ONGOING DIALOGUE, ENGAGEMENT, AND IMPROVEMENT Our relations with our suppliers has always been driven by the wish to build long-term partnerships. From this perspective, our commitment is not only to ensure they meet our standards, but also to help them improve their way of working and adopt sustainable practices. We consider them to be an integral part of our value chain, and we want them to have the same long-term vision of value creation. Beyond audits, we require our most strategic suppliers to report on a selection of CSR key performance indicators, covering social and environmental issues, and the traceability and CSR performance of their own supply chain. We use these KPIs in annual business reviews to benchmark and improve ongoing supplier performance. The responsibility for our suppliers’ compliance with our responsible-sourcing policy is at the heart of our purchasing teams’ mission. Our focus on creating value over the long term, enabled by our independence, means we can engage suppliers on more than cost and short- term financial-performance considerations. This is critical for effectively remediating social, environmental, and governance issues. For example, in 2008, during the financial crisis, a large number of our suppliers faced major financial stress due to the rapid and unexpected drop in demand for their goods and the increasing pressure on prices from the industry. What was important for us was not to obtain short-term financial advantage, but to support and sustain our strategic supplier base. Without this base, we wouldn’t have been able to operate over the long term. For this reason, we confirmed long-term orders to secure the production planning of our suppliers, and, in certain instances, afforded them shorter payment terms to help their liquidity. To increase traceability and sustainability of certain commodities, or particularly complex supply chains where it is hard to make progress, we participate in multi-stakeholder initiatives (MSIs), to take advantage of our collective leverage for effecting positive change. For example, to address systemic issues such as child labor, we engage with partners such as the ILO to find long-term solutions. 3 SUSTAINABLE RETAIL HUMAN RIGHTS IN OUR SUPPLY CHAIN