. The system is managed around a Joint Prevention Service, led by the Eroski Prevention Service Manager, who establishes and coordinates the common measures, policies, plans and objectives (see section 5.3. People.) Management authorities like the Health and Safety Committee, the Prevention Representatives and other actors such as the Prevention Coordinators help to implement it. Environmental Management System: ECOPLAN Our commitment to sustainable development and to satisfying the basic needs of the future generations means combining the preservation of the environment with an endeavour to bring together social well-being and financial goals. Our predominance as regards minimising the impact on climate change, protection of natural resources, waste management and the preservation of biodiversity is an obligation for us. Our Environmental policy is run by the Quality and Environment Department, who ensure compliance with the objectives integrated within all the areas and business lines. We also encourage consumer and society awareness through the Idea Sana EROSKI education and information programmes. 35 The management tool governing protection of the environment is ECOPLAN, whose key figures are the people in the organisation. Their individual and collective commitment consists of: 1. Maintaining a proactive attitude, which enables us to take on increasingly ambitious commitments. EROSKI SUSTAINABILITY REPORT 2003-2004 2. Controlling and either preventing or reducing the environmental impact of our activity. 3. Implementing environmental management systems with quantifiable yearly goals, and providing resources for these. 4. Including the environmental variable in our research and development of products and services, with a view to the profitability of our environmental action, and identifying new business opportunities. A different way of doing things 5. Informing and educating at all levels of the organisation, for orientating people towards sustainable development. 6. Establishing free-flowing communication channels with the authorities, the local community, sectoral organisations, suppliers and consumers which will ensure full information on the impact of our activity and the resources and technologies we devote towards minimising it. Economic/Financial System: ECOFIN Our initial responsibility as a business organisation is to generate wealth for our interested parties and to become consolidated as a stable group, guaranteeing the stability of our profits and their distribution throughout the company. Our initial responsibility as a business organisation is to generate wealth for our interested parties and to attain financial goals which, in coordination with our ethical and social commitments, will be a guarantee for the development of our mission and values, satisfying society's needs and helping to improve the quality of life. Economic and financial analysis, which enables our profits to be monitored and controlled, is carried out through the Operating Account and Balance Sheet, generated from the lowest level (the individual centres) to the highest levels. These financial reference statements are contrasted monthly with the Management Plan and the data from previous years in order to detect any deviations and/or trends making new policies or corrective measures necessary. In 2004, as a result of an internal redesign of the organisation, we created an Assets Guarantee Department, which is placed under 36 the Corporate Area on the hierarchy, separate from the former common management that controlled the drawing up of the economic and financial reports and their internal audit, for greater independence and analytical rigour. Its objective is to perform administrative audits and procedures at the points of sale, leading to the creation of an Internal Audit Report which includes a broken down financial evaluation produced each month and studied by the Company Council and all the managers. Like all companies of our size and volume of business, we are under obligation to carry out an External Audit providing a true and fair view of the state of our accounts. The Report drawn up as a result of this Audit is presented to the General Meeting for their approval. EROSKI SUSTAINABILITY REPORT 2003-2004 A different way of doing things 4.3 Management of our External commitments Our commitment to social responsibility is not an improvised or transitory policy. It is one of our most distinctive collective values as a cooperative company whose aim is to carry out an economic and social project in all the places it operates. This project involves reinvesting 10% of the company's annual profit, and it is proclaimed and communicated to the entire organisation in the Code of Ethics as one of the main principles behind our actions. It is integrated in each of the areas and business units by means of the annual challenges and goals defined in each Management Plan. More specifically, through the Eroski Foundation, we develop Social Action projects in accordance with the priorities established in the goals of the United Nations 2015 Millennium Declaration. We form alliances with non-governmental organisations so that the combination of knowledge and effort will led to greater benefits for the entire community. This means across-the-board implementation of Social Responsibility policies, and we communicate these by means of the key indicators of the Global Reporting Initiative in our Sustainability Report, which is supported by our education and information programme, Idea Sana EROSKI. These indicators are managed internally by the Ethics Committee. 37 The Eroski Group was also one of the Spanish signatories to the principles of the Global Compact in 2002 and a founder member of the Spanish Global Compact Association created in March 2004, actively participating in disseminating it and extending its principles to other organisations. Our degree of implication has enabled us to become a permanent member of its Square Table, a dialogue forum bringing together companies, NGOs, Educational Authorities and Public and Social Institutions in order to define and design good practices that encourage fulfilment of its principles. As signatories to the Global Compact, we inform society and our interested parties of our advances in fulfilling its 10 principles through a Progress Report, attached as Annex III of this Sustainability Report and also featuring in the official website of the Global Compact, www.globalcompact.org. We also endeavour to extend our commitment as a socially responsible company to other agents in society. To do this, we attend the main forums of reflection and debate, where it is defined how social responsibility policies are to be applied as EROSKI SUSTAINABILITY REPORT 2003-2004 part of company strategies, and we also participate in the analysis of how the different countries should regulate these practices so that the veracity and transcendence of the actions communicated is guaranteed, e.g. the Ministry of Labour and Social Affairs' Forum of Experts. A different way of doing things We belong to several consumer cooperatives, including Hispacoop, the confederation of Spanish consumer cooperatives, which acts as a consumers' association and a cooperative and business organisation. Organisations we participate in · · · · · · · · · · · · · · · · · · · · · · · 38 Global Compact Spanish Global Compact Association (ASEPAM) Global Reporting Initiative Board of Trustees of the Fundación Entorno Ministry of Labour and Social Affairs' Forum of Social Responsibility Experts Federation of Consumer Cooperatives of the Basque Country EURO-COOP: European Consumer Cooperative Organisation HISPACOOP: Confederation of Spanish Consumer Cooperatives ICCO, International Consumer Co-operative Organisation Business Confederation for Social Economy Social and Economic Council (CES) Council for Promotion of the Social Economy Social Responsibility Commission of the Spanish Association of Accounting and Company Administration (AECA) Group for creating the Social Responsibility Guide of the Spanish Association of Standards and Certification (AENOR) Basque Association for Sustainability Spanish Consumer Council National Consumers' Institute Basque Autonomous Community Consumers' and Users' Council Consumption/Company Observatory of the Directorate-General for Promotion CIOA - Inter-ministerial Commission for Food Planning Spanish Association of Large Distribution Companies (ANGED) Spanish Association of Commercial Coding (AECOC) UE Energy Advisory Committee 5 A year of advances. Generating wealth 5 and well-being A year of advances. 5.1. Consumer vocation wealth and well-being Generating 5.2 5.1 5.3 5.2 5.4 5.3 5.5 5.4 5.4 A driving force for economic and cultural development The consumer People A driving force in economic and cultural development Future Peoplegenerations: the Environment Society Future generations: The environment Society EROSKI SUSTAINABILITY REPORT 2003-2004 A year of advances Generating wealth and well-being A year of advances. Generating wealth and well-being Eroski endeavours to become a socially responsible organisation, contributing to the growth that generates social, economic and environmental wealth in order to distribute it jointly with members, workers and the community, and contributing to social well-being and the respect for Human Rights. We become fully involved with our surrounding environment, and in 1999 we created the Eroski Foundation to guarantee a high degree of ethics, the provision of useful, practical information to the community and the support of social initiatives nurturing sustainable development. This is how we channel the participation of the Member Friend consumers who collaborate with our social action campaigns, which are part of the United Nations' 2015 Millennum Goals, as described in Annex IV below. Our concern for people, managers and key figures, has enabled us to achieve and maintain the SA 8000:2001 Standard certification, commiting ourselves to the defence of and respect for human rights with regard to our suppliers, on whom we carry out periodical audits with a view to assuring progress in their staff policies and compliance with labour regulations. Within the company we have developed different policies for conciliating work and personal life and we advocate the generation of stable, quality employment, which can be seen from the reduction of our temporary staff index. We commit ourselves to the defence of the consumers, providing them with an offer of healthy, quality consumption, guaranteeing high product quality standards and an extensive programme of education and information through the Consumer EROSKI magazine and the general Idea Sana EROSKI programme, seeking to encourage healthy, environmentally friendly and 40 solidarity-minded habits in our consumers. Our involvement with sustainable development has led to a committed environmental policy, with the application of continuous improvement criteria within the company and the endeavour to reduce the ecological impact of our activity while maximising the energy efficiency of our transport, redesigning routes, optimising the loading capacity of our lorries and using alternative fuels. We also participate in sector forums with the aim of reducing the emission of greenhouse effect gases and minimising our contribution to the Climate Change. We have extended the promotion of environmental management to our suppliers using e+5 methodology, in collaboration with Fundación Entorno, in order to promote responsible action and adopt principles of respect for and protection of the environment. Our commitment to Social responsibility means that we are an organisation working from a social perspective, participating in the main forums of debate and opinion. We are involved in process of defining social responsibility policies, we closely collaborate with NGOs and institutions in awarenessraising and aid campaigns, we back international commitments such as the United Nations' Global Compact and we work within the Ministry of Labour and Social Affairs' Forum of Experts towards defining and drawing up a future regulation that will govern Social Responsibility in Spain. EROSKI SUSTAINABILITY REPORT 2003-2004 A year of advances Generating wealth and well-being 5.1 Consumer vocation We form part of the environment in which we work, and we are committed to defending the consumers' rights, the environment and the promotion of social and cultural intitatives. Via the Eroski Foundation, we transmit our values by reinvesting 10% of our profit in society. Advances 2003-2004 2002 2003 2004 1556* 1790 Innovating offer Commercial network Commercial network 1955 New products, spaces and services with added value Eroski-Red payment card holders 875,000 945,000 1,006,526 Actively involved Travel-Club card holders 2,182,382 2,091,483 2,408,932 Travel Club card gifts received 423,268 469,853 621,322 Consumer attention telephone (nº of calls) 14,788 31,995 56,075 New technologies Locations covered by on-line payment 31 37 81 Amongst the sector leaders Nº of purchases (millions) Average customers per day 196* 209 212 654,586* 697,066 708,597 Nº of Eroski product quality analyses 2,769 3,075 3,877 Nº of Eroski NATUR product quality analyses 2,240 2,651 3,992 Reliable products Guaranteeing health and safety Controlling the supply chain Nº of Eroski NATUR supplier audits 370 1,648 955 Nº of Eroski supplier quality controls 39 86 130 Nº of product controls at points of sale 600 887 999 2,695,000 3,850,000 3,545,000* 334,000 580,540 1,181,499 For a healthier lifestyle Intensive educational Consumer EROSKI magazines per year and informative Participants in Idea Sana work EROSKI schools and campaigns * Data affected by Consum S.Coop. leaving the sphere of the Eroski Group. WE WILL KEEP ON IMPROVING... setting goals for ourselves to provide solutions to adapt to the needs of consumers through assurance of the quality, origin and healthiness of our products, and education and information programmes for the defence of their rights and the creation of healthy, environmentally-friendly and solidarity-minded lifestyles. 