Guideline on the promotion of environmental protection and resource preservation in subsidiaries and administration

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1 Guideline on the promotion of environmental protection and resource preservation in subsidiaries and administration 1. Introduction and motivation The climate change as well as the protection of the environment and scarce resources are among the greatest challenges in our day and age. In many regions of the world, the demand for resources such as energy, water and raw materials is growing constantly as a result of rapid growth in population and/or economic prosperity. This is accompanied by increasing greenhouse gas emissions entering the atmosphere and the consequent progression of global climate change. Consequences, such as storms, droughts, flooding and other extreme forms of weather are not only a strain on man and the environment but also on the economy. As a result, the preservation of the environment and the protection of the climate has become of decisive importance. Galeria Kaufhof assumes this responsibility and has been implementing various measures to protect the environment and climate for many years. With this guideline, Galeria Kaufhof is committed to continuously promoting environmental protection in our subsidiaries and administration. To achieve this, we collaborate closely with employees and service providers and train our employees accordingly. 2. The objectives of our strategy We want to act with an awareness of our fundamental social-political obligation to protect the environment. All employees are encouraged to contribute to this aim on a daily basis. When sourcing goods for our own needs, we select products that fully avoid impact on the environment or at least keep environmental impact as low as possible. In addition, we also avoid environmental impacts in our business establishments. Any impact that cannot be entirely avoided is kept to a minimum. -1-

2 Carbon Footprint We wish to achieve a continuous reduction of our greenhouse gas emissions and thus contribute to complying with the international 2-degree target. The basis for this is the carbon footprint that Galeria Kaufhof has been measuring since In the period between 2006 and 2014, the company with its sales lines in Germany and Belgium has been able to reduce its specific greenhouse gas emissions by about one third. Driven by this success, we want to achieve a further reduction in Germany in comparison to 2014 by another 15 % by 2022 from 113 kg/m² to 96 kg/m² rental area. In 2017, Galeria Kaufhof has changed its scope of application of its carbon footprint and has calculated the carbon footprint according to the new rules. As in the past, the climate impact of the electricity and heating energy consumption of the department stores and the administration, the refrigerant emissions of the air-conditioning systems and food refrigeration, the paper consumption of the advertising brochures and the office paper as well as the fuel consumption of the company cars are taken into account. A new addition is the consumption of packaging material in the department stores and online shop. At the end of 2018, we will examine the development so far and possibly adjust the climate protection target upwards or downwards. Energy We want to decrease power consumption and heating requirements in our subsidiaries in particular. This is a decisive contribution in achieving our climate protection target, as energy consumption comprises 90 percent of climate change effects. In comparison to the reference year 2014, energy consumption per square meter should be reduced by 18 % by During conversions where this has not yet been done the lighting sources must be exchanged with energy-saving lamps. LED lighting should be deployed in suitable areas, such as the lighting for the jewelery counters. For the systematic and continuous increase of our energy efficiency in the subsidiaries, Galeria Kaufhof certified its Energy Management System in Germany in accordance with DIN EN ISO 50001:2011 in At the end of 2018, we will examine the development so far and possibly adjust the energy reduction target upwards or downwards. -2-

3 Paper In principle, all stationery used in procurement for the company s own needs must be certified according to one of the following standards: Forest Steward-ship Council (FSC ), Blue Angel (Blauer Engel) or EU Eco Label. We want to make communication measures with our customers more sustainable. For the print of our advertising brochures, we only make use of FSC -certified paper. Also packing and giftwrapping paper in our subsidiaries already comply with the FSC standard. We send letters to our customers with the climate-neutral DHL service "GoGreen". Printer paper in administration as well as hygienic paper is manufactured from certified sustainable forestry (FSC ) or from recycled material (Blue Angel, FSC or EU Eco Label). Company cars We want to reduce the emissions of our fleet of company cars on a continual basis. At the end of 2014, the average CO 2 emission of nearly 400 company vehicles amounted to 130 g/km. Our company car guideline encompasses a bonus/penalty system. The maximum permitted CO 2 emission for company cars for employees of management level 2 is 160 g CO 2 / km, for level 3 this is 140 g CO 2 / km. As an alternative to a company car, employees may also opt to receive a railway subscription Bahncard 100. Waste A responsible, systematic waste management system has been in place and tested out at our locations for several years - this starts with little things, such as our clothes hangers, which are indispensable when transporting or presenting goods. After goods are sold, the hangers are collected at the subsidiaries and given to a service provider, who checks and sorts them in terms of quality. Undamaged hangers are reused; damaged ones are granulated and reused for the production of new clothes hangers. This closes the loop of the life cycle of our clothes hangers. In addition, we use reusable containers for the transportation of goods from our warehouses to the subsidiaries wherever possible. In copying and printing systems we use rebuilt toner when available. -3-

4 Service packaging We want our customer service bags and shipping packaging to be as environmentally friendly as possible. Since May 2016, Galeria Kaufhof only offers plastic bags for an extra fee hands out plastic bags against a fee. In addition, Galeria Kaufhof offers its customers reusable bags and, to a limited extent, free paper bags. All bags at Galeria Kaufhof are made of certified, environmentally friendly material. The plastic bags are made of recycled packaging and have been awarded the Blue Angel [Blauer Engel] for their environmentally friendly production. Paper bags are made of FSC -certified paper from sustainable forestry. Alternatively, Blue Angel or EU Eco Label certified paper bags would be acceptable. The reusable bags are made of either recycled PET bottles or GOTS or Fairtrade certified cotton. Shipping packaging of the online shop kaufhof.de is only made of FSC -certified recycling cardboard. Here, too, alternative Blue Angel or EU Eco Label certified materials would be acceptable. Wood products Galeria Kaufhof uses a large number of wood products for furniture and decoration in the department stores. In principale, Galeria Kaufhof prefers to work with suppliers who can deliver FSC -certified wood products. Wooden products that are made of 50 % solid wood and tropical hard wood must be certified in accordance with the standard of the Forest Stewardship Council (FSC ). Galeria Kaufhof communicates this guideline to its employees and customers and trains relevant employees accordingly. 3. Scope of applicability of the guideline Galeria Kaufhof implements this guideline in all subsidiaries for the sourcing of products for the needs of the company, in customer service and sales at Galeria Kaufhof in Germany. -4-

5 4. Employee training Galeria Kaufhof informs the responsible employees on the content of this policy and trains them accordingly. Building services employees receive regular training on energy-related topics. 5. Informing customers Galeria Kaufhof keeps its customers informed of the company s carbon footprint on its website. 6. Implementation and monitoring of the guideline Those responsible for the areas of energy and waste management, marketing procurement, logistics and company car management are responsible for the implementation and monitoring of the corresponding measures. They will receive support from the Sustainability department. Galeria Kaufhof will measure the progress of the implementation by means of the following indicators: Total greenhouse gas emissions in tons per year (divided into power, heat, refrigerating agents, paper, packaging material and company cars) Greenhouse gas emissions per square meter rental area in kg per year (divided by countries) Energy consumption per square meter rental area in MWh per year (divided by countries) 7. Enforcement This guideline shall enter into force on April 26, It supersedes the environmental guideline 2.1 of Galeria Kaufhof from August 1, 2017, which has replaced the environmental guideline of Galeria Kaufhof from

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