This is a Category B project according to IFC’s Policy on Social and Environmental Sustainability because a limited number of specific environmental and social impacts that may result can be avoided or mitigated by adhering to generally recognized performance standards, Environmental, Health and Safety and Social (EHSS) general guidelines or design criteria as is described in the following sections. Because this is an investment in a corporate entity to support its food retail operations further expansion in Colombia, the key EHSS issues associated with this investment include: (i) assessment and management of environmental and social risks and impacts related to the operation of retail stores and storage of products at the distribution centers; (ii) labor and working conditions; (iii) life and fire safety; (iv) occupational health and safety (OHS); (v) solid waste management; (vi) water conservation and (vii) energy efficiency.

Environmental and Social Assessment and Management System (ESMS)

Due to the nature of retailing businesses which typically have facilities within urban settings and limited environmental issues (e.g., L&FS, emergency response plans, waste management, effluents, and energy consumption), regulatory agencies usually do not require an environmental impact assessment (EIA). The company must comply with Colombian requirements (NSR-10 and NTC for construction, Decree 1076/2015 Decreto Único Reglamentario del Sector Ambiente y Desarrollo Sostenible, Resolution 0631/2015 for effluents discharge, Resolution 0627/2006 for noise, besides the regional and/or local requirements) to obtain the necessary permits and authorizations at local and/or regional levels as part of commercial developments. In the main cities (such as Bogota, Barranquilla, Santa Marta, and Cartagena), environmental agencies issue permits after a site inspection. In addition, since 2016, a national legal framework requires approval of effluents discharges (from environmental agencies or public service companies, depending on the city). An excel matrix is used to control the requests to the public authorities. An environmental database system is used to manage Key Performance Indicators results per store for aspects and impacts such as waste, water, wastewater, energy, and GHG emissions among others. E&S KPIs results are shared with the executive level / corporate level on a monthly basis. The Occupational Health and Safety Management System includes policies and procedures covering H&S at work and surveillance programs.

Ara Tiendas started pre-operational activities in 2012. Different matters are dealt by different people using different platforms/systems. Ara’s environmental objectives for 2018 are: (i) Assurance of environmental legal compliance, carrying out the plans documented in the matrix of environmental legal requirements identified in 2017, focused on highest risk issues; (ii) Strengthening of the E&S management system, also attending the program Environmental business management of the Secretary of Environment of Bogota, that seeks to align environmental management with ISO 14001; (iii) Creation of the company’s environmental standards to be adopted by the whole company.

Going forward, as per ESAP #1, the company will consolidate an integrated Environmental and Social Management System (ESMS), following corporate policies and procedures, and PSs provisions, and develop all necessary policies, management procedures and programs to deal with identified gaps. The ESMS will ensure ongoing review of issues in a continuous improvement context.

Policy

Ara’s Environmental Policy is based on three pillars: (i) Reduction of energy consumption and greenhouse gases emissions, (ii) Biodiversity preservation through an active contribution to the protection of biological diversity and ecosystem services, and (iii) Responsible waste management, through a commitment to the prevention, reduction and recovery of generated waste.

Identification of Risks and Impacts

The company developed a tool: Identification of Environmental Aspects and Impacts Matrix, considering three criteria: legal requirements, communications from external stakeholders, and assessment of the environmental impacts (frequency, relevance and scope of the impact). Each criterion is qualified in terms of its level or magnitude (1, 5, or 10). Qualifications of each identified environmental aspect are added, and the significance is classified as being high, medium, or low. The main aspects are: Energy consumption, organic wastes, wastewater, and emission of offensive odors. Key Performance Indicators (KPIs) arising from these are: electricity consumption, generation of plastic bags, water consumption, and wastes. Tools and mechanisms to track the KPIs are selected from the risks & impacts analysis. Ara is currently focused on energy consumption and carbon footprint reduction.