41 EROSKI SUSTAINABILITY REPORT 2003-2004 A year of advances Generating wealth and well-being An innovating offer We provide solutions adapted to your needs Close to the consumers At Eroski we maintain our commitment to consumers and we offer them quality products at competitive prices, satisfying their needs and expectations of responsible, healthy, guaranteed consumption. Since Eroski was created, we have orientated our development as a company and our financial growth towards satisfying the needs of customers and consumers. To do this, we constantly extend our commercial network and seek to implement a type of establishment that is more user-friendly and accessible, introducing new products, spaces and services, improving our management style and introducing advances in our information systems and logistics chain. All this has helped us to increase the satisfaction of the more than 200 million customers who visit our shops each year. ambitious study every year since 2000 for a Our main concern is to identify society's interests. To do this, we conduct opinion polls to become aware of their desires and integrate them within the products we offer, the information we provide and our contribution to sustainable development. have had less confidence in the past (perceiving systematic, ordered analysis of the concerns, sensitivities and perceptions of the Spanish people as consumers. In 2004 the issues asked about were their confidence in food consumption, their degree of satisfaction with the information received on consumption-related issues, their economic interests, their awareness of the environmental problem, solidarity and lifestyle. The study's conclusions show a consolidation of the confidence in the food they consume, slightly higher in the case of those who have traditionally it as being more industrial or artificial). The information we have received on consumer issues is similar as regards the values from previous years, although satisfaction with supermarkets The Eroski Foundation, in collaboration with the Instituto de Empresa (Business Institute), publishes the Consumer Barometer, which has made an 42 and hypermarkets has improved. The level of social awareness regarding issues such as waste collection and fair trade is still low. A year of advances Generating wealth and well-being EROSKI SUSTAINABILITY REPORT 2003-2004 7.50 Confidence in Foods Confidence in House Brands 7.00 Confidence in Trade Satisfaction with information 6.50 Satisfaction with information (hypermarkets) 6.00 Satisfaction with information (supermarkets) 5.50 Cost compensation 2002 2003 At Eroski we also conduct complementary consumer interviews to evaluate their satisfaction with our services and, particularly, the fresh produce sections (the "Freshometer"), a trademark of our food offer and commitment to freshness and excellence of origin and taste. 2004 Also, aware of the importance of offering guaranteed quality products at very competitive prices, we have created a promotional category of basic products, Record Savings", where the quality standard of the brands is maintained but the prices are reduced by an average of 7% with respect to their usual market price. New business lines Investment in opening 279 new establishments and in improving our management and efficiency has led to a better service and greater economic profitability, at the same time benefiting our commitment to consumers and society. In accordance with the diversification policy included in our Strategic Plan, we work in very different businesses such as service stations, real estate, opticians, travel agencies, sports shops, perfumeries and leisure and culture establishments. At the same time we are developing new business lines such as ready- 43 cooked meals (Multifood S.Coop.) and new types of establishments. Some examples of these are Sportland and Forum and, more recently, Abac, which specialises in leisure and culture for an active use of free time. EROSKI SUSTAINABILITY REPORT 2003-2004 Over the 2003-2004 period the Eroski brand has extended its range to include child care products and tastes from abroad (ice creams, patés, cheeses, etc.), and has also extended its own brand range of drugstore products (washing powder, tin foil, cling film etc.). This product diversification has also involved the launch of an entire range of organic vegetable preserves and 49 new ready-cooked food A year of advances Generating wealth and well-being product lines with the brand name Eroski Restauralia, for high quality refrigerated meal solutions. There has also been an expansion of the Eroski NATUR brand fresh produce, both geographically and in the number of articles, which maintain their guaranteed quality commitment. An innovating offer To make things easier for home consumers we have extended our Eroski online coverage to Pamplona, and it will soon reach Guipúzcoa, Asturias, Cantabria and La Rioja, after several years operating in Vitoria and in the greater Bilbao area. This service can be accessed at www.compraonline.grupoeroski.com and it enables all the products normally on sale in a supermarket to be acquired and delivered to the consumer's home on the day and time selected. Our knowledge of our consumers and customers enables us to adapt and design products in accordance with their lifestyles. We have therefore redesigned our shops to make them more convenient, with larger areas given over to fresh produce, due to the positive perception of the high quality of these products, and new developments in range and layout in other sections such as wines, perfumery and other non-food products (footwear, toys, plants and technology). We have also enhanced our extra services with financial products, insurance and new sales channels. To benefit from the advantages of the new technologies, the Viajes Eroski travel agencies offer the possibility of interactive design and booking of holidays and also a customer help line, services which have been extended to include a virtual shop. The Eroski Travel Club has also been created for travellers to exchange their experiences, obtain information on leisure 44 activities, receive our special offers by e-mail and access articles on destinations of interest. With our value-added services we also provide specially-tailored information, payment facilities and the possibility of acquiring bazaar products, household appliances, textiles and holidays. In 2004 there were 860,279 EroskiRed payment card holders, with a total of 1,006,526 cards, and 621,322 gifts were earned with the Travel Club points card. In order to keep a permanent communication channel open, we have a free customer help line which has received 56,075 calls, 74% of them being for requests for information, 2% for suggestions, and 24% for incidents or problems. A year of advances Generating wealth and well-being EROSKI SUSTAINABILITY REPORT 2003-2004 Reliable products Guaranteed origin and quality Product certification and food safety The strict controls we perform on our products allows us to guarantee our customers food safety and assure maximum quality, accompanied by rigorous information, adjusted to their needs. Our Quality Policy includes laboratory analysis of products, supplier certification, implementation of quality systems at the distribution platforms and points of sale, and sensory studies and use tests with consumers. In 2003 a Genetics unit was incorporated to our laboratory, to join the already-existing Chemistry and Microbiology divisions. These three separate, certified units have introduced the following new food safety controls: - Eroski product control. New analytical techniques applied to inspection of coastal and shellfish fishing along the whole of the Cantabrian coast, after alarm was generated by the ecological disaster of the Prestige oil spill, and analysis of products containing paprika or other red spices, in response to consumer health doubts. - Action in case of food alert. Precise analytical devices enable us to act immediately if any food alerts should occur. Chemical Unit: - Allergen study. Evaluation of any traces of gluten, peanut, milk, egg and soya in foods where it is not indicated among the ingredients but where such substances could be present due to cross-contamination. - Specific nutrient campaigns. Analysis of fibre, omega-3 fatty acids and vitamins in enriched products, to check they are correctly labelled. Genetics Unit: - Detection of pathogens in food matrixes. Quicker identification of the presence of any pathogens, complementing the microbiology unit's analysis. - Identification of fish species. Establishing the identity of species. In 2004, 7,869 products were analysed, of which 3,992 corresponded to Eroski Natur product microbiology (fruit, vegetables or meat) and 3,877 to other Eroski brand products or special cases where the laboratory considered there 45 EROSKI SUSTAINABILITY REPORT 2003-2004 may be some doubt regarding quality and health conditions. To complete the food safety control, hygiene inspections are carried out at the points of sale and at our platforms, particularly those where our meat products are processed. To complete our commitment to offering healthy, quality consumption, we have organised, for the fourth consecutive year, calls for Grants and Subsidies for research into Bioethics and Business, Health and Nutrition and Food Safety, in addition to the direct backing and support of technology innovation centres, with whom we have started up two new projects as part of our food area R+D Plan: A year of advances Generating wealth and well-being - Development of PCR food analysis techniques, with the Gaiker Technology Centre. Laboratory use of techniques for detecting transgenics, salmonella and E.Coli and identifying tuna and sole species. - Automated traceability management system for fresh produce sections. Computerised systems for assuring traceability from the fresh produce platforms to the points of sale. - Project for innovation in the meat processing, packaging and distributing systems, with Gaiker, Ikerlan and the company Ulma. Improvement in fresh meat processing and packaging processes using a modified atmosphere system, for a greater product quality guarantee and a longer shelf life. Control of the supply chain We closely collaborate with our suppliers on product definition, manufacturing procedures which will assure quality standards and logistics management, introducing technology applications such as warehouse radio-frequency, automatic production lines for fresh produce, wireless communication for lorry positioning and high-productivity tools for supplying the different platforms. In order to guarantee the quality, origin and taste characteristics established for all our products, we have strict control mechanisms. These are even more rigorous for the suppliers of Eroski NATUR fresh produce, which also needs to comply with certification and verification process requirements. Certification procedure for Eroski NATUR brand suppliers After the assessment of commercial and logistics variables, the Quality Department checks the supplier control systems by means of an initial audit, in order to guarantee the traceability of 46 the products, compliance with technical and health regulations, the use of a natural production system and compliance with the established requirements. After this verification, we carry out periodical analytical monitoring audits in accordance with a specific Control Plan for each product. A year of advances Generating wealth and well-being EROSKI SUSTAINABILITY REPORT 2003-2004 Accreditations and Product Certifications, Eroski Group Management Systems CERTIFICATION Zorroza Meat Processing Centre Eroski Group Product Quality Laboratory Amorebieta, Vitoria and Pinto Fresh Produce Platforms DATE OF STANDARDCERTIFICATION AENOR UNE-EN ISO 9001:2000 1995 ENAC UNE-EN ISO/IEC 17025:2000 1997 SCOPE "The supply, handling, cutting, storage and delivery of meat and meat products to the Eroski Group points of sale" (2002) "Physical and chemical analysis of animal health residues in animals for slaughter and microbiological food analysis" (2002) "Supply and distribution of fresh produce (cooked pork products, fruit and vegetables and fresh fish) from the Zubieta (Amorebieta) platform to the Eroski Group. Supply and management of the distribution of fresh products (cooked pork products and fruit and vegetables) from the Vitoria platform to the Eroski Group. Supply and management of the distribution of fresh fish from the Pinto (Madrid) platform to the Eroski Group" (2001) AENOR UNE-EN ISO 9001:2000 1999 Artea Eroski Hypermarket AENOR UNE-EN ISO 14.001 2000 "Environmental Management" "Eroski Natur" beef CERTICAR Regulation 1760 /2000 2000 "Aspects of traceability and labelling of Eroski Natur beef" Eroski Natur" veg-fed chicken SGS UNE-EN ISO 45.011 2001 "Aspects of origin, rearing methods and feeding of Eroski Natur veg-fed chicken Bureau Veritas Quality International (BVQI) Service Quality Guarantee Referral 2001 "Service quality guarantee in fresh produce departments" Viajes Eroski Travel Agency Spanish Tourism Quality Institute (ICTE) Tourist Quality Q 2001 "Conformity of Viajes Eroski's business unit quality system with the quality standard requirements established by the ICTE for obtaining the Tourist Quality Q". Maxi Hypermarket in Zalla Bureau Veritas Quality International (BVQI) Service Quality Guarantee Referral 2002 AENOR UNE-EN ISO 9001:2000 2002 "Provision of holiday, group and business travel services under the brand names Viajes Eroski, Travel Air and Forum Club de Viajes. Design and development of holiday travel" Eroski Group User Service Centre AENOR UNE-EN ISO 9001:2000 2002 "Attention to incidents and problems affecting the users of the Eroski Group information systems" La Coruña Fresh Produce Platform AENOR UNE-EN ISO 9001:2000 2002 "Product supply and control activities. Production of processed products, preparation and distribution of orders for cooked pork products, dairy products, fruit, meat and fresh fish sold at Eroski Group shops and franchised centres". Elorrio General Goods Platform Euskalit (Basque Govnm't) Silver Q 2002 Olilán Oil Production Centre AENOR UNE-EN ISO 9001:2000 2003 Bureau Veritas Quality International (BVQI) SA 8000 2003 Euskalit (Basque Govnm't) Silver Q 2004 Garbera and Max Center Eroski hypermarkets Viajes Eroski Travel Agency Eroski Group Head Office Amorebieta Fresh Produce Platform 47 BODY "Service quality guarantee for fresh produce departments" "EFQM business quality excellence model" "Bottling and distribution management for olive and sunflower oils" "Social