2011 Communication on Progress

Participant
Published
  • 2011/05/09
Time period
  • January 2010  –  December 2010
Format
  • Stand alone document – Basic COP Template
Differentiation Level
Self-assessment
  • Includes a CEO statement of continued support for the UN Global Compact and its ten principles
  • Description of actions or relevant policies related to Human Rights
  • Description of actions or relevant policies related to Labour
  • Description of actions or relevant policies related to Environment
  • Description of actions or relevant policies related to Anti-Corruption
  • Includes a measurement of outcomes
 
  • Statement of continued support by the Chief Executive Officer
  • Statement of the company's chief executive (CEO or equivalent) expressing continued support for the Global Compact and renewing the company's ongoing commitment to the initiative and its principles.

  • Žiga Debeljak, President of the Management Board:
    "At Mercator Group, we believe that our business success is founded upon economic rationality, balanced development, and responsibility to people, environment, and the society. We are aware of the magnitude of our influence on economic and social development of each environment in which we operate, for all our stakeholders. Therefore, we included sustainable development into our business strategy which contributes to improvement in the quality of life, represents a competitive advantage, and provides a foundation for long-term success."

Human Rights
  • Assessment, policy and goals
  • Description of the relevance of human rights for the company (i.e. human rights risk-assessment). Description of policies, public commitments and company goals on Human Rights.

  • Assessment, policy and goals

    REFERENCE CORPORATE GOVERNANCE CODE
    Management of the company Mercator, d.d., is based on legislation, sound business
    practice, and the principles of the Corporate Governance Code for Publicly Traded Companies adopted
    on December 8th 2009, which is the company's reference code. The Corporate Governance Code for
    Publicly Traded Companies is available in Slovenian and English on the Ljubljana Stock Exchange,
    d.d., website at www.ljse.si.
    Each year, the Management Board and Supervisory Board of the company Mercator,
    d.d., examine the compliance of corporate governance at the company Mercator, d.d.,
    with the Code and prepare a relevant statements that presents the situation with regard to corporate governance at the company.

  • Implementation
  • Description of concrete actions to implement Human Rights policies, address Human Rights risks and respond to Human Rights violations.

  • mplementation

    Mercator Group fully follows the laws and policies of the countries in the region it operates in and it implements the highest corporate governance and work ethics measurements and best practices in regards to employees, customers, business partners and local communities.Mercator operates exclusively with verified and trustworthy partners and suppliers. The company fully co-operates with all the relevant inspectorial institutions within the respective markets and the EU and adopts its own internal control measures to ensure maximum control over business practices and regulations abidance and products' safety.

    Within its social responsibility program Mercator helps approx. 2000 projects and made every effort to improve the quality of the environment in which it operates.

  • Measurement of outcomes
  • Description of how the company monitors and evaluates performance.

  • Measurements of outcomes

    Mercator Group constantly measures it image in the business communities and among consumers. Mercator recently received World Finance award for corporate governance, Ruban d'Honneur at European Business Award for corporate sustainability and the Trusted Brand mark.

Labour
  • Assessment, policy and goals
  • Description of the relevance of labour rights for the company (i.e. labour rights-related risks and opportunities). Description of written policies, public commitments and company goals on labour rights.

  • Principle 3:
    Dialogue with employees and social partners is a priority in our HR strategy. We consult with representative trade unions before we make any important decission regarding our employees.
    Management board of Mercator Group meets trade unions representatives every quarter. Current affairs are assessed at monthly meetings between HR leaders and trade unions. Our employees are also presented at Supervisory board of Mercator Group.

    Principle 4:
    Mercator is a company that not just meets but also exceeds legal restictions. We bring our corporate culture, especialy values and standards at every single market.
    Respect of every individual is one of our basic corporate values. It is also written in business strategy. A lot of our communication is dedicated to corporate values: annual interviews, employee satsfaction surveys and visits of business units.

    Principle 5:
    We don't employ people that are younger than 15 years. We are obliged by that with legal restrictions and rules of our corporate culture.
    Since we are Familiy friendly company, we cooperate with students of our employees during summer months. Students perform easier tasks at the shop and earn budget for vacation, get familiar with real job and use their free time for new experiences.