In addition, a risk matrix is used to the site selection decision-making process, including risk identification, assessment, and mitigation plan. The Director of Security reports to the CEO and is supported by managers and analysts for each region. The Insurance and Risk Management area of the company follows the Group´s Risk Management Policy, which is set according to the ISO 31000 standard.

Management Programs 

With the objectives of continually improving the environmental performance of its activities, products and services, as well as to prevent pollution, minimize the environmental impacts and, as a minimum, ensure compliance with the applicable legislation, Ara develops management programs to promote resource efficiency, to mitigate water and energy consumption, to manage waste, to reduce the volume to be sent to landfills, to reduce the organic load of the effluents, to engage with workers and external stakeholders, to improve occupational health and safety, amongst other aspects.

Organizational Capacity and Competency

JM Group has a Committee on Corporate Governance and Corporate Responsibility, which is appointed by the Board of Directors and works closely with it, and an Ethics Committee, which monitors the disclosure and compliance with the Code of Conduct in all Group’s companies.

At the company level, an Environmental Specialist based in Bogota HQ reports to the Corporate Environmental Director. An environmental analyst is to be hired in 2018 to support him. In 2018, the company will outsource the licensing/permitting processes.

Occupational Health and Safety (OHS) is handled by an Employment Relations Manager in Bogotá, who reports to the HR Director, and Health Coordinators and Safety Coordinators for each region, who are in charge of managing drills and track Health and Safety (H&S) KPIs, supported by H&S analysists for each region. The company leverages the services and support provided by the professional risks insurance company (ARP). In 2018, Ara will hire an OHS Manager, who will report to the Employment Relations Manager.

Supply Chain Managers for each region receive support from four analysts, and report to the IT&Supply Director.

Security matters are handled by a Security’s Director, who reports to the CEO, with the support of two analysts, one Security Coordinator per region, and selected contractors for the whole country.

Going forward, as per the ESAP #2, Ara will review its internal environmental capacity to include at least one qualified environmental professional per each zone; and review responsibilities for stores’ managers on implementation of E&S management system and monitoring key E&S indicator. The company will submit a formal review of the internal capacity (personnel) to manage environmental, OHS and social elements in the operations, once expansion has been implemented. The company will review the need to have permanent staff covering these functions per each zone, as per ESAP #3.

Monitoring and Review

The company sets targets and KPIs results are compared to those targets and shared internally. Action plans are developed to improve the indicators, and in some cases, follow up audits are conducted. One of the main issues is related to stores’ construction. The company has different mechanisms to verify the compliance of the construction of stores with the legal requirements and the internal procedures, such as: Pre-opening, and post-opening inspections, annual H&S and HR audits, Ticketing Tool (Store Managers or Area Managers can report insecure conditions within the store through an internal system). The Fire Department’s authority does yearly inspections in each store. 

Reporting to Carbon Disclosure Project - CDP is audited by an external independent consultancy.

Supply Chain:

The JM Group has advanced standards and imposes high requirements on its suppliers in terms of production, storage and food quality. In the case of suppliers of Private Brand and Perishables, Ara has an Evaluation Audit process in place which comprehends food safety, quality, infrastructure, product, process, personnel, and environmental legal requirements. The audit ranks suppliers according to defined criteria.  In 2017, 116 Private Brands suppliers were audited in Colombia, the company conducted additional 37 evaluation audits, and 113 follow-up audits. 40 Perishables providers were audited in 2017.

Since 2014, and as part of the Carbon Disclose Project – CDP, the JM Group conducts an annual comprehensive survey of suppliers of products identified as containing deforestation risk commodities and requests the identification of the respective points of origin, up to country level. In 2017, in Portugal, Poland and Colombia, a total of 16,415 food and non-food products (SKU’s) were scoped and a survey was conducted on over 800 suppliers of products and packaging found to contain deforestation commodities.