Responsibility management system" "EFQM business quality excellence model" EROSKI SUSTAINABILITY REPORT 2003-2004 A year of advances Generating wealth and well-being Idea sana EROSKI Programme The Idea Sana EROSKI programme: for a healthier lifestyle The aim of the Idea Sana EROSKI programme, created in 2003, is to encourage our customers to adopt healthy, environmentally friendly and solidarity-minded lifestyle habits for physical, mental and social well-being, as defined by the World Health Organisation. It is a project geared towards consumers who are concerned with well-being, have an interest in social matters and wish to get actively involved with their environment. Full, useful and reliable information is transmitted by a team of trainers in a friendly, accessible way at the points of sale, with "schools", campaigns, specialised consultancy services and educational activities on health, leisure, food, physical exercise, well-being, the environment and solidarity. The Idea Sana EROSKI Magazine This twice-monthly magazine with a print run of 300,000 issues is a showcase for our activities and news and can be picked up free at our centres. It contains practical information and its content is produced with collaboration from experts. present 60 themes a year at around 445 meetings, with 15-20 people attending each meeting and a total of 24,250 participants in 2004. Idea Sana EROSKI counselling service. The demand for both general and personalised counselling on specific issues led us to develop this new initiative, visited by over 125,000 consumers the first time it was held. Psychologists and teachers were involved in the Toy Counselling Service, providing information to parents. Idea Sana EROSKI Stands These are located at Eroski hypermarkets and are a back-up for the campaigns carried out and a channel for integrating the new Foundation Member Friends. They were visited by 489,699 customers in 2004. Idea Sana EROSKI Schools These are hour-long meetings held at our shops to inform in a personalised, friendly way of issues such as food and nutrition, food handling, leisure and free time, sport and health, nature and the home. We 48 Stand at the Fair Trade fortnight, visited by 32,542 customers. EROSKI SUSTAINABILITY REPORT 2003-2004 Idea Sana EROSKI collectables and leaflets Leaflets to serve as a reminder of the campaigns, with written and graphic information. Idea Sana EROSKI forums. Conferences with advice from expert professionals in matters relating to health and well-being. This initiative began in April 2004 with the conference "How a newly-born baby adapts to its world", with the professional criteria of pediatricians and specialists of recognised prestige, and it has continued with forums such as: -Dance, bodily balance, with Víctor Ullate in Madrid. -Television and well-being, with Rosa Villacastín in Bilbao. -Sport and Lifestyle, with Blanca Fernández Ochoa in Seville and Juanito Oiarzabal in Málaga. -New Technologies in the Home, with Microsoft in Santander and Logroño. -Lifestyle and happiness, with Luis Rojas Marcos in Seville. -The importance of music, with Fernando Argenta and Inma Shara in Madrid. -The pleasure of reading, with Carmen Posadas in Málaga. 49 A year of advances Generating wealth and well-being A year of advances Generating wealth and well-being EROSKI SUSTAINABILITY REPORT 2003-2004 5.2 An economic and cultural driving force We wish to be acknowledged as key performers in the environment in which we work and live, and we therefore work towards promoting the localities in which we are present, economically, socially and culturally. Advances 2003-2004 2002 2003 2004 Net investment (thousands of euros) 271,815 509,304.56 357,193.51 Commercial network 1,955 1,556 * 1,790 Nº of local and regional products 9,074 10,785 9,789* Nº of regional shops and departments 36 41 48 Nº of individual campaigns for regional products 13 13 13 A driving force for growth Generating wealth Proximity and integration Promotion of regional products and cultures * Data affected by Consum S.Coop. leaving the sphere of action of the Eroski Group. We will keep on improving... endeavouring to assume the social and cultural realities of our environment, becoming a multicultural organisation that respects and encourages local differences while generating wealth and contributing to social well-being. 50 A year of advances Generating wealth and well-being EROSKI SUSTAINABILITY REPORT 2003-2004 A driving force for growth Collaborating with local economic development Our work to bring about the economic and social development of the community is patent in our creation of direct employment. We provide jobs at our centres, together with indirect employment deriving from our relationship with our suppliers and sub- contracted companies, whom we pay in accordance with the terms agreed on by contract. In 2004, 67.39% of our income was spent on acquiring products and services, amounting to 3,952 million euros. Eroski does not only generate wealth for its owners. Our activity throughout the whole of Spain makes us a major promoter of economic activity, as a result of the employment we generate and the economic activity established around us. The presence of our centres is a stimulus for the socio-economic development of the community of which we directly form part, through the multiplying effect of the emergence of sub-structures for providing our network of shops with complementary services. It is therefore our policy to give back to society 10% of the wealth it has helped us generate. The 5,866 million euros of gross income obtained by the Eroski Group in the financial year 2004 was distributed as follows: · 67.39 % was used to pay the suppliers for the goods and services acquired for sale. 51 · 7.84% was for the external goods and services consumed in order to carry out the activity. · 8.83% was allocated to the Administration for taxes, including 8.27% VAT. · 9.68% went to pay the wages of our team of people, and 3.22% for production equipment, more specifically for amortization. · The capital remuneration contributed by the shareholding members and the borrowed resources used represented 1.09%. · Allocation of Profit to the company accounted for 1.22% (percentage of net profit of interest and tax on gross sales), 10% of which was earmarked for charity. A year of advances Generating wealth and well-being EROSKI SUSTAINABILITY REPORT 2003-2004 Amortizations 3.22% Temporary External 2% Services 7.84% Fixed 4.48% Fiscal 0.37% Members 3.21% Dividends Reserves 0.58% 0.6% Education 0.13% Capital Remuneration 1.09% VAT 8.27% External Services 7.84% Fiscal Staff 0.37% 9.69% VAT 8.27% Results 1.22% 5,866,207 purchases 67.39% purchases 67.39% Proximity and integration Promoting local culture and tradition We work towards becoming fully integrated in the places where we work, identifying with their culture and customs, and we have become a multicultural entity, helping to integrate the different communities where our work centres are located. Our support of cultural promotion and integration includes the use of the different co-official regional languages at our points of sale, on all the computer supports, on the internet, in printed publications, on Eroski brand product labels and in advertising and promotional leaflets. To encourage economic and cultural development we promote the ongoing sale of artisanal products. This began in 1997 when we opened our first Regional Shop in Cáceres, and 48 Eroski hypermarkets are now involved 52 in the scheme. These spaces contain a fullscale reproduction of the decorative elements typical of each region and a total of 9,789 different local products are on offer. A year of advances Generating wealth and well-being EROSKI SUSTAINABILITY REPORT 2003-2004 Distribution of regional shops Hypermarket Province Hypermarket Province 01. 02. 03. 04. 05. 06. 07. 08. 09. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. Murcia Bizkaia Murcia Bizkaia Murcia Bizkaia Murcia Barcelona Albacete Tarragona Cádiz Guadalajara Cáceres Guadalajara Ciudad Real San Sebastián Córdoba San Sebastián Málaga La Rioja Málaga Cantabria Almería Asturias 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42. 43. 44. 45. 46. 47. 48. Seville La Rioja Málaga Toledo Pontevedra Ciudad Real Cuenca Guadalajara Seville Bizkaia Burgos Gipuzkoa Córdoba Gipuzkoa Seville Bizkaia La Coruña Huesca Pontevedra Cantabria Gerona Málaga León Valladolid Lorca Max Center Molina de Segura Bilbondo Cartagena Abadiano Murcia Tarrasa Albacete Tarragona Algeciras Cuenca Cáceres Guadalajara Ciudad Real Garbera Córdoba Urbil Málaga Calahorra Vélez Málaga Santander Roquetas de Mar Oviedo We also promote regional production by conducting yearly campaigns in all our centres, where the typical products of a region's cuisine are promoted outside the geographical area in which they are usually consumed. These individual campaigns are presented on specially dedicated stands or in promotional spaces at the shops, and they include regional varieties with special emphasis on one type of product. 53 Alcalá de Guadaira Logroño Fuengirola Toledo Lalín Tornelloso Cuenca Azuqueca de Henares Lebrija Berango Miranda de Ebro Tolosa Montilla Eibar Morón Zalla Ponteareas Jaca Ribadeo Castro Figueres Antequera La Bañeza Valladolid Regional campaign Murcia: Goat's cheese Extremadura: Soft cheese Castilla-La Mancha: Castilla Designation of Origin wine Andalucía: Virgin olive oil Asturias: Cabrales cheese Cantabria: Orujo cream liqueur Galicia: Rías Bajas Designation of Origin wine Aragón: Somontano Designation of Origin wine Castilla y León: Cured meat Catalonia: Virgin olive oil La Rioja: Rioja Designation of Origin wine Navarre: Patxaran liqueur Basque Country: Txakoli wine with designation of origin EROSKI SUSTAINABILITY REPORT 2003-2004 We also hold a yearly competition for regional products. These are judged by the laboratory and by a jury of consumers, and the supplier obtaining the highest marks is able to include A year of advances Generating wealth and well-being their product in our general product range, meaning it will be sold in our entire network of shops, with the consequent boost in trade. Each of our establishments helps define our function as economic promoters of the surrounding environment, and for the fifth consecutive year we have therefore maintained our commitment to collaborating with small artisanal producers. In order to collaborate towards local and regional development, we enter into fixed agreements with primary sector suppliers (suppliers of meat, fruit and vegetables). This affects around a hundred producers, with whom we agree on a series of purchase specifications regarding prices, estimated production, product data sheet, quality control mechanisms, etc. We also provide them with technical and assistential help in optimising their results. On a more general level, we also sign collaboration agreements for the promotion of regional products with administrations and institutions representing community interests. Some such agreements made in 2004 were as follows: Ministry of Agriculture, Fisheries and Food: Agreement for the promotion of local SME-produced agro-food products, worker training programmes, setting of quality criteria and crisis action. Fund for the Regulation and Organisation of the Fishery Products and Marine Fish Farming Market (FROM): Agreement with this Autonomous Body attached to the Ministry of Agriculture, Fisheries and Food, for refusal to sell immature fish. 54 Malaga Provincial Government: Agreement for the promotion of local products in the three hypermarkets in Malaga province, with more than 100 m2 in each establishment being given over to the display and sale of their products, plus 5 m2 for the direct promotion of Malaga Provincial Government. Landaluz: A campaign for the promotion of Andalusian products, in conjunction with other companies belonging to the Agro-Food Quality Business Association (LANDALUZ). Oviaragón: Aragón's main "ternasco" lamb production cooperative, with whom a collaboration agreement has been reached. Corderex: Agreement with the specific Extremadura lamb designation Control Board, with whom we are collaborating as regards the control, promotion and defence of the quality and specific characteristics of lamb. Galician beef producers: Collaboration agreement with the Control Board for the Protected Geographical Indication of GALICIAN BEEF, for promotion and production and marketing protection. Ojiblanca and Cordoriva: An agreement made with 25,000 cooperative member and oil-producing families, with whom we have undertaken to market an amount of produce roughly equivalent to 15 % of their annual production. EROSKI SUSTAINABILITY REPORT 2003-2004 A year of advances Generating wealth and well-being 5.3 A group with a human dimension The huge growth of our organisation over the last few years has had the effect of reinforcing our endeavour to make a reality of the corporate values that distinguish us as an advanced company where dealing with people is concerned. Our impetus in involving people in the company's capital, management and results is crucial for understanding this expansion. Advances 2003-2004 2002 2003 2004 Nº of worker members 13,079 10,868* 12,298 Nº of consumer members Nº of worker members on boards 516,666 9,793 341,333* 7,419 356,590 6,864* Nº of consumer members on boards Nº of Friends of the Eroski Foundation 7,985 9,854 7,297 99,854 7,727 137,396 Owners and key figures Active corporate life For quality employment Job creation 1,318 173 909 Percentage of temporary staff 28,57% 28.82% 28.91% Inclusion of less favoured groups Percentage of women on the staff 72,77 % 74.16 % 76 % Looking after our people Hours of Occupational Risk Prevention training 44,302 45,441 46,986 Empowerment and promotion Hours of training 153,000 159,124* 246,390 Excellent working atmosphere Working atmosphere (Twice-yearly) 3.27 out of 5 Generation of stable employment 3.34 out of 5 * Data affected by Consum S.Coop. leaving the sphere of action of the Eroski Group. We will keep on improving... putting our faith in basic issues like innovation, the management model, participation and business culture seen as major strategic challenges, and giving people greater prominence through effective participation in teamwork and the work of the organisation. 