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Chinese Superstore Operations

Promotion of CSR Activities

SDGs12 RESPONSIBLE CONSUMPTION AND PRODUCTION

CSR Promotion Structure

In recent years, public demand for companies to take a progressive stance on CSR has been rising sharply in China. Under the policies of the Chinese government, CSR implementation guidelines and assessment benchmarks have been formulated, and CSR assessment rankings have been published. Since 2013, Chengdu Ito‒Yokado and Hua Tang Yokado Commercial have been taking steps to create structures for promoting CSR more comprehensively and holding committee meetings.
The Corporate Culture and Ethics Subcommittee of Chengdu Ito-Yokado established a correspondence course that enables employees to acquire operational knowledge and technical awareness to ensure correct corporate behavior. Hua Tang Yokado Commercial’s Corporate Culture and Ethics Subcommittee works to ensure that all employees are aware of the Corporate Creed and Corporate Action Guidelines. The subcommittee worked to ensure that when employees’ contracts were cancelled due to store closures, the contract cancellations were mutually agreed, keeping in mind the importance of dealing sincerely with people. The Environmental Subcommittees at both Chengdu Ito-Yokado and Hua Tang Yokado Commercial aim to save electricity and water, and have advanced discussions towards energy-conscious store operations. The Consumer Affairs and Fair Business Practices Subcommittee works to promote provision of safe and reliable products and services, which helps to make them even better.

CSR Promotion Structure of Chengdu Ito‒Yokado

Chengdu Ito-Yokado, CSR Management Committee, Corporate Ethics and Culture Subcommittee, Consumer Affairs and Fair Business Practices Subcommittee, Environment Subcommittee, Information Management Committee, Risk Management Committee

CSR Promotion Structure of Hua Tang Yokado Commercial

Hua Tang Yokado Commercial, Corporate Ethics and Culture Committee, Corporate Ethics and Culture Subcommittee, Environment Subcommittee, FT Committee, Information Management Committee, Risk Management Committee

Publication of CSR Reports

In July 2016, Chengdu Ito‒Yokado published its first CSR Report, covering its social and environmental activities. In the course of preparing the report, the company referred to the Guidelines on Corporate Social Responsibility Reporting for Chinese Enterprises (CASS‒CSR 3.0) developed by the Chinese Academy of Social Sciences and the international Sustainability Reporting Guidelines (G4) of the Global Reporting Initiative (GRI). There is a comparison table for the two guidelines at the back of the report. The CSR report for the fiscal year ended February 28, 2017 was published in August 2017, with plans to distribute it to attendees at the Sichuan Province CSR reporting meeting and at meetings for the general public.

Promise to Customers

SDGs9 INDUSTRY, INNOVATION AND INFRASTRUCTURE

Quality and Freshness Management

Amid a rise in public interest in safety and reliability of food, we provide products using quality and freshness management expertise developed in Japan. Sales staff, product departments and quality management divisions receive education on safety laws and regulations, production and processing standards, hygiene standards, and other aspects. Around 710 employees of Chengdu Ito-Yokado and Hua Tang Yokado Commercial have been made aware of safety and quality management.
Chengdu Ito-Yokado employees each receive a copy of the “Standard Operation Manual” to establish a unified standard for production and processes. While improving quality on one hand, a representative from Head Office regularly visits stores to check that they are providing products that meet our standards. Annual third-party audits are also conducted.
We also visit our business partners farms and factories regularly to see that they are meeting our standards for facilities and equipment, hygiene and production management, inspection systems, individual hygiene, and legal and regulatory CSR. In the fiscal year ended February 28, 2017, Chengdu Ito-Yokado audited its business partners 64 times, and Hua Tang Yokado Commercial audited its business partners 6 times.

