Tesco Plc · LSE:TSCO
Tesco — ESG Presentation (June 2019)
122 slides from Tesco's sustainability presentation, Jun 26, 2019
Slide 1: Tesco
TESCO 4D AD AD AD <7
Slide 2: Introduction
Introduction. Dave Lewis Group Chief Executive
Slide 3: Health and safety
Health and safety. Screen Entrance to Entrance to event space event space Fire Exit Fire Exit 3
Slide 4: Welcome
Welcome. Investors • 41 individuals, including 22 ESG specialists • 35 institutions • Equity and fixed income Analysts • 15 sell-side analysts • Rating agencies Banking partners • 14 Relationship Banks 31 here last week for our Capital Markets Day – welcome back! 4
Slide 5: Objectives
Objectives - To share how we are embedding sustainability in our business model and ways of working - To demonstrate how we are managing current and future risks - A chance for you to meet our expert teams and ask questions 5
Slide 6: Suppliers Contractual Customers
Suppliers Customers Contractual Compliance Legislation 6
Slide 7: Suppliers Responsible production
Suppliers Customers Responsible Behavioural Responsible production advocacy consumption 7
Slide 8: Serving Britain's shoppers a little better every day
Our purpose: Serving Britain’s shoppers a little better every day. Our values: No one tries harder for customers We treat people how they want to be treated Every little help makes a big difference 8
Slide 9: Every little help makes a big difference
Every little help makes a big difference. 9
Slide 10: Our reach
Our reach Group UK 797 450,000 80m 6,993 300,000 19m large stores weekly Clubcard colleagues transactions stores colleagues households 1,855 small stores 8 62 73 markets >99% strategic sourcing online supplier countries 2 coverage partners JVs 10
Slide 11: Value in Your Town
Value in Your Town. £37.3bn £5.2bn Gross Value Added to the UK economy1 tax paid2 743k 18,646 Full time jobs supported at Tesco Number of local projects or causes and in the UK supply chain1 supported in the UK £19.9m 62.7m Colleague and customer fundraising for Meals donated to those in need across
Slide 12: Agenda
Agenda. 09.00 Welcome and Introduction Dave Lewis Governance Governance, risk and compliance Alan Stewart and Adrian Morris Environment Our environmental impact Sarah Bradbury Climate change Kene Umeasiegbu 10.30 – 10.45 Coffee Break Packaging Giles Bolton Tackling global food waste Mark Little Soci
Slide 13: Governance, risk and compliance
Governance, risk and compliance. Alan Stewart Adrian Morris Chief Financial Officer Group General Counsel
Slide 14: Corporate renewal: crisis response
Corporate renewal: crisis response. • Broad and deep review • Objective • Independent • Systematic • Tone from the Top/Board ownership • Regular oversight and reporting • Provided to Regulators • Reflected in FCA Notice and DPA Judgement Governance Leadership Controls Assurance Structures Policies R
Slide 15: Our governance structure
Our governance structure. Board Executive Committee PLC Board Group Risk & Compliance Committee Chaired by Chaired by John Allan Dave Lewis Alan Adrian Andrew Christine Alan Jason David Stewart Morris Yaxley Heffernan Brown Davies Ward Corporate Nominations Audit Remuneration Responsibility and Gove
Slide 16: Governance: three lines of defence
Governance: three lines of defence. Board and Committees Executive Committee / Group Risk & Compliance Committee What First Second Third line of defence line of defence line of defence • Management/ • Control functions • Internal audit Who ‘The Business’ • Own the risk • Design the controls • Test e
Slide 17: Risk management: Group principal risks