    Principle 6:
    We don't make differentiate between nationalities, gender, generations and religions when we employ new collegues. Women have equal opportunities for carrer advancement. The best example is our management board where you can find four women and two man.
    We received certificates that show our respect for employees. We are the only retailer from the region that received certificate for familiy friendly policies. Career advancement possibilities in our group are illustrated in certificate »Female manager friendly company«.

  • Implementation
  • Description of concrete actions taken by the company to implement labour policies, address labour risks and respond to labour violations.

  • No answer provided.
  • Measurement of outcomes
  • Description of how the company monitors and evaluates performance.

  • No answer provided.
Environment
  • Assessment, policy and goals
  • Description of the relevance of environmental protection for the company (i.e. environmental risks and opportunities). Description of policies, public commitments and company goals on environmental protection.

  • Mercator Group operations are conducted while bearing in mind the generations to come. We are aware that as Slovenia's largest company, increasingly becoming an international corporation, we are in a position to contribute substantially to the protection and preservation of the environment, although our activities are not among those most harmful to it. As a socially responsible enterprise aware of the importance of relieving the burden brought upon the environment, we are continuously improving our business processes to make them more environmentally friendly.

  • Implementation
  • Description of concrete actions to implement environmental policies, address environmental risks and respond to environmental incidents.

  • Environmental management system

    In order to even further advance our success in reducing the effects of our activities on the environment and preserving the natural environment, the company Poslovni sistem Mercator, d.d., is constantly improving and upgrading its environmental management system in compliance with the ISO 14001 standard. Regular internal and independent third-party audits indicate that the environmental management system is appropriately maintained, that environmental risks are well managed, and that we adapt to new requirements of the customers, the market, environmental legislation, and scientific and technological progress.

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    Mercator, d.d., is the only trade company in Slovenia, engaging in wholesale or retail of fast-moving consumer goods, to be awarded the ISO 14001 certificate.
    ----------------------------------------------------------------------------------------------------------------

    In order to identify, collect, assess, analyze, and apply the information on the volume and value of the flow of matter and energy, and on environmental costs, we upgraded the system for managing the key environmental performance indicators in order to provide management of environmental effects of the company and to link them to the key financial performance indicators.

    We have defined the Code of Responsible Energy and Environment Management and thus motivated our employees to adopt a desirable approach to energy, material, and waste management in their workplaces.

    We have signed the Retail Environmental Sustainability Code as apart of the REAP initiative (Retailers' Environmental Action Programme), an initiative by the European trade industry to define environmental commitments and to adopt the practices of environmentally friendly retail. The Code is a non-mandatory Code for European retail defining the standards of operations in retail.

    We have joined the Environment Protection Committee at the Slovenian Chamber of Commerce which brings together companies to define environmental legislation and to exchange sound environmental practices.

    We are involved in the European PLASTiCE project intended to promote the use of environmentally friendly sustainable plastic materials in Central Europe. By taking part in this project, we are looking to offer our customers packaging with lesser environmental footprint and to raise their awareness of the pros and cons of the use of biodegradable plastics.

    Waste and other environmental aspects

    We manage natural resources responsibly. By rationalizing the use of separation bags at checkout counters and by distributing reusable bags to customers, we have contributed to reduction in the use of natural resources consumed throughout the life cycle of a bag.

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    Compared to the reference year 2008, we cut the use of separation bags at check-out counters by 21 percent, and carrying bags by 22 percent.
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    We are working hard to apply the five-step waste management hierarchy; thus, prevention of waste generation, reuse, and recycling are priorities at our company.

    Compared to 2009, the amount and cost of mixed municipal waste was cut by 20% in 2010 by active sorting of fractions of waste and reducing the volume of waste bins for mixed municipal waste.

    Nearly 9 thousand tons of waste cardboard packaging was collected and recycled at the company Poslovni sistem Mercator, d.d., by conscious and diligent sorting of waste packaging. In addition, we collected over three thousand tons of waste plastic packaging and more than a thousand tons of waste wooden packaging.

