Topic | Objective | Progress of objectives 2017 |
Progress of objectives 2016 |
Progress of objectives 2015 |
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Supply chain |
The social responsibility of the production of own direct imports from high-risk countries has been assured. |
A total of 157 of Kesko’s suppliers' factories or plantations underwent full amfori BSCI audits. In addition, 146 suppliers’ factories or plantations underwent amfori BSCI follow-up audits. At the beginning of 2018, Kesko’s suppliers in high-risk countries had a total of 423 valid social responsibility audits. Two responsibility trainings were arranged for the ICA Global Sourcing (IGS) suppliers: 24 suppliers took part in the Hangzhou training in China and 23 suppliers in the Delhi training in India. As part of our cooperation with Plan International Finland, three amfori BSCI supplier trainings were arranged in Bangkok, Thailand. A total of 25 suppliers from the Thai fishing industry took part in the trainings. |
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We assure the responsibility of the ingredients (Tier 2) of private label Pirkka and K-Menu food products. |
The responsibility of ingredients used in 150 new Pirkka and K-Menu food products was assessed using our own risk analysis tool. Based on the risk analysis, 20 products contained ingredients which require further investigation in terms of the social responsibility of the producer. Our analysis of ingredients in our own brand products received recognition at the annual meeting of amfori (previously Foreign Trade Association, FTA). Thanks to the risk analysis, Kesko was elected among the top three finalists of the FTA member of the year award. |
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We identify and take account of water risks in our supply chain. |
Our water risk assessment work continued and we aim to use the results to plan actions. |
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Statements and policies |
Fish and shellfish: The selections of Kesko’s grocery trade and K-food stores do not include species on the red list of the WWF’s fish guide. Kesko’s grocery trade and K-food stores promote green list species in their selections. When making decisions concerning selections, we favour sustainable stocks of fish and MSC and ASC certified suppliers. K Group's fish and shellfish policy has been in effect since 2008. |
The retail selection of Kesko’s grocery trade included 196 MSC-certified fish products, of which 41 were Pirkka products and 1 K-Menu product. Our selections had 7 ASC-certified products, of which 4 were Pirkka products. |
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Palm oil: By 2020, all palm oil in our own brand groceries will be responsibly produced (CSPO). |
Some 82% of the palm oil in Kespro’s Menu food products sold in 2017 was sustainably produced (CSPO), of which 0.2% was Identity Preserved, 74.3% Segregated, 20.7% Mass Balance, and 4.9% RSPO credits. Some 43% of the palm oil in Pirkka and K-Menu food products sold in 2017 was sustainably produced (CSPO), of which 19% was Segregated, 79% Mass Balance, and 2% RSPO credits. |
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Soy: By 2020, all soy used in the production chain of our own brand products will be responsibly produced, and be either RTRS or ProTerra certified. The policy concerns ingredients of soy origin in grocery trade’s own brand food products and soy fodder used in the production of products of animal origin. |
We reviewed the share of responsibly produced soy in our own brand food products and their supply chain. The soy used in our own brand food products (Pirkka, K-Menu and Kespro’s Menu) sold in 2017 and their supply chain was not yet responsibly produced. |
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Timber and paper: By 2025, there will be only sustainable origin timber and paper products in Kesko's product range. Timber and paper products will be FSC or PEFC certified or made of recycled materials. In the grocery trade, the policy applies to our own brand products. |
In 2013, Kesko’s building and technical trade was awarded the PEFC certificate, which covers sawn pine and spruce timber and processed timber as well as the wholesale distribution of MDF boards in Finland (percentage-based method). The average PEFC certification percentage in 2017 was 89.7% for pine and 85.5% for spruce. Of the timber and paper products in the grocery trade’s Pirkka and K-Menu ranges, 54% contained sustainable raw material. In Kespro’s Menu range, 14% of timber and paper products contained sustainable raw material. |
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Plastic: We promote the recycling and reuse of plastics. We create operating models that prevent plastics from ending up in the environment. We seek alternatives to plastic as a packaging material. By means of consumer communications, we will increase the sales share of alternative shopping bags (cotton bags, reusable bags and jute bags) and cardboard boxes to 10% by 2025. We look for solutions to replace PVC as a material. |