55 A year of advances Generating wealth and well-being EROSKI SUSTAINABILITY REPORT 2003-2004 Eroski understands the growth of the organisation as being the combination of several factors: offering an alternative for healthy, obtaining good financial results and then reinvesting 40% of our profit in the worker members and 10% in society, the prominence and development of the people within the organisation, defending the rights of consumers and society, sustainably minimise the impact of quality consumption, protection of the environment to our activities on the environment. From this definition of our business strategy, it is clear how important people are within the group, and how much we wish to extend this awareness to all the organisations with which we are connected. The Eroski Group works to guarantee respect for human rights, and this has enabled us to achieve and maintain SA 8000:2001 Standard certification, which demonstrates our direct implication with this awareness and the fact that we promote it in our suppliers. Owners and key figures The Eroski Group has developed a company organisation model based on the ownership and prominence of its people as worker members. Each person who joins our organisation therefore does so as a member of our Cooperative or a member of Gespa (in the non-cooperative area), and has shares in the company capital, management and goals and in its profits. This situation, whereby a limited liability company benefits from the determination of its workers to be proprietors of the company, is a new experience in Spain. The worker members being shareholders in the company means that we are decisive agents in the decision-making process and in the company's strategic development. Represented by our democratically-elected delegates, we can formulate proposals and participate and vote in the adoption of the management authorities' agreements. In 2004 our staff amounted to 30,101 people, of whom 12,298 are worker members and Group proprietors. The proposals or suggestions put to us will be studied and voted by an internal democracy system based on peer-to-peer government participated in by consumer members and worker members on a 50% basis. 56 A year of advances Generating wealth and well-being EROSKI SUSTAINABILITY REPORT 2003-2004 The distribution of Eroski worker members by autonomous communities is as follows: Andalucia Aragón Asturias Cantabria Castilla y León Castilla-La Mancha Catalonia Extremadura Galicia La Rioja Madrid Murcia Navarre Basque Country Valencian C. 767 69 204 342 695 494 375 124 142 399 354 509 742 6,665 417 Total 12,298 Our corporate values include wage solidarity and participation as basic principles and characteristics. The only criteria for establishing wage levels are assessment of the tasks and skills necessary and the exercise of professional proactive attitudes to continuous improvement. Two assessment manuals are used for this purpose by the Assessment Committee, elected by the Board of Directors and the Company Council. Wage solidarity, taken as meaning a narrower salary range, implies that those in posts higher up on the hierarchy have to give over part of their remuneration in accordance with a more even scale, so that the posts of lesser responsibility have a higher wage than average in the sector. The Group's interaction and proximity with our customers and consumers is based on their participating as members in our ultimate management authority in the same proportion as the worker members. At the close of the financial year 2004 there were a total of 356,590 Consumer Members, throughout the whole of Spain. Both the consumer members and worker members are kept informed of the organisation's development through the Company Board Meetings, held on a yearly basis. The 57 204 342 6.665 142 742 399 375 695 69 354 417 494 124 509 767 consumers, who are involved in the group's strategic management, attend these meetings to receive information and collaborate to the management of the business with their suggestions and contributions. Participation in preparatory meetings 9.793 10.000 Consumer members 9.000 8.000 Worker members 7.985 7.297 7.419 7.000 7.727 6.864 6.000 2002 2003 2004 The figure of the Member/Friend of the Eroski Foundation was created to represent the consumers in areas where there are no consumer members. The number of Member/Friends of the Eroski Foundation tripled during 2003 and 2004, reaching a figure of 137,396 people by the end of 2004. EROSKI SUSTAINABILITY REPORT 2003-2004 A year of advances Generating wealth and well-being For quality employment Total commitment to our work In 2004 we continued our advancement in the creation of improvement programmes for getting the workers involved in the management and improving the quality of life at work. This policy has enabled us to attain better results in the Staff Satisfaction Survey, with a score of 3.34, which reflects the fact that there is a healthy working atmosphere and is an excellent evaluation by the Spanish Corporate Reputation Watch. MERCO, the Spanish Corporate Reputation Watch, assesses the reputation of Spanish business agents and companies through the Corporate Reputation Index. The variables it uses as a basis for calculating a company's reputation are the economic and financial results, the quality of the product or service, the corporate culture and the quality of working life, together with the ethics and corporate social responsibility, the global dimension, international presence and innovation. The Eroski Group has received an outstanding classification for quality of working life, ethics and social responsibility and innovation, improving on the score obtained in previous years. Other notable values were quality of product and service and economic results. In 2004 we came 33rd in the general index of the Spanish Corporate Reputation Watch (MERCO), our rating having improved on previous years, and our Chairman has been classed among the 100 most reputable business leaders, in 83rd place. Generating employment Our staff increase of 909 people in the year 2004 reflects our continuity and sustainability as regards job creation over the years. The Eroski Group maintains a strong expansion policy in all its lines of business, with 159 new establishments being opened in 2003 and 113 in 2004, which means we are now present all over Spain and also in France, and in many 58 autonomous communities we are the organisation generating the most employment. We also make local and regional agreements, such as those signed with the Guipúzcoa Regional Government and Cáceres City Council to encourage generation of employment and training of the population. A year of advances Generating wealth and well-being EROSKI SUSTAINABILITY REPORT 2003-2004 Map showing the distribution of workers by Autonomous Communities The distribution of Eroski workers by Autonomous Communities is as follows: Andalucía Aragón Asturias Balearic Islands Cantabria Castilla y León Castilla-La Mancha Catalonia Extremadura Galicia La Rioja Madrid Murcia Melilla Navarre Basque Country Valencian C. France 2.872 1.307 575 3.000 536 1.743 1.026 832 426 3.550 666 1.047 914 79 1.094 8.542 503 1.389 Total 30.101 1.389 575 536 8.542 3.550 1094 666 832 1.743 1.307 3.000 1.047 503 1.026 426 914 2.872 79 The Eroski Group is expanding, not only as regards new centres opening but also through involvement in the areas in which we become established: our people are from the places in which we work. Local people are the ideal choice as they are well aware of the characteristics of the area. Quality and stability At Eroski we are proud to be able to fulfil one of our fundamental goals for yet another year, the creation of quality, stable, participative employment. We continue to work towards reducing the percentage of people with temporary contracts and sub-contracted workers, and the inclusion of less-favoured groups. In 2003 the Eroski Cooperative made a major effort and took on almost 800 new people, mainly as shelf-stockers at our hypermarkets. 59 The gradual increase in the number of workers becoming worker members is also notable, with their numbers growing at a greater percentage rate than the numbers of staff themselves. In 2004 the worker members increased by 13.15% while the staff increased by 3.11%. This is proof of the fact that the company's philosophy is to create stable, participative employment. A year of advances Generating wealth and well-being EROSKI SUSTAINABILITY REPORT 2003-2004 Typical staff type percentage within Group companies 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Eroski Erosmer Scoop Ibérica Supera Udama Vegalsa Viajes Forum Daparjel Danesa Temporary Eroski also believes in youth and dynamism as opposed to the general tendency towards economic activity, with the number of adult profile employees having increased by 3.2% in 2004, while juvenile employment descended. The Eroski staff have an average age of 36 and an average seniority in the company of over 8 years, which shows that in many cases we generate first jobs that are stable and provide an opportunity to continue working in a quality job with a high degree of participation as a Group member. Percentage of staff by ages Under 25 23 % 26 - 35 7% 51 % 1% 18 % 36 - 45 46 - 55 Over 55 Eroski gives great importance to employing women and wishes to give them even more significance, which is a reversal of the current job market trend where, according to Labour Ministry data, women account for 56.7% of the unemployed. 60 Total Fixed term A year of advances Generating wealth and well-being EROSKI SUSTAINABILITY REPORT 2003-2004 In the same way, in all the Group's companies women occupy more posts than men, with 76% female staff. As part of our equal opportunities philosophy, a high number of posts of responsibility are occupied by women, and the number of management posts they hold is increasing day by day. % female staff 78.00 % 76.00 % 76.00 % 74.00 % 74.16 % 72.77 % 72.00 % 2002 Eroski's commitment to generating stable, quality employment is measured throughout the organisation by surveys which assess the degree of satisfaction and our adaptation to individual needs. In the opinion of the 13,582 participants in the survey (over 60% of the total staff), the main aspect considered susceptible to improvement is remuneration and recognition, and we are therefore undertaking specific 61 2003 2004 measures with a new Assessment System and an ambitious Leadership programme, which will include recognition, amongst other aspects. All the other factors are satisfactory, with the Very Satisfied classification being awarded to Working Atmosphere (3.73), Environmental Impact Policy (3.60) and Integration in the Company (3.59). The percentage distribution of people satisfaction was as follows: Very satisfied 3.9% Satisfied 39.4% Fairly satisfied 45.6% Fairly dissatisfied 10.3% Very dissatisfied 0.7% A year of advances Generating wealth and well-being EROSKI SUSTAINABILITY REPORT 2003-2004 Professional development duties, thus enriching the organisation. Our quick growth and diversification strategy requires the empowerment of our people in two aspects. Firstly, everyone's participation in the running of a larger organisation gives rise to big challenges, requiring development of personal skills and aptitudes for posts with a greater content and responsibility, always backed by continuing training programmes adapted to the developing needs. And also, the philosophy of internal promotion within the group gives rise to the need for a profile of flexible, cross-disciplinary people who will transmit the knowledge they have acquired in different areas as they perform their 260,000 h. In addition to investment in training new recruits, we have continued to train the people already forming part of the organisation, as a key factor for their internal promotion or reinforcement of their knowledge of the company's activity in general. All this has enabled 56% of posts to be covered through internal promotion this year. Evolution of hours worked 246,390 220,000 h. 180,000 h. 140,000 h. 153,000 121,000 159,124 139,000 100,000 h. 2000 2001 2003 2004 As regards training, we would stress the Training Programmes we have run on the subjects of Occupational Risk Prevention, Knowledge for Excellent Job Performance, Corporate Training and Training for Continuous Improvement. in the Basque language were proposed and given in accordance with the personal and professional characteristics of our staff, in order to better their situation and attend to their expectations. Also, in 2004 an intensive Leadership Programme was developed by means of 63 courses attended by 939 people, with a total of 26,288 hours of training being given. The aim of this was to provide our managers with the skills for directing their teams better, placing the emphasis on communication, affectivity and interpersonal relations. Company benefits At the same time, as a result of our commitment to people satisfaction and the creation of quality employment, some courses and training activities 62 2002 Eroski's great concern for the quality of the jobs we provide has led to policies for tailoring them to the individual needs that condition the way in which we can best carry out our work. We have therefore developed a policy for conciliating work and personal life which gradually includes more measures to optimise people's performance and satisfaction, with a personalised design and approach. EROSKI SUSTAINABILITY REPORT 2003-2004 A series of measures have therefore been devised, of benefit to all those belonging to the Group, providing they comply with certain requirements. Access does not depend on the level of the person's post within the company and the equality criterion extends to all those making up the organisation. A year of advances Generating wealth and well-being The measures include flexibility of working hours, and workers can apply for reduced hours, voluntary unpaid leave for longer than provided for by law, adapting the working week to 20 and 28 hours for those in responsible posts, etc. This would not imply any loss of professional category within the Group, and the complementary measures needed for their post to be covered would be taken. Basically, we are people, and we therefore understand the concerns and needs that must be attended to for quality posts to be generated. Our degree of participation and commitment to the organisation is a result of the response to our demands, and collaboration for the design of new measures to facilitate the conciliating of work and personal life to enable jobs to be done better. Occupational Risk Prevention Our aim is to improve working conditions on both a physical and organisational level, and we have dedicated much effort to ergonomic studies on significant tasks from a preventive perspective, post modelling and psycho-social intervention, assessing risk levels and organising conferences on emotional control. Also, to ensure a level of protection similar to the one our workers benefit from, we have begun to adapt and coordinate our business activity in accordance with the laws on this matter. During 2004, over 9,000 people participated in the training activities on prevention, and 47,000 training hours were dedicated to these matters. As regards Health Monitoring, we have continued with our commitment and have implemented a Basic Health Unit in Murcia in addition to our existing units. In all of them we continue to carry out medical check-ups in accordance with risk, medical consultations and counselling, and also educational and health promotion activities. 