    -----------------------------------------------------------------------------------------------------------------
    Sorting of waste packaging has resulted in prevention of nearly 10 thousand tons of carbon dioxide, and saving of 360 thousand cubic meters of water and over a thousand trees.
    -----------------------------------------------------------------------------------------------------------------

    We have sorted and collected over 4 thousand tons of biological waste used for generating electric power at the biogas power plant.

    In order to make waste sorting easier for our customers, we provided them with a possibility to dispose of waste luminaires at 20 additional locations. In addition to waste luminaire, customers can also dispose of waste batteries and accumulators using the neat boxes at our stores.

    The company Poslovni sistem Mercator, d.d., is also reducing emissions and other effects on the environment. A range of activities are in place to prevent excessive noise emissions, spillage of hazardous substances, emission of ozone-depleting substances, and to reduce the quantity of wastewater and pollution thereof.

    We use environmentally friendly ecological material for all Mercator's printed editions.

    Sustainable logistics and supply chain organization

    In 2010, too, we have again improved the level of usage of our cargo transport vehicles in delivery of the goods for sale and own use. Average volume usage of cargo capacity for 2010 was 84.1%, which is an improvement in usage by 5 percentage points relative to 2009, and translates into 15 cargo vehicles less on the roads each day.

    In December 2010, we exceeded for the first time the 85-percent volume usage of cargo transport capacity; attaining and exceeding this figure will remain the primary goal of transport capacity management.

    Supplying the delivery points with food products, fast-moving consumer goods, and home products, including driving a total distance of 16,856,000 kilometers in 2010, which is 956,000 kilometers less than in the year before, with the physical amount of the goods distributed unchanged. Such savings were made possible by improved volume usage of cargo transport capacity and permanent optimization in transport route planning.

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    By reducing the distance travelled, we cut the carbon dioxide emissions by 715 tons.
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    In 2010, we updated our vehicle fleet with 12 new EURO 5 emission standard vehicles, eliminating an equal number of obsolete cargo vehicles.

    Processes of supplying our delivery points with goods for sale and own use, we continued to carry out in 2010 the processes of reverse logistics. Reusable containers and waste packaging that cannot be sorted as municipal waste was delivered to collection points organized within our distribution centers on return trips. Thus, we avoided causing additional carbon dioxide emissions which would have occurred if collection of reusable containers and waste packaging had been outsourced.


    Energy efficiency

    The importance of energy efficiency has been on Mercator's agenda for over ten years; around the break of millennium, we started constructing all major Mercator centers in accordance with the principles of energy-efficient buildings. In our decisions, we increasingly favour the use of alternative energy sources. In recent years, efficient use of energy has thus become a part of Mercator's comprehensive corporate social responsibility. In addition to energy management, it involves environmental aspects, process aspects, and aspects of business performance.

    In order to cut the use of energy, the environmental project included in 2009 and 2010 a number of activities in the field of organizational and investment measures that involve cutting the specific use of power by 4%. This means that our power consumption will be decreased by the equivalent of annual consumption by 2,000 average households. In addition, we shall cut heating fuel consumption by 6%, thus saving EUR 1,000,000 per year. Total investment into measures of efficient use of energy amounted to over EUR 700,000.

    --------------------------------------------------------------------------------------------------------------------------------------
    Rational management of energy and natural resources, and carefully devised measures to reduce power consumption resulted in savings of 4% in power and 6% in heating fuels at the company Poslovni sistem Mercator, d.d., in 2010.
    --------------------------------------------------------------------------------------------------------------------------------------

    Based on determination of power consumption units, we compiled a priority list of measures for efficient use of energy, with focus on raising the awareness and education of employees on the subject, installing covers on refrigeration equipment, replacement and adaptation of the existing lighting in lightboxes with energy-efficient LED luminaires, energy bookkeeping and targeted energy consumption monitoring, remote control and management of central control systems, and other pilot projects.

    Energy-efficient buildings

    Since 2000, our shopping centers have been constructed according to the principles of efficient use of energy, which include improved heat insulation, optimization of glass surfaces, daylighting, controlled shading, displacement ventilation with floor heating and cooling, exploiting waste heat from refrigeration appliances and HVAC equipment, managing buildings through a central control system, etc.

    As a socially responsible retailer, we furthermore prioritized sustainable development where priorities include the Eco House development project which will upgrade the existing energy-efficient technologies and systems.

