RG 2

Digital Responsibility

Brief Overview:

The REWE Group assumes responsibility in the digital environment as well for its customers, employees and business partners in today’s era of digital change. The company

views Corporate Digital Responsibility (CDR) as an obligation to support digitalisation and promote digital skills;
associates the topic of CDR inevitably with the responsible processing of data;
has published in its “AI Manifesto” clearly comprehensible, specific recommendations for working with AI-based applications and processes, which are to be considered in the development of AI applications;
promotes a regular and intensive exchange among employees from different areas of the company and across company boundaries in order to help shape digitalisation in a responsible manner.

Management Approach

Effect

Digitalisation is a driving force behind fundamental changes in politics, science, business and society. The transformation through modern information technology and digital solutions also affects the retail and travel industry. Food is increasingly ordered via digital channels, and travel is being booked online. Stationary shopping and addressing customers are also becoming more digital; the same applies to new forms of delivery services. The REWE Group is aware that digitalisation offers great opportunities, but that potential risks must also be taken into account. The REWE Group can optimise its business and make more substantiated decisions by using data-driven insights. Both needs-based offers for customers and the more efficient design of processes represent opportunities for the responsible use of data. In terms of sustainability, a responsible use of digital products and services can also offer added value. For instance, the use of data-related analytical tools saves resources, e.g. by planning the inventory and its delivery according to demand. Furthermore, technologies can help to make supply chains more transparent. In the course of intensively dealing with its digital responsibility, the REWE Group can better counteract effects of digitalisation, such as the loss of privacy in data use or possible discrimination by algorithms. Further information on the company's approach to this risk can be found under Data Protection.

Principles

The REWE Group assumes responsibility for its customers, employees and business partners. In times of digital change, it is only logical for the Group to live this responsibility in the digital environment as well.

The REWE Group understands Corporate Digital Responsibility (CDR) as an obligation to support digitalisation and promote digital skills. In addition, data traffic is to be opened up – in compliance with pertinent laws and a common data ethic for all Group activities. For the REWE Group, people are at the centre of digitalisation at all times. Therefore, CDR is an indispensable part of the Group's conscientious use of data. It focuses in particular on the ethical use of data and data protection. The REWE Group also views CDR as the interaction of the responsible use of various technologies.

The development of products and services based on artificial intelligence (AI) has tremendous potential and offers added value to the customers and business partners of the REWE Group – including in the trade and tourism sectors. This requires a framework of future-oriented and reliable guidelines and instructions for action – right from the time of development and programming of AI-supported systems. The REWE Group is increasingly involved with AI-supported applications and processes. Against this background, the company published its “AI Manifesto” in 2020. It contains clear and specific recommendations that must be considered in the development of AI applications. The manifesto creates an awareness of potential risks and dangers related to the use of AI technologies and is designed as part of a risk-based approach to help to facilitate the development of sustainable and responsible systems.

Implementation

From marketing to sales and from purchasing to logistics, the REWE Group is driving digitalisation in its business segments and follows digital trends. This includes the increasing parallel use of online and offline channels for shopping. The development of innovative omni-channel measures will therefore play a prominent role in the business strategy for the coming years. When shopping, customers should be able to switch easily, intuitively and seamlessly between the individual sales channels – stationary, mobile and online. Customers will also receive information increasingly in digital form – the introduction of a WhatsApp flyer at REWE and PENNY in Germany is one example. The fact that customers can use this service without opening a customer account and can unsubscribe at any time with one click underlines the responsible approach of the REWE Group. The prominent role of digital communication is also reflected in the changing corporate structures: In October 2022, the two IT subsidiaries REWE Digital (online retail trade and technology development) and REWE Systems (stationary retail and IT infrastructure) were merged into one IT unit. Irrespective of the location, the technology teams work together in numerous workstreams with the aim of combining the best of both worlds – stationary and online retail trade. For cooperation of the teams and beyond the IT unit, agility is promoted and developed in order to foster a sustainable culture of values for the employees.

DER Touristik also offers customers additional digital services with interactive platforms, such as DER.COM, mein-der.de and MyITS, as part of its sales network, in addition to its traditional travel agencies. By intelligently combining online and offline, DER Touristik aims to be able to offer its expertise wherever customers are looking for it. For example, reise-spezialisten.com is a digital platform that enables advice to be tailored to the customer’s needs by linking algorithms to personal advisory services.

