Eurocash

The role of the administrative, management and supervisory bodies

Composition

Management Board

The Management Board of Eurocash S.A. consists of 7 members as of December 31, 2024.

Composition of the Company's Management Board at year-end 2024:

Gender and independence composition:

The number of executive members is 7. The Management Board is composed exclusively of persons with the appropriate competence, skills and experience. Both the President and the Members of the Board are appointed by resolution of the Supervisory Board for an independent three-year term.

Supervisory Board

On December 31, 2024, the composition of the Supervisory Board was as follows:

• Luis Amaral, Chairman of the Supervisory Board
• Przemysław Budkowski, independent member of the Supervisory Board
• dr Hans Joachim Körber, independent member of the Supervisory Board
• Jorge Mora, independent member of the Supervisory Board
• Francisco José Valente Hipólito dos Santos, Member of the Supervisory Board

Gender and independence composition:

The Supervisory Board consists of 5 members. The number of non-executive members is 5. The right to appoint and dismiss three members of the Supervisory Board is held by Politra B.V. (and its legal successors), while 2 members of the Supervisory Board are appointed and dismissed by the General Meeting. Members of the Supervisory Board are appointed for a joint three-year term.

There is no representation of employees and others providing labor on the Management Board and Supervisory Board.

Sustainability-related committees

The Supervisory Board has three committees - the Audit Committee, the Remuneration Committee and the Nominating Committee. Each of them consists of three members elected by the Supervisory Board, from among whom, also by the Board, the chairman of the respective committee is selected. One of the committees' tasks is, among others, to oversee the management of the Group's economic, environmental and employee impacts.

Audit Committee

Members have industry knowledge and skills, at least one is a financial specialist, and at least one meets the criteria for independence:

• Jorge Mora - Chairman of the Audit Committee
• Francisco José Valente Hipólito dos Santos - Member of the Audit Committee
• dr Hans Joachim Körber - Member

Nominating Committee

At least one member meets the criteria for independence:

• dr Hans Joachim Körber - Chairman of the Nominating Committee
• Luis Manuel Conceicao Pais do Amaral - Member of the Nominating Committee
• Jorge Mora - Member of the Nominating Committee

Remuneration Committee

At least one member meets the criteria for independence:

• Przemysław Budkowski - Chairman of the Remuneration Committee
• Francisco José Valente Hipólito dos Santos - Member of the Remuneration Committee
• Jorge Mora - Member of the Committee

Powers and responsibilities for sustainability

The tasks of the Management Board include, in particular, leadership and acting in the interest of the company, commitment to setting and achieving strategic goals, including in the area of sustainable development, and ensuring the company's efficiency and safety. The principles under which the Management Board operates and the criteria for the nomination of new members are defined in the Regulations of the Management Board.

Successful implementation of the sustainability strategy requires active oversight and involvement of the Management Board. Its role is to set direction, monitor progress and ensure compliance with regulations and stakeholder expectations, and implement a culture of sustainability within the organization, among others by:

• determining long-term sustainable development goals,
• creating strategies and overseeing policies covering environmental, social and governance areas,
• introducing key performance indicators (KPIs) to measure progress toward goals.

Sustainability is an area of ongoing focus for management, including the Management Board and senior managers, and is subject to validation and oversight by the Supervisory Board.

The Supervisory Board works in a culture of debate, analyzing the company's situation and performance and verifying the work of the Management Board, including in terms of achieving established sustainable development goals. ESG issues are discussed at Supervisory Board Meetings.

Specific sustainability roles and organizational structure

Management of the Group's ESG area reports directly to the CEO, as it covers all aspects of the organization. The CEO coordinates activities, assigns responsibility to designated individuals, and oversees key issues such as strategic development, risk management, ethics, compliance, environmental issues, taxonomy disclosures and double materiality.

Since 2022, the Group has had an ESG Team under the responsibility of the Director of Risk Management and Sustainability, who reports directly to the CEO. ESG-related activities are carried out with the support of the departments responsible for environmental protection, human resources and HR, health, safety and quality management, liquidity, legal department and communications, among others. Those responsible for each area – environmental, social and management - meet periodically and report to the Group's Management Board.

The team's responsibilities include:

• implementation and coordination of sustainability strategies,
• supporting the achievement of sustainable development goals.

Responsibilities of the Management Board for managing impacts, risks and opportunities:

Board engagement and expertise development

The Group's Management Board approves the direction, scope of sustainability activities and goals, and reviews and oversees their integration with the organization's business objectives. In addition, it participates in the preparation of the non-financial report by approving, among other things, its structure, assumptions and scope of disclosures, and verifies the results of the double materiality assessment (DMA).

Sustainability disclosure are discussed with relevant Management Board Members in face-to-face meetings and ongoing reviews. The Board also monitors sustainability risks. As part of the risk management process, regular meetings are held to review key challenges in this area.

In addition, the Management Board systematically improves its ESG expertise through meetings with experts and those responsible for this area in the organization.

In 2024, members of the Management Board collaborated on the development of the Group's new sustainability strategy, participating in workshops as experts and approving the goals and directions. As a result of the adopted solutions, the Group will develop a sustainability management system, and the Management Board will supervise the implementation of the strategy.

Management and supervisory bodies are informed about sustainability issues at periodic meetings regarding, among other things, assessments of the risk analysis system of individual areas affected by risks, impacts and opportunities. Management of risks related to a particular area is carried out by individual units in the structure, and it is up to them to take responsibility for risk management. In the case of extraordinary or highly significant risks, management is subject to the assessment of the Management Board, which assigns responsibility to those appointed to each area.

Board remuneration and sustainability

The Group has a Remuneration Policy for Members of the Management Board and Supervisory Board of Eurocash S.A.. It defines the principles of remuneration of members of the highest management bodies. The remuneration and financial objectives of the Members of the Management Board and Supervisory Board are not directly linked to sustainability goals, including climate change issues, however, individuals reporting to the Members of the Management Board and their teams have established business objectives related to ESG issues.

Remuneration systems for senior executives are based on Mercer's methodology and include a base salary and an annual bonus tied to the achievement of annual business goals. Base salary is determined based on Mercer's class, market practices and the position's business goals.

Integration of sustainability-related performance in incentive schemes

Management Board and Supervisory Board

The Group has a Remuneration Policy for Members of the Management Board and Supervisory Board of Eurocash S.A. It defines the principles of remuneration of members of the highest management bodies.

The remuneration and financial objectives of the Members of the Management Board and Supervisory Board are not directly linked to sustainability goals, including climate change issues.

Broader Management and Teams

Individuals reporting to the Members of the Management Board and their teams have established business objectives related to ESG issues.

Remuneration systems for senior executives are based on Mercer's methodology and include a base salary and an annual bonus tied to the achievement of annual business goals. Base salary is determined based on Mercer's class, market practices and the position's business goals.

Sustainability KPIs

The employee engagement rate is one of the sustainability KPI targets.

Strategy, business model and value chain

Business model

Eurocash Group is the largest Polish wholesale distributor of FMCG products, as well as the organizer of well-known franchise, association and partnership chains, such as ABC, Delikatesy Centrum, Groszek, Gama, Duży Ben, Lewiatan and Euro Sklep. In addition, the Group is a logistics and technology partner for local stores, as well as the owner of Frisco, the No. 1 e-grocery store in Poland. Eurocash's customers are mainly local entrepreneurs, to whom the Group offers effective business models on the one hand, and purchasing scale, logistics, marketing aids, access to knowledge and modern technological solutions to support store operation and development on the other.

The Group's mission since its establishment - that is, for almost 30 years – has been to promote Polish entrepreneurship and the development of independent trade in Poland. In addition, the company strives to set trends, both in business and environmental responsibility for the sector.

The Eurocash Group consists of 40 companies. The parent company is Eurocash S.A., which is responsible for most of the Group's sales. The company's headquarters are located in Komorniki in the Wielkopolska region.

Business Profile

Through a range of distribution formats, Eurocash Group focuses its business on the wholesale distribution of goods to customers in the independent grocery market, particularly to retail stores (small supermarkets and grocery stores), convenience stores, gas stations, and restaurant, hotel and café chains.

The Group pays special attention to the adult assortment. Alcohol offered by Eurocash goes only to entrepreneurs with the required licenses for its sale. In turn, the procedures for the tobacco products offered are fully adapted, among other things, to the EU directive limiting the gray zone of cigarette sales. The Group has solutions in place to monitor and track the movement of tobacco products from the moment they leave the manufacturer's location to the first retail outlet.

Sales structure

The Group has included reporting of significant business segments in its financial statements in accordance with IFRS 8, broken down into retail, wholesale and projects. The significant groups of products offered relate to two categories: alcohol and tobacco products, which account for 26% and 26.3% of sales, respectively.

Percentage share of revenue from merchandise sales by business segment:

• Wholesale: 72%
• Retail: 25%
• Projects: 3%

Eurocash Group is also a responsible employer for more than 16,000 people employed under employment contracts. The company's organizational culture provides each employee with respect, clear rules for cooperation and promotion, as well as extensive opportunities for professional development.

The Eurocash Group declares that it is not active in the fossil fuel, controversial weapons, chemical production and tobacco cultivation and production sectors.

Sustainability goals embedded in the business model

The sustainability strategy we have adopted presents our approach and assumptions to sustainability topics, our ambitions and projects to support us in doing business even more responsibly.

The direction of ESG (Environmental, Social, Governance) activities is set by the "Together for Sustainability" Strategy. Its pillars respond to the needs and expectations of the Group's key stakeholders - employees, entrepreneurs, business partners, consumers and the environment.

Value chain

The Eurocash Group's value chain model was developed based on an analysis of the flow of goods. The key element of the value chain is the operational processes carried out in the Group, which include the management of purchasing, transportation and sale of goods to customers up to the final phase of their life cycle. In developing the value chain, the Group took into account business relationships and activities to attract new customers and retain existing ones.

The earlier stages of the value chain, referred to as upstream, include all operations carried out by others. These include the sourcing of raw materials, the production of food, as well as support activities such as the generation of electricity purchased by the Group and the supply of water. This group includes producers of food and primary raw materials, processing, and suppliers of services necessary to carry out operations.

In the area of own operations, the Group lists the supply of products and services from manufacturers. The main stakeholders in the own operations stage are employees responsible for warehousing and transportation, suppliers of products or services, and employees, owners and consumers associated with wholesale or retail sales.

Downstream in the value chain, on the other hand, refers to the later stages of distribution. It includes processes related to retail sales by the Group's customers and franchisees, waste processing and end use of products by consumers.

The value chain model is used, among other things, to calculate greenhouse gas emissions, analyze the interactions between the Group and its environment, and evaluate processes in the context of a circular economy.

Stakeholders in the value chain

Group strategy

Business strategy

Business strategy is a key element that determines its competitiveness and ability for long-term development. In a dynamically changing market environment, successful management of commercial activities requires precisely defined objectives, clearly defined competitive advantages and a flexible approach to changing economic conditions and customer expectations.

The strategy aims not only to maximize profits, but also to build lasting relationships with customers, optimize operational processes, and leverage innovative technological solutions. The Group aims to increase its efficiency by streamlining its supply chain, developing its offerings and adapting to market trends such as digitalization and sustainability.

An effective business strategy is based on analyzing the competition, identifying key market segments and adapting operational activities to changing consumer needs. This allows the Group to build a strong market position and achieve stable growth in the long term.

Sustainability Strategy "Together for Sustainability"

In the face of growing environmental, social and economic challenges, sustainability strategy is becoming a key element in the long-term success of an organization. Its goal is to harmoniously combine economic growth, environmental protection and social responsibility.

In implementing the strategy, the Group has sought, among other things, to minimize the negative impact of its operations on the planet, use resources efficiently, and care for social welfare. We believe that implementing such measures not only increases the Group's competitiveness, but also builds reputation and contributes to global initiatives to protect the environment and improve the quality of life.

Adopting a sustainability strategy requires us to take a long-term approach, collaborate with stakeholders, and innovate. It is not only an obligation, but also an opportunity to create a more resilient and responsible business model.

The "Together for Sustainability" strategy complements and develops the goals, both business and ESG, outlined in the Eurocash Group's overall strategy for 2023-2025. The strategy presents our approach and assumptions to sustainability topics, ambitions and projects to support us in doing business even more responsibly.

Four pillars of strategy

Our mission is to shape responsible influence on economic relations, society and the environment. Our sustainability strategy is based on a comprehensive approach that considers not only business efficiency, but also environmental, social and ethical responsibility.

Central to this process are the designated four pillars of the sustainability strategy, which provide the foundation for long-term and stable growth. The pillars respond to the needs and expectations of the Group's key stakeholders, i.e. employees, responsible distributors, conscious retailers and sustainable products. The implementation of the strategy is overseen by the President of the Eurocash Group, together with the Board Members responsible for each area.

Cross-cutting implementation of the strategy's elements allows the Group to effectively adapt to global trends, regulations and growing stakeholder expectations. By implementing activities within the four pillars, the Group can not only reduce its negative impact on the environment, but also build competitiveness and strengthen relationships with customers, business partners and employees across the value chain.

Strategic challenges and key projects

Challenges:

• Climate change and emissions reduction - aligning distribution processes with decarbonization and climate neutrality requirements
• Natural resource management - reducing energy consumption by implementing modern technologies and circular economy
• Regulations and growing ESG requirements - aligning operations with increasingly stringent environmental, reporting and corporate social responsibility regulations
• Customer and stakeholder expectations - growing environmental awareness among consumers and investors is forcing the delivery of more sustainable products

Key projects:

• Green operational transformation including investment in technologies that reduce energy consumption
• Gradual transition to renewable energy, such as installation of photovoltaic panels and purchase of RES power
• Optimizing the delivery and use of a green fleet
• Circular economy project
• Social responsibility and ethical management, i.e. working with suppliers with responsible business practices and extensive education in the value chain

In 2024, the Group updated its sustainability strategy and supplemented the ESG goals outlined in the Eurocash Group's business strategy for 2023-2025. The strategy update included the interests and opinions of stakeholders. In addition to communication at the Group level, each business unit developed its own most effective way of building relationships, exchanging opinions and information. Dialogue with stakeholders was included at both the operational and strategic levels.

Interests and views of stakeholders

Key stakeholder groups identified

The Eurocash Group has identified the following key stakeholder groups:

• Employees (own workforce)
• Suppliers and subcontractors of products and services
• Shareholders
• Customers (entrepreneurs/franchisees)
• Consumers
• Other stakeholders:
  • Local communities and NGOs
  • Environment
  • Facility owners
  • Other contractors
  • Competition
  • Other Eurocash companies
  • Financial institutions
  • Education sector: universities and trade schools
  • Industry and consumer organizations
  • Certifying organizations
  • Media and advertising agencies
  • Research organizations
  • Public administration
  • Environmental institutions

Stakeholders are identified both at the Group level and in individual business units. The power of influence is studied in a two-way dimension: the Eurocash Group's impact on stakeholders, as well as their impact on the Group.

In 2023, a working meeting of the ESG team determined the materiality of stakeholders, examining the strength of influence in a two-way dimension.