Provision of Traceability Information

In the fiscal year ended February 28, 2014, Chengdu Ito‒Yokado launched sales of "看得見的放心" food products, which are based on the same concept as the Fresh Foods with Traceability products launched in Japan. Consumers can scan a QR code on these products to confirm on a dedicated website who the farmers are and where and how the products were grown. In the fiscal year ending February 28, 2017, the 看得見的放心 product range was increased further to around 110 lines. These products have proven popular with customers who have a particularly strong interest in food safety and reliability, including customers with children and expectant mothers.
In the fiscal year ended February 28, 2015, Hua Tang Yokado Commercial started selling organic foods in cooperation with farmers by establishing rigorous food safety management systems and drawing up annual cultivation plans. Furthermore, the company also provides "放心肉項目" meat products, for which customers are able to use consoles installed in sales areas to confirm the meat producer. This system was set up based on instructions from the Beijing Municipal Commission of Commerce. The safe meat project further strengthened traceability in the fiscal year ended February 28, 2017 with the introduction of a third-party supervision system for quality management by local authorities.

Development of看得見的放心
[Third Parties] Third-Party Audits : The system will be regularly audited by specialist third-party organizations to enhance the transparency of food safety and quality, fertilizer management and so forth. Safety and Quality : Products will be checked by setting proprietary standards for product safety and quality (taste and freshness). [Source region] Growing environment : Chengdu Ito-Yokado selects farmers who are farming in good environments and will work together with them to improve the farming environment further. Fertilizer Management Together with growers, Chengdu Ito-Yokado works to ensure proper management of fertilizers, agrichemicals and other chemicals and reduce their use. [Ito-Yokado] Improvement Efforts : Together with farmers, Ito-Yokado works to make continuous improvements and regularly reports on these activities. [PCs and Mobile Phones] Disclosure of Information : Information about farmers and where and how products were grown will be disclosed on product packaging, the看得見的放心 website and mobile site, in-store POP displays, and elsewhere.

Quality Supervision System and Meetings with Customers

Since the fiscal year ended 28, 2009, Chengdu Ito-Yokado appointed 10 customers at each store to act as a quality supervision officers to help improve its products and stores from the perspective of the customers who actually shop there. The quality supervision officers meet at each store once a quarter to give their opinions, and are encouraged to make proposals on matters that they have noticed at any time. The opinions of the quality supervision officers led to the introduction of China’s popular WeChat Pay and Alipay smartphone app payment systems. Customers have been able to use these since September 2016.
In addition to quality supervision officers, we asked for cooperation from 80 customers and received 219 opinions. Based on these, we reviewed product volumes and took other steps to provide even better products.
Other efforts included making home visits to 600 customers living in our stores’ neighborhoods to ask their opinions. In March, June, and September we conducted customer satisfaction surveys, asking for opinions from 6,000 customers.
Chengdu Ito-Yokado and Hua Tang Yokado Commercial also collect opinions via the Internet, telephones, opinion boxes, and in-store conversations. In the fiscal year ended February 28, 2017, Chengdu Ito-Yokado received 10,401 opinions and Hua Tang Yokado Commercial received 69,293 thanks to proactive efforts by store employees to create a system for gathering opinions. We value customers opinions and we are establishing systems to create stores that reflect their wishes.

Salmon tasting event at the 双楠 store
Sandwich tasting event at the 锦华 store

Promise to the Local Community

SDGs1 NO POVERTY
SDGs4 QUALITY EDUCATION
SDGs11 SUSTAINABLE CITIES AND COMMUNITIES

Donations

Chengdu Ito‒Yokado is involved in providing educational support and in supporting households in poverty, among others. The company makes annual donations to Sichuan University, and as of 2016 it has made 19 donations that have supported 530 students. In the fiscal year ended February 28, 2017, the company donated \330,000 to Japanese language students of Sichuan University and \1,200,000 to 30 outstanding students. Moreover, prior to Children’s Day, the company donated \160,000 to each of six Ito Friendship Elementary Schools to assist with activity expenses for Children’s Day. The company also held summer camp events over two days and one night in which children enjoyed the experience of managing a store for a day and visiting a museum.
This year, the company donated breakfast to 蒲江成雅友愛 Elementary Schools Friendship Elementary School to help foster the habit of eating breakfast among the many local elementary school students who do not eat breakfast. The donation was intended to assist the development of the children and included supplies such as milk, eggs, and jam, as well as cash, with a total value of \1,060,000.
In other efforts, the stores make seasonal visits to local households experiencing poverty, people with disabilities, and elderly people living alone, giving them presents of living essentials. In the fiscal year ended February 28, 2017 the company donated a total of \6.11 million through these social contribution activities.

