SUSTAINABILITY REPORT2017

Dear readers,

We live in turbulent times, and like the whole of society, companies are operating in an ever-changing world. The list of key megatrends is expansive and increas­ingly wide-ranging. In recent years, devel­op­ments such as accel­erated digital­i­sation and large-scale migration have been added to the existing trends such as global­i­sation, climate change and urban­i­sation. Such changes not only determine what we need to tackle, but also how we work, commu­nicate, consume and live - worldwide.

As an inter­na­tional business, we’re both directly affected by these changes, and also respon­sible for shaping them positively and harnessing their possi­bil­ities. We view their tremendous dynamism as an engine to drive devel­opment with innovative concepts and strong alliances, based on global and national guide­lines. Back in 2009, we joined the United Nations Global Compact. The Sustainable Devel­opment Goals (SDGs), United Nations Guiding Principles on Business and Human Rights, and the National Action Plan on Business and Human Rights (NAP), adopted in 2016, are important corner­stones for us in terms of sustainable and profitable devel­opment.

In times of change, new challenges require new approaches. Not only do we need the courage to address our short­comings in the industry and develop new solutions, but as companies we also have a social obligation to share knowledge and innova­tions with each other.

10 years ago, when we realised that respect for human rights in our consumer goods supply chain was not adequately guaranteed, despite estab­lished and recog­nised measures, and that it barely provided any improvement for people, we entered a new path; together with GIZ (Deutsche Gesellschaft für Inter­na­tionale Zusam­me­narbeit), we developed a supplier quali­fi­cation programme, which focuses on dialogue between all involved in the factories from which we source: managers, workers and Tchibo employees. Through the WE programme (Worldwide Enhancement of Social Quality), we’re working on ensuring that employees in our global supply chains not only know their rights but are also supported in their pursuit thereof in a sustainable manner. Since the initial training sessions in our Chinese production facil­ities, we have not only gained experience and insights, but more impor­tantly achieved an outreach to over 364,000 employees in over 360 factories across 11 countries. Over 75% of Tchibo consumer products are manufac­tured in WE factories.

We see it as our respon­si­bility to share our achieve­ments for the benefit of the entire industry and therefore also opening up the WE programme to other companies. The more we embody and manifest the under­lying principles of dialogue, empow­erment and co-creation through the WE programme, the more the people in the value-added chains will benefit from them.

Our consumers are at the heart of our business activ­ities. We want to inspire them to act respon­sibly. This is why we are increas­ingly offering products made out of sustainable qualities. Take our premium coffees, for example, where we only use certified green coffee grades, as we do for our Cafissimo and Qbo capsule coffees too. In 2017, about 80% of the cotton in our textile and garment products was more sustainable. In fact, we are the third largest seller worldwide of organic cotton textiles. Our sustainable assort­ments have been further enriched by our closed-loop recycling concept. As part of this concept, we produce products from recycled materials that can be used for a long time and then returned to high-quality recycling.

In 2017, we took another decisive step to promote sustainable action among consumers. We were the first company in the mainstream market for garments to introduce a second-life rental service:  Tchibo Share. Tchibo Share is a rental service for baby and children's clothing made of sustainable materials. Not only are we making it easier for our customers to enjoy sustainable consumption, but with Tchibo Share, we’re also holis­ti­cally promoting the longest possible use of our products through a full closed-loop service.

Overall we have made progress in 2017 towards becoming a 100% sustainable business model, and this is largely due to our employees. Their commitment, energy and creativity are at the heart of our success. For that I would like to thank them very much.

I would also like to express our gratitude to our customers for placing their trust in us and honouring our commitment with their purchasing decisions.

In this sustain­ability report, you’ll find a compre­hensive account of the achieve­ments, future measures and the latest devel­op­ments in 2018. I wish you an infor­mative and inter­esting read and I should be pleased to hear any sugges­tions and requests, as well as constructive feedback.

Kind regards

Thomas Linemayr