63 These measures, together with other occupational risk prevention activities, has enabled us to reduce the incidence rate (i.e. the number of accidents per 1000 workers) in comparison to past years, with a figure of 70.96. A year of advances Generating wealth and well-being EROSKI SUSTAINABILITY REPORT 2003-2004 5.4 Environmentally committed managment We are aware that our growth needs should not condition the well-being of future generations, and we therefore advocate protection of the environment as part of our day-to-day activities. We also extend this principle to our suppliers and consumers. Advances 2003-2004 2002 2003 2004 Environmental management Continuous improvement model Nº of environmental certifications 2 1 1 Installation of photovoltaic panels 3 3 4 Climate change Electrical consumption (J/m2.h) 15,086,614 8,748,000 7,488,000 Use of resources 3 Water consumption (Artea) (m /fish sales) 2.23 Packaging consumption (Artea)(unit/fresh prod. sales) 162.58 Waste management Biodiversity Waste generation (Artea) (kg) 1,170,944 1.83 1.5 134.74 128.57 972,751 1,004,611 Hazardous Waste (HW) (Artea) (kg) 1,395 1,510 1,154 Recycled materials (Artea) (kg) 598,540 543,211 569,097 GMO analysis 281 208* 148 Nº of Eroski Natur supplier analyses 2,240 2,651 3,992 Extension of responsibility Acting on the supply chain Reinforcement of consumers' ecological awareness Nº of Eroski Natur supplier inspections 370 1,648 955 Certified suppliers (by e+5 levels) 50 100 135 Participants in environmental awareness-raising and education 32,500 85,560 211,200 Battery collection (kg) 29,180 26,100 21,150 Nº of waste collection centres 6 6 6 * Data affected by Consum S.Coop. leaving the sphere of action of the Eroski Group. We will keep on improving... extending our commitment to programmes geared towards suppliers and consumers to encourage environmentally-friendly processes for recognition, control and minimisation of the impact on the environment. 64 A year of advances Generating wealth and well-being EROSKI SUSTAINABILITY REPORT 2003-2004 Environmental management Environmentally friendly growth We were the first Spanish distribution company to obtain ISO 14001 Standard certification for an environmental management system, at our Pamplona installation, and this was followed by ISO 14001 Standard certification of our environmental management system by AENOR in 2000 at the Eroski Hypermarket in Artea. In 1994, ECOPLAN, the first conceptual framework for our Environmental Policy, was created and implemented throughout the entire organisation. From that year onwards, ECOPLAN has been g ra d u a l l y r e n e w e d i n a c c o r d a n c e w i t h our continuous improvement objective, adapting to a new structure, geographical dimension and number of people and consumers, with in-company training being given on the efficient use of resources and workplace waste management, forming a link throughout the organisation. Evolution of environmental education hours at the Artea hypermarket 0.56 2004 0.42 2003 0.74 2002 1.17 2001 0.97 2000 0 65 0.2 0.4 0.6 0.8 1 1.2 We participate in the main forums of debate and studies of environmentally friendly, sustainable practices. In 2004 we sponsored the Seventh National Environmental Congress: the Sustainable Development Summit, organised by the CONAMA Foundation, which dealt with the challenges of development and sustainable consumption, the new globalisation, sustainable use of natural resources, waste management and climate change strategies. The measures taken to minimise our environmental impact were set within the framework of four of the main global scale environmental problems: climate change, use of resources, waste management and biodiversity. To do this, we identified the most significant environmental impacts in each area and line of business and focused our efforts on them, reviewing the Environmental Management Plan each year and adapting it to fulfil our continuous improvement commitment. A year of advances Generating wealth and well-being EROSKI SUSTAINABILITY REPORT 2003-2004 Impact identification matrix Climate change Development area Commercial area Purchases (own brand) Logistics area (Platforms) Service stations What to act on Consum charter IMPACTS Eroski Eroski express Areas and business units involved Transport Energy consumption Refrigerants Use of resources Water Product Env. management system Reusable packaging Consumer portion packaging Construction of buildings Secondary and tertiary packaging Waste mangement Selective separation Biodiversity Sustainable agriculture Eroski NATUR FSC Conservation of natural spaces Climate change Climate change is considered to be one of the most serious ecological problems and our contribution focuses on transport activity, while also taking into account indirect CO2 emissions caused by electrical consumption at our installations, and refrigerant gas leaks. The Sustainable Transport initiatives, which we are working on together with the Spanish Association for Commercial Coding (AECOC) and as members of the MIRACLE project, are centred on finding alternatives to road transport, giving 66 rise to an annual saving of 168,000 litres of fuel in 2004 by transporting 7,800 pallets by train. We are also studying the viability of using sea transport for shipping goods from Italy and Holland. A year of advances Generating wealth and well-being EROSKI SUSTAINABILITY REPORT 2003-2004 We have also succeeded in minimising our average electrical consumption by 15%, with a consequent saving of 19,250 euros on industrial cooling installations, air conditioning, lighting and bakery ovens as a result of separate lighting systems functioning by areas and time zones, automatic switch-on according to a reading of external lighting by movement sensors and lighting installations. Evolution and savings in electrical consumption in hypermarkets 12.0000 10.0000 8.0000 6.000 2000 2001 2002 7,488 14.0000 8,748 16.0000 15,086.61 18.0000 16,213.85 Optimising despatch and automating route planning between the forwarding and distribution platforms via regional platforms will allow for a reduction in the total mileage travelled. These measures are consolidated with the implementation of a PMGE route-optimising module to attain a reduction of around 4%, both financially and of pollutant emissions. Petrol pumps with vapour recovery systems for refuelling have also been installed at 24 service stations since 2001, reducing the emissions of volatile organic compounds by 2%. measures for extending the life span of the 17,440.87 Our fleet renewal policies at the Elorrio, Zubieta and Agurain platforms (corresponding to 32% of our turnover) are measures which, in addition to improving our logistics activities, guarantee efficient fuel consumption and fewer emissions of greenhouse effect gases, with the average lifetime of the vehicles being between two and two-and-a-half years. 2003 2004 Unit of measurement: thousands of joules/total production m.h The consumption in joules was obtained by extrapolation from the size in m2 of the sales areas of the centres. We have also put our stakes in the use of renewable energy sources, installing photovoltaic panels as a complementary method of covering our electrical needs. We do this in four centres at present and intend to extend it to the rest of the commercial network. Use of resources Natural resources need to be exploited and managed in a more efficient way, to prevent these non-renewable sources from becoming depleted and also to reduce the amount of waste generated through their consumption. Our main consumption is of electricity for our network of commercial establishments, fuel for the logistics platforms, packaging, water 67 for cleaning and sanitary use, and paper. A year of advances Generating wealth and well-being EROSKI SUSTAINABILITY REPORT 2003-2004 Water is a renewable resource, although it is scarce in some areas of Spain. However, much pressure has been put on it by human use and this has caused deterioration and loss of its quality. Evolution and savings in water consumption Our commitment has led us to introduce economy measures such as the installation of shower-type hoses and steam cookers in the fish department and timers on the washroom taps in our centres. These data from the ISO 14001 Standard certified Artea Hypermarket show how far we have developed in this regard. This centre serves as a model for the rest of the commercial network. in m3/fish department sales 1.5 2004 1.83 2003 2.23 2002 2.34 2001 2.53 2000 0 0.5 1 1.5 2 2.5 3 Paper-making entails major energy and water consumption, in addition to trees needing to be cut down to obtain cellulose. Taking measures for encouraging economy in its use and later recycling are essential if we wish to reduce the pressure on our forests and eco-system. We have managed to reduce our consumption of paper, which we use mainly for advertising leaflets and publications, in our offices and for cash register receipt rolls, through measures such as double re-use of office paper, reusable envelopes for in-company mail, the use of chlorine-free or 100% recycled paper for leaflets and publications, and selective mailing schemes. The manufacture of containers and packaging requires a large amount of plastics, metals and energy. Recovery and recycling will prevent them from being disposed of indiscriminately and avoid much contamination of air and water. Containers, particularly for fresh produce, and shopping bags (photodegradable since 1991), are now being replaced by reusable packaging, which reduces the material needed and their environmental impact. We are once more giving our customers free reusable bags, certified by 68 AENOR in 2000, which we exchange for new ones when they break. Each bag saves on the use of 15 conventional plastic bags, and they are manufactured with a minimum of 15% of recycled materials and inks complying with the toughest regulations. A year of advances Generating wealth and well-being EROSKI SUSTAINABILITY REPORT 2003-2004 Waste management We are concerned with waste generation at the points of sale and the amount of packaging used by Eroski brand products, and we carefully monitor their characteristics, for example by changing our bottled water containers from PVC to PET bottles. · Urban waste and similar: meat waste, used vegetable oils, hard plastic waste. · Container and packaging waste: secondary and tertiary packaging (cardboard and plastic), lightweight containers and wooden containers. · Bulky waste: scrap and debris. Eroski Hypermarkets have infrastructures which allow us to selectively separate the waste generated, to dispose of it correctly. The waste separated and managed is as follows: · Hazardous waste: paint, bleach, motor oil, fluorescent tubes, grease sludge, batteries, empty containers with hazardous content. Evolution of waste generation at the Artea Hypermarket (kg) 1,400,000 total kg kg recycled 1,000,000 2000 2001 2002 2003 Biodiversity The loss of biodiversity cannot be considered as merely an environmental problem, as it also has profound repercussions on economic and social development. Eroski contributes to preventing the loss of biodiversity by using sustainable agriculture procedures for its fresh produce and wood products from sustainably-managed forests (as the loss of forest ecosystems on a global level is another of the main casues of the climate change). 69 Analysis of Genetically Modified Organisms (GMOs) YEAR Number 2004 41 2003 0 2002 281 2001 2000 208 148 1,154 543,535 979,049 1,510 543,211 972,751 1,395 598,540 1,170,940 1,353 585,632 1,208,765 2,216 200,000 529,823 600,000 1,197,219 kg of HW 2004 A year of advances Generating wealth and well-being EROSKI SUSTAINABILITY REPORT 2003-2004 Widening our responsibility Motivation for promoting environmentally-sound practices Acting on the supply chain Since 1999 we have been making environmental diagnoses of our suppliers and sub-contracted companies, and we have proceduralised this in a tough statement of conditions. Among the environmental requirements, which are particularly critical in the case of fresh produce, are recycling of hothouse plastics and phytosanitary treatment containers, limitations on the use of phytosanitary products for fruit and vegetables, regulation of the amounts of nitrates for treating soils and prohibition of feed containing drugs for meat products. Percentages of products affected by environmental criteria 35 30 25 20 15 2001 2002 70 33.8 23.6 24.5 2003 Eroski NATUR fruit and vegetables To guarantee compliance with these environmental requirements and others concerning hygiene, health and origin, all suppliers of Eroski NATUR products undergo a control programme involving several inspections per year and samples being taken for waste control. 