Risk management: Group principal risks. Risk 5 1. Customer 2. Transformation 4 3. Liquidity 4. Competition & Markets 3 Impact 5. Brand, Reputation & Trust 6. Technology 2 7a. Data Security & 7b. Data Privacy 1 8. Political, Regulatory & Compliance 9. Health & Safety 1 2 3 4 5 10. People 11. Brexit L
Slide 18: Business Unit Principal Risk Prioritisation 2018/19
Business Unit Principal Risk Prioritisation 2018/19 year end. Principal Risks UK Rating Movement Compared to ROI One Stop Booker CE Thailand Malaysia Bengaluru dunnhumby Group Previous Year 1 Customer n n n n i n n n High Risk n Stable 2 Transformation n n i n i n i n n Medium Risk h Increasing i De
Slide 19: Key compliance risks and sub-risks
Key compliance risks and sub-risks. Risk Customer 1. Data Privacy Transformation 2. Data Security Liquidity Competition & Markets 3. Anti-bribery Brand, Reputation & Trust 4. Fraud Technology 5. Competition Law Data Security & Data Privacy 6. Supplier legislation Political, Regulatory & Compliance H
Slide 20: Risk, Controls and Assurance (RCA) framework
Risk, Controls and Assurance (RCA) framework. 20
Slide 21: Health and Safety
Health and Safety. Programme: • Group Safety Blueprint implements ISO RCA framework via controls, training and assurance 4% 7% 45001 • Risk owner: Dave Lewis, supported by Group Safety Director and team UK & ROI Thailand • Reporting to GRCC, Exec and Board Total injuries1 reportable injuries accredi
Slide 22: Data privacy: delivering GDPR
Data privacy: delivering GDPR. Programme: Governance and oversight: • PCP built around RCA framework via 34 Group privacy workstreams Privacy Risk & Data Usage • Risk owner: Group Customer Director & Committee Executive Compliance Board Committee Committee Group People Director, supported by Group G
Slide 23: Updated Code of Business Conduct
Updated Code of Business Conduct. The What The How Code Guidance pages Living our Code pages ‘Follow the rules’ ‘Do the right thing’ 23
Slide 24: Code of Business Conduct
Code of Business Conduct. 26,000 92% 55,000 colleagues agree modules Annual Code Annual speak-up surveys Annual compliance certification exercise e-learning campaign 24
Slide 25: Risk management: equal pay litigation
Risk management: equal pay litigation. • Pay Policy: not determined by gender – same role, same pay • Legal Tests • Comparability • Equal value • Different skills/demands • Different environment • Material Factor Defence • Separate labour markets: distribution/retail • Claims driven by law firms/lit
Slide 26: Risk management: shareholder litigation (2014)
Risk management: shareholder litigation (2014). • FCA approved compensation scheme • £47m paid out • 2 Shareholder groups • 112 reduced to 78 • Critical legal tests • Board knowledge • FCA/SFO findings • Trial set late 2020 26
Slide 27: Tax
Tax. • We pay the right amount of tax in accordance with the tax laws in all of the territories in which we operate. • Tax is considered in all significant business decisions but we do not undertake any transactions for the sole purpose of realising tax savings. 27
Slide 28: Simplifying our Group structure
Simplifying our Group structure. 28
Slide 29: Measuring and reporting our ESG work
Measuring and reporting our ESG work. 35 Annual Report and Little Helps Plan TCFD Key Performance progress update Indicators • People • Product • Places 29
Slide 30: Our environmental impact
Our environmental impact. Sarah Bradbury Group Quality Director
Slide 31: Group Quality team
Group Quality team. Colleague numbers Product safety Group support Responsible Agriculture technical functions sourcing Agriculture 8 F&F 35 Regulation and Environmental 15 GM 27 standards 43 Human Rights 31 Food Tech UK 80 Audit programme 7 Packaging 10 Depot QA UK 48 Food Development and Chef netw