We removed environmentally harmful microbeads from all our own brand cosmetic products. During 2018, microplastics will be removed from all our own brand detergents. The Pirkka ESSI circular economy bags were introduced to K-food stores' shopping bag selections at the start of 2017. The bags are made of over 90% recycled materials, around half of which is plastic packaging separately collected from households. By the end of 2017, small thin plastic bags were only available at checkouts by request for e.g. flowers. We reduced the consumption of small plastic bags by 20% in 2017. We successfully piloted the new wood fibre-based EcoFishBox produced by Stora Enso in K-food stores. Since 2017, K Group gift cards have been made from PVC-free materials. In Onninen Express stores in Finland, regular customers have been handed shopping baskets that the customers can use to carry products to their construction site and bring back the next time the visit the store. |
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We offer an extensive selection of own brand products with responsibility labelling. |
The Pirkka range had 37 Pirkka Fairtrade products, 116 Pirkka Organic products, 41 Pirkka MSC-certified fish products, 35 UTZ-certified products, 76 Nordic Swan label products, 137 products with the Key Flag symbol, 88 Seed leaf label products, 220 Hyvää Suomesta (Produce of Finland) products, and 5 products with the Finnish allergy label (Allergiatunnus). Kespro’s Menu range had 4 Fairtrade products, 5 organic products, 30 MSC-certified products, 2 ASC-certified products, 15 products with the Nordic Swan ecolabel, 10 UTZ-certified products, 21 products with the Key Flag symbol, 4 Hyvää Suomesta (Produce of Finland) products and 23 Seed leaf label products. |
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Product safety |
The product safety of K Group’s selections has been verified. The Product Research Unit's laboratory monitors the product safety and quality of the own brand products and own imports in the grocery trade. All of our food product operations have a self-control plan in place. |
The Product Research laboratory analysed 7,350 product samples and conducted 15,076 analyses. In total, 522 suppliers of Kesko’s own brands of food products have international audit certifications that assure product safety. The number of own audits was 59. |
The activities of the Product Research Unit of Kesko’s grocery trade include assessing the impacts of products on health and safety. Manufacturers of Kesko’s own brand food products must have international certifications that assure product safety. The standards approved by Kesko’s grocery trade include: BRC, IFS, FSSC 22000 and GlobalGAP. In 2017, the total number of certified suppliers was 581 (561 in 2016). This number also includes old audits conducted according to Kesko’s grocery trade’s own audit guidelines.
A total of 7,350 product samples were analysed (7,770 in 2016). Most of them were related to the product development of own brands. A total of 2,395 own control samples were analysed (2016: 2,387).
When developing own brand products, Kesko’s grocery trade pays special attention, in line with its strategy, to the health aspects of the products.
As proposed in The EC White Paper on Nutrition, Overweight and Obesity-related Health Issues, sugar, saturated fat and salt were reduced in more than 150 Pirkka products during the period 2007–2013. The health aspects of new Pirkka products are taken into account at the product development stage.
The National Nutrition Council of Finland published its nutrition commitment operating model in June 2017. The nutrition commitment is the Finnish contribution to the EU Roadmap for Action on Food Product Improvement framework’s reformulation programme.
K Group joined the nutrition commitment by making a vegetable commitment, which encourages K-food store customers to increase their use of vegetables through the following actions, which extend to year 2020:
In 2016 and 2017, a study on the likelihood of food fraud was conducted and a fraud control plan was prepared (Vulnerability Assessment and Critical Control Points, VACCP). 77 threats of fraud were identified. Six of them were assessed to be critical control points, which are analytically monitored by fraud control on a regular basis, in addition to normal product and supplier assurances.
In 2017, there were 140 product recalls in Kesko’s grocery trade (99 in 2016). Of these, 33 were Kesko’s grocery trade’s own brand products (26 in 2016). In the other cases, Product Research assisted the manufacturers in recalls. There were 4 public recalls involving a potential health hazard resulting from product flaws or defects in Kesko’s grocery trade’s own brand products in 2017 (2 in 2016).