20.2 15.2 12.2 0 7.9 5 15.6 10 2004 Eroski NATUR meat Analysis of Eroski NATUR Suppliers YEAR Number of analyses Number of inspections 2004 1512 250 2003 2016 333 2002 2240 370 2001 2651 1648 2000 3992 955 A year of advances Generating wealth and well-being EROSKI SUSTAINABILITY REPORT 2003-2004 We also work with five transport companies who are all ISO 14001 Standard certified, and another three who are due to have their environmental management system certified by 2005. This means that 90% of our transport will be certified. The e+5 programme. Environmental rating of suppliers and sub-contracted companies The Eroski Group participates in a programme for the environmental classification of suppliers and sub-contracted companies, developed by the Fundación Entorno and which provides 135 of our suppliers with a procedure for phasing in environmental management systems. The requirements are as established in the ISO 14001 Standard and there is an external classification audit whereby a certificate is issued. In 2004, the Eroski Group, together with the companies Coca Cola, Gas Natural and Ericsson, and in collaboration with Fundación Entorno, obtained the Garrigues Award for Sustainable Environmental Management for this initiative of extending environmental management to suppliers and sub-contracted companies in accordance with e+5 methodology for large companies. We are now able to assess and improve our suppliers' environmental actions by means of this system, and can therefore act on our commitment to contributing to sustainable development and the social demand for environmental protection. Further information from www.emas5.com Raising consumers' ecological awareness The level of awareness of environmental issues is high, and we are committed not only to implementing environmentally friendly management practices but also to publicising them, so that we succeed in disseminating the importance of environmentally concerned lifestyles. As well as integrating the environmental variable in our working procedures and products, we also wish to instil these values in the consumers through a large variety of 71 awareness-raising activities and specific measures for encouraging and facilitating environmentally friendly practices. EROSKI SUSTAINABILITY REPORT 2003-2004 A year of advances Generating wealth and well-being Main actions for awareness-raising and promotion of environmentally friendly practices in 2004 72 Exhibition SOS Save our Planet A travelling exhibition, held in collaboration with WWF/Adena, for informing on the main environmental problems of our planet, with a programme of guided visits for schools and the general public, raising awareness of the need to save energy. Over 9,200 participants to date. So what can I do as a consumer? "Idea Sana EROSKI" information campaign at our points of sale, in collaboration with WWF/Adena, for informing consumers of the importance of saving and optimising energy, providing advice for how to do so at home, school, the workplace and transport. 100,000 information leaflets Tragamovil Awareness-raising campaign for the collection of disused mobile phones and their accessories for recycling in collaboration with ASIMELEC, the Spanish Multi-Sector Association of Electronics and Communications Companies. 18,305 consumers involved Recyclable bags The launch at our centres of a recyclable bag, which is replaced free of charge when it wears out. This initiative allows savings to be made on the consumption of t-shirt bags and awareness to be raised in society regarding environmentally friendly habits. Over 50,000 bags Environmentally friendly driving habits An "Idea Sana EROSKI" information leaflet, launched simultaneously with a "school" or series of lectures organised in collaboration with the RACC (Royal Automobile Club of Catalonia), on environmentally friendly driving habits. 25,000 leaflets, 1,430 attendees and 6 press conferences. Glass recycling and healthy habits in the home Idea Sana EROSKI, in collaboration with ECOVIDRIO, has published a series of collectables and run a series of training sessions on the importance of recycling in the home: Reduce, Re-use and Recycle. 5,000 collectables, 880 participants and 4 press conferences. Ecological summer An information campaign, in collaboration with the Federation of Associations "Conocer y Proteger la Naturaleza" ("Know and Protect Nature"), with a leaflet containing a list of proposals for Environmental protection in the home and on our summer holidays. 10,000 leaflets. Sponsorship of the VII National Environment Congress Sponsorship of the VII National Environment Congress: Sustainable Development Summit, organised by the CONAMA Foundation, in which the issues studied were the sustainable use of natural resources, waste management and climate change strategies. Toner cartridge collection Collection of printer ink and toner cartridges at all the hypermarkets in our commercial network, with collaboration and support from WWF Adena and Pelikan Hardcopy. Battery collection Collection of batteries at all the hypermarkets and supermarkets in the commercial network. 21,150 Kg collected Waste collection centres In order to encourage selective waste collection amongst the customers of our centres, we have provided special areas for depositing domestic waste (cardboard, plastic, containers, glass, oil, batteries) in some of our establishments. Our Pamplona centre also has infrastructure for collecting special waste such as paints, pharmaceutical products and x-rays. 6 establishments provided with infrastructure. A few drops ahead Campaign for publicising the Comprehensive Water Saving Plan in Álava, organised in collaboration with Vitoria City Council and AMVISA. A year of advances Generating wealth and well-being EROSKI SUSTAINABILITY REPORT 2003-2004 5.5 Solidarity and action for society Social Responsibility is our commitment to practising solidarity as members of the community in which we work and as members of society in general. We therefore set aside 10% of our profits for activities to aid society through the Eroski Foundation, thus generating wealth and contributing to social well-being and global sustainable development. The Eroski Foundation plans its activities on an international scale and also on a level close to its customers, to encourage a healthy, environmentally friendly and solidarity-minded lifestyle and as a channel for developing their social awareness. As a socially responsible company we are also committed to the Global Compact Principles for respect and defence of human rights and the environment, and to the 2015 Millennium Goals in their aim to contribute to social well-being and the eradication of poverty. Advances 2003-2004 2002 2003 2004 For a better world Active involvement Donation to Social Action (thousands of euros) 2,083.47 1,526.20* 1,706.44 Transmission of values Consumer campaigns (thousands of euros) 4,485.73 5,138.47 6,021.18 Fair Trade sales 120,200 180,303 101,779 * 125,183 Kg 158,242 Kg 158,634 Kg Food donations (Food Bank) Product Donation programme funds 480,809 802,311 1,187,543 Sales of products processed by disabled people (twice-yearly campaign) 16,934.32 euros 5,951 84,779.83 Special Employment Centre services 101,061.27 127,112.38 136,458.03 * Data affected by Consum S.Coop. leaving the sphere of action of the Eroski Group.. We will keep on improving... by feeling we are part of society and actively participating in its development through our business activity and the activities of the Eroski Foundation, based on dedicating 10% of our profits to society. 73 EROSKI SUSTAINABILITY REPORT 2003-2004 A year of advances Generating wealth and well-being For a better world Active participation The Eroski Foundation divides its work between Social Action, signing collaboration agreements with tertiary sector organisations, awarenessraising activities, and annual calls for Research Grants and Subsidies and for International Cooperation Intervention Financing Projects for the promotion and development of cooperatives, fair trade, and training and empowerment of the vulnerable population. We actively collaborate with social, economic, cultural and environmental development through our activity and our solidarity-orientated participation in society. The Eroski Foundation therefore backs various NGOs, either through direct financial contributions or by establishing collaboration agreements for carrying out specific activities. Agreements signed with NGOs in 2004 Intermon-Oxfam. Sponsorship of the tenth Solidarity Festival, "A Day for Hope" in 47 towns throughout Spain with the slogan "Women in Development" and which was attended by 262,800 people. The Eroski Foundation made a contribution of 20,000 euros. Médecins sans Frontières. Collaboration with the Emergency Fund for action against natural disasters, with a contribution of 9,000 euros. UNICEF. The Education Now campaign for protecting the Right to Education in the Third World, raising funds for the purchase of school equipment for girls in 25 Third World countries. The amount contributed by the Eroski Foundation was 25,000 euros. The Red Cross. Emergency Humanitarian Campaign to help those affected by the Asian tsunami disaster, with a donation in our name of 15,000 euros. WWF/Adena. Support campaign for raising society's awareness of the climate change, offering proposals for improvement at work, school, the home and transport, with a contribution of 30,000 euros. Children of the World Federation. Product Donation programme where toys, clothing and shoes for a value of 894,000 euros were donated to be sent to less favoured countries, mainly Chile, Peru, Guatemala, Russia and Bolivia, and also for the street children of Brazil and Cuba and Africa. 74 EROSKI SUSTAINABILITY REPORT 2003-2004 The Eroski Foundation develops and supports international cooperation aid programmes, focusing its efforts in accordance with the 2015 Millennium Goals established as part of the Millennium Declaration approved at the United Nations meeting held in New York in 2000. Our Social Action is in accordance with these eight goals, as described in Annex IV, Product Donation programme Member of Intergroup Far East Limited (IFEL) since 1997 A year of advances Generating wealth and well-being and is geared towards developing initiatives in line with the priorities declared by United Nations for eliminating the FOREIGN DEBT of the least favoured countries, organising a balanced structure of INTERNATIONAL TRADE and providing OFFICIAL AID FOR DEVELOPMENT. In addition to the Agreement signed with the Children of the World Foundation, the Eroski Foundation has also set up campaigns for Product Donation to other organisations and NGOs, including the Pro-Sahara Solidarity Caravan Coordinator, Unicef, Nuevo Futuro, Apace, Fundación O Belén and Adra. 1,187,543 in donated products IFEL, a group of European consumer cooperatives for the joint management of non-food product purchasing in Asia, created a Social Welfare and Children's Education Fund with the aim of promoting Basic Education for Children. Since its creation it has participated in 5 projects for building schools and setting up education projects in China, Thailand, Indonesia, India and Vietnam. Amount committed: 250,000 US$ Yearly Call for Financing International Cooperation Intervention Projects We contribute to enabling less-favoured, marginalised and excluded people from deprived countries to fulfil their basic needs sustainably and by themselves. To do this, we promote justice, equity, respect of human rights and environmental sustainability through Project Financing in three areas: promotion and development of cooperatives, fair trade, and training and empowerment of the vulnerable population. As a result of the two most recent calls, in 2003 and 2004, 6 projects were started up with a contribution from the Eroski Foundation's of 317,434.85 euros. The 75 donation for the selected projects represented a 45% increase as compared to the years 2001 and 2002. A year of advances Generating wealth and well-being EROSKI SUSTAINABILITY REPORT 2003-2004 The type of projects represented depends on their aims. As we are a cooperative, committed to the promotion of healthy, guaranteed trade and with an intensive consumer education and information programme, the cooperation call must include projects on three issues that are coherent with our philosophy: 2003 CEAR Foundation Promotion of Cooperatives Senegal Project for Supporting the Fight against Poverty through Micro Credits and Micro Deposits COCENFE Training and empowerment Santo Domingo (Dominican Republic) Training and Integration in the Labour Market for People with Disabilities through the creation of an Underwear Production Workshop. INTERMÓNOXFAM Training and empowerment Santo Domingo (Dominican Republic) Coffee and Sustainable Development for the municipality of Concepción Husta, Huehuetenango Spanish Federation of Members of Religious Orders(FERS) Training and empowerment Bolivia Improvement of Living Conditions in the Community of San Lorenzo through the Empowerment of Women and Commercialisation Private Catalan Foundation (AKWABA) Training and empowerment Ivory Coast "Social and Work Training for Child Soldiers on the Ivory Coast" COFADE Trade Foundation Cooperatives and Fair Trade Honduras Development of Fair Trade Relationships with Craftspersons and Rural Cooperatives with FSCcertified wood. 2004 In acknowledgement of the efforts and investments made by the Eroski Group in favour of sustainable development and a more equal distribution of wealth, in April 2004 we received the Cooperation Award for Sustainable Development, part of the Spanish Section of the 2003-04 European Environment Awards, organised by Fundación Entorno, for the Project "Support for the creation of cooperatives and associations for promoting food safety in Machacos (Kenya) which we carried out in collaboration with the Red Cross. 