Commodities assessed include: palm oil, soy, paper, wood and beef. JM is prioritizing engagement with suppliers heavily dependent on such origins, encouraging the use of certified commodities, alongside with product reformulation. The JM Group is part of The Consumer Goods Forum and has committed to this organization's ambition of ending 2020 with zero net deforestation in the supply chain. The first step of the JM deforestation risk management strategy is the substitution of deforestation-related commodities in Private Brand and Perishable products portfolio for certified ones or substitutes, and avoidance of countries of origin with high deforestation risk. In 2017, and comparing with the baseline year (2014), there was a 38% decrease of palm oil used in Private Brand products and Perishables. There was also a 41% reduction in paper and wood products from countries at risk of deforestation.

JM Group engages in a number of multi-stakeholder initiatives, both within the industry and with other organizations, in projects targeted at reducing deforestation from agricultural commodities production. Besides the already mentioned The Consumer Goods Forum (commitment to 2020 Zero Net Deforestation target, use of industry focused guidelines for the sustainable sourcing of timber, palm and soy and active participation in forest-related Working Groups), examples include Roundtable on Sustainable Palm Oil (the Group became a member in 2017) and the Soy Buyers Coalition, with whom the Group also started to cooperate with in 2017.

The assessments of Private Brand and Perishables suppliers for Quality covers waste management practices as well as a comprehensive set of environmental aspects, such as criteria associated with the management of water, effluents, atmospheric emissions, noise and hazardous substances. The company also assesses Health & Safety in the workplace and training conditions, comprehending criteria such as the existence and use of appropriate clothing, equipment for hand wash, rules of conduct, personal hygiene, the existence and conditions of social areas for employees, changing rooms and bathrooms for employees.

As per ESAP #4, the company will review the Private Brand Supplier’s Quality audits to include the screening of child labor, forced labor and significant occupational health and safety risks. As needed, Ara will train auditors and will amend supply contracts and Terms of Agreement to address these aspects.

At the end of 2017, Ara had 4,453 employees (around 80% in stores), half of which are women. Women also represent 30-40% of management positions. Ara has a relevant plan to expand and open new stores in the coming years and that is expected to create more than 3,000 direct jobs.

Human Resources Policies and Procedures

As per its HR Policy and procedures, Ara Tiendas aims at being a best in class employer, committed to develop a healthy workplace to all its employees, embodied by opportunities for personal and professional achievements. A Code of Ethics is shared and signed by all direct employees and contractors. The company expects to conduct Engagement surveys once every two years. The first survey was conducted in 2017 through a third-party, with a 90% response rate. General results were shared with all employees. Action plans were developed by assigned teams from different regions to address the negative aspects raised by the employees.

Working Conditions and Terms of Employment

Ara differentiates from its competitors by providing additional benefits to its employees. Ara’s entry salary in 2017 was 33% higher than the national minimum wage and up to 60% higher when including all legal and voluntary benefits; Also in 2017 Ara provided training to 92.7 % of employees. Both led to a low turn-over rate of 29%, when compared within the food retail industry.

Each store has communal areas such as bathrooms, rest areas for food, refrigerator, microwave, lockers and other elements that allow staff to take their food inside the operation and be comfortable in their moments of rest.

Workers’ Organization

Ara has a track of good relationship with several Unions related to the retail business. Ara doesn’t restrict by any means its workers’ rights to organize.

Non-discrimination and Equal Opportunity

Criteria for equal opportunity and non-discrimination in employment are documented within the Code of Ethics. The company prioritizes hiring local professionals aiming to maximize local economic development impact.

Grievance Mechanism

The company received 135 internal grievances in 2016, mostly through phone line. Employees have access to record grievances as there is one computer per store that can be used for that. However, there are not anonymous channels. There are suggestion boxes in every store, but they are used mostly by costumers. A Working Committee with representatives of employees and employers was created to discuss major complaints and further actions. As per ESAP #5, the company will review its internal grievance mechanism to cover all employees (and their organizations, where they exist), allowing for anonymous complaints and confidentiality provisions, to raise workplace concerns. In addition, the company will inform widely among the workforce about the reviewed grievance mechanism (at the time of recruitment in the case of new hires) and make it easily accessible.