Engagement methods and frequency

Dialogue with stakeholders is carried out through various channels of communication. In addition to communication at the Group level, each department or business unit develops its own most effective way of building relationships, exchanging opinions and information. Dialogue with stakeholders is included at both the operational and strategic levels.

Table 5. The Group's methods of communication with important stakeholders

Table 6. Group's relationship with significant stakeholders

Engagement with specific stakeholder groups

Employees (own workforce):

Every year, in an anonymous Employee Opinion Survey, the Group provides an opportunity for every employee to express their opinion on working conditions, tasks performed, opportunities for development and perceptions of the Management Board's work. The purpose of the survey is to allow all employees to indicate which areas related to the workplace are rated positively and which need to be changed or improved.

Communication with employees is carried out through:

• Internal intranet
• Email newsletters and posters
• Direct meetings and conversations with supervisors

Information from employees goes to Management Board Members indirectly through employee supervisors.

Franchisees:

The Group has established a Franchisee Council, elected every 3 years by democratic vote. The Group attaches great importance to regular quarterly meetings with franchisees.

Every year, the Congress of Polish Trade Entrepreneurs is organized by the Eurocash Skills Academy, where investments in franchise networks, technological solutions offered to entrepreneurs and ideas for attracting and keeping customers are presented. This allows direct relations to be established between network representatives - suppliers - franchisees. Franchisees have the opportunity to voluntarily use the educational platform and webinars.

Suppliers:

Sales departments responsible for supplier relations periodically meet and exchange views. An example of ongoing stakeholder engagement is the preparatory process for the deposit-in system.

Stakeholder participation in materiality assessment:

840 stakeholders participated in the double materiality assessment survey in 2024, including 551 employees. Representatives of relevant stakeholder groups completed an online survey assessing the relevance of issues and risks arising in relation to the business.

Integration of stakeholder views into strategy and business model

In 2024, the Group updated its sustainability strategy and supplemented the ESG goals outlined in the Eurocash Group's business strategy for 2023-2025. The strategy update included the interests and opinions of stakeholders.

Information obtained through communication processes was used in the development of the Business and Sustainability Strategy. The Management Board and the Supervisory Board are informed periodically on the information obtained from stakeholders.

Stakeholder opinions help to develop new solutions that best meet the needs of the audience at the operational level. An example is the ongoing preparatory process for the deposit-in system.

The direction of ESG (Environmental, Social, Governance) activities is set by the "Together for Sustainability" Strategy. Its pillars respond to the needs and expectations of the Group's key stakeholders - employees, entrepreneurs, business partners, consumers and the environment.

Distinction between affected stakeholders and users of information

The Group distinguishes between:

Affected stakeholders (those impacted by the business):

• Employees in own operations and value chain
• Franchisees and retailers
• Local communities
• Consumers
• Suppliers and their workers

Users of sustainability information:

• Investors and shareholders
• Financial institutions
• Rating agencies (implied)

The materiality assessment considered both groups, with 840 stakeholders participating in the survey, including 551 employees, to assess impact materiality and financial materiality from different perspectives.

Material impacts, risks and opportunities and their interaction with strategy and business model

Material impacts, risks and opportunities (IROs)

[SBM-3]

The materiality assessment conducted identified 19 sub-topics that are significantly affected by the Group (impact materiality) or that significantly affect the Group's operations (financial materiality).

The materiality of the impact (influence) took into account what the Group has or could have on the environment and people, including the impact on their human rights, related to its own operations and to all levels of the value chain, including through its products and services, as well as through its business relationships. The materiality assessment was made based on qualitative information.

Specified:

• strength of impact,
• scope of impact,
• reversibility of effects,
• likelihood of impact.

In the case of financial materiality, sustainability risks and opportunities with negative/positive financial effects that have or could have a significant impact on the entity's cash flow, access to financing or cost of capital in the short, medium or long term were examined.

Specified:

• probability,
• the strength of the potential financial effect.

List of material impacts

Table 7. Significant topics and description of influence (impact)

Significant risks and opportunities

[SBM-3] [GOV-5]

During the DMA risks and opportunities were identified and rated as significant. Appropriate management of them makes it possible to minimize negative events and counteract their adverse effects. This is followed by informed and strategic decision-making and optimization of resources. The resilience of the organization is increased because early detection of threats allows to prevent or effectively respond to them, minimizing negative effects, and the use of opportunities resulting from the materiality assessment can lead to innovation and a better market position. Eliminating potential problems before they occur reduces losses and improves business continuity. A transparent approach to risk and opportunity management builds trust with customers, partners and employees.

A total of 8 material risks and 3 opportunities were identified in the environmental and social areas. There are none in the corporate governance area.

Table 8. Risks and opportunities in area E

Interaction with strategy and business model

[SBM-3]

Social and labor affairs are one of our priorities and an integral part of our 2023-2025 business strategy and sustainable development strategy. We have clearly defined development directions for the human dimension including providing employees with the best possible and safe working conditions. Potential and actual influences on the people doing the work in the value chain are cooperation with suppliers with responsible business practices, ethical management and extensive education in the value chain.

We note a slight reputational and market opportunity risk associated with exploitation of low-skilled and low-paid workers in sourcing regions where minimal protection is provided. The risk increases with potential media and community backlash and consumer preferences for more ethically sourced or sustainable goods.

Biodiversity strategy interaction [E4-1]: The Eurocash Group has not assessed the resilience of its strategy and business model to risks related to biodiversity and ecosystems.

Issues concerning critical raw materials are addressed in the sustainability strategy, in the fourth pillar: sustainable product - origin and consumption of resources. The implementation of a purchasing policy for critical raw materials for products is planned as a strategic goal by 2030. The full identification of critical raw materials for products in the Eurocash Group is planned by mid-2025. At the same time, the EUDR requirements for products related to deforestation (including cocoa, coffee, soy, palm oil, etc.) will be implemented.

Circular economy strategy interaction [E5-6]: The Group identified and evaluated transition and physical risks and opportunities related to resource utilization and the circular economy, including the application of evaluation criteria based on its influences and dependencies showing:

• possible risks:

  • lack of or limited access to raw materials for private label packaging,
  • increased costs of:
    • waste management, including due to the lack or improper segregation of recyclables,
    • packaging and thus final private label products, which translates into profitability,
    • fees for the recovery organization to take over the obligation to carry out the recovery and recycling of packaging waste,
  • image - lack of understanding and negative reaction from the audience (customers),
  • unforeseen legal changes that may affect the campaign,
  • loss of customers due to lack of profitability (estimate 30% of small-format stores), a significant decrease in turnover and profits - in the case of a bail system,
  • financial penalties due to:
    • failure to comply with regulatory requirements for packaging (e.g., rPET)
    • failure to achieve adequate levels of recovery and recycling of packaging waste,
    • improper waste handling,

• possible opportunities:

  • use of alternative forms of packaging,
  • an increase in revenue from the sale of recyclable materials and recycling documents,
  • reducing the cost of contracts with recovery organizations to take over packaging recovery obligations,
  • image, including improving relationships and cooperation with franchisees,
  • building a competitive advantage for customers - increasing turnover and profits.

Resilience to material IROs

Management of risks related to a particular area is carried out by individual units in the structure, and it is up to them to take responsibility for risk management. In the case of extraordinary or highly significant risks, management is subject to the assessment of the Management Board, which assigns responsibility to those appointed to each area.

Significant risks related to sustainability issues have been included in the list of risks maintained at the Group.

The validity of the materiality process conducted is three years.

Description of the process to identify and assess material impacts, risks and opportunities

Overview of the materiality assessment process

A materiality assessment process was conducted in 2022/2023 to identify key stakeholder groups and to identify the impacts that Eurocash Group's operations have on the environment and society. In 2024, the study was updated to fully comply with the requirements of the Corporate Sustainability Reporting Directive (CSRD) and the European Sustainability Reporting Standards (ESRS).

The double materiality analysis conducted took into account both the impact materiality perspective – the external impact of the Eurocash Group on areas of sustainable development, and the financial materiality perspective - the impact of external factors in the areas of environment, society and corporate governance affecting the Group. The study took into account the specifics of the FMCG industry, the business model, the value chain and the opinions of the Group's key stakeholders.

As a result of the analysis, a list of sustainability issues that may arise in the Group's operations and its value chain was developed, along with the identification of impacts, risks and opportunities and an assessment of their materiality.

Step-by-step methodology

The diagram below shows the steps of the double materiality assessment performed:

[Figure 8. Steps in the double materiality assessment (DMA) process - referenced in text]

During the process, impacts, risks and opportunities arising from the company's own operations and upstream and downstream business relationships in the value chain were identified and evaluated in the short, medium and long term.

Inputs to the assessment

Stakeholder consultation

During the survey, by completing an online survey, representatives of relevant stakeholder groups had the opportunity to assess the relevance of issues and risks arising in relation to our business, which were used to develop recommendations after the survey. 840 stakeholders participated in the survey, including 551 employees.

Internal expert methodology

The assessment was based on an internal expert methodology based on ESRS standards.

Industry specifics and value chain

The study took into account:

• The specifics of the FMCG industry
• The business model
• The value chain
• The opinions of the Group's key stakeholders

Results of the assessment

As a result of the study, the following items emerged:

• 19 key sustainability disclosures
• 8 significant risks and 3 opportunities in this area

Impact materiality assessment

A sustainability issue is relevant from an impact perspective insofar as it relates to an individual's significant actual or potential positive or negative impacts on people or the environment in the short, medium or long term.

Classification of impacts

Each identified impact was classified as:

• positive/negative
• and actual/potential

Scoring criteria for impact materiality

Then, in accordance with an internal expert methodology based on ESRS standards, materiality was assessed based on qualitative criteria including:

• scale
• scope
• irreversible nature (only in the case of negative impact)
• and the probability of occurrence

assigning the appropriate weight to each criterion on a scale of 1 to 5, where 1 is the least and 5 is the greatest strength of influence.

In accordance with the ESRS guidelines, the principle that assessing the severity of an impact takes precedence over its likelihood has been applied when assessing potential negative impacts on human rights.

Threshold for materiality

To determine which topics are material, a materiality threshold was established in an expert manner with the greatest care and transparency, below which topics were considered irrelevant.

Due diligence process

The process of identifying, assessing, prioritizing and monitoring the Eurocash Group's potential and actual impacts on people and the environment was conducted based on the due diligence process set forth in the international instruments of the UN Guiding Principles on Business and Human Rights and the OECD Guidelines for Multinational Enterprises.

Financial materiality assessment

A sustainability issue is material from a financial perspective if it has, or could reasonably be expected to have, a materiality financial impact on the entity.

For the identified impacts, the possible risks and opportunities that may occur in connection with a given impact and affect the Eurocash Group's financial position, financial results, cash flows, access to financing or cost of capital are identified.

Scoring criteria for financial materiality

Analogous to the impact assessment, in accordance with an internal expert methodology based on ESRS standards, materiality was assessed based on qualitative criteria including:

• scale
• and the probability of occurrence

assigning the appropriate weight to each criterion on a scale of 1 to 5, where 1 is the lowest and 5 is the highest impact.

Threshold for materiality

In order to identify relevant topics as before, a materiality threshold was established, below which topics were considered irrelevant.

Frequency and governance

Timing

• Initial materiality assessment: 2022/2023
• Updated to comply with CSRD/ESRS: 2024

Governance oversight

The Group's Management Board approves the direction, scope of sustainability activities and goals, and reviews and oversees their integration with the organization's business objectives. In addition, it participates in the preparation of the non-financial report by approving, among other things, its structure, assumptions and scope of disclosures, and verifies the results of the double materiality assessment (DMA).

Value chain mapping

During the process, impacts, risks and opportunities arising from the company's own operations and upstream and downstream business relationships in the value chain were identified and evaluated in the short, medium and long term.

Examples of sector-specific assessments

Biodiversity (E4)

The double materiality analysis identified potential impacts on biodiversity and ecosystems at our own locations and in the upstream and downstream value chain. The assessment took into account:

• direct factors affecting biodiversity loss
• impact on species status
• impact on range and status of ecosystems
• impact on ecosystem services and dependencies on them

Circular economy (E5)

As a result of the dual materiality analysis, positive and negative, actual and potential impacts were identified in terms of the circular economy in its own locations and upstream and downstream in the value chain. The assessment took into account:

• resource impact, including resource utilization
• resource outflows related to products and services
• waste

Transition plan for climate change mitigation

Overview

Setting decarbonization targets allowed us to identify areas and create a plan for reducing GHG emissions in the Eurocash Group with a 2030 outlook.

Eurocash S.A. and none of its subsidiaries have a transformation plan for climate change mitigation by 2050, it is planned to prepare such a plan by 2027.

SBTi alignment and targets

In 2022, Eurocash Group joined the Science Based Targets Initiative (SBTi), under which decarbonization targets through 2030 were set and approved in 2023.

The established targets commit us to reduce CO2 emissions by no less than 47.7% by 2030 in scope 1 and 2 emissions compared to 2020, and to engage major suppliers to set their own decarbonization targets by 2027 in scope 3.

The adopted decarbonization targets for 2030 were set as envisioned by the Paris Agreement, and aim to limit global warming to 1.5°C.

Scope of the plan

*As part of the SBTi initiative, calculated Scope 1 and 2 greenhouse gas emissions and established decarbonization targets for entities over which the Eurocash Group had operational control at the time, i.e.: Eurocash S.A.; Eurocash Serwis sp. z o.o.; AMBRA sp. z o.o.; Polska Dystrybucja Alkoholi sp. z o.o.; Eurocash Franczyza sp. z o.o.; Lewiatan Podkarpacie sp. z o.o.; Lewiatan Północ sp. z o.o.; Lewiatan Kujawy sp. z o.o.; Lewiatan Wielkopolska sp. z o.o.; Lewiatan Opole sp. z o.o.; Lewiatan Orbita sp. z o.o.; Lewiatan Zachód sp. z o.o.; Lewiatan Podlasie sp. z o.o.; Lewiatan Śląsk sp. z o.o.; Euro Sklep sp. z o.o.; Partnerski Sklep Detaliczny SA; Eurocash Sieci Partnerskie sp. z o.o.; Delikatesy Centrum sp. z o.o.; Podlaskie Delikatesy Centrum sp. z o.o.; Kontigo sp. z o.o.; Duży Ben sp. z o.o.; abc na kołach sp. z o.o.; Innowacyjna Platforma Handlu sp. z o.o.; Detal Finanse sp. z o.o.; Akademia Umiejętności Eurocash sp. z o.o., Partner sp. z o.o.. They do not include the following companies: Lewiatan Holding S.A.; Firma Rogala Sp. z o.o.; Inmedio Sp. z o.o.; Arhelan Sp. z o.o.

Key decarbonization levers

According to our decarbonization strategy, the main lever for reducing greenhouse gas emissions will be the use of energy from renewable sources. In 2025, an evaluation of strategic activities will be conducted and their contribution to the decarbonization goal will be determined.

Key activities and projects implemented in the Eurocash Group that are levers for decarbonization:

• diversification of the sources of energy used in facilities towards increasing the share of green energy,
• modernization of cooling systems to gradually move away from high-carbon refrigerants,
• improvement of energy efficiency of operational buildings,
• optimization of fuel consumption in logistics.