Slide 32: Our sourcing footprint
Our sourcing footprint. 80m customer transactions 6,993 stores 2,749 food supplier sites c.20,000 UK farmers 824 GM and clothing Supplier site concentration supplier sites 4 High 73 Medium Low countries 32
Slide 33: Our environmental impacts
Our environmental impacts. Commodities Farm Manufacturing Own ops Customer Climate change carbon impact 3.3 million tonnes of CO2e from our own operations Food waste 44,297 tonnes from our UK operations Packaging 928,649 tonnes of UK primary packaging (branded and Own Brand) Marine 35,135 tonnes of
Slide 34: Our environmental commitments
Our environmental commitments. 2006 2009 2010 2013 2016 2017 2018 50% carbon Zero carbon CGF 2020 Zero Commitment to No food safe Launch of Little Announced reduction target business by 2050 Deforestation publish our own for human Helps Plan zero per sq. ft. of target adopted food waste consumption
Slide 35: Deforestation
Deforestation. Soy Palm Oil Wood and Paper Amazonian beef Launched Zero Member of the Commitment to source Three year attempt to Deforestation Soy Roundtable on 100% certified FSC / PEFC improve industry Transition Plan 2018 Sustainable Palm Oil 2006 or from recycled sources standards (RSPO) and Pal
Slide 36: Water
Water. Marine Clothing Agriculture Member of the Sustainable Member of Zero Discharge Working with suppliers and industry Fisheries Partnership since 2011 Hazardous Chemicals organisation on water stewardship initiatives since 2015 including in Doñana, Spain, Western Published data on source fisheri
Slide 37: Sustainable agriculture
Sustainable agriculture. Sustainable Future Farmers Animal welfare Antibiotics Farming Groups Foundation • 100% cage free eggs in • Implemented 8 UK, ROI, and CE by 2025, commitments in 2017 on • UK agriculture’s biggest • 50 Farmers per year and by 2030 in Thailand the use of antibiotics customer •
Slide 38: Tesco Sustainable Dairy Group
Tesco Sustainable Dairy Group. • Established 2007, now with 600 QVIS (Quality, Value, QUALITY Dairy Health Index 46 30 dairy farmers Innovation & Service) Milk Quality 5 scorecard Cleanliness Red Tractor 5 3 • Pay guaranteed prices and Biosecurity 3 agree long term contracts. VALUE 33 5 Carbon footp
Slide 39: Climate change
Climate change. Kené Umeasiegbu Head of Environment
Slide 40: Climate change
Climate change. 2006 Set 50% carbon reduction target per sq. ft. of store by 2020 2009 first business globally to set a zero carbon goal 2015 achieved 42% carbon reduction per sq. ft. 2015 Carbon Trust report on achieving zero carbon ambition 2017 first business globally to set science-based climate
Slide 41: Evolution of own operations targets
Evolution of own operations targets. Group absolute emissions forecasts 7 Business as usual 6 5 Previous target: (50% reduction per sq. ft.) mtCO2e 4 Current Science based target 3 2 ~35% reduction ~60% reduction (2020) (2025) 1 0 2006 2025 41
Slide 42: Science-based targets
Science-based targets. • Targets endorsed by the Science-Based Targets Initiative, and announced in 2017 • First business to set own operations target on a 1.5 degree trajectory • Supply chain targets are on a 2-degree trajectory Science-based targets (2015 baseline) 2020 2025 2030 2050 Tesco operat
Slide 43: Emissions hotspots
Emissions hotspots. Tesco value chain – 2015 Baseline Tesco operations – 2015 Baseline Distribution Tesco operations 7% 3.3m tonnes CO2 14% Refrigerants 18% 12% Manufacturing Agriculture 61% 3.3m tonnes CO2 7% Packaging Grid Electricity Heating 65% 6% 10% Other sources Other fuels (heating) Distribu