K-Rauta had two (1 in 2016) and Onninen three (4 in 2016) recalls in 2017. Konekesko had one public recall in 2017 (0 in 2016), which constituted the only public recall for the building and technical trade division that year.
In 2017, there were no legal proceedings or fines related to product health or safety.
On the product labelling of its own brand products and imports, Kesko complies with all related legislation. Key regulations include:
The name and location of the manufacturer are indicated on all Finnish Pirkka products and on all K-Menu products. Foreign Pirkka products carry the name of the country of manufacture. Country of origin is indicated on all own brand products of K-Citymarket and Kesko’s building and technical trade.
The country of origin of meat is disclosed in accordance with regulation (EU) No 1337/2013. As ingredients, meat and dairy are labelled in accordance with the national decree MMM 218/2017.
In addition to statutory package labelling, voluntary labelling can be added to inform the consumer of matters related to corporate responsibility. Such labelling may include organic labels and ecolabelling, as well as labelling indicating social responsibility.
The own brand products of Kesko’s grocery trade bear material symbols on their packaging. These symbols help and guide consumers to recycle packaging materials. Chemicals that are hazardous to the environment have warning labelling in accordance with the CLP regulation.
In September 2015, the California Air Resources Board (CARB) and the Environmental Protection Agency (EPA) uncovered engine software that adjusted nitrogen oxides in Volkswagen Group’s type EA 189 cars with 1.2 litre, 1.6 litre and 2.0 litre diesel engines.
As far as the brands represented by VV-Auto are concerned, the number of such cars in Finland was identified at 53,000. The case applies to all of the brands imported by VV-Auto: Volkswagen, Audi, SEAT and Volkswagen Commercial Vehicles.
The recalls and repairs of Volkswagen, Audi and SEAT 2.0, 1.6 and 1.2 litre EA 189 diesel cars (SEAT service campaign) proceeded at the planned schedule in Finland in 2017.
By the end of the year, a software update was available for all of the approximately 53,000 cars, and some 47,000 cars (88.4%) had been fully updated.
After the corrective measures, the cars meet the requirements of the EU5 emissions standard. The corrective measures do not affect the car's fuel consumption, engine power, CO2 emissions, driving behaviour or acoustics.
On the product labelling of its own brand products and imports, Kesko complies with EU and Finnish legislation.
In 2017, there were 39 product recalls resulting from defective product labelling (24 in 2016), of which 9 (7 in 2016) were Kesko’s own brand products.
Responsible purchasing is guided by Kesko's purchasing principles.
The principles are based on national labour protection legislation and corresponding conventions of the International Labour Organization (ILO), which are applied when national legislation does not correspond to the same level. In its operations, Kesko pays special attention to human rights issues and working conditions in its supply chain and, in monitoring these, primarily focuses on suppliers in high-risk countries. In accordance with the amfori BSCI (Business Social Compliance Initiative), high-risk countries are countries and areas where there is a risk of human rights and workers' rights violations. The classification is based on the World Bank's Worldwide Governance Indicators.
Kesko and K Group stores are responsible to the products' end-users for ensuring that the products comply with all the requirements of Finnish and EU legislation, are safe for users and meet quality and other promises. Kesko's product labelling and marketing communications comply with legislative requirements and the recommendations of authorities.
Kesko and K Group stores want to support customers in making sustainable choices and offer a wide selection of products with responsibility criteria.
Kesko's policy on chemicals applies to home textiles, clothing, leather goods, shoes and upholstered furniture. Based on EU and Finnish legislation, it lists the chemicals which are prohibited or the quantity of which is restricted in the products supplied to Kesko. In addition, for substances of very high concern, Kesko sets restrictions that are stricter than those set in legislation.
Kesko’s plastics policy promotes recycling and the reuse of plastics. The objective of the operating model is to prevent plastics from ending up in bodies of water and elsewhere in the natural environment.
Various product group-specific responsibility policies and statements, such as the palm oil policy, the fish and shellfish statement, the timber and paper policy, and the stand on the sandblasting of jeans, have been prepared to support purchasing operations.
