STAKEHOLDERS
This material references Disclosures 102-40, 102-43 and 102-44 of GRI 102: General Disclosures 2016
SUSTAINABILITY
In line with our sustainability strategy, in Chedraui we keep a close touch with our stakeholders, meaning those groups or individuals who represent economic, environmental and social interests and who affect or are affected, directly or indirectly, by the Company's activities.
In the following table is depicted a list of the main interest groups identified by our Management, as well as a description of the topics of interest and means of interaction which the Company uses to inform and/or consult its activities.
At Grupo Chedraui we promote the necessity of having the most excellent business relationship with our over 2,300 suppliers from whom we buy our products, as this affinity acts as a paramount pillar in the Company's strategy of ever offering the lowest prices.
In the operations in Mexico, no single or group of suppliers amounts for more than 4% of the total product purchases conducted during 2019, consequently, there is no dependence on any supplier in particular. Likewise, approximately 2.3% of total products were imported.
Main Suppliers
| Business name | Share of total purchases |
|---|---|
| Marcas Nestlé S.A. de C.V. | 3% |
| Kimberly Clark de Mexico S.A. de C.V. | 3% |
| Comercializadora de Lácteos y Derivados, S.A. de C.V. | 3% |
| Colgate Palmolive S.A. de C.V. | 3% |
| Sigma Alimentos Comercial S.A. de C.V. | 2% |
| Unilever de México S. de R.L. de C.V. | 2% |
| Procter & Gamble Mexico Inc. | 2% |
| Bimbo S.A. de C.V. | 2% |
| Comercializadora Pepsico Mexico S. de R.L. de C.V. | 2% |
| Ganaderos Productores de Leche, S.A. de C.V. | 2% |
In the United States, during 2019 our most important supplier was GSC Wholesale LLC, standing for approximately 14.55% of total products purchased.
The stores in the U.S. do not import any items from Mexico since many of our Mexican suppliers have parallel operations in the United States, therefore, all products sold in these stores are purchased in this country.
We acknowledge the fact that a large part of our success is fueled by the commitment of our workforce, whose preparation and responsibility turns them into our greatest competitive advantage in an industry where customer contact and care is fundamental.
As of year-end, our workforce consisted of a total of 50,894 employees, of which 90.0% worked at the stores, 4.8% in administrative areas and 5.2% in distribution centers, excluding independent contractors such as third party employees who manage certain operations in the Company.
Hiring
In Mexico, our hiring policy is oriented to employing members of the local community where each store is located in order to offer a better service. We also hire college students to cover administrative positions.
The remaining employees are hired by one of our subsidiaries, whether in Mexico or the United States.
Training
One of our most ambitious and crucial projects is the Chedraui Corporate University, as its online courses allow all our employees to receive the required training in a timely manner, bolstering a better performance.
Trainings are divided in theorical and practical courses, which are evaluated separately taking into account the values of honesty, commitment, respect and efficiency.
Replacement Training Program: Through this program, we ensure having a sufficient, trained and available staff for senior positions, in addition to counting always with the required employees to sustain our stores expansion.
Safety, Health and Hygiene
We encourage the culture of prevention among our employees through the launch of health campaigns and by providing them with personal protection equipment (PPE). The Company is constantly evaluated in these areas, having complied fully with the requirements and obtaining a performance above the industry’s average, in each evaluation.
Each work center counts with a Health and Safety Committee, which, in collaboration with the unions, bolster the promotion of health while encouraging and regulating the safety of all employees.
Health and safety policies and objectives are reviewed annually, in line with our heavy commitment to continuous improvement in this matter.
Remuneration
Store managers and employees earn a combination of fixed salary and performance bonuses regardless of the business line they work in.
In addition to the compensations required by law, all our employees have additional medical service and an established program that covers compensation for personnel who opts for voluntary retirement, calculated in accordance with the Federal Labor Law.
Gender Diversity
As a leading company in the food retail sector, it is essential that all our employees and executives, as well as other stakeholders, have the conviction to respect and enforce diversity, gender equality and human rights. We do not distinguish any customer or employee by their career, race, gender, religion, age, sexual orientation, abilities and nationality, in line with the United Nations (Global Compact).