Protecting the Work Force

The company complies with legal minimum age of work requirements by requesting valid documentation of age in the employee contracting process.

Occupational Health and Safety

The company has occupational programs and committees as required by local law. The company manages risks identified in the Risk Matrix Identification, provides PPE and training; and maintains OHS records. First aid kits are available in each store, in the social area.

Employees receive continuous training and there are safety competitions. Stores and DCs training program includes: H&S, Safety and Emergency Brigade Certification, Practical Training at Work Sites - Safety Competences. Stores’ employees are also trained in Prepare Your Body Program, for implementation at work sites. DCs’ Fork Lift Operators are certified by SENA (20-hour Government Training Program). Trainings for DCs’ employees include: Product baking, fork lift equipment operation, ergonomic safe practices, chemical products safe use, and safety work standards. In addition, there is a Vendors and Contractors Certification Course for DCs. In all the work centers, practical drills are carried out in emergency scenarios such as first aid, earthquakes and safe use of fire extinguishers.

The layout of the DC in Barranquilla is provided with some elements aiming at preventing accidents, such as a bridge to avoid use of the same areas at the same time by people and trucks. Electronic forklifts also contribute to prevention of ergonomic health problem among the operators.

Safety awareness is developed through Daily Safety Dialogues focusing on the most common occupational risks and health problems. In Barranquilla, an internal initiative named Lección de un Punto (or An Issue Lesson) raises creativity and shared responsibility among the workers to present improvement ideas. Track record of accidents in the Barranquilla DC includes just one accident so far (in 2015, the same year the DC opened) in the double pallet aisle, when an operator broke one leg. Although the number of employees raised almost 40% between 2017 and 2016 accidents’ frequency rate decreased 11%, and severity rate decreased 51% in the same period.

Workers Engaged by Third Parties

Construction activities are developed by third parties. The company has selected at least two contractors for each zone, after assuring compliance with legal requirements. The company audits H&S aspects, including first aids, Personal Protection Elements, tools and equipment’s condition review, safety store’s conditions review, emergency preparedness, work in heights control, and chemical products safety.

Ara’s construction manual provided to its contractors include environmental aspects following the national environmental requirements (Decree 1076/2015 Decreto Único Reglamentario del Sector Ambiente y Desarrollo Sostenible, Resolution 0631/2015 for effluents discharge, Resolution 0627/2006 for noise etc.), and internal procedures. It includes design and construction requirements, and devices’ features for drainage systems, emission of gases, waste collection and segregation, water, generation of organic load (COD) in wastewater, and internal generation of organic waste. Environmental KPIs tracked by the company are: electricity consumption, use of plastic bags, water consumption, and wastes. The company also monitors total energy consumption, and carbon footprint.

Resource Efficiency

Electricity and energy consumption are addressed through the “Efficient Use Program”, including Bioclimatic architecture for the DCs, such as: air curtains, AC regulation, Automatic main door, efficient refrigerators, efficient lighting, natural lighting, dimerization, and motion sensors. In the Caribbean region, where energy demand surpasses the generation of energy, the stores have diesel power plants to operate in emergency situations of energy outage.

An EDGE self-assessment has been performed by Ara’s technical team based in Bogota and reviewed by IFC’s in house green building specialist. Results show that the average store meets energy, water and materials standard (20% of saving compared to baseline). Therefore, project meets IFC’s EDGE standard requirement.

Water

In 2017, Ara’s water consumption has increased due to the increase in the number of stores. However, due to efficiency increase, the relative Index (water usage per revenues) has been reduced.

In the DC in Barranquilla there is rain water collection and reuse of water for toilets, cleaning, trucks and containers washing. In the stores there are low consumption sanitary appliances.