Slide 44: Actions in our own operations
Actions in our own operations. Energy efficiency Refrigeration Renewable electricity • £70m p.a. invested (2007 to 2015) • Natural refrigeration in 1,000 UK • On track to deliver transition plan • LED lighting in c.2,000 UK stores stores • 100% certificates in UK, ROI and and 90% of stores across •
Slide 45: Group renewable electricity roadmap
Group renewable electricity roadmap. 2018/19 2020 2025 2030 58% actual to date 65% renewables 80% renewables 100% renewables 100% in UK & ROI Non-renewable electricity Renewable certificates Grid Power Purchase On-site generation Agreements (PPAs) 45
Slide 46: Own operations emissions reduction
Own operations emissions reduction. Million tonnes CO2 emissions 4.0 3.5 31% -18% -24% -31% absolute reduction in 3.0 carbon emissions since 2015 2.5 £37m 2.0 energy efficiency savings since 2015 1.5 Cash neutral transition to 100% renewable 1.0 electricity 0.5 0.0 2015/16 2016/17 2017/18 2018/19 46
Slide 47: Reducing transport emissions
Reducing transport emissions. Large distribution Home delivery Customer vehicles Communicating and trialling new Electric delivery van trial in London Largest retail EV charging network in technology to encourage further Europe: 2,400 charging bays in 600 investment stores by 2021 47
Slide 48: Supply chain - manufacturing
Supply chain - manufacturing. Supply chain science-based targets (2015 baseline) 2020 2025 2030 Manufacturing -7% -20% -35% Agriculture -7% -12% -15% Tesco Group Value Chain Emissions Typical Manufacturing Emissions Hotspots in Food Production Packaging Tesco operations materials 14% 18% Electricity
Slide 49: Manufacturing emissions reduction
Manufacturing emissions reduction. UK reduction based on a sample 56 of our largest suppliers BASELINE (4.1)% (6.2)% Target 7% reduction by 2020 2015/16 2016/17 2017/18 49
Slide 50: Supply chain - agriculture
Supply chain - agriculture. Supply chain science-based targets (2015 baseline) 2020 2025 2030 Manufacturing -7% -20% -35% Agriculture -7% -12% -15% Tesco Group Value Chain Emissions Agriculture Emissions Hotspots Not including land use change Other ag. emissions Tesco operations 14% 10% Soil emissio
Slide 51: Current priorities in agriculture emissions
Current priorities in agriculture emissions. • Robust methodologies to track emissions on a representative sample of farms covering: − Fertiliser emissions − Methane from dairy farms − 50% of in-scope farm-level data • Scaling sustainability innovation with key suppliers • Zero deforestation soy pla
Slide 52: Climate change: future risks assessment
Climate change: future risks assessment. • In 2017, Tesco signed the statement of support for the TCFD • Risks assessment of 3 business areas: Produce, Protein and UK Property • Analysis of physical and transition risks of business-as-usual and sub-2 degree scenarios to 2030 • Findings and plan to b
Slide 53: Break
Break. 53
Slide 54: Packaging
Packaging. Giles Bolton Responsible Sourcing Director
Slide 55: Key packaging milestones
Key packaging milestones. 2007 2008 2010 2017 2019 Target to reduce Introduced on Industry Little Helps Plan Trials of soft branded and Own pack recycling agreement to packaging targets plastic recycling; Brand packaging labelling recycle 150,000 DRS; and plastic by 25% (by 2010) tonnes of free prod
Slide 56: Packaging: our commitments
Packaging: our commitments. 1. Our packaging fully recyclable by 2025 – 83% UK Own Brand packaging widely recyclable (2017) 2. End use of hard to recycle materials from UK packaging by end 2019 - exiting all harder to recycle plastics e.g. PVC - black plastic removed from Own Brand by end of 2019 3.