Actions and resources in 2024

The Eurocash Group has been taking action to mitigate climate change for many years by implementing projects that contribute to the reduction of CO2 emissions in its operations, and by joining the global SBTi Initiative it has reaffirmed its commitment to combating climate change.

Table 12. Decarbonization measures taken in 2024.

The amount of greenhouse gas emission reductions resulting from the implementation of individual measures is not shown in this report, due to the lack of detailed technical data to reliably estimate this measure. In 2025, internal efforts will be made to collect more detailed data on ongoing and planned investments, which will allow better estimation of reduction effects in the future.

Investment commitments

The investment activities undertaken required significant financial outlays, which are shown in the disclosures under Commission Delegated Regulation (EU) 2021/2178, activities 3.6, 7.3, 7.5 and 7.6 (Section 2.3).

In 2025, it is planned to continue modernization activities at the facilities, invest in its own renewable energy installations and implement projects in logistics.

Challenges and locked-in emissions

The challenges in implementing decarbonization measures are financial aspects and market dynamics. On the other hand, failure to undertake them in the areas of buildings and transportation, which are the Companies' main assets, could jeopardize the achievement of greenhouse gas emission reduction targets (the so-called "emissions freeze").

Scope 3 engagement

As part of the reduction of Scope 3 emissions, which account for more than 90 percent of the Group's total generated emissions, we have taken steps to engage key suppliers in setting their own decarbonization targets, providing them with a Code of Good Practice that presents the Group's values.

Eurocash Group's operations are associated with significant greenhouse gas emissions, which are generated throughout the value chain. Emissions from its own operations, i.e. Scope 1 and Scope 2, account for approx. 3% of the Group's total emissions, while the remaining approx. 97% are emissions generated upstream and downstream in the value chain, as a result of the type and scale of operations.

Policies related to climate change mitigation and adaptation

Eurocash Group has defined its approach to climate change mitigation and adaptation through two key policy instruments:

Sustainability Policy

The Sustainability Policy defines the Group's approach to climate protection through key principles:

• Building environmental awareness among employees and partners throughout the supply chain
• Considering environmental criteria in decision-making and operational activities
• Rational use of natural resources including water, energy and fuels
• Monitoring the group's carbon footprint in all three scopes and taking decarbonization measures

Monitoring and implementation: The Group has established a monitoring system for energy and fuel consumption, and calculates carbon footprint annually in 3 scopes to better manage these areas.

Strategy "Together for Sustainable Development"

This strategy complements and develops the goals of the ESG area as presented in the overall Strategy of the Eurocash Group.

Key content: The strategy includes:

• Ambitious decarbonization targets prepared in response to growing business awareness and external stakeholder expectations
• Goals for improving efficient use of energy in operational facilities
• Optimization in transportation of supplies by reducing kilometers traveled
• Commitment to Science Based Targets Initiative (SBTi) with targets to reduce CO2 emissions by no less than 47.7% by 2030 in scope 1 and 2 emissions compared to 2020
• Engagement of major suppliers to set their own decarbonization targets by 2027 in scope 3

Alignment with international standards: The adopted decarbonization targets for 2030 align with the Paris Agreement and aim to limit global warming to 1.5°C.

Actions and resources in relation to climate change policies

The Eurocash Group has been taking action to mitigate climate change for many years by implementing projects that contribute to the reduction of CO2 emissions in its operations. By joining the global SBTi Initiative it has reaffirmed its commitment to combating climate change.

Key strategic activities and decarbonization levers

The following key activities and projects are identified as levers for decarbonization:

• Diversification of the sources of energy used in facilities towards increasing the share of green energy
• Modernization of cooling systems to gradually move away from high-carbon refrigerants
• Improvement of energy efficiency of operational buildings
• Optimization of fuel consumption in logistics

According to the decarbonization strategy, the main lever for reducing greenhouse gas emissions will be the use of energy from renewable sources. In 2025, an evaluation of strategic activities will be conducted and their contribution to the decarbonization goal will be determined.

Decarbonization measures taken in 2024

Resources allocated

Financial resources:

• The investment activities undertaken required significant financial outlays, which are shown in the disclosures under Commission Delegated Regulation (EU) 2021/2178, activities 3.6, 7.3, 7.5 and 7.6 (Section 2.3)
• Specific capex/opex amounts are not disclosed in the provided excerpts

Planned investments:

• In 2025, it is planned to continue modernization activities at the facilities, invest in its own renewable energy installations and implement projects in logistics

Scope 3 actions

Supplier engagement:

• Steps taken to engage key suppliers in setting their own decarbonization targets
• Providing suppliers with a Code of Good Practice that presents the Group's values
• Target: engaging major suppliers to set their own decarbonization targets by 2027 (Scope 3, linked to SBTi commitment)

Linkage to policies and targets

Actions are linked to:

• Sustainability Policy (monitoring emissions and taking decarbonization measures is one of the principles)
• Sustainable Development Strategy (improving energy efficiency of facilities is one of the goals)
• SBTi commitment: reduce CO2 emissions by no less than 47.7% by 2030 in scope 1 and 2 emissions compared to 2020

Monitoring and management

• Monitoring system for energy and fuel consumption in place
• Annual carbon footprint calculation in 3 scopes
• Regular inspection and servicing of equipment and appliances, as well as energy audits

Challenges and limitations

• The amount of greenhouse gas emission reductions resulting from individual measures is not shown due to lack of detailed technical data
• In 2025, internal efforts will be made to collect more detailed data on ongoing and planned investments to better estimate reduction effects
• Challenges include financial aspects and market dynamics
• Failure to undertake decarbonization measures could jeopardize achievement of GHG reduction targets ("emissions freeze")

Future plans

• Preparation of a transformation plan for climate change mitigation by 2050, planned by 2027
• Evaluation of strategic activities and their contribution to decarbonization goals planned for 2025

Targets related to climate change mitigation and adaptation

Science Based Targets Initiative (SBTi) Decarbonization Targets

In 2022, Eurocash Group joined the Science Based Targets Initiative (SBTi), under which decarbonization targets through 2030 were set and approved in 2023.

Scope 1 and 2 Target

Target metric: Absolute CO2 emissions reduction in Scope 1 and 2

Target value: Reduce CO2 emissions by no less than 47.7%

Target year: 2030

Baseline year: 2020

Baseline value: 189,403 tCO2e (gross emissions by market-based method)

Scope: Entities over which the Eurocash Group had operational control, including: Eurocash S.A.; Eurocash Serwis sp. z o.o.; AMBRA sp. z o.o.; Polska Dystrybucja Alkoholi sp. z o.o.; Eurocash Franczyza sp. z o.o.; Lewiatan Podkarpacie sp. z o.o.; Lewiatan Północ sp. z o.o.; Lewiatan Kujawy sp. z o.o.; Lewiatan Wielkopolska sp. z o.o.; Lewiatan Opole sp. z o.o.; Lewiatan Orbita sp. z o.o.; Lewiatan Zachód sp. z o.o.; Lewiatan Podlasie sp. z o.o.; Lewiatan Śląsk sp. z o.o.; Euro Sklep sp. z o.o.; Partnerski Sklep Detaliczny SA; Eurocash Sieci Partnerskie sp. z o.o.; Delikatesy Centrum sp. z o.o.; Podlaskie Delikatesy Centrum sp. z o.o.; Kontigo sp. z o.o.; Duży Ben sp. z o.o.; abc na kołach sp. z o.o.; Innowacyjna Platforma Handlu sp. z o.o.; Detal Finanse sp. z o.o.; Akademia Umiejętności Eurocash sp. z o.o., Partner sp. z o.o.

Type: Absolute target

Validation: Science-based target (SBTi approved in 2023), aligned with Paris Agreement 1.5°C pathway

Progress to date (2024):

• Emissions: 153,265 tCO2e (gross emissions by market-based method)
• Reduction achieved: 34.1% below baseline (33.8% also mentioned)

Scope 3 Target

Target metric: Supplier engagement - commitment of key suppliers to set their own decarbonization targets

Target value: 35 key suppliers to set their own decarbonization targets

Target year: 2027

Baseline year: Not explicitly stated for this metric

Scope: Major suppliers (Scope 3 value chain)

Type: Engagement target

Validation: Part of SBTi initiative

Progress to date (2024): 21 suppliers committed

---

GHG Emission Intensity Target

While not explicitly stated as a formal target, the company reports GHG emission intensity per net revenue:

2024 performance:

• Total GHG emissions (location-based method) per net revenue: 146.53 tCO2e/PLN 1 million (7.51% lower than 2023)
• Total GHG emissions (market-based method) per net revenue: 146.52 tCO2e/PLN 1 million (7.26% lower than 2023)

Energy consumption and mix

Reporting scope: Calculations include the parent company Eurocash S.A. and all consolidated Group companies. Energy and fuel use relates to facilities (offices, stores, warehouses, distribution centres, loading centres) and transport (cars, vans, forklifts).

Total energy consumption and mix (2020–2024)

Energy mix breakdown (2024): Electricity accounts for 51.75% of total consumption, natural gas for heating accounts for 10.29%, and diesel fuel for transport accounts for 15.58%.

Energy intensity (per net revenue)

The Group's activities belong to sectors with significant climate impacts (Section G, Annex 1 NACE Rev. 2, Delegated Regulation EU 2022/1288).

Calculation methodology: Energy consumption data based on actual consumption of electricity, natural gas, coal, fuel oil, propane, LPG, diesel (ON), petrol (PB) from invoices and internal monitoring. Emission factors from KOBIZE 2023, CRO, DEFRA 2024, EXIOBASE.

Gross Scopes 1, 2, 3 and Total GHG emissions

Methodology and Scope

Methodology: Emissions are calculated based on Greenhouse Gas Protocol methodology:

• Scope 1 and 2 in accordance with The Greenhouse Gas Protocol Corporate Accounting and Reporting Standard Revised
• Scope 3 under the Corporate Value Chain (Scope 3) Accounting and Reporting Standard
• In accordance with the guidelines of the European Sustainability Reporting Standards (ESRS)

Organizational boundaries: Calculations include the parent company Eurocash S.A. and the Group companies. The parent company accounts for 100% of the greenhouse gas emissions of the companies included in the consolidated financial statements.

Operational limits: Calculations include Scope 1, 2 and 3.

Base year: 2020, chosen as the base year for decarbonization target.

Main sources of emission indicator data:

• National Center for Balancing and Managing Emissions, KOBiZE 2023
• Central register of operators, CRO
• Department for Environment, Food and Rural Affairs of the United Kingdom, Defra 2024
• EXIOBASE

Changes compared to previous years:

• Emissions reporting organizational boundaries changed from operational control to financial reporting control, requiring recalculation of previous years
• Number of Scope 3 categories reduced to 6 significant categories representing 99.22% of average total Scope 3 emissions

Scope 1 GHG Emissions

Scope 1 emissions arise from combustion of fuels in stationary sources for heating, mobile sources (cars, forklifts), and escape of refrigerants from air-conditioning and refrigeration equipment.

Scope 2 GHG Emissions

Scope 2 indirect emissions are related to the purchase of electricity and heat for operating facilities. Calculations use both location-based and market-based methods.

Scope 3 GHG Emissions

Scope 3 emissions accounting for 96.90% of the Eurocash Group's total emissions are other indirect emissions generated in the value chain.

Scope 3 category methodology notes:

• Category 1: Purchased goods calculated using mass volume converted to emissions using DEFRA 2024 factors or scientific studies. Services estimated using averaged data method with Exiobase factors.
• Category 3: Based on fuel and energy consumption data with DEFRA factors, including Well-To-Tank emissions and transmission/distribution losses.
• Category 4: Road transport using volume of goods and average DEFRA 2024/Exiobase factors. Estimated data method used where distance data unavailable. Includes Well-To-Tank emissions.
• Category 5: Based on waste amounts with DEFRA 2024 factors.
• Category 7: Based on distance traveled by employees on buses and in cars, using DEFRA 2024 factors with Well-to-Tank.
• Category 14: Estimated energy utilities consumption in franchise stores based on retail space and average consumption rates per m² from proprietary stores.

Total GHG Emissions

GHG Intensity

The Group's net revenues as reported in financial statements were PLN 32,451 million in 2023 and PLN 32,241 million in 2024.

SBTi Decarbonization Targets Progress

The table shows emissions and progress towards SBTi decarbonization targets for entities over which the Eurocash Group had operational control at the time of target setting.

Note: SBTi targets cover entities listed in the report footnotes, excluding Lewiatan Holding S.A., Firma Rogala Sp. z o.o., Inmedio Sp. z o.o., and Arhelan Sp. z o.o.

Biogenic CO2 Emissions

Not disclosed.

Regulated Emissions (EU ETS)

Percentage of Scope 1 greenhouse gas emissions from regulated emissions trading schemes: 0.00% for all years reported.

GHG Removal and Carbon Credits (E1-7)

In 2024, the Eurocash Group did not pursue the purchase of offset units or Carbon Credits.

Internal Carbon Pricing (E1-8)

The entity does not use an internal system for determining greenhouse gas emission fees in processes related to managing climate change-related impacts.

Anticipated financial effects from material physical and transition risks and potential climate-related opportunities

Phase-in exemption applied

Eurocash has indicated that ESRS E1-9 "Anticipated financial impacts from significant physical and transition risks and potential climate-related opportunities" will be subject to reporting for the 2025 reporting year.

Specific data points not subject to reporting

The following specific data points under E1-9 are explicitly identified as "Not subject to reporting":

• ESRS E1-9: Reference portfolio's exposure to physical climate risk point 66
• ESRS E1-9: Disaggregation of monetary sums according to acute and permanent physical risk point 66(a)
• ESRS E1-9: Location of significant assets with significant physical risk point 66(c)
• ESRS E1-9: Distribution of the book value of real estate by energy efficiency classes point 67(c)
• ESRS E1-9: Degree of portfolio exposure to climate-related opportunities point 69

Pollution of air, water and soil

Materiality Assessment

ESRS E2 Pollution was subjected to in-depth analysis during the materiality assessment and was ultimately deemed not material to the organization.

Emissions Profile

Eurocash Group's operations are primarily associated with the emission of pollution of air resulting from the combustion of fuels in transportation vehicles and heating sources, including:

• Dust (total dust, PM10, PM2.5)
• Carbon monoxide
• Nitrogen oxides
• Sulfur oxides

These are not substances of potential concern and of particularly high concern. The emission levels for each type of pollution do not exceed the applicable threshold value specified in Annex II of Regulation (EC) No. 166/2006 (E-PRTR - European Pollutant Release and Transfer Register).

ESRS E2-4 Disclosure Status

According to the ESRS compliance table:

ESRS E2-4 - Amount of each pollutant listed in Annex II of the E-PRTR (European Pollutant Release and Transfer Register) emitted to air, water and soil, point 28: Not significant

Supplier Environmental Requirements

Suppliers are obliged to implement and apply environmental protection measures, including activities that prevent:

• Excessive noise emissions
• Soil pollution
• Support for biodiversity

Policies related to water and marine resources

Eurocash has assessed ESRS E3-1 disclosures as not significant:

• ESRS E3-1 Water and marine resources point 9: Not significant
• ESRS E3-1 Special policy point 13: Not significant
• ESRS E3-1 Sustainable practices in the seas and oceans point 14: Not significant

No specific policies related to water and marine resources are disclosed. The company has determined that these disclosure requirements are not material to its operations.