Certification/audit system |
Product group |
Coverage of criteria |
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amfori BSCI (amfori Business Social Compliance Initiative) | All product groups |
Social, limited environmental part |
SA8000 | All product groups | Social |
SMETA | All product groups |
Social, limited environmental part |
ICS | All product groups | Social |
Fairtrade | Agricultural products incl. cotton | Social, environmental |
Rainforest Alliance | Agricultural products | Social, environmental |
Pro Terra | Agricultural products | Social, environmental |
MPS-Socially Qualified | Agricultural products | Social |
Soil Association Ethical Trade | Agricultural products | Social |
Sustainability Initiative of South Africa SIZA | Agricultural products | Social, environmental |
Sustainably Grown | Agricultural products | Social, environmental |
UTZ Certified | Coffee, cocoa, tea | Social, environmental |
RSPO (Roundtable on Sustainable Palm Oil) | Products containing palm oil |
Economic, environmental, social |
RTRS (Round Table on Responsible Soy) | Soy | Economic, environmental, social |
WIETA | Wines | Social |
Vinos de Chile | Wines | Social, environmental |
MSC (Marine Stewardship Council) | Caught fish and shellfish | Environmental (sustainable fishing) |
ASC (Aquaculture Stewardship Council) | Farmed fish and shellfish | Social, environmental |
Florverde Sustainable Flowers | Flowers | Social, environmental |
FLA (Fair Labor Association) | Consumer goods | Social |
FWF (Fair Wear Foundation) | Clothing | Social |
GOTS (Global Organic Textile Standard) | Textiles, hygiene products (organic) | Social, environmental |
WRAP (Worldwide Responsible Accredited Production) | Textiles, shoes | Social |
IMO Fair for Life | All product groups | Social, economic |
FSC (Forest Stewardship Council) | Wood products and timber | Social, environmental |
ICTI CARE | Toys | Social |
PEFC (Programme for the Endorsement of Forest Certification) | Wood products and timber | Social, environmental |
ICA Social Audit * | Consumer goods | Social |
* Conditional approval. A maximum of two IGS audits are approved after which the supplier must adopt amfori BSCI audit or some other approved audit conducted by an independent party.
Supplier agreements require that suppliers and service provides comply with the principles of the K Code of Conduct and the BSCI Code of Conduct.
Kesko's grocery trade requires that the manufacturers and producers of its own-brand products have an international food safety certification. Kesko’s grocery trade approves the following audit procedures: BRC, IFS, ISO/FSSC 22000, SQF1000/2000 and GlobalGAP, IP basic certification for vegetables, or IP-Sigill.
The Product Research Unit's laboratory monitors the quality of products sold by K-food stores and K-Citymarket hypermarkets. It is a testing laboratory T251 which has been accredited by the FINAS accreditation services and approved to comply with the SFS-EN ISO/IEC 17025 standard.
The assessment of a store's responsible operations comprises the store's annual self-assessment, the criteria defined in the store's quality system and a responsibility audit performed by an external party on a specified sample. The auditor reports the results to the store and to Kesko.
Responsible choices are communicated to customers in stores according to the K-responsibility concept within-store communications, such as shelf labelling and product labelling. The selection and marketing policies of organic, eco-labelled and Fairtrade certified products are included in K-food stores' chain concepts. The K responsibility concept is in use in K-food stores and K-Rauta stores.
In 2016, Kesko joined the amfori BSCI Sustainable Wine Programme programme. The programme focuses on improving the social responsibility and environmental responsibility of wine production and its goal is to increase transparency and traceability in wine production.
In 2016, Kesko became a member of the Centre for Child Rights and Corporate Social Responsibility (CCR CSR) based in China. The objective of CCR CSR is to prevent and reduce child labour, improve the status of young workers at factories, and make the daily life of migrant worker parents easier. Kesko participates in the Virtual Working Group of the organisation.
Compliance | Kesko |
Product safety | Kesko - private labels and own imports |
Social responsibility of procurement (1st tier) | Kesko |