Slide 57: Packaging: our footprint
Packaging: our footprint. Packaging material for Tesco UK primary packaging 2017 (tonnes) 430,067 Own Brand Branded 252,586 152,357 30,261 63,378 Paper Glass Aluminium Steel Plastic Plastic in Tesco UK Own Brand primary packaging 2017 Polyvinyl chloride (PVC) & Other plastics (tonnes) polystyrene (P
Slide 58: Packaging: Long-term packaging reduction
Packaging: Long-term packaging reduction. UK Own Brand primary packaging weight reduction (g per unit sold) 45 40 35 30 25 20 Target 50% by 2025 15 reduction 10 5 0 2006 2008 2010 2012 2014 2016 2018 Source: Valpak 2017. 58
Slide 59: Packaging: Benchmarking
Packaging: Benchmarking. Source: ‘Checking out on plastics’, Greenpeace, 2018. 59
Slide 60: Packaging: our approach: closed loop
Packaging: our approach: closed loop. Three point plan 1. Sustainable packaging; Remove, Reduce and Redesign 2. Closing the loop; Retrieval and Recycling 3. Generating advocacy; awareness and informing 60
Slide 61: Packaging: three point plan
Packaging: three point plan. 1. Sustainable packaging; Remove, Reduce and Redesign Red – Exit Amber - Hold Green – Preferred (poor for recycling and/or potentially harmful) (until infrastructure and/or scientific (easily recycled, can have high recycled developments take place) content) PVC & Polyst
Slide 62: Packaging: three point plan
Packaging: three point plan. 2. Closing the loop; Retrieval and Recycling There are 39 different sets • The inconsistency in collection protocol of rules for makes it difficult for us to help advise what can be customers on what can be recycled and how put in plastic best to do so recycling • Certai
Slide 63: Packaging: three point plan
Packaging: three point plan. 3. Generating advocacy; awareness and informing Packaging-free fruit and 10 stores testing soft Refillable trials veg trials plastics recycling 100,000 bottles collected Understanding how best to help customers; and engaging Government, NGOs and industry. 63
Slide 64: Three point plan - test and learn
Three point plan - test and learn. 24 graduates from across Tesco given brief to innovate to accelerate our ambition to reduce plastic • Internal and external expert advisers brought in to support thinking • A whole range of ideas, including: Address 34+ Eliminate single 193m hangers: convenience li
Slide 65: Tackling Global Food Waste
Tackling Global Food Waste. Mark Little Head of Food Waste Reduction
Slide 66: Global impact of food waste
Global impact of food waste. 1 1 in 9 8% $940bn 3 of all food goes hungry of greenhouse gas economic is wasted around the world emissions losses per year Source: World Resources Institute (WRI). 66
Slide 67: Food waste
Food waste. Upstream Midstream Downstream Manufacturing Retail ops Household 1.85m tonnes 0.26m tonnes 7.10m tonnes Agriculture (unknown) Source: Food waste across the UK value chain, including Tesco - Waste and Resources Action Programme (WRAP). 67
Slide 68: Food waste varies by geography
Food waste varies by geography. Source: World Resources Institute (WRI). 68
Slide 69: No time for waste at Tesco
No time for waste at Tesco. Our commitment: to help halve global No food sent to food waste from landfill in the UK farm to fork by 2030 since 2009 First UK retailer to publish our food waste data in 2013 69
Slide 70: Matching supply and demand
Matching supply and demand. Actual Sales Volume Tesco ¼lb beef burgers – sales forecast vs. actuals (May-July 2018) Sales Forecast Forecast Exceeding Sales 70
Slide 71: Halve food waste in our own operations by 2030
Halve food waste in our own operations by 2030. Total food waste as a percentage of total sales UK CE ROI Booker 0.53% 1.18% 1.23% 1.09% 0.17% 0.45% 0.16% 0.92% 2017/18 2018/19 2017/18 2018/19 2017/18 2018/19 2017/18 2018/19 71
Slide 72: No food safe for human consumption will be wasted
No food that’s safe for human consumption will be wasted in our UK retail operations. Milestones towards target1 Bar chart – AR/on 81% website 75% 63% 64% 58% February April September February May 2018 2018 2018 2019 2019 1. Percentage of surplus food safe for human consumption redistributed from ou
Slide 73: Community Food Connection