Employees by Gender:
| Gender | Mexico | % | U.S. | % | Total | % |
|---|---|---|---|---|---|---|
| Male | 18,045 | 46.0% | 5,133 | 44.0% | 23,178 | 45.5% |
| Female | 21,184 | 54.0% | 6,532 | 56.0% | 27,716 | 54.5% |
| Total | 39,229 | 100.0% | 11,665 | 100.0% | 50,894 | 100.0% |
Unions
As of December 31st, 2019, 39.7% of our employees were unionized.
Our employees in Mexico are affiliated to 27 separate unions while the labor relations with each of these unions are governed by 321 collective bargaining agreements, which in turn, are negotiated one by one with each union on an annual basis.
In the U.S., only our employees whom used to work at Grupo Gigante (prior to its acquisition) are unionized.
| Unionized and non-unionized employees | 2017 | 2018 | 2019 |
|---|---|---|---|
| Retail Operations in Mexico: | |||
| Total unionized employees | 18,569 | 19,956 | 18,670 |
| Total non-unionized employees | 15,696 | 16,120 | 16,189 |
| Retail Operations in the U.S.: | |||
| Total unionized employees | 542 | 634 | 604 |
| Total non-unionized employees | 5,111 | 10,882 | 10,322 |
| Distribution Centers | |||
| Total unionized employees | 569 | 585 | 740 |
| Total non-unionized employees | 1,722 | 2,011 | 1,935 |
| Administrative areas | |||
| Total unionized employees | 0 | 0 | 189 |
| Total non-unionized employees | 1,975 | 2,253 | 2,245 |
| Total Employees | 44,184 | 52,442 | 50,894 |
Employee Retention
For us it is of utmost importance to maintain an informed and enthusiastic workforce, as we strive to keep our turnover rate at minimum levels in an industry that is characterized by its high turnover rates. In this regard, we perform all of the abovementioned actions to nurture a sense of loyalty and community in our employees and thus encourage them to make a career in the Company.
At Grupo Chedraui we are greatly devoted to Corporate Social Responsibility, reflected in our Code of Ethics where the various commitments we have made in this matter are established, including:
Our main tool for approaching the community and carrying out social outreach actions is the Chedraui Foundation, through which programs in the areas of education, health, housing, nutrition, social welfare and attention to those affected by natural disasters are executed, having a positive impact on the communities where it is present.
EDUCATION
Through our three Liceos de Artes y Oficios in the cities of Xalapa, Veracruz and Villahermosa, we offer high school education, vocational degrees and intensive courses, providing quality education to Mexican youth from the most vulnerable sectors.
We train our scholars to continue their studies at university, to find better jobs and/or to establish their own business with the objective of improving their living standards and that of their families. We grant scholarships to our former students with higher averages so they may continue studying as well as those from the Universidad Veracruzana through the U.V. Foundation, while also supporting the Pro Empleo Xalapa foundation in the creation of micro and small business in this community.
In 2019, the Liceos de Artes y Oficios reached the figure of 45,507 trained strudents, throughout its more than 32 years of history.
HEALTH
We coordinate with various institutions specialized in health to support in the care of patients who suffer from a wide range of medical conditions and do not have the economic capacity to access the quality and tailored medical care they need. In this sense, it is worth noting the assistance we receive from NADRO, a distributor of pharmaceutical and personal hygiene products.
Among the supported institutions are:
NUTRITION
In terms of food, we make the most of our employee’s commitment who, through a volunteer program, help with the separation, selection and delivery of edible food, meaning that it does not meet sale quality standards, but is in perfect condition to be consumed.
The food is directly delivered to various organizations aimed at helping Mexican families with limited resources, notably the Asociación de Bancos de Alimentos de México (BAMX), Alimentos de Mexico a Compartir (AMA), Fundación Emmanuel, whose mission is to assist people deprived of their liberty and their families, street children, persons living in extreme poverty, as well as, Vida y Familia (Vifac) which serves women with high-risk pregnancies.
HOUSING
In partnership with the Provivah Trust, we participate in the construction of decent housing for low-income families who do not have the possibility of accessing credit to generate a legacy for their children.