    -----------------------------------------------------------------------------------------------------------------
    Since 2000, our shopping centers are constructed according tot he principles of efficient use of energy.
    -----------------------------------------------------------------------------------------------------------------

  • Measurement of outcomes
  • Description of how the company monitors and evaluates environmental performance.

  • Environmental management system (EMS)
    Prepared Organizational Rule on energy management. Data on environmental aspects included in the SAP tool, and completed Monthly Report on environmental aspects for the requirements of environmental projects.

    Waste and other environmental aspects
    Compared to last year, the amount and cost of mixed municipal waste was cut by 20% by active sorting of waste and reducing the volume of waste bins for mixed municipal waste.

    Sustainable logistics and supply chain organization
    Average volume usage of cargo transport capacity in 2010 amounted to 84.1%, which is 5 percentage points higher than in 2009.
    5.7% less distance travelled compared to 2009, or "savings" of 956,000 km which saved 715 tonnes of CO2 emissions.
    12 cargo vehicles were replaced for EURO 5 standard vehicles.
    Return trips are used to remove waste packaging that cannot be sorted as municipal waste (additional trips are not necessary, which reduces CO2 emissions).

    Energy efficiency
    Reduction in specific use of electric power by 4%.
    Employee education on the efficient use of energy.
    Project activities completed: installation of covers and doors on refrigeration equipment; replacing the existing lighting with LED lamps for exterior lighting of major Mercator stores; established central control for management of major trade facilities.

    Energy-efficient buildings
    Project starting points for the ECO HOUSE development project.

Anti-Corruption
  • Assessment, policy and goals
  • Description of the relevance of anti-corruption for the company (i.e. anti-corruption risk-assessment). Description of policies, public commitments and company goals on anti-corruption.

  • REFERENCE CORPORATE GOVERNANCE CODE
    Management of the company Mercator, d.d., is based on legislation, sound business
    practice, and the principles of the Corporate Governance Code for Publicly Traded Companies adopted on December 8th 2009, which is the company's reference code. The Corporate Governance Code for Publicly Traded Companies is available in Slovenian and English on the Ljubljana Stock Exchange, d.d., website at www.ljse.si.
    Government relationship management
    Slovenian legislation, acts, standards, and EU directives are documents setting the legislative
    framework within which business processes of the Mercator Group are taking place. This framework is the foundation for internal legal acts of the company, which are managed in the Mercator Standards Collection.

  • Implementation
  • Description of concrete actions to implement anti-corruption policies, address anti-corruption risks and respond to incidents.

  • Implementation

    In its operations, the company is making use of the infrastructure provided for the business entities by the government.

    The Management Board declares that the relations within the Mercator Group are managed in a
    transparent manner. Any contracts on control, transfer of profit, and other agreements that are,
    by nature, enterprise contracts, shall be signed and registered in the mandatory way, i.e. in
    compliance with relevant legislation and any other rules and regulations.
    Stock of the company Poslovni sistem Mercator, d.d., is listed on the Ljubljana Stock Exchange.
    Therefore, the company observes in its public communication all procedures and rules stipulated by
    the stock market in order to provide equal treatment of shareholders and the interested segments of
    the public.
    Preventing abuse of insider information – illegal insider trading
    Rules on trading restrictions and trading disclosure regarding the company stock and shares of
    associated companies have been clearly laid out, including an accurate list of persons for whom
    such restriction shall apply.

  • Measurement of outcomes
  • Description of how the company monitors and evaluates anti-corruption performance.

  • Measurement of outcomes

    An independent, or external, auditor performs the audit in compliance with the expert and
    professional ethics principles of audit, relevant legislation, and other rules and regulations on
    auditing. Independent auditor is, as a rule, present at the company Shareholders Assembly, Audit
    Committee meetings, and Supervisory Board meetings at which decisions related to the Annual
    Report or the internal control and risk management systems are made.

    Independent inspections of the company Mercator include an examination in compliance with the Inspection Act, as to whether legislation and relevant rules and regulations are complied with.
    External assessment take place through certified assessment organizations which assess the
    compliance with the requirements of the ISO standards implemented and certified by the
    company Mercator.