Water consumption

Eurocash has assessed ESRS E3-4 disclosure requirements as not significant.

According to the company's materiality assessment table:

• ESRS E3-4 - Total amount of water recycled and reused point 28(c): Not significant
• ESRS E3-4 - Total water consumption in m³ per net income from own operations point 29: Not significant

The company mentions "Monitoring of energy and water consumption" as part of its operations with service providers (energy, water, consulting services), but does not provide quantitative water consumption, withdrawal, or discharge data.

No metrics for water consumption, withdrawal by source, discharge by destination, water stress area consumption, water intensity, or water recycling/reuse are disclosed.

Transition plan and consideration of biodiversity and ecosystems in strategy and business model

Strategy and business model resilience assessment

The Eurocash Group has not assessed the resilience of its strategy and business model to risks related to biodiversity and ecosystems.

Integration into corporate strategy

Issues concerning critical raw materials are addressed in the sustainability strategy, in the fourth pillar: sustainable product - origin and consumption of resources. The implementation of a purchasing policy for critical raw materials for products is planned as a strategic goal by 2030. The full identification of critical raw materials for products in the Eurocash Group is planned by mid-2025.

Specific biodiversity targets

At the same time, the EUDR requirements for products related to deforestation (including cocoa, coffee, soy, palm oil, etc.) will be implemented.

Based on the implemented purchasing policy for critical raw materials, further goals and actions will be set.

Geographic and value-chain scope

The Group has adopted sustainable ocean and sea practices only within the warehouses of the catering business unit, where certified standards regulating the distribution of fish and seafood from sustainable fisheries (MSC) and responsible farming (ASC) have been implemented.

No locations in or near biodiversity-sensitive areas have been identified. We also have no direct impact on changes in land use, fresh water or seas.

Policies

The entity has not adopted a policy to protect biodiversity and ecosystems covering operational locations owned, leased, or managed in or near a biodiversity-sensitive area. Sustainable land and agricultural practices are generally covered by the Code of Good Practice for Suppliers and Good Sustainability Practices in the Eurocash Group. In 2025, we will take action in the area of adopting policies to combat deforestation.

The Group did not include in its plans activities to compensate for the loss of biodiversity.

Linkage to nature-related risk assessment

Based on the assessment of the double materiality for the impact of procuring products associated with the risk of deforestation and land degradation, qualitative financial impacts were determined:

• a risk that may significantly affect the Group's ability to achieve its goals,
• an opportunity that may moderately affect the Group's ability to achieve its goals

and described taking into account the effects, impacts and dependencies:

• possible risks: financial penalties in case of non-compliance with new deforestation regulations and reputational risk, which may increase in the long term,
• possible opportunities: building cooperative relationships with suppliers and customers.

The expected financial impact and the sources and level of uncertainty associated with these assumptions have not been quantified.

Policies related to biodiversity and ecosystems

Eurocash has not adopted a specific policy to protect biodiversity and ecosystems covering operational locations owned, leased, or managed in or near a biodiversity-sensitive area.

However, certain aspects of biodiversity and ecosystems are addressed within existing policies:

Code of Good Practice for Suppliers

• Scope: Suppliers
• Key content: Sustainable land and agricultural practices are generally covered by this policy

Good Sustainability Practices in the Eurocash Group

• Scope: Eurocash Group
• Key content: Sustainable land and agricultural practices are generally covered by this policy

Sustainable ocean and sea practices

• Scope: Warehouses of the catering business unit only
• Key content: Implementation of certified standards regulating the distribution of fish and seafood from sustainable fisheries (MSC) and responsible farming (ASC)

Policies to combat deforestation

The Group states that in 2025, it will take action in the area of adopting policies to combat deforestation. Implementation of a purchasing policy for critical raw materials for products is planned as a strategic goal by 2030, which will include EUDR requirements for products related to deforestation (including cocoa, coffee, soy, palm oil, etc.). Full identification of critical raw materials for products is planned by mid-2025.

Actions and resources related to biodiversity

Planned actions

Policies to combat deforestation (planned 2025)

• Scope: Value chain / upstream (suppliers)
• Time horizon: Short-term (2025)
• Description: The Group will take action in the area of adopting policies to combat deforestation
• Link to policy: Related to Code of Good Practice for Suppliers and Good Sustainability Practices in the Eurocash Group
• Resources allocated: Not disclosed

Actions in place

Sustainable ocean and sea practices (MSC/ASC certification)

• Scope: Own operations - warehouses of catering business unit only
• Description: Implemented certified standards regulating the distribution of fish and seafood from sustainable fisheries (MSC) and responsible farming (ASC)
• Link to policy: Covered by Code of Good Practice for Suppliers and Good Sustainability Practices in the Eurocash Group
• Resources allocated: Not disclosed

Excluded actions

The Group explicitly states:

• No activities to compensate for the loss of biodiversity are included in its plans
• Future goals and actions will be set based on the implemented purchasing policy for critical raw materials (timeline not specified)

Targets related to biodiversity and ecosystems

No specific quantified targets related to biodiversity and ecosystems have been disclosed.

The company states:

• Based on the implemented purchasing policy for critical raw materials, further goals and actions will be set.
• By 2025, the Group will take action in the area of adopting policies to combat deforestation.

The Group has not included activities to compensate for the loss of biodiversity in its plans.

Impact metrics related to biodiversity and ecosystems change

E4-5 Disclosure

No locations in or near biodiversity-sensitive areas have been identified. The Group has no direct impact on changes in land use, fresh water or seas.

The facilities used for the activities are not located in or near biodiversity-sensitive areas, and the activities related to these locations do not negatively affect these areas or lead to the deterioration of natural habitats and habitats of species or to the disturbance of species for which a protected area has been designated.

The Group does not list locations with its own operations that have a significant negative impact on biodiversity. The facilities are not located in or near areas that are sensitive in terms of biodiversity. No significant negative impacts have been identified in relation to land degradation, desertification or soil sealing.

Species Impact

In the vicinity of some warehouses and distribution centers, there is an increase in the bird population - mainly the house sparrow (Passer domesticus - a strictly protected species) and the city pigeon (Columba livia forma urbana - a partially protected species). Due to the sanitary risk, trapping is carried out at these locations. All activities in this respect are based on permits from the Regional Director for Environmental Protection and under ornithological supervision.

Critical Raw Materials and Deforestation

Significant impacts identified:

• Acquisition and use of critical raw materials, including those related to the risk of deforestation and land degradation
• Implementation of EUDR requirements

The full identification of critical raw materials for products in the Eurocash Group is planned by mid-2025. EUDR requirements for products related to deforestation (including cocoa, coffee, soy, palm oil, etc.) will be implemented.

No quantified metrics for land use footprint, deforestation footprint, restoration activities, or ecosystem condition are provided.

Anticipated financial effects from biodiversity and ecosystem-related impacts, risks and opportunities

Assessment of financial impacts

Based on the assessment of the double materiality for the impact of procuring products associated with the risk of deforestation and land degradation, qualitative financial impacts were determined:

• a risk that may significantly affect the Group's ability to achieve its goals,
• an opportunity that may moderately affect the Group's ability to achieve its goals

and described taking into account the effects, impacts and dependencies:

• possible risks: financial penalties in case of non-compliance with new deforestation regulations and reputational risk, which may increase in the long term,
• possible opportunities: building cooperative relationships with suppliers and customers.

Quantification

The expected financial impact and the sources and level of uncertainty associated with these assumptions have not been quantified.

Policies related to resource use and circular economy

Eurocash Group does not yet have a dedicated circular economy policy, but plans to implement one in 2025. The company addresses resource use and circular economy through its existing policies and commitments.

Sustainability Policy

Key content:

• Commitment to rational use of natural resources
• Prevention of environmental pollution
• Waste reduction
• Prevention of food waste

Scope: Eurocash Group operations

Code of Good Practices for Suppliers

Key content:

• Addresses resource use and circular economy issues

Scope: Suppliers

Eurocash Group's Good Sustainability Practices

Key content:

• Addresses resource use and circular economy issues

Dedicated Circular Economy Policy (planned)

Implementation timeline: Will be implemented in 2025

Related strategy and targets

The Group has set voluntary goals as part of its "Together for Sustainable Development" strategy:

"Responsible Distributor" pillar:

• Building a logistics network to collect packaging and packaging waste from the Group's individual stores and its customers (priority objective)

"Sustainable Product" pillar:

• Reducing the level of food waste by:
  • Cyclically conducting "Szanujemy – nie marnujemy" (Respect - Don't Waste) campaigns
  • Inclusion of business partners (franchisees with more than 10 stores and top suppliers) in the "Szanujemy – nie marnujemy" program to monitor the food waste rate

Actions and resources related to circular economy

Circular economy project

Action name: Circular economy project
Scope: Not specified
Time horizon: Not specified
Resources allocated: Not quantified
Expected outcomes / KPIs: Not specified
Links to policy/target: Not specified

Deposit system

Action name: Deposit system
Description: Eurocash Group is actively involved in the glass bottle trade and implementing a deposit system for packaging and packaging waste collection.

Scope: Own operations and downstream (franchisees)
Time horizon: Ongoing since 2023, continuing through 2025

Actions taken:

• Established deposit system working team in 2023
• Analyzed network structures for implementation possibilities
• Estimated costs of introducing the deposit system on a store-by-store basis
• Negotiated with suppliers of hardware and software (bottle machines, scanners, POS)
• Conducted tests in 66 stores (in 4 provinces) using 23 automatic collection devices (bottle machines) and 43 manual collection devices (scanners, POS systems)
• Held discussions with deposit system operators to establish cooperation
• Participated in review and drafting of deposit act amendments

Educational activities:

• Periodic meetings with franchisees (webinars, Q&A meetings, training sessions)
• Prepared information materials for franchisees via network communication channels and Eurocash Skills Academy platform
• Developed and implemented training on deposit system operation for operational staff
• Ongoing updates to educational content

Resources allocated: Not quantified (costs estimated but amounts not disclosed)
Expected outcomes / KPIs: Not specified
Links to policy/target: Not specified

Tackling food waste

Action name: Tackling food waste
Description: Prevention of food waste as a main responsibility; reducing food waste rate across distribution stages.

Scope: Own operations
Time horizon: Ongoing

Actions at distribution stages:

• Order planning: Analyzing sales data, seasonality, shelf life of products and working with local suppliers
• Receipt of products: Control of transport conditions and product quality
• Storage and display: Ensuring proper storage conditions, FEFO principle, management of vegetable, fruit and bread zones

Resources allocated: Not quantified
Expected outcomes / KPIs: Reduce food waste rate
Links to policy/target: Not specified

Other circular economy related actions mentioned

• Optimizing the delivery and use of a green fleet (mentioned in strategy but no detailed actions disclosed under E5-2)
• Social responsibility and ethical management - working with suppliers with responsible business practices (mentioned in strategy but details not provided under E5-2)

Targets related to circular economy

Voluntary Goals under "Together for Sustainable Development" Strategy

The Group has set voluntary goals in this area as part of the pillars of its "Together for Sustainable Development" strategy:

"Responsible Distributor" Pillar:

• Target: Building a logistics network to collect packaging and packaging waste from the Group's individual stores and its customers (priority objective)
  • Target metric: Logistics network establishment for packaging collection
  • Target value: Not quantified
  • Target year: Not disclosed
  • Baseline year: Not disclosed
  • Baseline value: Not disclosed
  • Scope: Own operations (Group's individual stores) and customers
  • Type: Qualitative target

"Sustainable Product" Pillar:

• Target: Reducing the level of food waste through:
  • Cyclically conducting "Szanujemy – nie marnujemy" (Respect not waste) campaigns
  • Inclusion of business partners (franchisees - more than 10 stores and top suppliers) in the "Szanujemy – nie marnujemy" program to monitor the food waste rate
  • Target metric: Food waste reduction
  • Target value: Not quantified
  • Target year: Not disclosed
  • Baseline year: Not disclosed
  • Baseline value: Not disclosed
  • Scope: Own operations and value chain (franchisees and suppliers)
  • Type: Qualitative target

Note

A dedicated circular economy policy will be implemented in 2025.

E5-4 Resources Introduced into the Organization

The resources introduced into the Eurocash Group include products used in its operations, including IT equipment, office supplies, protective clothing, forklifts, cars and trucks and others, as well as technical materials, including primarily packaging materials: cardboard, plastics (stretch film), pallets. During the reporting period, the Group did not introduce or use biological materials in its operations. The Group did not analyze the masses of products used.

Packaging Materials

• Total weight of packaging materials used: 91,371 Mg
• Weight of secondary materials used (including packaging): 88,598 Mg

Percentage of secondary materials: 96.97% (88,598 Mg / 91,371 Mg)

Private Label Product Packaging

In 2024, the Eurocash Group, along with private label packaging, introduced materials for packaging:

Renewable materials as percentage of private label packaging: 32.1% (9,051.03 Mg / 28,188.94 Mg)

Resource Circularity Initiatives

Since 2022, Eurocash Group has been cooperating with CHEP, the world's largest pallet supplier, in a pooling model. This enables reuse of pallets in a circular system.

The Group has equipped distribution centers and warehouses with plastic boxes used for picking general cargo. After cleaning and disinfection, the boxes are returned to circulation and reused, eliminating single-use packaging such as cardboard boxes.

Methodology Note

The Group did not introduce or use biological materials in its operations during the reporting period. The analysis of masses of products used (IT equipment, office supplies, protective clothing, vehicles, etc.) was not conducted. Quantitative data is provided for packaging materials only.

Resource outflows

Packaging of private label products

The Eurocash Group is responsible for marketing the packaging that contains the products of the Group's own brands. This packaging is recyclable, with the Group not verifying at what percentage. Each year, the company is required to maintain certain levels of recycling and recovery of individual types of packaging. This obligation is carried out through packaging recovery organizations.

In 2024, the Eurocash Group, along with private label packaging, introduced:

• 19,137.91 tons of non-renewable materials (including plastics, glass, metal)
• 9,051.03 tons of renewable raw materials (including paper, wood)
• About 56.36% of the introduced packaging was recovered

Materials used for packaging of private label products by weight (Mg)

Non-renewable raw materials:

• Plastics: 5,343.52 Mg
• Glass: 10,132.69 Mg
• Metal: 3,270.12 Mg
• Other non-renewable raw materials: 391.58 Mg
• Total non-renewable: 19,137.91 Mg

Renewable raw materials:

• Paper and cardboard: 6,616.69 Mg
• Wood: 607.03 Mg
• Other raw materials: 1,827.31 Mg
• Total renewable: 9,051.03 Mg

Total materials used: 28,188.94 Mg

Percentage of recovered materials from sold products and their packaging by material category (2024)

Pallet pooling

Since 2022, Eurocash Group has been cooperating with CHEP, the world's largest pallet supplier, in a pooling model. Trucks delivering goods to the Group's customers can simultaneously pick up empty pallets from the store. All this happens in a single course, which means rational optimization of resources - fewer kilometers traveled, less fuel consumption, fewer CO2 emissions and fewer trees cut down to produce new pallets.

