REWE Group Sustainability Report 2017

Compliance

GRI 205: Anti-corruption
GRI 206: Anti-competitive Behaviour
GRI 307: Environmental Compliance
GRI 419: Socio Economic Compliance


Management Approach

Violations of regulations can have personal consequences (including claims for damages or criminal charges) for individual employees or board members of REWE Group. This, in turn, could hurt the image of companies in REWE Group. A trade and tourism company faces particular compliance risks in the areas of price-fixing, the exercise of market power against suppliers and personal gain. For this reason, integrity and fairness in business transactions as well as in interaction with others are important fundamental principles in the mission statement of REWE Group. With the code of conduct of REWE Group, the company has defined standards of behaviour that are obligatory for all individuals who work on behalf of REWE Group.

In the course of introducing an anti-corruption system, various codes of conduct were implemented for managers and employees and an internal anti-corruption officer and an external ombudsman were appointed. In February 2009, REWE Group named a chief compliance officer, and, in June 2010, the Corporate Department of Governance & Compliance began to combine and coordinate the activities of REWE Group. Since 2011, the department has been supported in its work by decentralised compliance officers in the respective business units and country companies. As part of an efficient compliance management system (CMS) based on the standard IDW PS 980, REWE Group has set up a compliance programme that comprises a number of preventive steps. Since mid-2011, regular compliance risk analyses have been conducted with the goal of developing further preventive measures. Training for employees and special rules governing ways to handle gifts made to top executives or purchasing departments are also included. In 2015, the CMS was submitted to an external readiness check by a highly respected auditing firm. As a follow-up step, the CMS has been reviewed on the basis of the recognised audit standard (PS 980) of the Institute of Public Auditors (IDW) in Germany since 2016. The objective of the audit is to continuously improve the existing system. The first step of the audit – planning the CMS – was completed successfully in July 2017. Following this, the second certification step, the appropriateness test, was started. The Corporate Department of Governance & Compliance is responsible for the combine guideline management of REWE Group since 2016. Within the scope of the reorganisation, a company-wide process and a new IT system were implemented. Compliance-relevant combine guidelines will be successively transferred to the new tool where they will be available to all employees. The project will be completed in 2019.

Formal complaints can be addressed to a number of different departments at REWE Group, including management, compliance, quality management and purchasing. They can also be sent directly to the stores themselves.

Until now, legal violations have not been comprehensively and centrally tracked by REWE Group. For this reason, no assurances can be given regarding the completeness of the information in the following categories.

GRI 205-1: Operations assessed for risks related to corruption

With the help of an IT-supported tool, corruption risks are systematically recorded and evaluated in REWE Group. Appropriate measures are then developed on the basis of this information. This represents complete coverage both nationally and internationally. “Commercial bribery” was identified as a key corruption risk in the business areas of Purchasing and Logistics.

The basic conditions, guidelines and processes for a uniform risk management system throughout the combine with regard to the compliance risks of antitrust breaches and corruption will be created by the Corporate Department of Governance & Compliance. Annual compliance risk analyses have been carried out and appropriate measures to control risks have been developed and implemented since 2012. As part of the integration project Governance Risk & Compliance (GRC), business operation risks and compliance risks are jointly collected, evaluated according to the same criteria and integrated into a group-wide system solution (for more information about risk management, see the Combined Management Report for the 2017 Business Year, pages 25–30 ).

GRI 205-2: Communication and training about anti-corruption policies and procedures

All employees in administration throughout Germany must take part in the e-learning module “Compliance Basics” which explains how to handle gifts (anti-corruption); it is voluntary for top executives. In 2017, work was started on developing a new training format for anti-corruption and integrity. This will replace the current e-learning module “Compliance Basics” and will be gradually rolled out nationally and internationally. Numerous classroom training sessions and workshops were also organised in which employees were taught how to fulfil compliance requirements. The training concept applies a risk-focused approach that calls for training to be held on a regular basis. As a result, nearly all relevant employees will have received the training within a period of two to three years.

REWE Group has been providing information about compliance, particularly whistleblower management, on its website. Its code of conduct can also be downloaded there. Every employee of REWE Group can find important compliance information on the intranet and in various team rooms.

Total number of employees having undergone anti-corruption and procedure training in the organisation

2015 2015 2016 2016 2017 2017
Non-management level, absolute Management level, absolute Non-management level, absolute Management level, absolute Non-management level, absolute Management level, absolute
Retail Germany 514 63 318 35 734 98
Retail International 1,915 139 3,679 637 1,796 284
Specialist Stores 64 2 33 9 53 0
Travel and Tourism 145 64 506 15 483 172
Other 490 200 461 93 556 105
Total 3,128 468 4,997 789 3,622 659
Because of the reorganisation, National Full-Range and Discount Stores, and Products are aggregated in Retail Germany. The information about International Full-Range and International Discount Stores is also consolidated in Retail International.

GRI 205-3: Confirmed incidents of corruption and actions taken

Whistleblower tips received by compliance officers are systematically entered in the compliance tip tool. They are then reviewed and forwarded to the appropriate department, in particular auditing. This department examines the allegations and reports the results and measures to be taken as a result to the Corporate Department of Governance & Compliance. It is the responsibility of the operational units to implement these measures, which can involve such matters as labour or criminal issues. In 2017, one significant tip about corruption was received by Governance & Compliance. This case involved commercial bribery. Labour-law disciplinary steps were taken. REWE Group protects the names of whistleblowers and affected individuals as part of its whistleblower management system.

Together with decentralised compliance officers, the Corporate Department of Governance & Compliance holds annual workshops for the purpose of modifying the compliance programme and implementing preventive measures to minimise compliance risks.

GRI 206-1: Legal actions for anti-competitive behavior, anti-trust, and monopoly practices

REWE Group does not report legal actions or the results of such actions as this information is subject to confidentiality obligations.

GRI 307-1: Non-compliance with environmental laws and regulations

REWE Group does not provide disclosures about non-compliance with environmental laws and regulations as this information does not have the necessary level of quality available throughout the combine. There are no plans to gather this information in future as the effort to acquire the data is not proportional to the benefits obtained from gathering it.

GRI 419-1: Non-compliance with laws and regulations in the social and economic area

REWE Group does not provide disclosures about non-compliance with laws and regulations as this information does not have the necessary level of quality available throughout the combine. There are no plans to gather this information in future as the effort to acquire the data is not proportional to the benefits obtained from gathering it. Legal risks are reported in the Combined Management Report for the 2017 Business Year from page 29 . Other provisions for court, litigation and legal consulting costs are reported in note 34 of the Management Report for the 2017 Business Year on page 123 .

More topics:

GRI 102-18 - 102-21

Sustainability Strategy

GRI 102-1 – 102-7, 102-10

REWE Group Portrait

GRI 102-8, 102-41

Employee Structure

GRI 102-9

Supply chain

GRI 102-12, 102-13

Initiatives and Memberships

GRI 102-16, 102-17

Ethics and Integrity

GRI 102-45 – 102-47, 102-49

Materiality

GRI 102-40, 102-42 – 102-44

Stakeholder Dialogue

GRI 102-48, 102-50 – 102-56

Report Profile

GRI 201

Economic Performance

GRI 415

Public Policy

GRI 418

Customer Privacy