GHG Emissions

Ara’ stores are located near its consumers, avoiding the use of transportation by its customers, thus helping in reducing CO2 emissions while also addressing the challenge of low accessibility. Due to the need to guarantee electricity in some regions of the country, especially in the Caribbean coast, Ara’s GHG emissions raised in 2017, reaching 31,395 tCO2, corresponding to an Index of 0.030 tCO2e, against 0.024 in 2016. The company adopted the Greenhouse Gas Protocol methodology and the CO2 equivalent emissions in 2017 were above 25,000 tons. Going forward, Ara will continue to report annually its direct GHG emissions from the facilities owned or controlled within the physical project boundaries, as well as indirect emissions associated with the off-site production of energy used by the project (Scopes 1 and 2), using the GHG Protocol or any other internationally recognized methodology.

The JM Group is seeking to adopt the provisions of the Kigali Amendment to the Montreal Protocol (hydrofluorocarbons or HFCs Phase-down), which will enter into force in January 2019 for its European facilities. Refrigerants currently used in Europe’s JM operations in industrial refrigeration are: (i) For the existing stores are R134a, R404A, R407A (small condensing units), R407F (small condensing units), R449A (retrofit) and R290 (propane) for plug in/chest freezers; (ii) For the new stores it´s applied full natural refrigerants, R744(CO2) and R290 (propane) for plug in/chest freezers and (iii) For distribution centers with natural refrigerants, R717 (ammonia) and R744 (CO2). Refrigerants now used in Europe in HVAC are R134a, R410A, R407C and R32. For its industrial refrigeration equipment, a corporate procedure defines that all new stores and major remodeling projects in Europe should be performed with equipment with 100% natural refrigerants (no HFCs).

In Colombia, Jeronimo Martins already uses 100% natural refrigerants (no HFCs) for distribution centers, such as R717 (ammonia) and R744 (CO2). Ara´s stores follow the Colombian guidance and regulation, using R290 (propane) for plug in/chest freezers and R404A for remote wall cabinets. Some field tests with natural refrigerants are however taking place by Jeronimo Martins. For the HVAC (heating, ventilation and air conditioning) ARA follows Colombian guidance and regulation with HFC refrigerants.

Pollution Prevention

Ara developed a construction manual to be followed by its contractors, with requirements for the stores, including EHS aspects, such as wastewater, and thermal and acoustic comfort, considering natural lighting and ventilation.

The JM Group obtained an overall rating of “A-” (positioning the Group as being in the “Leadership” level) in the CDP Climate Change 2016. As a result of store-network and logistics infrastructure expansion, Ara’s total energy consumption more than doubled regarding 2016. The waste recovery rate from operations increased by 2,6 p.p. in 2017 Vs 2016, while the volume of used batteries collected from clients and sent to recovery amounted to 180 kg. Ara has in place programs to reduce the use of plastic bags. Folding baskets (reusable) are used for fruit and vegetables.

Wastewater Treatment

Effluents are discharged in compliance with local permits and regulations. All the stores sell roast chicken, roasted in store, which contributes to an elevated level of organic contamination in the wastewater. Aiming at reducing COD in the effluents, Ara has a contract to apply a wastewater treatment with bacteria in 101 stores, after some pilot tests in three stores showed results of around 85% of reduction of organic compounds, and around 95% of reduction of suspended solids, and grease in the effluents. Besides reducing source oil & grease generation, the effluent treatment with bacteria control offensive odors. The sub products are sent for reuse.

Solid Waste Management

In 2017, Ara produced 10,467 tons of waste, around 56% more than in 2016, due to the growth in the number of stores. Despite the increase in absolute numbers, the Index of tons per millions COP decreased from 0.009 in 2016 to 0.008 in 2017.

Cardboard and paper waste, as well as unsorted waste, accounted for most of waste in Colombia (90%). Each store has a cardboard compactor to make it usable for recovery, and to facilitate its transport to a warehouse, where third-parties treat and recycle them.