76 EROSKI SUSTAINABILITY REPORT 2003-2004 A year of advances Generating wealth and well-being Annual Call for Research Grants and Subsidies We collaborate with research in three fields: Bioethics and Business, Nutrition and Health, and Food Safety. The grants or subsidies are awarded annually, extendible to a maximum of three years and endowed with an amount of 6,000 euros. They are aimed for university graduates from Spanish research centres. In 2004 the centres awarded the grants were the Biology Faculty of the University of Murcia for its study Improvement in the nutrition of 77 new species of interest in aquaculture: feeding rhythms and diets" in the Nutrition and Health area, and the Autonomous University of Barcelona for its project "New methods for determining microbiological risks in different shopping centre areas", in the Food Safety category. The Bioethics and Nutrition category was declared void as no projects were presented. EROSKI SUSTAINABILITY REPORT 2003-2004 A year of advances Generating wealth and well-being Transmission of values Committed consumers We maintain our commitment to being a socially responsible company that protects and respects human rights and extends this awareness to the people making up our organisation, our consumers and the organisations with which we collaborate. The Eroski Foundation's solidarity effort stems from our direct involvement in promoting consumer awareness, with the aim of joining forces to increase the economic impact and repercussion of solidarity initiatives. The Eroski Foundation wishes to involve consumers in the cooperation and solidarity activities it carries out at our centres, giving 78 them the opportunity to participate and collaborate. Some of our activities in 2004 were as follows: World Education Campaign: Education Now Campaign coordinated together with UNICEF for collecting funds for promoting programmes for the education of girls in underdeveloped countries, through the sale of calendars, financed by the Eroski Foundation, at all our shops. 60,000 euros were raised. Product Collection Campaign Two annual campaigns forming part of the agreement with the Spanish Food Bank Federation, consisting of the collection of products donated by the consumers, to which the Eroski Foundation also added a contribution of the same number of kilograms as those of the most-donated product at each collection centre. These goods were distributed amongst the most needy people in each area. Amount collected: 158,634 kg. Over a million kilos have been collected in 8 years of collaboration. III Fair Trade Campaign: Fair Trade T-shirts Fortnight of information and awareness-raising in collaboration with Intermón-Oxfam regarding consumption of products manufactured in accordance with Fair Trade parameters. This campaign included a programme of commitment with less-favoured countries and support for women victims of gender violence. 45,800 participants contributed 3 euros for each t-shirt bought. The funds raised were destined to both causes. Emergency Humanitarian Campaign: Special Tsunami Plan Idea Sana EROSKI and the Red Cross organised a fund-raising event with 60,000 calendars being produced, financed by the Eroski Foundation. A net donation of 1 euro was given for each calendar sold. The Foundation also made a donation of 15,000 euros. 119,500 euros were raised. Idea Sana EROSKI Calendar A solidarity, environmental and food calendar was produced to raise funds for the Reina Sofía Foundation. 300,000 calendars were produced, with 1 euro being raised for each one. Sponsorship of the Day of Hope Idea Sana EROSKI and Intermon Oxfam organised a Solidarity Day to raise the awareness of the citizens of 46 Spanish towns regarding the disadvantaged situation of thousands of people all over the world. Over 235,000 people participated. A year of advances Generating wealth and well-being EROSKI SUSTAINABILITY REPORT 2003-2004 The commitment of the Eroski Group, as a cooperative company that contributes resources to society, and the Eroski Foundation, as a tertiary sector organisation, raises our awareness, and our Social Action campaigns cater for urgent needs, in addition to carrying out international cooperation projects supported by an annual call for subsidies. In 2003 we organised the Yo colaboro ("I'll help") campaign in favour of the victims of the Iran earthquake, printing pocket calendars which were sold for 1 euro, raising the amount of 48,592 euros. Sadly, another urgent campaign had to be organised in 2004 to aid the South-East Asian victims of the tsunami disaster. On this occasion, apart from making a donation of 15,000 euros, we raised 119,500 euros at our centres between 26 December and 31 January as part of the Special Tsunami Plan in collaboration with the Red Cross. The funds raised contributed to sending cans of drinking water, first aid material and emergency services to the area, together with services for family locating and regrouping, rebuilding, empowerment for possible future disasters and economic development programmes. We have also continued to work towards international cooperation since 2000, as well as with the contributions of the Eroski Foundation and the consumers on specific campaigns, creating stable collaboration programmes which are integrated within the commercial activity throughout our network of shops. To do this, we have carried out a variety of awareness-raising campaigns in our shops with the aim of promoting responsible consumption that will contribute to achieving an improvement in the quality of life of the least favoured people. Our Idea Sana EROSKI programme and Intermón-Oxfam have therefore collaborated intensively over the last few years in order for Fair Trade to take its place day by day in the family shopping basket. At the same time, we have reinforced these campaigns with the Idea Sana EROSKI schools at the centres and with the Idea Sana EROSKI magazine giving information on these projects and the related website www.ideasana.com. Fair Trade is an alternative to conventional international trade. It is a commercial partnership seeking the sustainable development of less-favoured producers who are normally excluded from the market: a sustainable economic alternative for less well-off and more vulnerable populations. The basic lines defining these products are the guarantee of a decent wage and gender equality of the producers, in addition to the quality and naturalness of their components, and environmentally friendly processing. Fair Trade products available to customers at our centres are: · EQUITA cocoa spread 400 gr · EQUITA instant cocoa 375 grs. · EQUITA Natural ground coffee 250 grs. · AFRICAO hot chocolate powder 250 GR 79 · MASCAO organic milk chocolate 100 GR · MASCAO organic plain chocolate 100 GR · Organic black tea in palm basket 6 6 Annexes Annexes Annex II Annex Correlation table table with GRI Correlation with GRI requirements requirements Annex II II Annex AENOR Validation validation report AENOR Report Annex III Annex III 2004 Global Compact Progress Global Compact Progress ReportReport 2004 Annex IV Social Action Annex IV and 2015 Millennium Social Action and 2015 Goals Millennium Goals 81 2.6 2.5 2.4 2.3 2.2 2.1 25 12 24 23,30 30 8-9,24 4 2.12 2.11 2.10 11 4 4 4 4 SUPPLIERS CULTURE CREATORS FUTURE GENERATIONS ANNEX I Correlation table with GRI requirements INSTITUTIONS INTERESTED PARTIES CONSUMERS EROSKI SUSTAINABILITY REPORT 2003-2004 PAGE 8-9, Annex III 2.7 14 14,51-52 2.13 N.A.* FAMILY Annex I correlation table with GRI requirements GRI requirement 1.1 6 Vision and strategy 1.2 2.8 Profile / Profile of organisation 2.9 2.14 N.A.* Profile / scope of report 2.16 2.15 PEOPLE ALLIANCES SOCIETY CUSTOMERS 82 2.19 2.18 2.17 31-36 Annex II 31-36 N.A.* 31-36 Annex II PAGE 2.20 4 3.6 3.5 3.4 3.3 3.2 3.1 13 6 30 57 12, 30-32 3 3 3 3.10 3.9 19-22 19-22 19-22 18 SUPPLIERS INSTITUTIONS CULTURE CREATORS FUTURE GENERATIONS FAMILY ANNEX I Correlation table with GRI requirements CUSTOMERS INTERESTED PARTIES CONSUMERS EROSKI SUSTAINABILITY REPORT 2003-2004 GRI REQUIREMENT 2.21 Profile / Profile of report 2.22 Government Structure and Management Systems 3.7 Structure and Government 3.8 3.11 Commitment with interested parties 3.12 PEOPLE ALLIANCES SOCIETY 83 PAGE 3.17 3.16 3.15 3.14 3.13 31-36 * 52-54.66-67 70-72 38 74-79 32 EC5 EC3 EC4 EC3 EC2 EC1 * 51-52 51-52 51-52* 51 51 * 10 SUPPLIERS INSTITUTIONS CULTURE CREATORS FUTURE GENERATIONS FAMILY ANNEX I Correlation table with GRI requirements CUSTOMERS INTERESTED PARTIES CONSUMIDORES EROSKI SUSTAINABILITY REPORT 2003-2004 GRI REQUIREMENT 3.18 47 Global policies and management systems 3.19 EC6 Annex I 3.20 4.1 Index of GRI content EC7 Economic performance indicators Customers Central Suppliers Central Additional Central Employees Capital providers Central PEOPLE ALLIANCES SOCIETY 84 EC9 EC8 52-54 * 51-52 PAGE EC10 52-54 EN6 EN5 EN17 EN4 EN3 EN2 EN1 * * 68,Annex III 67, Annex III * 67, Annex III Annex III 68-69, Annex III EN8 * Annex III* SUPPLIERS INSTITUTIONS CULTURE CREATORS FUTURE GENERATIONS FAMILY ANNEX I Correlation table with GRI requirements CUSTOMERS INTERESTED PARTIES CONSUMERS EROSKI SUSTAINABILITY REPORT 2003-2004 GRI REQUIREMENT EC13 Economic performance indicators Public Sector Central Indirect economic impact Additional EN7 Environmental performance indicators Raw Materials Central Power Central Additional Central Water Biodiversity Central EN9 Emissions, waste and residues Central PEOPLE ALLIANCES SOCIETY 85 EN16 EN15 EN14 EN33 EN13 EN12 EN11 EN10 66-67 * * 64 66, ANNEX III 40, 71 * * 69,Annex III * Annex PAGE EN34 LA2 LA1 62-63 15,55-56 60 LA4 LA3 13 19,22 ANNEX III SUPPLIERS INSTITUTIONS CULTURE CREATORS FUTURE GENERATIONS FAMILY ANNEX I Correlation table with GRI requirements CUSTOMERS INTERESTED PARTIES CONSUMERS EROSKI SUSTAINABILITY REPORT 2003-2004 GRI REQUIREMENT Additional Suppliers Central Products and services Central Fulfilment Additional Transport LA12 Social performance indicators Employment Central Additional Central LA13 Company/worker relationship Additional PEOPLE ALLIANCES SOCIETY 86 PAGE 35 63* 35 Annex IV LA5 LA7 HR3 HR2 HR1 34-35, Annex III 34-35, Annex III 34-35, Annex III 9,40,73 HR5 Annex III SUPPLIERS INSTITUTIONS CULTURES CREATORS FUTURE GENERATIONS FAMILY ANNEX I Correlation table with GRI requirements CUSTOMERS INTERESTED PARTIES CONSUMERS EROSKI SUSTAINABILITY REPORT 2003-2004 GRI REQUIREMENT Health and safety Central LA8 62 55 LA6 LA9 Training and education LA17 60-61, Annex III Central LA10 Annex III Additional Central Diversity and opportunity LA11 HR4 Human Rights. strategy and management Central Central Non-discrimination Central 34-35, Annex III HR7 34-35, Annex III HR6 Freedom of association and group negotiation Central Child labour Central Forced and obligatory labour PEOPLE ALLIANCES SOCIETY 87 SO1 71-72 32-54,76 PAGE SO4 Central PR2 PR1 42-43 48-49, 52 31-35, 45-49 INSTITUTIONS CULTURE CREATORS FUTURE GENERATIONS FAMILY ANNEX I Correlation table with GRI requirements CUSTOMERS INTERESTED PARTIES SUPPLIERS ALLIANCES SOCIETY EC7 For further information, the company's Annual Report may be consulted at www.eroski.es EC2 Spain is the only country in which Eroski carries out its activity directly. 3.18 No decisions have been made regarding the location or modification of the operations. 2.19 There are no significant changes. Any amendment relating to an indicator is shown in the text itself. CONSUMERS EROSKI SUSTAINABILITY REPORT 2003-2004 GRI REQUIREMENT Central Annex III Community Additional SO2 12, Annex III Corruption SO3 Central Political contributions PR8 Central Customer health and safety Central * Products and services Additional PR3 Central Respect for privacy 2.8 For further economics information the 2004 Annual Report can be consulted at www.eroski.es 2.15 Not applicable. Eroski does not draw up joint reports with other companies. 2.16 Not applicable. Although there are no significant changes on reformulating the information, in any cases where there are amendments to this effect, it is indicated in the text itself. 2.17 Eroski applies all the principles and protocols of the GRI. PEOPLE 88 EROSKI SUSTAINABILITY REPORT 2003-2004 EC11 Eroski promotes the sale of regional products in the areas in which it works. These acquisitions are made from suppliers in the surrounding environment of the centres. EC9 Information available in the Group's Annual Audit Report, entered in the Commercial Register. EN2 Numerical indicator not included. EN4 Indirect power consumption data corresponding to electrical consumption for 2004: 22,741,118 J/m2. Data calculated in accordance with the GRI technical Protocol on power. EN6 Eroski's activity does not affect habitats rich in biodiversity. EN7 Eroski's activity does not have an impact on biodiversity. EN8 Eroski's activity does not produce greenhouse effect gas emissions. ANNEX I Correlation table with GRI requirements EN9 Eroski's activity does not use or emit ozone-depleting substances. EN10 Eroski's activity does not cause any significant atmospheric emissions. EN12 Eroski's activity does not produce any significant discharge into water. EN13 Eroski's activity does not produce any significant discharge of chemical substances, oils or fuels. EN16 In the period 2003-2004 no episodes or fines were produced. LA9 Data expressed in terms of total hours of training. LA11 The information on the composition by sexes of the Governing Council can be consulted in the Eroski Group Corporate Government Report at www.eroski.es PR3 Eroski conforms to current legislation as regards this matter. EROSKI Sustainability Report 2003-2004 89 ANEXO II INFORME DE VALIDACIÓN AENOR 90 EROSKI SUSTAINABILITY REPORT 2003-2004 Progress Report 2004 1 Global compact principles Human Rights Companies must support and respect the protection of international human rights Plans for action HR 2 HR 1 Ind. Policy for the selection of suppliers and sub-contracted companies subject to the signature of a Social Responsibility Commitment for the defence and promotion of human rights in the carrying out of its activities. The EROSKI GROUP's commitment to Social Responsibility is one of the five principles of its Code of Ethics, which is the framework for the development of its strategy. It is therefore a member of forums of recognised prestige on a national and world level which regulate companies' compliance with social responsibility, such as the Global Compact and the Spanish Ministry of Labour and Social Affairs' Forum of Experts, and it is committed on an international level to defending human rights and protecting the Environment in accordance with guidelines such as the Millennium Development Goals and Sustainable Development, as defined in the Brundtland Report. Evidence ANNEX III Global Compact Progress Report 2004 THE EROSKI GROUP is committed to the protection of human rights and states the priority of the same in its Code of Ethics, endeavouring to defend the rights of its workers, consumers and suppliers and those of society. HR 3 HR 4 Audit for SA 8000:2001 Standard certification at its central offices, applicable to all suppliers, with a gradual requirement programme being established prioritising nonconformities by importance. Establishment and monitoring of an Ethical Management System implemented by the EROSKI GROUP's management, for controlling the respect for the human rights of its workers, consumers and suppliers. 