Community Food Connection. >60 million Charity Introduction Surplus food responds and meals posted on app donated to to charity collects by Tesco those in need colleague 73
Slide 74: Working in partnership to reduce food waste in supply chains
Working in partnership to reduce food waste in our supply chains. Whole crop utilisation 74
Slide 75: Help customers reduce food waste at home
Help customers reduce food waste at home. Promotions No BOGOFs on fruit and vegetables in the UK since April 2014 Labelling Over 180 best before dates removed from fruit and vegetables Innovation Such as frozen avocado, beetroot, pomegranate and herbs 75
Slide 76: UN SDG Target 12.3
UN Sustainable Development Goal Target 12.3. By 2030, halve per capita global food waste at the retail and consumer levels and reduce food losses along production and supply chains, including post-harvest losses. Target Measure Act Endorse & Sign up for Innovation adopt 12.3 transparency 76
Slide 77: Tesco Product Partners have published food waste data
27 Tesco Product Partners have published food waste data. 77
Slide 78: Tesco Product Partners have published food waste data
27 Tesco Product Partners have published food waste data. 78
Slide 79: Branded Partners signed up to Target, Measure, Act
10 Branded Partners have signed up to Target, Measure, Act. 79
Slide 80: Champions 12.3 achievements
Champions 12.3 achievements. Establishing the business case for Working with the IGD to agree Advocating the case for target, countries, cities and principles for UK food industry measure, act to governments food businesses 80
Slide 81: Our social contribution
Our social contribution. Christine Heffernan Group Comms Director
Slide 82: Our social contribution: Birmingham Ladywood case study
Our social contribution: Birmingham Ladywood case study. 13 Stores serving the local community £123m economic contribution 2,600 jobs supported 90 supplier partners across Birmingham 23,400 meals donated through Community Food Connection £110,400 donated via Bags of Help Source: Tesco in the UK: The
Slide 83: Our social contribution: supporting communities
Our social contribution: supporting communities. 25,000 good causes and £70m donated 3,448 since 2016 through Bags of Help 696 2,701 2,015 1,245 41,000 Over 125 million1 1,704 3,835 Local projects supported 1,764 Meals provided through out food through our community 1,952 surplus donation programme
Slide 84: Health
Health • UK has the 3rd highest obesity rate in Europe1 • Increasingly interventionist approach to public health • 7 out of 10 customers look to First health range GDA front of Reformulation Sweet free checkouts supermarkets to help them pack labeling make healthy choices2 Customer health Energy dri
Slide 85: Health strategy
Health strategy. Tesco is the easiest place to work and shop for you to make healthier choices. Taste Cost Confusion Time Visibility UK’s leading workplace health programme Make baskets healthier Healthy body Reformulation Healthy mind improving diets (swaps) Nutrition Inspiration (always on) Measur
Slide 86: Reformulation
Reformulation. Example of reformulation improvement • Improving health when we review a product 2008 2019 without compromising on taste and quality • Focus on overall nutritional profile – 34% fat reducing sugar, saturated fat, salt whilst 20% saturated fat improving fibre and adding veg 43% s
Slide 87: Health events
Health events. • Reduced price of healthier products • Offering healthier alternatives • Dedicated healthy promotional aisle • Jamie Oliver ambassador – recipes, scratch cooking May 2017 January 2018 September 2018 87
Slide 88: Health events
Health events. September 2018 event results: Summer 2019 event • Sales of Helpful Little Swaps Helpful Little Swaps basket products increased by 17% indicative reductions year on year 50% sugar • Helpful Little Swaps basket 30% salt 12% cheaper than a standard 40% fat & saturated fat basket • Hea
Slide 89: CGF Trials
CGF Trials. CGF ‘One for Good’ campaign in London • Tesco co-chair with Danone • 52 week trial, in 35 Express stores in Lambeth and Southwark • Reposition unhealthy promotions and increase feature space for healthier promotions • Targeted outcome – healthier basket, reduction in calories/spend, impr