The company donates edible food products with short expiration dates from the DCs to ABACO (Asociación de Bancos de Alimentos de Colombia), this way, avoiding letting them turn into waste. In 2017, over 116 tons of food products were channeled to this charity reaching more than 590 vulnerable people and preventing the emission of 2,400 tons of CO2 that would have resulted if the food was to be sent to landfill.

Community Health and Safety

One of the main risks arising from retail services come from transportation of products. In the case of Ara, logistics is internalized through a Transportation Management System aiming at good planning of routes/times. Fleet and transportation services are outsourced by selected companies per region (payed per kilometer), tracked by GPS, controlled by an Operational Control Center, and some of the vehicles are provided with refrigerated containers. The company tracks fleet preventive maintenance, and speed limits, which contribute to avoidance of emissions, fuel optimization, and accidents prevention.

Infrastructure and Equipment Design and Safety

Risk of fire in stores is considered important since these are buildings open to the public. The stores comply with the national construction code (NSR 10), which includes requirements for fire prevention, and firefighting protection. The technical specifications for the construction of emergency exits are determined by the urban curatorship, and by the local Fire Department. The internal procedures for the construction of emergency exits are in alignment with the recommendation and requirements generated by the public entities and in compliance with the construction code. Each store and distribution center have a supply of portable fire extinguishers and hose reel cabinets, safety and health at work signage, and information for compliance with safety procedures. The stores have alarm systems for detecting smoke, heat and movement which are monitored 24 hours a day by the security area of the company, and an Emergency Brigade of a minimum of 4 employees trained in First Aid Care, emergency evacuations and management of fire extinguishers as well as fire control techniques per each store.

The company has different mechanisms to verify the compliance with the legal requirements and the internal procedures, as following: (i) Pre-opening inspection (Responsible H&S); (ii) Post-Opening Inspection (Responsible H&S); (iii) Periodic H&S audits (Minimum one yearly to each store) ((Responsible H&S); (iv) HR Yearly inspection (Validate legal compliance in all the aspects that are relevant from the HR point of view) (Responsible Operational HR); (v) Fire Department’s Inspection (Yearly); (vi) Ticketing Tool, in which Store Managers or Area Managers can report unsecure conditions within the store through an internal system. The findings are shared with the Regional Directors and with whom is responsible of the process that need to intervene.

The stores are defined as “public access buildings” as per the EHS General Guidelines. Ara’s intent is to have stores located as stand-alone one-story structures that will have an average size of 350 sqm. As per ESAP #6, Ara will develop a Life and Fire Safety (L&FS) procedure (including checklists) for the construction and remodeling of new stores to be opened and include emergency planning and response. The procedure will consider local legal requirements, and aspects such as occupancy levels, means of egress and systems for fire prevention, detection and suppression as per the section 3.3 Life and Fire Safety (L&FS) Applicability and Approach of the General EHS Guidelines. The following features are typically expected (some of the items listed below have been implemented by the company in some premises visited during the appraisal): (1) two independent and separate exits; (2) fire alarm systems with pull stations  horn/speakers for notification of alarm and visual notification, and smoke/heat detectors; (3) exit signage; (4) emergency lighting; (5) portable fire extinguishers; (6) in case of gas supply line, the company must provide automatic means to shutdown gas supply to kitchen equipment; (7) grease trap on kitchen hood ductwork and periodic cleaning; (8) control of inventory of flammable/combustible liquids in the store; (9) O&M program for L&FS system.

As per ESAP #8, for the first 10 (or a representative sample) new stores remodeled or built after IFC’s commitment, a qualified fire safety professional shall inspect and submit to IFC certifications that each facility is constructed and commissioned in full compliance with local building codes, local fire department regulations, and all life and fire safety aspects of the previously approved L&FS procedure, including those defined in the L&FS section 3.3 of the General EHS Guidelines.

For the existing stores, already open to the public, Ara will conduct risk-based L&FS audits at a representative sample of stores, by a suitably qualified professional agreed with IFC (ESAP #7). The audits should consider, among others, compliance with local requirements, maintenance and operation of systems, and emergency response plans and capacity. Based on the findings, the company will develop and implement an agreed time-based action plan to address any deficiencies identified.