SOCIAL WELFARE
Through various institutions focused on the promotion of universal values, integral formation, as well as charity and volunteer work to support vulnerable people and communities, including Caritas Mexicana and Caritas Regionales, we aid in the improvement of life quality for low-income individuals.
SUPPPORT FOR PEOPLE AFFECTED BY NATURAL DISASTERS
In the event of a natural disaster, in Chedraui we have historically channeled important efforts to assist those affected by the tragedy, donating a variety of items or providing financial support for different activities, including food, medicine, personal hygiene items, cleaning and even housing repair or reconstruction, including furniture and essential household goods.
During 2019, these resources were deployed to support families affected by floods in local communities and other minor disasters.
ROUND UP FUNDRAISERS
In each of our stores we carry out fundraisers whose proceeds are allocated to support various institutions. Thanking our clients for their assistance, goodwill and trust, we announce proudly that during 2019 a total of Ps.3,485,050 was collected and has already been fully delivered to all benefited institutions.
Adding up all the contributions made by Chedraui Foundation in favor of education, health, nutrition, housing, social welfare and attention to victims affected by natural disasters, a total of Ps.76,371,729 was donated.
At Chedraui we are aware that, even though economic profitability is the usual way to measure a company's success, this becomes less important if it is not backed by a high-level social and environmental performance, as sustainability is the way to build a legacy that lasts enough for future generations to enjoy.
For this reason, our Code of Ethics establishes the following:
Environmental Care:
We commit to fully comply with environmental laws, adopting procedures to reduce and eliminate toxic and dangerous materials in order to avoid air, soil and water pollution, as well as to the care and help with reforestation of green areas.
To meet this objective, we have established a Sustainability Committee, which holds meetings periodically, chaired by the director of Sustainability and Social Responsibility and composed by various key executives.
Sustainable projects in communities
As a proof of the commitment that we have acquired with communities where we operates, the Company implements sustainable projects aimed to preserve the biodiversity of the locations where new stores are scheduled to open.
In this sense, before the building of new stores, studies and surveys are conducted to evaluate the economic potential, the social benefit and being fully aware impacts that the construction and its operation will cause, deploying in all cases preventive and/or mitigation measures that strengthen the original environment conditions of the selected site.
In 2019, together with Chedraui Foundation, we conducted 2 reforestation campaigns using new technologies, such as drones, in the states of Oaxaca and Veracruz, for the assisted dispersal of native seeds from these two regions, covering over 100 hectares.
Carbon Footprint
Our main goal in environmental terms is to reduce our carbon footprint to minimum levels, a goal we pursues through the efficient use of energy and water resources, coupling it with extensive recycling of materials such as cardboard, paper and other actions.
Furthermore, we are constantly deploying several initiatives aimed at replacing traditional energy sources with cleaner and more advanced, including the use of wind energy to supply roughly 80% of the stores' energy requirements.
Carbon footprint reduction achieved during 2019: 202,523.51 tons of CO2 thanks to the use of wind energy and 46 tons CO2 for the use of solar energy (which started towards year-end), amounting to 202,569.51 tons of CO2 = 384’382,645.44 KWh, which is equal to planting a total of 10,126,175 trees or taking out of circulation 84,385 cars, or eliminating the consumption of 98,792 barrels of oil.
Water Management
Through the deployment of several water education campaigns, we encourages our employees to save the maximum amount of water, supporting these actions with the optimal use of this resource thanks to the efficient sanitation services and our treatment plants, counting with 1,237 dry urinals. All these actions in their aggregate saved over 158 million liters of water.
Recycling
All of our stores in both Mexico and the United States separate waste properly.
We count with plastic bags that comply with the provisions and standards of the respective authorities in each of our stores, for benefit of the environment, we also offer reusable bags in the area of fruit and vegetables, allow our customers to bring their own containers for the sale of bulk products (sausages, butchers, etc.) and we have reusable bags in checkout area.
In 2019 we recycled 29,283 tons of cardboard and 1,756 tons of plastic wraps which added up equals to planting 497 thousand trees; eliminating the use of more than 117 million liters of water, saving 9 million barrels of oil or not using 213 million kW/h of electricity.