Reusable plastic boxes

In an effort to eliminate single-use packaging such as cardboard boxes, Eurocash Group has equipped distribution centers and warehouses with plastic boxes, which are used for picking general cargo. After cleaning and disinfection, the boxes are returned to circulation and reused.

Anticipated financial effects from resource use and circular economy-related impacts, risks and opportunities

Identified risks and opportunities

The Group identified and evaluated transition and physical risks and opportunities related to resource utilization and the circular economy, including the application of evaluation criteria based on its influences and dependencies showing:

Possible risks:

• lack of or limited access to raw materials for private label packaging,

• increased costs of:

  • waste management, including due to the lack or improper segregation of recyclables,
  • packaging and thus final private label products, which translates into profitability,
  • fees for the recovery organization to take over the obligation to carry out the recovery and recycling of packaging waste,

• image - lack of understanding and negative reaction from the audience (customers),

• unforeseen legal changes that may affect the campaign,

• loss of customers due to lack of profitability (estimate 30% of small-format stores), a significant decrease in turnover and profits - in the case of a bail system,

• financial penalties due to:

  • failure to comply with regulatory requirements for packaging (e.g., rPET)
  • failure to achieve adequate levels of recovery and recycling of packaging waste,
  • improper waste handling,

Possible opportunities:

• use of alternative forms of packaging,

• an increase in revenue from the sale of recyclable materials and recycling documents,

• reducing the cost of contracts with recovery organizations to take over packaging recovery obligations,

• image, including improving relationships and cooperation with franchisees,

• building a competitive advantage for customers - increasing turnover and profits.

Anticipated financial impacts

The anticipated qualitative financial impact from the identified risks was determined as likely to significantly affect the Group's ability to achieve its goals. Opportunities, on the other hand, are likely to have a largely positive impact on the Group's ability to achieve its goals.

Deposit system cost estimation

As part of the Eurocash Group deposit system working team activities established in 2023:

• based on the analyses, the costs of introducing the deposit system were estimated on a store-by-store basis,

• negotiations were undertaken with suppliers of hardware and software to operate the deposit system (bottle machines, scanners, POS).

Waste

Waste generation and management

The Eurocash Group generated a total of 27,282.92 tons of waste in 2024, including 81.89 tons of hazardous waste. These are mainly municipal waste, packaging waste - waste paper and film, and food waste. The Group does not generate radioactive waste.

All waste is collected selectively. Municipal waste is segregated into fractions - paper, plastic and metal, glass, bio and mixed waste. Collection of the Group's waste is handled exclusively by authorized companies, and collection of waste other than municipal waste is confirmed each time in the system of the Database of Products and Packaging and Management of Waste (BDO). Cooperation is regulated by contracts and, in the case of municipal waste, also by municipal declarations.

All waste, except municipal waste and animal by-products (UPPZ), is recorded through BDO. Municipal waste collections are verified on an ongoing basis when invoices are settled (via Jobrouter, among other applications) and municipal declarations. Receipts of animal waste are verified through commercial documents. On the basis of BDO's waste records, waste management reports are submitted annually to the Marshal's Offices.

Waste management in the Group is governed by waste management procedures and guidelines for the collection of waste paper and film from Eurocash Group units. The waste management process is supervised by the Environmental Protection Department.

Waste generated, diverted for recovery and disposal in 2024 (Mg)

Policies related to own workforce

Eurocash Group has implemented several policies and documents governing its own workforce, aligned with international human rights standards and labor conventions.

Policy for the Protection of Human Rights in Eurocash Group

Scope: All employees and associates, regardless of form of employment

International alignment: The policy is based on:

• The International Bill of Human Rights and Universal Declaration of Human Rights (UN General Assembly)
• International Labor Organization's Declaration of Fundamental Principles and Rights at Work (and its eight fundamental conventions)
• United Nations Guiding Principles on Business and Human Rights
• Ten principles of the United Nations Global Compact
• Convention on the Rights of the Child

Key content:

• Developing and implementing internal regulations that guarantee human rights
• Activities for the protection of human rights in emergency situations (wars, armed conflicts, humanitarian crises)
• Promoting a culture of respect for human rights and fighting discrimination and intolerance
• Educating employees and external stakeholders about human rights and their protection
• Monitoring compliance with human rights and responding to violations

Governance: Responsibility for implementation rests with the CEO, who assigns responsibility to designated individuals and teams

Public availability: Not disclosed

Code of Ethics and Conduct for Employees

Scope: All employees and associates, regardless of position or form of employment

Key content: The Code defines standards of conduct, key values, expected attitudes and unacceptable behavior, including commitments to:

• Adherence to the values of the Eurocash Group
• Compliance with labor laws
• Respect for human rights, fighting discrimination and intolerance
• Care for occupational safety and employee health
• Fostering a diverse and inclusive work environment
• Prohibiting forced labor, human trafficking and forms of modern slavery
• Personal data protection and confidentiality
• Countering bullying and discrimination
• Educational support and professional development
• Countering corruption and avoiding conflicts of interest
• Verifying the reliability of suppliers

Public availability: Not disclosed

Diversity Support Policy

Scope: All employees

Key content: Strategic directions and principles to create a work environment based on respect, inclusion and appreciation of diversity, including:

• Equal opportunity in employment, wages and promotion
• Promoting openness and countering stereotypes
• Integration and active support for employees with different backgrounds, skills and identities
• Promoting diversity by gender, age, education and location

Public availability: Not disclosed

Sustainability Policy

Scope: Group-wide

Key content (workforce-related aspects):

• Building environmental awareness among employees and partners throughout the supply chain
• Considering environmental criteria in decision-making and operational activities

Public availability: Not disclosed

Remote Work Agreement

Scope: Hybrid and remote workers (more than 1,000 employees covered by hybrid work formula, about 250 employees covered by total remote work formula)

Key content:

• Established in 2023 based on legal regulations
• Defines flexible hybrid work formula with three forms: stationary work, hybrid work, and total remote work
• Authority given to Management Board members responsible for individual business units to shape proportion of stationary and remote work days

Public availability: Not disclosed

Remuneration Policy

Scope: All Eurocash Group employees

Key content:

• Based on best market practices, values and strategy of the Group
• Supports employee involvement, work efficiency and responsibility for results
• Updated in 2023 for transparency and consistency
• Uses Mercer's international IPE methodology for position mapping and valuation
• Position Valuation Committee (includes top management representatives from various Group units) supervises valuation process
• Based on Total Rewards concept including: fixed salary, variable remuneration, benefit packages, training and development, culture and appreciation programs, wellbeing and integration activities, flexible work arrangements
• Employees receive annual Total Rewards summary

Monitoring:

• Group participates periodically in compensation surveys
• Reviews employee compensation twice a year
• Conducts annual Remuneration Systems Effectiveness Survey based on internally defined indicators
• Reviews remuneration systems in terms of financial indicators, system effectiveness, management processes, market solutions, and employee feedback

Public availability: Not disclosed

Training and Employee Development Strategy at Eurocash Group

Scope: All employees

Key content:

• Closely linked to leadership development and career development strategy
• Includes initiatives for developing leadership competencies, workshops and training programs on diversity/inclusion/wellbeing/sustainability, developing competencies of the future

Public availability: Not disclosed

Career Management Policy

Scope: All employees

Public availability: Not disclosed

EC Group Leadership Policy

Scope: Leaders/managers

Public availability: Not disclosed

Eurocash Group's education subsidy rules

Scope: Employees eligible for education subsidies

Public availability: Not disclosed

Information System Usage Policy

Scope: Eurocash S.A. and affiliated companies

Key content:

• Sets clear rules for proper use of IT system
• Designed to protect confidentiality of information, minimize risk of loss of integrity and availability of data, and minimize business risks

Public availability: Not disclosed

External Entity Access Management Policy

Scope: External entities accessing Group systems

Key content:

• Rules and guidelines for cyber and information security

Public availability: Not disclosed

Occupational Health and Safety Policies and Procedures

The Group has implemented several health and safety standards including:

• Procedure for supervision of health and safety records
• Procedure for reporting occupational diseases
• Procedure for reporting accidents
• Procedure for conducting training
• Eyeglasses reimbursement procedure
• Procedure for issuing preventive meals

Scope: All employees (occupational health and safety management system covers more than 18,000 employees, 100% coverage)

Monitoring:

• Health and Safety Department coordinates all health and safety activities
• Continuous accident register maintenance
• Register of occupational diseases
• Cyclical revision and updating of all health and safety documents
• Regular risk assessments
• Control schedule agreed with business

Public availability: Not disclosed

Diversity, Equality and Inclusion Strategy at Eurocash Group

Scope: All employees

Key content: Systematizes approach to managing diversity, ethics and inclusive work environment

Monitoring: The Group became a signatory to the Diversity Charter in 2024 and had practices evaluated in the Diversity IN Check survey

Public availability: Not disclosed

Taking action on material impacts on own workforce

Overview

Eurocash Group's key activities in protecting human rights and diversity include:

• Creating an open and tolerant work environment with principles of respect and equality
• Anti-discrimination and bullying - implementation of anti-discrimination policies and whistleblowing procedures
• Preventing child and forced labor - adhering to the principles of the International Labor Organization (ILO)

In 2024, the Group became a signatory to the Diversity Charter and had its practices evaluated in the Diversity IN Check survey.

Key documents implemented: Diversity, Equality and Inclusion Strategy at Eurocash Group, which systematizes approach to managing diversity, ethics and an inclusive work environment.

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1. Diversity, Equality and Inclusion (DEI) Initiatives

Campaigns and initiatives to promote DEI

• Comprehensive communication campaign on DEI, raising employee awareness of diversity
• Promoting the Diversity Charter, to which the Group is a signatory
• #UjawnijSię campaign - encouraging open conversations about disabilities in the workplace
• Collaborate with employment intermediary organizations to support the employment integration of people with disabilities

Education and support for employees

• Webinars and e-learning trainings on topics related to diversity, anti-bullying and negative phenomena in the workplace
• "Badania profilaktyczne i zdrowy styl życia jako droga do długowieczności" ("Preventive screenings and healthy lifestyles as a path to longevity") - promoting preventive health care

Scope: Own operations
Resources: Over 1,000 employees covered by hybrid work formula, about 250 employees covered by total remote work formula

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2. Data Security and Protection

Policies implemented:

• Eurocash Group Information System Usage Policy
• External Entity Access Management Policy

Actions:

• Continuous monitoring of security incidents and vulnerabilities
• Testing resilience to cyber-attacks
• Mandatory information security and data protection training for all employees
• Optional training to increase awareness and application of IT security best practices
• Regular updates to trainings to include latest threats and technologies

Outcome: In 2024, no Eurocash Group company was fined by the Office for Personal Data Protection supervisory authority for violations of personal data processing.

Objective (S1-5): Increase employees' knowledge, awareness and competence in data protection and maintain the highest level of security.

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3. Remote Working and Digitization of HR Processes

Policy: Remote Work Agreement (implemented 2023, continued 2024)

Work formats:

• Stationary work - in warehouses, stores, wholesalers
• Hybrid work - part of week in office, remaining days from home
• Total remote work - especially for analytical, IT, support positions

Coverage:

• More than 1,000 employees in hybrid work formula
• About 250 employees in total remote work formula

Infrastructure support:

• Additional conference rooms in offices for desktop meetings
• Acoustic booths for individual remote meetings
• Ergonomic audit conducted
• Application for booking desks, conference rooms and parking spaces
• Internal social platform for knowledge sharing

Digitization initiative (started 2024):

• Integrated HR technology platform
• Self-service HR service
• Access to data for managers
• Automation of HR processes
• Digitizing hybrid working hours documentation

Outcome: Reduction in paper usage, compliance recognized by external experts, contributed to Top Employer Poland certificate.

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4. Employee Listening Strategy

Objective: Create inclusive work environment, increase team engagement, foster innovation

Methods for obtaining feedback:

• Cyclical Employee Opinion Survey (all employees)
• Periodic Pulse surveys
• Webinars with Board members with direct questioning session
• Dedicated email and company-wide mailboxes
• Hotline for employees
• Survey for new hires and their supervisors
• Questionnaire for employees who voluntarily leave the company
• Evaluation surveys after company events and measuring attendance
• Study of cooperation between units

Responsibility: Head of Human Resources Department

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5. Work-Life Balance (Wellbeing) Programs

#Zdrowe biuro (Healthy office) series

Policy: Wellbeing Policy (part of HR Strategy 2023-2025)

Activities in 2024:

• Preventive examinations in offices and competitions with vouchers for employees from other locations
• Flu vaccination in offices
• Office massages
• Webinars on pro-health topics
• Wellbeing and sports newsletters
• "Zgłoś swój start" program - subsidizes employees' sports activities
• Communication of educational nature, inspiring healthy lifestyle
• Anti-stress group on social media platform
• Psychological support hotline
• Separate form of psychological support for executives
• Pink Box

Preventive examinations campaigns

#PinkOctober and #Wąsopad campaigns (October-November 2024):

• Cancer prevention focus
• Preventive examination packages at headquarters offices (Komorniki, Warsaw, Lublin)
• Contests with prizes including vouchers for blood tests at Diagnostyka facilities throughout Poland
• Quantitative outcome: 800 people screened for cancer markers
• Campaign with Rakiety Foundation on self-examinations
• 2 editions of Bieg Kobiet - Zawsze Pier(w)si (5 kilometers)
• Webinar on cervical cancer prevention and HPV
• Home HPV tests available

"Scan Your Health" campaign:

• Held at three main offices
• Quantitative outcome: 600 people screened (stationary and via screening vouchers)
• Three screening packages: Diabetes and Insulin Resistance, Healthy Heart, Healthy Head
• May contest: 50 vouchers for examinations matched to age group with consultation

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6. Employee Development and Training

Strategic pillars:

• Sustainability
• Developing the competencies of the future
• Continuation and implementation of workshops, training and development programs

Training types in 2024:

• "Rozwój w Twoich rękach" Program - 27 soft and tool training topics available to all employees and leaders
• Specialized training by internal experts
• Group internal training for teams across business units
• External individual and group training (specialized, professional skills)
• Wellbeing webinars
• Webinars on managing diversity and building inclusive work environment
• Induction training for new employees
• Leadership development programs
• Mentoring Zone program
• Coaching Zone program
• Subsidies for postgraduate studies/qualification courses/foreign language learning

Leadership development programs

Policy: Leadership model based on Leadership Fundamentals concept (Leadership of Self, Leadership for Others, Leadership Performance)

Programs:

1. First Time Manager program

   • Target: People taking on managerial positions and those wanting to develop managerial competence
   • 2024 outcomes: 36 people completed, 19 started next edition

2. #LeadUp leadership competency development program

   • Target: Managers
   • Cumulative outcome (as of 2024): 46 people completed

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7. Health and Safety Programs

Eurocash Group's Health and Safety Department operates in 5 key areas:

Area 1: Health and Safety Procedures and Monitoring

• Regular updating of manuals, procedures and risk assessments
• Accident investigations and incident monitoring
• Ensuring continued fitness for duty testing of all employees
• Health and safety inspections per annual schedule
• Time perspective: Ongoing, according to notification and/or current schedule
• Outcome: 100% of current documents, post-accident investigations conducted and units inspected

Area 2: Periodic Safety and Health Training

• Training per regulation for all employees
• Time perspective: Ongoing; every 3 years for labor positions, every 5 years for those in charge of employees, every 6 years for administrative and office positions
• 2024 quantitative outcomes: 2,757 laborers, 4,878 employees' managers, and 522 administrative and office employees trained

Area 3: First Aid Training

• Objective: Training 5,000 employees across the Group in practical first aid methods
• Time horizon: 3 years (2023-2025)
• Quantitative outcomes: 2,063 people trained in 2023, 1,715 people trained in 2024

Area 4: Safe Driving Training

• Ongoing training of employees with company cars
• Topics: safety, driving ergonomics, eco-driving principles, first aid in traffic accidents
• Time perspective: Ongoing

Area 5: Health and Safety Campaign

• Not detailed in excerpts

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Identified Risks Being Addressed

• Working conditions and wage pressures/minimum wage changes
• Lack of qualified employees in key positions and high turnover
• Loss of reputation or unfavorable employer opinion
• Risk of corruption, conflict of interest or personal gain
• Risk of loss of health or life, occupational diseases
• Risk of unequal treatment and inequality of opportunity
• Risk of violating data protection regulations
• Risk of violating labor laws

Targets related to own workforce

Data Security and Protection

Target: Increase employees' knowledge, awareness and competence in the area of data protection and maintain the highest level of security for the Group's employees.