91 EROSKI SUSTAINABILITY REPORT 2003-2004 Progress Report 2004 2 Global compact principles Human rights Companies must not be complicit in human rights abuses Plans for action HR 2 Ind. A Social Responsibility Commitment is required from all suppliers and sub-contracted companies in order to enter into any collaboration agreement. Suppliers and sub-contractors are classified according to their commitment to their workers' human rights. The specific requirements and deadlines for taking measures for improving conditions inside and outside their work installations are then defined. An Occupational Risk Prevention Commitment is required from all the suppliers and sub-contracted companies so that their work centres comply with the minimum legal requirements, and they must also collaborate on improving respect for human rights over and above these safety standards. Evidence ANNEX III Global Compact Progress Report 2004 Protocol of conformity of suppliers and sub-contracted companies taken on from the central offices of the EROSKI GROUP, promoting and complying with the requirements of the SA:8000 Standard in their activities. HR 2 A Social Responsibility Commitment is required from all suppliers and sub-contracted companies in order to enter into any collaboration agreement. Suppliers and sub-contractors are classified according to their commitment to their workers' human rights. The specific requirements and deadlines for taking measures for improving conditions inside and outside their work installations are then defined. An Occupational Risk Prevention Commitment is required from all the suppliers and sub-contracted companies to ensure that their work centres comply with the minimum legal requirements, and they must also collaborate on improving respect for human rights over and above these safety standards. Programme of audits on the highest risk suppliers to ensure compliance with SA:8000 Standard criteria and commitment to 15 years of conformity with these requirements. HR 3 The EROSKI GROUP uses certification by means of an external audit to guarantee respect for the human rights of all the workers involved in all the stages of the production process for socially responsible products. The suppliers must have an increasing quantitative and qualitative commitment to observance of the criteria of the SA 8000:2001 Standard as regards protection and defence of the human rights of their workers. Design and plan for the launch of socially responsible products with a certified guarantee of compliance with the human rights of all the workers involved in all stages of the production process. 92 EROSKI SUSTAINABILITY REPORT 2003-2004 Progress report 2004 3 Global compact principles Labour regulations To respect freedom of association and the effective recognition of the right to collective bargaining 4 The elimination of all types of forced or compulsory labour HR 5 Ind. The EROSKI GROUP endeavours for its workers to actively participate on committees and forums created to encourage contribution and proposals for improving working conditions. The staff departments of each centre encourage and organise the holding of such meetings in addition to the meetings required by the business activity itself for the treatment and consideration of the working atmosphere and conditions. Evidence ANNEX III Global Compact Progress Report 2004 Plans for action LA 3 The EROSKI GROUP encourages its workers to actively participate in the cooperative area with an increase in worker members and through formulas of capital contribution to the private company GESPA in the non-cooperative sphere, created to respond as far as possible to the company structure. HR 7 The EROSKI GROUP has a growing commitment to quantitative and qualitative compliance with the requirements of the SA 8000:2001 Standard regarding its suppliers' respect of human rights. The EROSKI GROUP respects freedom of association and aims to take its workers into account in the management authorities' decision-making process and for them to participate in the capital, management and profits, on the basis of a cooperative model that acknowledges people as partners and key figures. Therefore, on the path towards this achievement, it dedicates resources to training its staff to take on responsibilities, and to the Empowerment Programmes at its centres. The EROSKI GROUP has never tolerated any type of forced or compulsory labour within its organisation and carries out an internal audit in compliance of the SA:8000 Standard on the Group's suppliers with the highest risk of failing to comply with this point, to avoid any such practices throughout the production chain. 93 EROSKI SUSTAINABILITY REPORT 2003-2004 Progress report 2004 5 Global compact principles Labour regulations The effective abolition of child labour 6 The elimination of discrimination in respect of employment and occupation Plans for action LA 10 HR 4 HR 6 Ind. Policies for customers and workers' accessibility to the installations, and recruitment of people with disabilities and groups with different needs. Equality of wage conditions at equal levels of responsibility. Equality of conditions for common-law and marital unions. Policies for customers and workers' accessibility to the installations, and recruitment of people with disabilities and groups with different needs. Policies for conciliating work and personal life. The EROSKI GROUP has a growing commitment to quantitative and qualitative compliance with the requirements of the SA 8000:2001 Standard regarding its suppliers' compliance with human rights. Evidence ANNEX III Global Compact Progress Report 2004 The EROSKI GROUP does not tolerate child labour within its organisation and carries out an internal audit in compliance with the SA:8000 Standard on the Group suppliers with the highest risk of failing to comply with this point, to prevent any such practices occurring throughout the production chain. LA 11 Policies for conciliating work and personal life such as the provision of 20 and 28 hour weeks for persons in posts of responsibility so that they may reconcile different individual circumstances with executive or management tasks. The EROSKI GROUP does not tolerate any discriminatory practice and coexists with different socio-demographic realities which it integrates within its culture with a view to tolerance and enrichment of its values. The diversity of the organisation itself, due to its particular nature and the integration of these realities, forms the basis of a philosophy free from discriminatory practices and with equality of professional opportunities. 94 EROSKI SUSTAINABILITY REPORT 2003-2004 Progress report 2004 7 Global compact principles The Environment To support a precautionary approach to environmental challenges 8 To undertake initiatives to promote greater environmental responsibility Plans for action The EROSKI GROUP has developed an ambitious Environmental Management Plan (ECOPLAN) for 20042008, in which it specifically undertakes to: 1. Support a precautionary approach to environmental challenges. 2. Take initiatives for promoting greater environmental responsibility, and 3. Encourage the development and diffusion of environmentally friendly technologies. EN 11 EN 8 EN 10 EN 5 EN 3 EN 2 EN 1 3.13 Ind. Diagnosis of waste management and prioritising of action with regard to paper and cardboard, wood, meat waste, soft or bulky plastics and electrical and electronic appliances throughout the commercial network, in order to reduce generation of the same and optimise the efficiency of their processing. Development of a Green Transport Project put into practice by the EROSKI GROUP management, fitting a controller cabinet with indicators of the reduction of the emission of significant gases into the air. Implementation of water consumption saving measures such as shower-type hoses and fitting timers to washroom taps throughout the commercial network. Pilot tests have been carried out and later extended to the commercial network for systems optimising power consumption, such as separate lighting in different areas and time zones, and programmes for extending the lifetime of the lighting installations. Promotion of campaigns for recycling office material such as cardboard, paper, toners and batteries in all the EROSKI GROUP centres. Programme for the rational use of raw materials and reduction of their consumption through initiatives such as the introduction of the consumer portion to reduce packaging, and methods for using fewer t-shirt bags and optimising their production from an environmental perspective, in addition to the provision of re-usable bags (made from 15% recycled material) for customers. The EROSKI GROUP has defined the impact of its activities with regard to climate change, protection of natural resources, waste reduction and management and preservation of biodiversity, and has developed a system of control and minimising of consequences on the basis of this. Evidence ANNEX III Global Compact Progress Report 2004 EN 14 Inclusion of the environmental variable as a definitive factor in the development of EROSKI GROUP own brand products. Programme for e+5 environmental classification of suppliers and sub-contracted companies in collaboration with Fundación Entorno, to improve environmental behaviour throughout the supply chain and study improved production practices. 95 EROSKI SUSTAINABILITY REPORT 2003-2004 Progress report 2004 10 To encourage the development and diffusion of environmentally friendly technologies 9 To undertake initiatives to promote greater environmental responsibility 8 Global compact principles The Environment Anticorruption Companies must work against corruption in all its forms, including extortion and bribery Ind. Evidence ANNEX III Global Compact Progress Report 2004 Plans for action Incorporation of renewable power sources, consisting of photovoltaic panels to complement the needs of the commercial network. Educating the workers on the impact that the EROSKI GROUP's activity could have with regard to climate change, protection of resources, waste reduction and management and preservation of biodiversity. Sponsorship of the VII National Environment Congress (CONAMA): the "Sustainable Development Summit" organised by the CONAMA Foundation in 2004. 1.1 EN 17 Education and information for EROSKI GROUP consumers on environmentally friendly habits, e.g. recycling mobile phones through the ASIMELEC (TRAGAMOVIL) project, recycling glass in collaboration with ECOVIDRIO, campaigns for environmentally friendly driving with the RACC and Energy saving programmes and "S.O.S. Save our Planet" with the WWF/ADENA, amongst others. Initiatives for the use of renewable power sources and energy-efficient practices. SO 2 The EROSKI GROUP also carries out numerous training activities for its workers for awareness and use of better practices in carrying out their duties, and for society in general for encouraging healthy and environmentally friendly habits which will improve their quality of life and protect the environment for future generations. The EROSKI GROUP, right down from its Code of Ethics to its internal regulations, proposes and encourages ethical, transparent practices in the carrying out of duties at all hierarchical levels of the organisation. EROSKI SUSTAINABILITY REPORT 2003-2004 ANNEX IV Social Action and 2015 Millennium Goals Our social action and the 2015 millennium goals As we act in accordance with the guidelines of the United Nations Organisation, our solidarity programme is set within the framework of the goals established in its 2015 Millennium Goals Declaration of 2000. These take the form of 8 principles to which governments should adhere in order to collaborate with sustainable development and better distribution of the world's wealth, and they are therefore a guideline for all companies which, like Eroski, wish to contribute to eliminating the FOREIGN DEBT of the lessfavoured countries, organising a balanced structure for INTERNATIONAL TRADE and providing OFFICIAL AID FOR DEVELOPMENT. Due to their importance, the Millennium Goals are the guideline for Eroski's Social Action: 1.- Eradicating extreme poverty and hunger: Eroski conducts annual Product Donation (1,187,543 euros in 2004) and Fair Trade campaigns. 2.- Achieving universal primary education: Over the last 3 years, Eroski has promoted awareness-raising actions in collaboration with UNICEF for the education of girls in underdeveloped countries, as part of the "Back to School" campaign. Funds have been raised to a value of 60,000 euros. 3.- Promoting gender equality: Eroski grants micro-credits to women through an annual call for financing international cooperation interventions. 96 4.- Reducing the child mortality rate: Eroski collaborates with Save the Children and the Food Bank as part of the Accelerated Child Survival and Development Programme. 5.- Improving maternal health: Eroski is running Balanced Diet Programmes for its consumers and customers in collaboration with the Spanish Heart Foundation, the Diabetes Foundation, the Spanish Association of Dieticians and Nutritionists and the Cinco al Día ("Five a Day") Association. 6.- Combating HIV/Aids, malaria and other illnesses: Eroski collaborates on and organises awareness-raising campaigns with Médecins sans Frontières on a permanent basis. 7.- Assuring the sustainability of environmental resources: Eroski carries out public information and education activities at its centres and promotes protection of the environment through campaigns for recycling and encouraging an environmentally friendly lifestyle. 8.- Developing a global partnership for development: Eroski is a founder member of the Global Compact, and so in its business activity it is also committed to fulfilling principles which make it a socially responsible organisation. In this way, Eroski, through the Eroski Foundation, carries out Social Action programmes geared towards sustainable development and the eradication of poverty. We are the first generation able to achieve this. Autor:Grupo Eroski Diseño: DI-DA (Durango) Impresión: Gráficas Lizarra Depósito legal: NA-2732-05
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