  • *CNY 1 = ¥16.76

Donations for Outstanding Students
Participants in the summer camp event

Volunteer Activities

Chengdu Ito-Yokado visited local households experiencing poverty and elderly people living alone to give them presents of living essentials on the Spring Festival, the Dragon Boat Festival, the Mid-Autumn Festival, and the Double Ninth Festival. We also designate the third week of every month as Environmental Protection Week, during which employees at every store clean up the areas around the stores.
Hua Tang Yokado Commercial conducts cleanup activities every day, with employees striving to lead neighborhood beautification efforts.

Promise to Employees

SDGs4 QUALITY EDUCATION
SDGs8 DECENT WORK AND ECONOMIC GROWTH

Store Management by Local Employees

Since opening our first stores in China, we have been actively appointing local employees with the aim of developing stores that are deeply tied to local communities. At Chengdu Ito‒Yokado and Hua Tang Yokado Commercial, Chinese store managers have been appointed. The ratio of Chinese employees in management positions, excluding executives, is close to 90%, with 86.3% at Chengdu Ito-Yokado and 88.6% at Hua Tang Yokado Commercial.
In addition, we have been making progress on the appointment of women in China. The ratio of women in management positions, excluding executives, was 54.7% at Chengdu Ito‒Yokado, with female store managers at two out of the six stores, and 57.1% at Hua Tang Yokado Commercial, with a female store manager at one of its two stores.

Employee Data (As of December 31, 2016)

Chengdu Ito‒Yokado Hua Tang Yokado Commercial
No. of employees 3,520 426
  Part‒time employees 269 6
Full‒time employee turnover (%) 24.0% 4.9%
Ratio of Chinese employees in management positions (%) 86.3% 88.6%
Ratio of women in management positions (%) 54.7% 57.1%
Number of employees with disabilities 56 13

Human Resources Development

Training programs have been enhanced to boost the motivation of local employees and enable them to demonstrate their abilities to the fullest. At Chengdu Ito-Yokado, we developed correspondence programs for enhancing employees’ primary qualification capabilities and their workplace operation skills in 2016. These courses have been developed to nurture human resources with “three capabilities” (the ability to move forward, the ability to think things through thoroughly, and the ability to work as part of a team). The programs are provided to all store employees, including management. This has enabled them to acquire operational knowledge and skills by correspondence.
Furthermore, practical skills training sessions are open for all employees to observe if they wish, even if they are not undertaking training, and they are able to learn directly from the lecturer. We also hold an operational skills contest and award the winners to encourage employees to improve through friendly competition. At Hua Tang Yokado Commercial, awards are presented for employee of the month each month, as well as for department of the month to motivate employees. Furthermore, five employees from each store are commended and awarded as “service stars” for providing service at or above a certain standard. The recipients may be full time, part time, or tenant sore employees.

Operation skills contest (Chengdu Ito-Yokado)

CSR Education

Chengdu Ito-Yokado invites lecturers with knowledge about CSR to workshops for identifying corporate social responsibility and issues to be addressed moving forward.
Hua Tang Yokado Commercial analyzes customer feedback to identify issues and decides on a course of action through general management meetings and meetings for reflecting on issues, mainly with store management and the Head Office Product Division. Making reference to the Corporate Creed and the corporate code of conduct, we continue striving to ensure that employees remain aware of these issues and observe conduct guidelines to uphold the public’s trust in the company.

Self-Recommendation System

In the fiscal year ended February 29, 2016, Chengdu Ito-Yokado began operating a Self-Recommendation System as a show of respect for the autonomy of employees and to provide an outlet for their motivation. The system is for employees who have worked for the company for at least one year, and allows them to put themselves forward as candidates for the jobs they seek.
Applicants who pass assessments are assigned to their desired workplace after a training period. In the fiscal year ended February 28, 2017, 59 people were assigned to their desired workplace out of 29 applicants.