• Description: Key objective is to increase employees' knowledge, awareness and competence in the area of data protection and to maintain the highest level of security for the Group's employees. Effective data protection minimizes the risk of costly security breaches.
• Type: Qualitative target
• Baseline: Not disclosed
• Target year: Not disclosed
• Target value: Not quantified
• Scope: Own workforce (Eurocash Group employees)
• Progress to date (2024): No Eurocash Group company has been fined by the Office for Personal Data Protection supervisory authority for violations of personal data processing.

Occupational Health and Safety Documentation

Target: 100% up-to-date documentation

• Description: Maintaining a system of records and regularly updating health and safety-related documents, including procedures, manuals, regulations and job-specific risk assessments.
• Type: Absolute target
• Target year: 2024
• Target value: 100% up-to-date documentation
• Baseline year: Not disclosed
• Baseline value: Not disclosed
• Scope: Own workforce (all Eurocash Group operations)
• Progress to date: Not disclosed

Strategic Objectives

Objectives related to employees are defined in the Sustainable Development Strategy. They relate to:

• Employee development
• Building commitment and satisfaction
• Ensuring a safe and friendly workplace

For detailed implementation, reference is made to Point 1.4 of the Group Strategy [SBM-2] - not included in these excerpts.

Characteristics of the undertaking's employees

Total headcount and FTE

As at 31 December 2024:

As at 31 December 2023:

Headcount by gender

As at 31 December 2024:

All employees are on permanent contracts. No temporary employees or employees with non-guaranteed hours are reported.

Full-time employees by gender (2024):

Part-time employees by gender (2024):

Women represent approximately 69% of total employees.

Headcount by age group

As at 31 December 2024:

The majority of employees (approximately 66%) are in the 30-50 age range.

Headcount by country/region

The only country in which the Eurocash Group has more than 50 employees is Poland. All 16,391 employees are located in Poland. Information by country is therefore not presented separately.

Headcount by employment contract type

As at 31 December 2024:

100% of employees are on permanent contracts.

Non-employees (own employee resources)

As at 31 December 2024:

Total own employee resources (employees + non-employees): 18,061

Employee turnover

Period 01.01.2024 to 31.12.2024:

Period 01.01.2023 to 31.12.2023:

The Group notes that in line with its business strategy, measures to optimize organizational structures in 2024 resulted in a higher-than-expected employee turnover rate of around 40%.

Top management diversity

As at 31 December 2024:

Top management (senior executives) accounts for 2% of the total workforce.

Methodology notes

• Headcount data is reported as at 31 December 2024 and 2023.
• The number of hours worked for accident rate calculation was determined based on the assumption that one person worked 40 hours per week.
• Non-employees include workers hired through temporary employment agencies, apprentices, contractors, interns, and self-employed persons.
• Employee turnover rate is calculated as the number of employees who left during the reporting period divided by total headcount.

Characteristics of non-employees in the undertaking's own workforce

Overview

Eurocash Group employs individuals under forms other than employment contracts, including civil law contracts, B2B contracts, and workers provided through temporary employment agencies. The Group uses these non-employee workers primarily for inventory work, loading/unloading goods in stores, and logistical support in distribution centers.

Total non-employee workforce

A total of 1,670 people worked in the Group on contracts other than employment as at the end of the reporting period (31.12.2024).

Breakdown by type

Methodology

• Data reported for the number of employees at the end of the reporting period (31.12.2024)
• For persons provided by temporary employment agencies, data obtained from external temporary employment agencies
• Counting method: headcount (not FTE)

Additional context

During the reported period, several hundred people performed work under contract of mandate, most often involving carrying out inventories at various business units. More than 1,000 employees were hired through temporary labor agencies, mainly for unloading and loading goods in stores and as logistical support in distribution centers.

Non-employee workers are also referred to as employees delegated by employment agencies, apprentices, contractors, interns or self-employed persons.

Multi-year comparison

No prior-year comparative data disclosed for non-employee workers.

Collective bargaining coverage and social dialogue

Collective bargaining coverage

People employed at Eurocash have full freedom to form employee groups. The company does not have a collective bargaining agreement with its employees, and there are trade union organizations representing employees in the Eurocash Group.

Note: No percentage of employees covered by collective bargaining agreements is disclosed. No percentage of employees covered by workers' representatives is disclosed. No information on European Works Council or other social dialogue body is disclosed. No country-by-country breakdown is provided.

Diversity metrics

Gender split at top management level

Data as at end of 2024:

Age band distribution of total workforce

Data as at end of 2024:

Context

Senior executives account for 2 percent of the total workforce, and 65 percent of them are men. The Group had more than 16,000 full-time employees in 2024, of whom nearly 69 percent were women.

Adequate wages

Disclosure reference: ESRS S1-10

Benchmark used: National benchmarks ensuring adequate wages

Eurocash states:

"All employees are paid adequate wages in accordance with applicable benchmarks ensuring that the needs of the employee and their family are met in light of national economic and social conditions."

Coverage: 100% of employees (implied)

Methodology: No specific living wage methodology or external benchmark disclosed. The company references compliance with "applicable benchmarks" that meet employee and family needs in national context, but does not specify:

• Which benchmark(s) are used
• How adequacy is assessed
• Whether a living wage calculation (e.g., Fair Wage Network, Anker, WageIndicator) is applied
• How frequently benchmarks are reviewed

Context: The disclosure occurs in a section discussing minimum wage increases in Poland (20.5% increase in 2024 following 17.8% in 2023) and wage pressures as an identified HR risk. The company notes it is developing a revised wage gap methodology but does not connect this to living wage assessment.

Gender wage gap: Overall gender wage gap reported as 13% (unadjusted). The company is developing an "adjusted wage gap" model for compliance with EU Directive 2023/970, with reporting planned from 2027.

Social protection: All employees covered by social protection for illness, occupational accidents, disability, parental leave, and retirement through public programs or voluntary benefits.

No forward-looking commitment to living wage targets or extension to value chain workers disclosed.

Social protection

All Group employees are covered by social protection against loss of income caused by any of the following major events, such as illness, occupational accident, acquired disability, parental leave and retirement.

Social protection is offered through public programs or voluntary benefits offered by the unit.

Coverage

• % of employees covered: 100%
• Events covered: illness, occupational accident, acquired disability, parental leave, retirement
• Type of scheme: Public programs or voluntary benefits offered by the unit (combination of both)
• Country breakdown: Not disclosed
• Specific exclusions: None disclosed

Persons with disabilities

Percentage of employees with disabilities

In the Eurocash Group, 3.3% of employees are people with disabilities.

Support programmes

The Group provides:

• Extended medical care for employees with disabilities and their relatives
• Disadvantaged people's allowances - financial support for employees with disabilities and parents/guardians of dependents

Training and skills development metrics

Performance and career development reviews

Training hours

Health and safety metrics

Coverage of health and safety management system

The occupational health and safety management system covers more than 18,000 employees. In 2024, 100% of employees and 10% of non-employees belonging to the entity's employee resources were covered by the occupational health and safety management system.

Work-related accidents, fatalities and lost days (2024)

Methodology note

The employee accident rate was calculated as the number of accidents divided by the number of hours worked by employees and multiplied by 1,000,000. The number of hours worked was determined based on the assumption that one person worked 40 hours per week. There were no fatalities among employees' own resources or other employees, and no cases of work-related ill-health among employees in 2024.

Work-life balance metrics

Entitlement and uptake of family-related leave

All employees in the Eurocash Group are entitled to leave for family reasons.

Note: Data refers to 2024. The disclosure confirms universal entitlement to family-related leave across the workforce.

Return-to-work rate after parental leave

Not disclosed.

Work-life balance initiatives

The Eurocash Group implements a comprehensive Wellbeing Policy as part of its HR Strategy 2023-2025, including:

• Preventive health examinations and cancer screening programs
• Flu vaccination and office massages
• Psychological support hotline and executive support
• Sports subsidies program ("Zgłoś swój start")
• Hybrid/remote work options
• Subsidized medical and sports packages

In 2024, approximately 800 employees participated in cancer prevention screening programs, and 600 employees participated in the "Scan Your Health" campaign.

Compensation metrics

Pay gap

The Eurocash Group has developed a methodology for examining the gender wage gap in accordance with EU Directive No. 2023/970 of May 10, 2023. There are transparent, clear mechanisms for salary formation in the Group. Mercer's analytical-point method of valuing work is used, which ensures the existence of a mechanism for comparing work for the notion of equal work and work of equal value.

The process of examining the wage gap in the Eurocash Group involves analyzing the pay gap between men and women, taking into account the valuation of positions and business areas.

In this process, the following indicators are examined:

• gender wage gap,
• gender wage gap in the form of complementary or variable components,
• median gender wage gap,
• median gender wage gap in the form of complementary or variable components,
• the percentage of female and male employees receiving supplemental or variable components,
• the percentage of female and male employees in each quartile of salary,
• gender wage gap among employees by category of employee, according to the usual basic hourly or monthly wage and supplemental or variable components.

In 2025, the Eurocash Group plans to internally analyze the results obtained, develop an "adjusted wage gap" model, and adapt the wage gap study to the guidelines of the legislator, who will implement the provisions of the EU Directive on wage disclosure in Poland.

Due to the pending implementation of regulations and the obligation to report the wage gap from 2027, for the time being the Group is able to provide information on the overall wage gap in the Eurocash Group, which is 13 percent.

Remuneration ratio

Annual total compensation of the highest-paid individual to the median annual total compensation of all employees (excluding the highest-paid individual) was 38.84.

Methodology

The overall wage gap indicator was calculated based on the formula: (Women's average basic salary converted to full-time - Men's average basic salary converted to full-time) / Men's average basic salary converted to full-time.

The Group uses Mercer's analytical-point method of valuing work, ensuring transparent mechanisms for salary formation and work comparison for equal work and work of equal value.

Incidents, complaints and severe human rights impacts

Reporting and complaints mechanism

Through reporting channels, the Group received 63 reports from employees about potential irregularities in 2024. All of them were verified while an impact remediation plan was implemented for 38 of them. Recommendations were made to the human resources departments of each business unit, responsible for deciding whether to implement remediation programs or, as a last resort, terminate the employment relationship. In 2024, one case of discrimination, including harassment, was reported in the Eurocash Group.

Incidents, complaints and serious impacts on human rights compliance

Policies related to value chain workers

Eurocash Group has addressed policies related to value chain workers under ESRS S2-1, though the disclosure is relatively limited compared to own workforce policies.

Human Rights Policy

Scope:

• Relevant to those performing work in the value chain
• Described in more detail in Section 3.1.A. Respect for Human Rights (cross-reference provided)

Key content: The company states that "Human rights policy obligations that are relevant to those performing work in the value chain are addressed by the Eurocash Group Human Rights Policy" but details are not provided in the excerpted sections.

International standards alignment:

• The disclosure table references:
  • UN Guiding Principles on Business and Human Rights (UNGPs)
  • OECD Guidelines
  • International Labor Organization's Core Conventions 1-8
• The company acknowledges reporting on "Failure to comply with the UN Guiding Principles on Business and Human Rights and the OECD Guidelines point 19" and "Due diligence strategies for issues covered by the International Labor Organization's Core Conventions 1-8, point 19"

Planned Code of Ethics for Franchisees

Scope:

• Intended for franchisees
• Not yet implemented

Key content: The company states: "In its relations with franchisees, the Group has not implemented a code of ethics, which we plan to develop in the near future. This document will be an extension of existing internal procedures aimed at promoting fair, transparent and responsible practices regarding working conditions at our franchisees."

Other policy commitments

The company references commitment to ensuring employees adhere to policies and procedures for:

• Protecting personal information
• Protecting confidential information
• Ensuring safe working conditions

However, these appear to be internal policies rather than specific policies governing value chain workers.

Monitoring and grievance mechanisms

The company provides channels for value chain workers to report concerns:

• Breach reports can be made by any person suspecting a personal data breach
• Contact available via email, telephone, and website
• Reports from value chain workers are treated the same as those from own employees
• Assurances of anonymity and protection provided
• Feedback on acceptance of submissions is provided

Taking action on material impacts on value chain workers

Personal data protection and GDPR compliance

Scope: Upstream and downstream value chain (suppliers, franchisees, customers)

Actions taken:

• Technical and organizational measures implemented to ensure highest standard of personal data protection
• Mandatory GDPR training for new employees (2-year validity) and periodic refresher training conducted by established GDPR team
• Thematic training and publication of articles for selected business areas
• Random audits of individual businesses and processors entrusted with personal data processing
• Pre-cooperation assessment of all contractors handling personal data
• Process risk analysis and qualification of suppliers and franchisees for data protection compliance
• Implementation of control mechanisms: data encryption, access policies, security audits

Resources: Non-financial - dedicated GDPR team

Outcomes: In 2024, no company from the Eurocash Group was charged with a fine by the Personal Data Protection Office for violations of personal data processing, nor was any other penalty imposed.