Slide 90: Strengthening our always on health presence
Strengthening our always on health presence Healthy brands and ranges Jamie Oliver partnership Café healthy choices Health Signifier Enhanced lifestyle and Free Fruit for Kids dietary free text search 90
Slide 91: Tesco Own brand nutrient changes vs. volume growth
Tesco Own brand nutrient changes vs. volume growth 2018 vs. 2015 % Volume Change Own brand sales % volume change Sugar Saturated Fat Total Fat Salt Fibre Protein Source: Kantar | Take Home Purchasing | Tesco Own Label | % Change Nutritional Volumes | 52 w/e 30th Dec 2018 vs 52 w/e 3rd Jan 2016. 91
Slide 92: Human Rights in our supply chain
Human Rights in our supply chain. Giles Bolton Responsible Sourcing Director
Slide 93: The global human rights context
The global human rights context. More people are on the move than ever before • 258 million people now live outside their country of birth. • 26 million are refugees or asylum seekers. Source: United Nations 2017 figures. More people are known to be in forced labour than ever before Source: United N
Slide 94: Human Rights: key milestones
Human Rights: key milestones. Consumer Gangmasters UN Guiding Goods Forum – 3 Licencing Principles on Priority industry Authority Business and UK Modern Principles on established Human Rights Slavery Act Forced Labour 1998 2001 2005 2012 2010 2015 2017 2018 2019 Founder Founder First Tesco Ranked No
Slide 95: Our due diligence approach
Our due diligence approach. Assess Prioritise Mitigate Remediate Monitor and risk and risks risks and communicate identify ensure leverage grievance mechanisms Based on international best practice Informed by our supplier partners and expert stakeholders 95
Slide 96: Our human rights commitments
Our human rights commitments. 1. Ensure international human rights standards are respected at all our suppliers’ sites (Tier 1). 2. Focus on the most serious risks to workers throughout our supply chains, working transparently with NGOs, unions and others to identify and address them (beyond Tier 1)
Slide 97: Tier 1 human rights risk
Tier 1 human rights risk. 98% high-risk tier 1 supplier sites have had an audit in the last year (sites supplying UK) No. of supplier sites by country, showing relative human rights risk of countries Site numbers by risk and business unit 3,000 UK Own Ops, Carwash & Food 2,500 1 Asia Non-Food 1 2 2
Slide 98: Tier 1 ethical assurance programme
Tier 1 ethical assurance programme. • 63% high-risk tier 1 supplier sites where critical non-conformances have been identified (2018/19, sites supplying the UK) • Of these 89% had mitigation or remediation processes implemented on time • Remaining 11% • 37 non-food supplier sites exited • 2 sites te
Slide 99: Beyond Tier 1 - our top 10 supply chains
Beyond Tier 1 - our top 10 supply chains. Key issues Certification (UKROI) Sector change Bananas Wages, union representation 100% World Banana Forum Berries Gender discrimination N/A ETI/Oxfam Berries project Cocoa Livelihoods, child labour 100% World Cocoa Foundation Coffee Forced labour 100% Globa
Slide 100: Collaborating beyond Tier 1
Collaborating beyond Tier 1. UK • Stronger Together • Food Network for Ethical Trade • Funding Futures • Responsible Car Wash Scheme Italy Spain • ETI Italian • Spanish Supplier tomatoes Forum project • Stronger Together Bangladesh • Accord Global Reach: Morocco • ETI Social Dialogue • World Banana
Slide 101: Human Rights case studies
Human Rights case studies. 100% black tea Rainforest Alliance Certified 268 hand car washes 2 suppliers, 140 tea gardens 1 franchise partner Kenya, India, Malawi c.2,300 workers • Sector change through Ethical Tea Partnership • Industry leading compliance programme. • Key projects: • Helping establi
Slide 102: People
People. Natasha Adams Chief People Officer
Slide 103: Our colleagues
Our colleagues. Asia Bengaluru age 60+ age 450,000 <20 colleagues Europe age 50-59 age 20-29 Male 6,993 shops around the world ROI Female UK age 40-49 Located in 10 age 30-39 different countries 73 years by market location by age1 by gender between our oldest and youngest colleague 1. UK only. 103
Slide 104: People: the changing world of work