Promise Regarding the Environment

SDGs7 AFFORDABLE AND CLEAN ENERGY
SDGs12 RESPONSIBLE CONSUMPTION AND PRODUCTION
SDGs13 CLIMATE ACTION

Initiatives to Reduce Greenhouse Gas Emissions

Concern over air pollution and other environmental problems is growing in China, and with the progress on the Paris Agreement, the government is also strengthening regulations. Chengdu Ito-Yokado and Hua Tang Yokado Commercial are working to reduce their environmental impact through measures such as installing energy-efficient equipment. Under an agreement with the city of Chengdu, Chengdu Ito-Yokado was required to reduce energy consumption by 780 standard coal tons in the fiscal year ended February 28, 2017, and achieved the target with a reduction of 902 standard coal tons. New stores were fitted with the latest, highly efficient refrigeration systems, and we invested in energy saving equipment. In the back rooms, we strove to avoid wasting energy, and worked to save water through measure such allowing items to defrost naturally rather than using running water.
At Hua Tang Yokado Commercial, we established an energy-saving target with the city of Beijing, aiming to reduce energy usage by 356.2 standard coal tons in the fiscal year ended February 28, 2017. We reduced energy usage by 921.9 standard coal tons, meeting the target. We also participated in an assessment of our execution on promises related to CO2 emissions credits and target transactions. In 2016, our CO2 emissions target was 16,384 tons, against which our actual emissions were 13,204 tons, achieving the target. Hua Tang Yokado Commercial works to reduce its environmental load by concentrating products centrally before sorting them for each store and delivering them. By continuously operating this scheme, the company contributes to reducing CO2 emissions by reducing the number of delivery vehicles, easing urban traffic congestion, and preventing noise and atmospheric pollution.

Chengdu Ito-Yokado

2014 2015 2016
Number of stores 6 6 6
Energy consumption (standard coal tons) 9,503 9,886 8,984
Electricity consumption (MWh) 75,197 78,582 83,110
Gas usage (1,000 m3) 198 200 620
Water usage (1,000m3) 808 747 828

Hua Tang Yokado Commercial

2014 2015 2016
Number of stores 6 5 2
Energy consumption (standard coal tons) 7,465 4,340 3,418
Electricity consumption (MWh) 41,738 24,765 19,255
Gas usage (1,000m3) 812 448 4,489
Water usage (1,000m3) 309 177 130

Award History (FY2017)

Chengdu Ito-Yokado and Hua Tang Yokado Commerical received the following awards in the fiscal year ended February 28, 2017, in recognition of its various initiatives.

Chengdu Ito‒Yokado “Sichuan Top 10 Economic Leaders” award (Chairman Tomohiro Saegusa) Huaxi City Daily
“2016 Sichuan Industry Leaders Top 10” Huaxi City Daily
"Fiscal 2016 Sichuan Innovative Manager”award (Chairman Tomohiro Saegusa) Chengdu Economic Daily
"National Fashion Tri-Cities Fashion Industrial Zone Commerce and Industry Leader”award Toutiao
Fiscal 2016 Retailer Best 10:
Award for Contribution to Differentiated Experience-Based Sales Areas and Areas that Facilitate Purchasing Annual Public Benefit Contribution Award
Chengdu Retailers' Association
Chinese Commercial Brand Best 10 China Retailer’s Association
China Business Herald
“Chengdu City May Day Award” Chengdu City General Labor Union
“2015-2016 China Retail Person of the Fiscal Year Special Prize” (Chairman Tomohiro Saegusa) China Retail Federation
Fiscal 2016 Tax Payment Grand Prize Wuhou District CPC Committee of Chengdu、Wuhou District People's Government of Chengdu
“Closest to Consumers” Award (Jinhua Store) Chengdu Business Council
017 Chengdu Chinese New Year Shopping Season Award:
Most Suited to Chengdu, Most Stylish, Most Suited to New Year, Closest to Consumers, Sales Floor with the Most Product Explanations
Chengdu Business Council
2Fiscal 2016 “Top 10 Tax Payments by Modern Commercial Trading Field” State Taxation Bureau of Wuhou District
Shopping Fair “Favorite Sales Area” (High-tech Store) Chengdu Business Council
2016 Contribution Prize Sichuan Trade Council
Model Store for Safe and Reliable Consumption (Jianshe Road Store) Chengdu Administration for Industry and Commerce
Hua Tang Yokado Commercial 2016 Leading Companies with Safest Production Systems Chaoyang District Xiaoguan Subdistrict

Initiatives in China

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