Code of Good Practices for Suppliers implementation

Scope: Upstream value chain (suppliers)

Actions taken:

• Code of Good Practices for Suppliers and Good Practices for Sustainable Development in the Eurocash Group prepared and provided to key suppliers as recommendations for implementation
• Working to ensure at least largest suppliers implement the Code in their operations
• Supplier survey conducted including questions on respect for human rights and working conditions
• Work only with approved suppliers as integral part of supplier registration (per sustainability strategy)

Time horizon: In coming years, plan to strengthen due diligence process and consider describing and implementing a supplier audit procedure

Expected outcomes: Implementation of the code promotes responsibility in the value chain

Supplier audits and monitoring

Scope: Upstream value chain (suppliers, including private label manufacturers)

Actions taken:

• 477 supplier audits conducted in 2024 (including 118 suppliers producing private labels)
• 68 preliminary audits for new supplier implementation (12 for private label manufacturers)
• Audits conducted during approval process and as ongoing monitoring during cooperation
• Standards implemented: ISO 22000 (since 2010), BRC GS S&D, MSC/ASC Supply Chain, Organic certification
• Internal audits: wholesalers audited annually, distribution centers and stores quarterly, Eurocash Gastronomy monthly

Resources: Non-financial - internal audit teams, certification bodies

Code of Ethics for franchisees

Scope: Downstream value chain (franchisees)

Status: Final version in development, to be based on sustainability and ethical management principles, enriched with additional requirements tailored to franchise model specifics

Actions taken:

• Establishment of Franchisee Council with active participation in substantive cooperation on network development

Human rights due diligence

Scope: Upstream and downstream value chain

Policy framework: Minimum standards based on international guidelines:

• International Bill of Human Rights
• ILO Declaration of Fundamental Principles and Rights at Work and eight fundamental conventions
• Directive on corporate sustainability due diligence
• UN Global Compact ten principles
• Convention on the Rights of the Child
• UN Convention on the Elimination of All Forms of Discrimination against Women
• OECD Guidelines for Multinational Enterprises
• ISO 37001:2016 and ISO 37002:2021

Requirements for suppliers:

• Absolute respect for human rights
• Action to protect human rights in emergency situations
• Combat discrimination and intolerance
• Zero tolerance for forced labor, human trafficking, child labor under 15 years, prison labor (except rehabilitation programs)
• Fair pay and equal treatment of women and men
• Respect for human dignity

Outcomes: In 2024, there were no serious issues or incidents of human rights violations related to the Group's upstream and downstream value chain.

Reporting mechanisms

Scope: All value chain workers (employees, suppliers, franchisees)

Actions taken:

• Anonymous Helpline established for employees and business partners
• Procedure for Internal Notifications and Follow-up in Eurocash Group
• Appointed team to review manifestations of disrespect for business ethics principles

Link to policy: Aligned with ISO 37002:2021 Management systems for whistleblowing

Targets related to value chain workers

The S2-5 disclosure relates to targets for managing significant impacts, risks and opportunities related to value chain workers.

Stated Objectives

The company states:

"The objectives regarding cooperation with suppliers will continue on the basis of the adopted Sustainability Strategy. They include respecting the Code of Good Practices for Suppliers and Good Sustainability Practices in the Eurocash Group, which the Group has committed to implement at its key suppliers (accounting for 75% of Eurocash's turnover)."

The text references that strategic objectives and metrics can be found in Chapter 1.4 Group Strategy (not included in the excerpts provided).

Franchisee Engagement

The company describes qualitative objectives related to franchisees (part of the value chain):

• Developing the Delikatesy Centrum franchise network in version 2.0 with broad participation of franchisees in a balanced profit-sharing model
• Establishing the Franchisee Council
• Franchisees co-determining new directions and participating in shaping key commercial and operational processes through thematic working groups

No quantified targets, baseline years, target years, or measurable metrics related to value chain workers are disclosed in the S2-5 section of the excerpts provided.

Policies related to affected communities

Eurocash has not disclosed specific policies related to affected communities under ESRS S3-1.

The sustainability statement indicates that ESRS S3-1 disclosure requirements are assessed as "Not significant" for the company, specifically:

• Human rights policy commitments (point 16)
• Failure to comply with the UN Guiding Principles on Business and Human Rights, the ILO Principles, or the OECD Guidelines (point 17)

While the company has disclosed a Sustainability Policy and Strategy "Together for Sustainable Development" in the context of climate change (ESRS E1), these policies are not described as addressing affected communities issues covered under ESRS S3-1.

The company has determined that policies specifically addressing affected communities are not material to its operations and has therefore not provided detailed disclosures under this standard.

Policies related to consumers and end-users

Food Safety Policy

Eurocash Group has implemented a Food Safety Policy that emphasizes the importance of food safety and continuous improvement, capturing it holistically in the supply chain from field to table.

Key content:

• Food safety is a priority for every employee
• Building a strong work culture that is safe for products, people and the environment
• Elimination of sources of any non-compliance in the aspect of product quality
• Safe food and customer satisfaction as the most important quality criterion

Link to international standards: The Policy does not address human rights issues as defined in the UN Guiding Principles, the International Labor Organization's Declaration on Fundamental Principles and Rights at Work or the OECD Guidelines for Multinational Enterprises.

Implementation monitoring:

• ISO 22000 standard implementation (food safety standard covering approval and evaluation of suppliers, reception, storage, transportation, hygiene, supervision of nonconformities, validation and verification; certified since 2010)
• BRC GS S&D – global safety standard for food storage and distribution at Eurocash Gastronomy (certified annually in warehouses: Błonie, Sosnowiec)
• 477 supplier audits conducted in 2024 (including 118 for private label suppliers)
• 68 preliminary audits for new supplier implementation
• HACCP system with annual management review
• 73 batch recall procedures in 2024 (63 related to product quality or safety)

Code of Ethical Conduct (data security and GDPR)

The Code of Ethical Conduct ensures personal security of consumers and end users in the context of data security and data protection.

Key content:

• Strict adherence to policies and procedures regarding protection of personal data and confidential information
• Protection of data obtained through online sales

Supporting policies and procedures:

• Privacy policy – defines rules for processing personal data of customers and end users
• Cookie policy – governing use of tracking technologies on website
• Rules and regulations of online store – containing key information on protection of customer data in order processing
• GDPR procedures – specifying how to exercise customer rights (e.g., right to erasure, object to processing, access to information)
• Instructions for retention periods for personal data
• Procedures for implementing demands of subjects and their rights
• Violation handling procedures

Implementation monitoring:

• Periodic updating of security systems and privacy policies
• Training employees on data protection
• Prompt response to reports of potential breaches
• Ensuring customers' rights to delete, limit or amend their processed data
• Individual networks monitor website traffic and analyze potential threats
• Automated systems protect customer data from unauthorized access
• Networks review policies to adapt them to legal and market changes

Product labeling procedures

The Group has implemented procedures governing product labeling and information:

• Procedure: Surveillance of nonconformities
• Procedure for handling complaints
• Rules for returns and exchanges of goods and customer complaints
• General Terms and Conditions of Supply of Products – Private label
• Warehouse Receipt Procedure

Key content:

• Verification of labels of all introduced products
• Ensuring consumers are not misled by incorrect labeling
• Compliance with constantly changing legal regulations
• All food products checked for correct labeling
• Use of SAP system to ensure flow of information
• Additional requirements for fresh produce related to marketing standards and origin information

Implementation monitoring:

• Training specialists from Eurocash Group
• Cooperation with accredited laboratories
• Verification and commentary for small local entrepreneurs on labeling requirements

Manual of Good Marketing Practices for Alcoholic Beverages

The Manual of Good Marketing Practices for Alcoholic Beverages in the Eurocash Group ensures compliance with the Act of October 26, 1982 on Upbringing in Sobriety and Counteracting Alcoholism.

Key content:

• Defines basic concepts
• Indicates prohibited and permitted activities
• Bullet points good practices and examples of marketing activities
• Covers rules of advertising, promotion and sponsorship of alcoholic beverages

Scope: Applicable to marketing activities undertaken by employees and associates of the Eurocash Group and third parties working on behalf of the Eurocash Group.

Implementation monitoring:

• Age verification of customers (no sale to persons under 18)
• Obtaining appropriate licenses for alcohol sale
• No advertising of alcoholic beverages targeting minors
• Compliance with restrictive regulations allowing alcohol advertising in limited locations
• Restriction of alcohol sale during nighttime hours per local regulations
• Regular webinars and training sessions on rules of conducting promotions and advertising of alcoholic products

Manual of Good Advertising Practices (tobacco products)

The Manual of Good Advertising Practices ensures compliance with the Act of November 9, 1995 on Health Protection from the Consequences of Tobacco and Tobacco Products.

Key content:

• Defines basic concepts
• Indicates prohibited and permitted activities
• Bullet points good practices and examples of marketing activities

Scope: Applicable to marketing activities undertaken by employees and associates of the Eurocash Group and third parties working on behalf of the Eurocash Group.

Implementation monitoring:

• Age verification (no sale to persons under 18)
• No sponsoring of cultural, sports and other events in relation to promotion of tobacco products
• Regular webinars and training sessions

Gaps identified

The Group explicitly states: "The Group has not developed a policy related to protecting the rights of consumers and end users, which it will consider introducing in future years."

Taking action on material impacts on consumers

Product Quality and Safety Management

Supplier audits and quality control

• Description: Comprehensive supplier audit program including preliminary audits for new suppliers and ongoing monitoring audits
• Scope: Upstream value chain (suppliers and manufacturers)
• Quantified activity: In 2024, conducted 477 supplier audits (including 118 private label manufacturers), of which 68 were preliminary audits (12 for private label)
• Standards implemented: ISO 22000 (certified since 2010), BRC GS S&D (Gastronomy warehouses), MSC/ASC Supply Chain, Organic certification under Regulation (EU) 2018/848
• Outcomes: Monthly audits for Eurocash Gastronomy; quarterly audits for distribution centers and stores; annual audits for wholesalers

Product testing and storage trials

• Quantified activity (2024): 206 product tests via accredited external laboratories; 1,430 product batches in storage tests; 622 quality inspections at suppliers; 67 local visits by technologists
• Effectiveness: 234 state inspectorate inspections in 2024, with 12 cases of non-compliant results leading to 15 product withdrawal procedures

Fresh Product Availability Program

Description: Expansion into fresh vegetables, fruits, meat, and fish distribution in response to customer demand

• Scope: Own operations (warehouses) and upstream (suppliers)
• Actions taken:
  • Prepared special temperature zones in warehouses
  • Refined logistics processes for perishable goods
  • Implemented expert-led quality control at delivery acceptance
  • Introduced option for pre-shipment inspection at supplier facilities
  • Regular storage trials and market comparisons
• Governance: Two key procedures established: Procedure for receiving goods into warehouse; Storage procedure

Product Labeling and Information

Label verification and support program

• Description: Verification of all food product labels for regulatory compliance; support for small local entrepreneurs in label development
• Scope: Upstream (suppliers) and downstream (customers)
• Activities:
  • All introduced products checked for correct labeling
  • Development of private label lines (e.g., Kanka) with enhanced legibility
  • Fresh produce labeling includes marketing standards and origin information
  • Product catalogs with full composition, allergen information developed for customers
  • Guidelines, manuals, training courses and webinars through Skills Academy
• Resources (non-financial): Cooperation with accredited laboratories; internal specialists; SAP system for information flow
• Outcomes (2024): 29 non-compliance cases identified, 11 resulted in penalties from external bodies (mainly related to price display and promotional marking)

Consumer Inclusion and Accessibility

Multi-channel distribution strategy

• Scope: Own operations and downstream
• Channels established:
  • Stationary: Extensive network of tens of thousands of stores
  • Online: Duży Ben (2 million customers, 429 stores by Dec 2024); Frisco (70,000 customers/month); Kontigo drugstore (15 stores, liquidated Dec 2024)
  • ABC na Kołach: 65 mobile convenience stores serving least urbanized areas
• Target: Expansion of additional 500 net stores per year (included in 2023-2025 business strategy)
• Time horizon: 2023-2025 (business strategy period)

Responsible Marketing of Harmful Products

Alcohol and tobacco sales controls

• Scope: Own operations and downstream (franchise/partner stores)
• Measures implemented:
  • Age verification (no sales to under-18s)
  • Appropriate alcohol licenses obtained by product type
  • No participation in alcohol advertising targeting minors
  • No tobacco product sponsorship of cultural/sports events
  • Compliance with restrictive alcohol advertising regulations
  • Nighttime alcohol sales restrictions per local regulations
  • Regular webinars and training on promotion and advertising rules

Data Protection and Customer Privacy

Digital security measures

• Scope: Own operations (online platforms)
• Actions:
  • Periodic updates of security systems and privacy policies
  • Employee training on data protection
  • Prompt response to potential breach reports
  • Customer rights management (delete, limit, amend data)
  • Individual networks monitor website traffic and analyze threats
  • Automated systems protect customer data
  • Policy reviews to adapt to legal and market changes
• Outcomes: Increasing customer confidence in online shopping; transparent data processing policies; increasing staff awareness

Complaint Management

Multi-channel complaint handling

• Scope: Own operations and downstream
• Channels: Network websites and apps; website forms; Helpline; direct store reporting
• Process: Individual handling of each complaint; regulations posted on websites and at points of sale
• Monitoring: Monthly analysis of complaint levels; ongoing actions with sales department and suppliers

Targets related to consumers

Eurocash has not set quantified targets related to consumers and end-users under ESRS S4-5.

Disclosure statements from the report:

Data security:

"The Group did not set a goal for improving data security in the Sustainable Development Strategy."

Product labeling:

"The organization and individual units/departments monitor the number of reports of objections from consumers, collect full information and promptly pass it on to the manufacturer... At the same time, the Group monitors changes in labeling legislation and supervises their implementation by manufacturers."

No quantified targets, baseline years, or target years disclosed.

Social inclusion:

"The organization and individual networks, by monitoring reports of objections or development tips from consumers, can take business action to improve product availability, change possible sales forms, or expand inclusion strategies."

No quantified targets disclosed. The company has a business strategy goal to expand "an additional 500 net stores per year" but this is framed as a business strategy target, not an S4-5 consumer impact target.

Sale of alcohol and tobacco:

"Goals for managing significant negative impacts, increasing positive impacts, and managing significant risks and significant opportunities have not been set."

Conclusion

The company explicitly states in multiple sections under [S4-5] that it has not set targets for consumer-related impacts.

Business conduct policies and corporate culture

Overview

Eurocash Group has established an extensive corporate governance framework based on ethical principles, transparency, and responsible business conduct. The Group operates in accordance with law, market standards, internal regulations and ethical principles. Corporate culture is spread through mission, vision and values, senior management involvement, employee selection aligned with values, regular training, transparent communication, and recognition of employees for attitudes aligned with company values.

Code of Ethics and Conduct for Employees

Scope: All employees and associates, regardless of form of employment

Approval and oversight: CEO (Paweł Surówka) - responsible for business ethics

Key content and principles:

• Adherence to the values of the Eurocash Group
• Compliance with labor laws
• Respect for human rights, fighting discrimination and intolerance
• Care for occupational safety and employee health
• Fostering a diverse and inclusive work environment
• Prohibiting forced labor, human trafficking and forms of modern slavery
• Personal data protection and confidentiality
• Countering bullying and discrimination
• Educational support and professional development
• Countering corruption and avoiding conflicts of interest
• Verifying the reliability of suppliers

Purpose: Forms the basis of the organization, helping employees make the right decisions in difficult situations and shaping responsibility to society. Ensures actions are consistent with the highest ethical standards, promoting transparency, respect, honesty and responsibility.