The DCs are not classified as “public access buildings” as per the EHS General Guidelines. Distribution centers have always more than 2 emergency exits and comply fully with all the legal requirements (NSR 10). Minimum L&FS requirements will be as required per local code and based on the company’s fire risk management for property protection, business continuity and protection of staff. For the DCs, Ara will consider key criteria for the design and operation of the centers, such as (1) two or more independent and separate exits; (2) fire alarm systems; (3) fire protection systems: fire pumps, sprinklers, hose reels, special systems for cold storage/computer rooms etc. (as applicable); (4) exit signage; (5) emergency lighting; (6) portable fire extinguishers; (7) control of good practice of storage system (staking arrangements, structural racks, maintain clear the corridors, segregate and separate hazmat’s and aerosol cans, etc.); (8) maintain the storage of “idle” pallets on the exterior of the facility; (9) strict housekeeping; (10) use of gas or electric fork lifts; (11) Emergency Brigade; (12) O&M program for L&FS system.

Community Exposure to Disease

The company has a Food Safety Program and it is enforced to the suppliers as well, in particular those producing its private label programs. Company has defined Quality and Food Safety Corporate Guidelines for its Private Label and Perishables Products. The Audit Plan for suppliers and Control Plan for products is based on risk assessment. Product control is made only by external accredited labs.

In Colombia the company started a pilot project for Suppliers Development with the objective of continuous improvement in food safety, quality and service level. Inside this pilot project the company, in cooperation with an international food safety company (3M) is providing free training on food safety for all food suppliers.

Security Personnel

The process of new store opening includes approvals from CEO, CFO, and the Security Officer. The company does not use armed guards in its stores and distributions centers. This is explicitly stated in a management procedure (Manual del Vigilante) that emphasizes the preventive approach based on a negotiation process, valid also for outsourced guards. The security workers are trained in the internal procedures and sign the Code of Ethics as part of the onboard process. The company has an Operational Control Center (OCC) in each region to monitor the cameras at all the stores in that region, DC (if any), and warehouses. In Barranquilla, there are four people per shift. In case of robbery stores are connected to the local police system and the security company.

Since 2011, the JM Group has adopted the London Benchmarking Group (LBG) social impacts evaluation model to measure, in a systematic way and adapted to its activity, the impacts that its projects and support programs have in promoting social cohesion. By using this model, relevant information was obtained about the outcomes in charities supported and, their beneficiaries in the scope of the Group’s commitment to support surrounding communities. Ara has a partnership with the Instituto Colombiano del Bienestar Familiar that already resulted in a regular supply OF food over 3,500 children through the governmental program of Madres Comunitarias. In 2017, the company helped its customers to contribute to the “SOS Colombia Children’s Villages Foundation” by means of the “round up and donate” campaign run at the checkout counters of Ara stores. The program aims at helping families with children and adolescents. The “Strengthening Family” campaign donates to food banks in Colombia. In 2018, Ara plans to develop and implement a Biodiversity Program in Colombia, supporting Proaves.

External Communications and Grievance Mechanisms

Management of external complaints are dealt through a website platform called “Doc Manager”, supported by a call center that receives requests, complaints and claims. All the grievances are recorded, including the environmental aspects that affect clients and the surrounding community. The requirements are distributed according to the areas responsible for taking actions. Likewise, a written response is given to inform the person or applicant about the actions taken or to be taken, and the timing to close the petition. A second communication is provided once the problem is solved. In addition, all the stores have grievances boxes.

The JM Group develops and discloses GRI – aligned Sustainability Reports annually.

Company: Jeronimo Martins Colombia

Point of Contact: Nuno Sereno

Title: Chief Financial Officer

Telephone Number: +57 1 7965179

Email: nuno.sereno@jeronimo-martins.com

Mailing Address:

Bogota

Website: www.jeronimo-martins.com