Involvement of Stakeholders

The topic of digitalisation and sustainability, was rated for instance with regard to the responsible use of digital solutions (more transparency in the supply chain due to digital traceability of products) as relevant for the company by the stakeholders in the Materiality Analysis. They are informed annually about the effectiveness of measures taken via the Sustainability Report and in various dialogue formats (see Stakeholder Dialogue). This exchange allows stakeholders to provide important input on the issue, which is also the subject of regular and intensive exchange among employees from different areas of the company. This is promoted by the REWE Group throughout the Group. The REWE Group is also actively involved in pan-corporate committees and associations in order to establish digital responsibility in the company and share experience across company and industry boundaries. As part of its public affairs activities, the REWE Group also engages in dialogue with politicians on the topic digital responsibility.

The REWE Group is also actively involved in pan-corporate committees and associations in order to establish digital responsibility in the company and share experience across company and industry boundaries.

Employees, customers, business partners and other stakeholders can submit their grievances or comments on the topic of digitalisation. For this purpose, the REWE Group has established reporting and grievance mechanisms. For more information, please refer to the Compliance section.

In addition, employees can report data protection incidents and various IT incidents such as failures of IT applications and attempted fraud via a crisis hotline. The hotline is available 24/7. There are also IT-specific hotlines and ticket systems to clarify questions and comments and to report and solve IT technical problems.

Measures and Projects

The REWE Group has made progress with regard to digital responsibility during the reporting period through a range of measures and projects. These are presented below, sorted thematically by:

Processes

Data protection training for mobile working

Mobile working has been standard at the REWE Group since the pandemic and is used by many colleagues. Topics such as data protection and the transfer of digital skills play a major role. In the reporting period, various online training courses and seminars on data protection and data security at the home office was therefore available to all employees. In addition, in 2022 a combine-wide awareness campaign for data protection and information security was launched to communicate both topics holistically. The campaign started with the first module “Security@Home” and will be continued in the next few years (for more information see Data Protection).

Products and Services

Payment without checkout at REWE Pick&Go Highlight

One example of the responsible use of new technologies in terms of CDR by the REWE Group are the REWE Pick&Go stores in Germany. As the first provider in the German food retail sector, REWE has made so-called hybrid shopping possible since October 2021, initially in Cologne, with a second store opening in Berlin in 2022 in the presence of the Federal Minister for Digital and Transport, Dr Volker Wissing: Customers can pay in the traditional way at the chekout or use a digital system – without having to go through the checkout process and the waiting times that is frequently associated with it. "Pick&Go" uses camera and sensor technology to record purchases securely and in a data-saving manner, and automatically settles them after customers leave the store. In order to take advantage of this service, customers need to use the Pick&Go app, which stores their payment method, and scan their QR code at the entrance. The app uses computer vision technology which is supplied by data from cameras on the ceiling and weight sensors in the shelves. Data protection was and is a central aspect in the development and operation of the system: The images recorded of customers are processed in a data-saving manner and are used exclusively to enable checkout-free shopping. No facial recognition system is used, and the system cannot identify customers after a visit to the store. All of these points were already taken into account by the REWE Group and its technology partners when designing the system as part of their digital responsibility. Contact was also sought with the responsible data protection authority at an early stage – beyond legal notification requirements.

In addition to the two hybrid test stores in Cologne and Berlin, REWE Pick&Go also reached the next milestone during the reporting period: The first fully autonomous REWE store was opened in Munich city centre in the presence of the Bavarian State Minister Hubert Aiwanger. Here, too, customers will be able to shop without going to the checkout using "Pick&Go". REWE is working on this project with the Israeli technology company Trigo Vision, which specialises in computer vision technology. Its software creates a 3D model of the supermarket, so the layout and movements in the store can be mapped digitally. Customers can select products anonymously and pay for them automatically on the way out, while protecting their privacy.

QR code for product tracing for customers

Customers in Germany can also use a QR code to track the supply chain all the way back to the producers of REWE’s private label bananas and REWE Beste Wahl pineapples as well as PENNY’s Fairtrade-Biohelden bananas and pineapples (for more information, see the section Focus Raw Materials – Food). Since mid-2022, this has also been the case for two milk and 36 meat products of the organic private label. This service is made possible by the platform “fTRACE”. The technology obtains the information on individual products directly from the suppliers, who enter it into the system on a daily basis. In addition, data from external databases, such as the QS inspection system for food safety and the Animal Welfare Initiative, are stored. It guarantees high and reliable data quality and an automatic comparison of information for plausibility control.