Public availability: Available to all employees on the company's intranet

Implementation monitoring: In 2024, mandatory online training on "Principles of Ethics in Eurocash Group" was prepared for all employees

Sustainability Policy

Scope: Eurocash Group operations

Approval and oversight: Adopted by the company; updated in 2024 alongside the Sustainability Strategy

Key principles related to business conduct:

• Building environmental awareness among employees and partners throughout the supply chain
• Considering environmental criteria in decision-making and operational activities
• Rational use of natural resources including water, energy and fuels
• Monitoring the group's carbon footprint in all three scopes and taking decarbonization measures

Link to standards: The policy addresses sustainability commitments in line with CSRD and ESRS requirements

Anti-corruption Policy

Scope: Employees, co-workers, management, contractors, business partners and persons performing any activities on behalf of and for the Eurocash Group

Approval and oversight: CEO (Paweł Surówka) - responsible for countering corruption and bribery

Key content: Defines standards for anti-corruption actions, prohibited behaviors regarding corruption and bribery

Link to standards:

• Compliance with the law
• Standards of the compliance management system
• Whistleblower protection system for companies listed on the Warsaw Stock Exchange
• ISO 37001:2016 standards

Implementation monitoring:

• Compliance department conducted webinar on Anti-Corruption Policy and Conflict of Interest Management
• Group plans to repeat training in 2025 and consider including it in mandatory training for newly hired employees
• Corruption risk assessment carried out cyclically every two years across all business units
• 66 people performing risk-exposed roles identified (0% covered by training during reporting period)

Human Rights Policy

Scope: Group's own operations and value chain (suppliers, franchisees)

Approval and oversight: CEO (Paweł Surówka)

Key commitments:

• Respecting and protecting human rights in accordance with international standards
• Preventing discrimination, forced labor, child labor
• Ensuring safe and fair working conditions
• Educating employees and external stakeholders about human rights
• Monitoring compliance with human rights and responding to violations

Link to international standards:

• International Bill of Human Rights (based on Universal Declaration of Human Rights, 1948)
• International Covenant on Civil and Political Rights and its protocols
• International Covenant on Economic, Social and Cultural Rights
• ILO Declaration on Fundamental Principles and Rights at Work and its eight fundamental conventions
• UN Guiding Principles on Business and Human Rights
• OECD Guidelines for Multinational Enterprises
• UN Convention on the Rights of the Child
• UN Convention on the Elimination of All Forms of Discrimination against Women
• United Nations Global Compact (UNGC) - Ten principles

Diversity Support Policy

Scope: All employees

Approval and oversight: Board Member for Human Resources (Katarzyna Kopaczewska) - responsible for working conditions, employment, education, employee rights, work-life balance, diversity

Key principles:

• Equal opportunity in employment, wages and promotion
• Promoting openness and countering stereotypes
• Integration and active support for employees with different backgrounds, skills and identities
• Promoting diversity by gender, age, education and location

Implementation:

• In 2024, Eurocash Group became a signatory to the Diversity Charter
• Group's practices evaluated in Diversity IN Check survey
• Comprehensive communication campaign on DEI implemented
• Webinars and e-learning trainings on diversity, anti-bullying and negative phenomena in the workplace

Conflict of Interest Management Policy

Scope: Employees and management

Approval and oversight: Part of anti-corruption framework overseen by CEO

Key content: Defines standards for managing conflicts of interest, mechanisms to prevent conflicts in supplier selection processes

Code of Good Practices for Suppliers

Scope: All suppliers, particularly key suppliers (target: 75% of turnover)

Approval and oversight: Board Member for Commercial Procurement (Marcin Celejowski) - responsible for relationships with suppliers

Key content:

• Minimum standards for business relations based on international guidelines
• Respect for human rights
• Prevention of forced labor, human trafficking, child labor
• Anti-discrimination requirements
• Fair pay and equal treatment
• Occupational health and safety compliance
• Anti-corruption and transparency requirements
• Environmental protection measures
• Data protection requirements

Link to international standards: Based on the same international frameworks as Human Rights Policy (listed above), plus:

• Directive on corporate sustainability due diligence
• ISO 37001:2016 Management systems for anti-corruption activities
• ISO 37002:2021 Management systems for whistleblowing

Public availability: Provided to key suppliers as recommendations for implementation

Implementation monitoring: Group plans to strengthen due diligence process and consider implementing supplier audit procedure in coming years

Remuneration Policy for Members of the Management Board and Supervisory Board

Scope: Members of the Management Board and Supervisory Board of Eurocash S.A.

Key content: Defines principles of remuneration; remuneration and financial objectives are not directly linked to sustainability goals, including climate change issues, however individuals reporting to Board Members have business objectives related to ESG issues

Food Safety Policy

Scope: Wholesale distribution and retail operations

Key content:

• Emphasizes importance of food safety and continuous improvement
• Holistic approach to supply chain from field to table
• Priority on safe food and customer satisfaction
• Building strong work culture safe for products, people and environment

Note: Does not address human rights issues as defined in UN Guiding Principles, ILO Declaration, or OECD Guidelines

Implementation monitoring: Maintaining ISO 22,000 standard is a KPI target

Whistleblowing System and Procedures

Policy framework: Regulations for Accepting and Processing Reports of Violations (updated January 2025 in line with Whistleblowers Act)

Scope: All employees, contractors, business partners and persons performing activities for and on behalf of Eurocash Group

Approval and oversight:

• CEO (Paweł Surówka) - responsible for whistleblower protection
• Risk Management and Sustainability Department - independent unit responsible for reviewing reports

Key content:

• Multiple reporting channels including anonymous Trust Line/Helpline
• Absolute confidentiality and anonymity guaranteed
• Protection against repressive, retaliatory, discriminatory or unfair treatment
• Objective analysis by independent unit
• Processes for handling reports of fraud, corruption, conflict of interest, discrimination, bullying, violations of employee/consumer rights

Link to standards: ISO 37002:2021 Management systems for whistleblowing

Public availability: Regulations available to all employees on company intranet; informational posters in facilities for employees without computer access

Implementation monitoring:

• In 2024: 125 reports received, all verified, 38 confirmed
• Recommendations made to HR departments for corrective programs or employment termination
• Training courses and webinars provided on whistleblowing channels and anti-harassment/discrimination
• Regular presentation of report analysis and status to Management Board

Corporate Governance Compliance

Standards followed:

• Best Practices of Companies Listed on the Warsaw Stock Exchange 2021
• Standards recommended for compliance management system in counteracting corruption and whistleblower protection for companies listed on markets organized by Warsaw Stock Exchange S.A.
• National and international generally applicable laws
• Professional standards appropriate for the industry

Due Diligence Statement

The Group has integrated due diligence into governance, strategy and business model as referenced in disclosure points S1-1, S2-1, and S4-1. Actual practices regarding due diligence are presented in the sustainability statement.

Prevention and detection of corruption and bribery

Anti-corruption Policy

Scope:

• All employees, co-workers, management, contractors, business partners and persons performing any activities on behalf of and for the Eurocash Group

Key content and principles:

• Developed in compliance with the law, the standards of the compliance management system, the whistleblower protection system for companies listed on the Warsaw Stock Exchange and the ISO 37001:2016 standards
• Defines standards for actions addressed to all stakeholders
• Details prohibited behavior regarding corruption and bribery
• The Group plans to revise this policy in the next reporting year

Links to international standards:

• ISO 37001:2016 Management systems for anti-corruption activities

Monitoring and implementation:

• Each incident reported by a whistleblower regarding corruption or bribery is individually analyzed and dealt with according to an internally developed method
• There is a separate unit in the Group that handles investigations, separate from the chain of management structures involved in the case, ensuring independence and objectivity
• Corruption risk assessment carried out cyclically every two years across all business units
• Identified increased corruption risk in purchasing, particularly non-commercial purchases
• Higher standards implemented for tendering and verification of bidders/potential suppliers
• Mechanisms to prevent conflicts of interest and control mechanisms in supplier selection process

Training:

• Compliance department conducted webinar on Anti-Corruption Policy and Conflict of Interest Management for employees, including those in positions at risk, prior to the reporting period
• The Group plans to repeat the training in 2025 and will consider including it in mandatory training for newly hired employees
• In 2024: 66 people in risk-exposed roles, 0 covered by training programs during the reporting period (0%)

Significant corruption risks identified:

• Risk of conflict of interest
• Risk of obtaining a personal benefit (property, non-property) as a result of the choice of supplier
• Failure to conduct tenders for non-commercial contracts resulting in inflated costs of service delivery
• Risk of biased one-person supplier selection decisions
• Lack of "second hand" control
• Lack of automation in the process of selecting non-commercial suppliers

Code of Ethics and Conduct for Eurocash Group Employees

Key content and principles:

• Governs the adamant policy on anti-corruption and bribery alongside the Anti-corruption Policy
• Mandatory online training "Principles of Ethics in Eurocash Group" has been prepared for all employees

Links to international standards:

• ISO 37002:2021 Management systems for whistleblowing

Code of Good Practices for Suppliers

Scope:

• Suppliers (provided to key suppliers in the form of recommendations for implementation)

Key content and principles:

• Presents the Group's commitment and values in the area of sustainability
• Systematizes the requirements the Group places on suppliers
• Promotes responsibility in the value chain
• Minimum standards for business relations based on international guidelines

Links to international standards:

• The International Bill of Human Rights (Universal Declaration of Human Rights, 1948)
• International Covenant on Civil and Political Rights and its two protocols
• International Covenant on Economic, Social and Cultural Rights
• Declaration of Fundamental Principles and Rights at Work of the International Labor Organization (ILO) and its eight fundamental conventions
• Directive on corporate sustainability due diligence
• Ten principles of the United Nations Global Compact (UNGC)
• Convention on the Rights of the Child
• UN Convention on the Elimination of All Forms of Discrimination against Women
• OECD Guidelines for Multinational Enterprises
• International Labor Organization (ILO) labor standards
• ISO 37001:2016 Management systems for anti-corruption activities
• ISO 37002:2021 Management systems for whistleblowing

Monitoring and implementation:

• In the coming years, the Group plans to strengthen the due diligence process and consider describing and implementing a supplier audit procedure
• This process will be part of the oversight of the implementation of socially acceptable principles at suppliers who have adopted the Code

Conflict of Interest Management Policy

Mentioned as an implemented policy addressing conflict of interest risks.

Sustainable Development Policy

Mentioned as an implemented policy. Monitoring emissions and taking decarbonization measures is stated as one of the principles of this policy.

Incidents of corruption or bribery

Confirmed incidents

In the reporting year 2024, there were no prosecutions against the Eurocash Group for violations of anti-corruption and anti-bribery laws. There were no convictions or fines for violations of anti-corruption laws and anti-bribery laws.

Convictions and fines

The Group reports zero convictions and zero fines paid for violations of anti-corruption or anti-bribery laws in 2024 (per disclosure G1-4).

Disclosure G1-3-21b:

Investigation procedures and speak-up mechanisms

The Eurocash Group does not have a dedicated procedure for prompt, independent and objective investigation of incidents of business conduct, including incidents of corruption and bribery. Nevertheless, there is an Anti-Corruption Policy in place in the organization, which details prohibited behavior in this regard.

Each incident reported by a whistleblower regarding corruption or bribery is individually analyzed and dealt with according to an internally developed method. The Group plans to revise its Anti-Corruption Policy in the next reporting year.

There is a separate unit in the Group that handles the investigation or work of the investigation committee. It is separate from the chain of management structures involved in the case, which ensures the independence and objectivity of the investigation process. The Group has not developed a procedure for reporting the results of the investigation to administrative, management and supervisory bodies.

The Group provides a Whistleblower Trust Line (Helpline) through which employees, contractors, business partners and all persons performing any activities for and on behalf of Eurocash can report misconduct, including corruption, fraud, conflict of interest, and other violations. All whistleblowers are guaranteed absolute confidentiality and the opportunity to remain anonymous.

Corruption risk assessment

The corruption risk assessment carried out in the Group identified an increased corruption risk in purchasing, including in particular non-commercial purchases. In response, the Group has implemented higher standards for tendering and verification of bidders, as well as mechanisms to prevent conflicts of interest and control mechanisms in the supplier selection process.

All business units of the Group are assessed for corruption risks on a cyclical basis every two years. Significant corruption risks identified include:

• Risk of conflict of interest
• Risk of obtaining a personal benefit (property, non-property) as a result of the choice of supplier
• Failure to conduct tenders for non-commercial contracts resulting in inflated costs of service delivery
• Risk of biased one-person supplier selection decisions
• Lack of "second hand" control
• Lack of automation in the process of selecting non-commercial suppliers

Anti-corruption training

The compliance department conducted a webinar related to anti-corruption and bribery topics for employees entitled "Anti-Corruption Policy and Conflict of Interest Management in the Eurocash Group" prior to the reporting period. The Group plans to repeat the training in 2025 and will additionally consider including it in the list of mandatory training for newly hired employees.

In 2024, 0 people in risk-exposed roles were covered by training programs during the reporting period (out of 66 people performing risk-exposed roles).

Payment practices

Policy and governance

The Eurocash Group implemented payment practices in 2019 based on the Procedure for Circulation and Acceptance of Documents and Verification of Suppliers. The overall goal is to organize the document circulation system to ensure timely transfer of financial documents to accounting and adaptation of accounting documentation to regulatory requirements. The Group takes care to pay obligations on time to minimize risks associated with late payments.

The Board Member for Finance (Piotr Nowjalis) has responsibility for payment practices.

The Procedure standardizes payment terms depending on the method of document distribution and protects small, medium and micro entrepreneurs (SMEs). Payment terms for SME suppliers range from 14 to 39 days on average, depending on the company in the Group and the nature of the business. For suppliers classified as Large suppliers, payment terms range from 15 to 90 days on average.

Payment performance metrics (2024)

Methodology notes: The calculated value is a weighted average of payment days, taking into account the weight of the number of documents in each company. Payment term was shown as the number of days between the document date on the invoice and payment. Documents financed under factoring were taken into account according to the date of financing. The calculation excludes intra-group transactions, payments to authorities and adjustment invoices.

Document delivery channels

The Group allows contractors to send accounting documents through four channels:

• Automatic electronic data exchange (EDI system)
• Electronic document flow in PDF
• Documents in paper form, scanned in the office department
• Self-invoicing

Payments are processed daily, except for exceptions. Counterparties have access to up-to-date knowledge of ongoing transfers via payment advices.

Reverse factoring

The balance of trade liabilities as at 31 December 2024 included the value of balances covered by the supplier financing program in the amount of PLN 1,716,017,979, while as of 31 December 2023, the corresponding value was PLN 1,405,186,228.

Generally, suppliers of alcohol, tobacco and other products with long-term shelf life participate in factoring programs. Only approximately 5% of the turnover realized with help of factoring programs concerns suppliers of fresh and perishable products.

Legal proceedings

As of the reporting date, the Group has no pending litigation in connection with delays in payment due to negligence or cases in which the Group recognizes the plaintiffs' claims as valid in principle. The only litigation is of a contentious nature, in which the Group disputes plaintiffs' claims either in principle or in amount.

Training

The Group has not implemented policies for in-house training on payment relationships with suppliers. However, all employees were provided the opportunity to take a general course entitled "False Invoices and Attacks on Payment Processes," available online at the Eurocash Skills Academy.