People: the changing world of work. Diverse Colleague Technology & Health & Culture & workforce proposition Automation wellness values The changing The deal we Technology is We want work Increasing mix of people get from work transforming to help us live expectations in work is evolving how we work
Slide 105: A place to get on
A place to get on. 105
Slide 106: Building skills and growing careers
Building skills and growing careers. iTouch Learning for all Digital and Future Skills • 515,000 training sessions for colleagues last year • c.200 Digital champions supporting over 2,600 colleagues so • 10,000+ apprenticeships since 2012 far • c.2,500 colleagues trained in Continuous Improvement, 4
Slide 107: Everyone is welcome
Everyone is welcome. At the heart of the business • Executive sponsor for Diversity & Inclusion • External benchmarking completed Gender • 31% Board, 31% Exec, 23% Director, 39% Manager female representation • Median gender pay gap 8.9% (3.1% when premiums removed) • Strong succession pipelines - 45
Slide 108: Colleague health and wellness
Colleague health and wellness. 8 Colleague Health Events since 2017. UK’s largest ever workplace health survey Healthy Healthy Nutrition mind body • >4 million pieces of free fruit • Partnership with Mind • 13,000 colleagues accessing Gympass • Free fruit ‘Always on offer’ in stores • Mindapples and
Slide 109: Total reward
Total reward. Simple Fair Competitive Sustainable Colleagues given choice; Consistent terms and We assess competitiveness A balance of fixed and reward is simple, clear and conditions building trust and on a total reward basis variable pay, that is easy to understand transparency, with clear sustain
Slide 110: Driving colleague engagement
Driving colleague engagement. 83% of colleagues would recommend Tesco as a great place to work Quarterly Colleague Challengers 83 83 83 Forums running for community 81 15+ years of 300 colleagues 76 70 USDAW partnership Aug Aug Jan Jan Jan Jan 2014 2015 2016 2017 2018 2019 Colleague Contribution Pan
Slide 111: Closing Remarks
Closing Remarks. Dave Lewis Group Chief Executive
Slide 112: Suppliers Responsible production
Suppliers Customers Responsible Behavioural Responsible production advocacy consumption 112
Slide 113: Summary
Summary. • Corporate renewal plan • Risk management and mitigation Governance • Protocols and processes embedded within the business and culture • Code of business conduct - speak up culture • Target, measure, act • Own operations and supply chain commitments, including climate Environmental change,
Slide 114: Affordable, healthy, sustainable food for all
Affordable, Core Tesco competence healthy, sustainable food for all. 114
Slide 115: Future of Food
Future of Food. Professor Michael Bourlakis Dr. Tara Garnett John Shropshire Lord John Krebs Professor Pamela Professor Corinna Anna Taylor Ronald John Mandyck Hawkes Patrick Coveney Dave Lewis Tim J. Smith 115
Slide 116: Packaging
Packaging ELIMINATE WASTE x TO LANDFILL < SUSTAINABLE a PACKAGING Little helps to reduce plastic. CREATINGA CLOSED LCOP REPURPOSE cm) RETRIEVE 116 a a a a
Slide 117: Sustainable Development Goals
¢ @) SUSTAINABLE gM @ ? DEVELOPMENT ant tALS 72 tire a) ee HEALTH QUALITY GENDER 6 hee WATER HUNGER 3 ito WELT “yf EDUCATION Ss 6 ite SANITATION DECENT WORK AND g INDUSTRY, INNOVATION REDUCED SUSTAINABLE CITIES fy eaten 8 ECONOMIC GROWTH AND INFRASTRUCTURE 1 0 INEQUALITIES ‘AND COMMUNITIES. 1 CONSUM
Slide 118: Our key contributions to the UNSDGs in 2018/19
Our key contributions to the UNSDGs in 2018/19. 62.7 million 69% of 58% of 77% of Tesco 81% of food 31% 72% of wild 100% of meals donated colleagues and electricity colleagues agree surplus safe for reduction in caught palm oil in UK, to local 55% of UK sourced from they have the humans GHG emission
Slide 119: Q&A
Q&A. 119
Slide 120: Kate Ewart
Kate Ewart Product Development Director
Slide 121: Lunch
Lunch. 121
Slide 122: Disclaimer
Disclaimer. This document may contain forward-looking statements that may or may not prove accurate. Forward-looking statements are statements that are not historical facts; they include statements about Tesco’s beliefs and expectations and the assumptions underlying them. For example, statements re