coca-cola in russia sustainability report 2018 · coca-cola in russia, from january 1 to december...

COCA-COLA IN RUSSIA SUSTAINABILITY REPORT 2018

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Report Summary01. About the Report

About the Report 002

Scope and Boundaries 003

Disclamer 004

02. Sustainable Growth Strategy

Top Management of Coca-Cola in Russia Explains how the Business Responded to the Challenges of 2018 and what it does to Maintain Sustainability in 2019 007

03. Coca-Cola in Russia

Coca-Cola in Russia: 2018 at a Glance 020

Brand Portfolio 022

Sustainability Risks and how We Manage them 023

Supplier Sustainability 024

2018 Milestones 025

2018 Awards 026

Other Initiatives 028

04. Sustainability of Coca-Cola in Russia in 2018

Value Chain 032

Sustainability Commitments 034

What We do to Meet Sustainability Commitments in Russia 040

Sustainability and Corporate Social Responsibility Strategy in Russia: a New Outlook 043

Who is in Charge of Sustainability of Coca-Cola in Russia 052

2018 Business and Sustainability Results 053

Stakeholder Engagement 071

2018 Material Topics 073

05. Business Ethics and Partnerships: how We are Changing the Market

Business Ethics: Principles 081

Anti-Corruption 082

How We Work with Suppliers of Ingredients and Materials 088

06. Product Quality and Safety: the Way to Go

How We Ensure the Quality and Safety of our Products 098

What We did in 2018 to Improve our Quality Management System 105

Why do We Only Give Ourselves 4+ Grade for Now? 107

Key Quality Indicators in 2018 109

07. A Balanced Lifestyle: how We Support Conscious Consumption in Russia

Our Achievements in 2018 113

Cooperation with Partners and Government 116

Responsible Marketing 117

Our Plans for 2019 118

08. Caring for our Employees: Why do People Want to Work for Coca-Cola in Russia

People of Coca-Cola in Russia 121

Well-Being of our Employees 131

Training, Education and Talent Development 134

Enhancing Engagement and Satisfaction 139

Gender Equality 142

Ambassadorship Program 145

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09. Workplace Health and Safety: how We Eliminate Risks for our Associates and Partners

Occupational Safety at Bottling Plants 150

Traffic Safety 157

Fire Safety 160

Safety for our Suppliers and Contractors 161

10. Developing a Culture of Volunteering in Coca-Cola in Russia

How We Helped Russia in 2018 165

How We will be Helping Others in 2019 168

11. How We Help to Develop Sustainable Agriculture in Russia and Strive to Source Raw Materials Locally

Why Local is Better 173

How We Ensure the Quality of Raw Materials 175

Keeping it Local 177

12. How We Protect the Environment: Reducing Greenhouse Gas Emissions and Advancing Water Stewardship

How We Reduce Greenhouse Gas Emissions 182

How We Preserve Water 190

13. A Country Without Waste: how We are Changing the Culture of Waste Management for the Future of the Planet

World Without Waste 196

"Separate with Us" 199

Coca-Cola in Russia for Clean Shores and Riverbanks 209

Volunteer Movements and External Projects 213

Industrial Waste Management 216

Report Summary

14. How We use Coca-Cola Brand Power to Tackle Socially Significant Issues

Empowering the Youth 222

Building an Inclusive Society 226

Disaster Relief 231

15. How it Works: Four Stories of our Initiatives Helping People in 2018

How "Separate with Us" Project Helps the Locals to Improve the Environmental Situation in their Regions 235

How the 2018 FIFA World Cup™ in Russia Supported Career Growth of the Coca-Cola Employees 240

How the Coca-Cola Christmas Caravan Changed in 2018 and Why? 246

Volunteering Makes People Happy and Companies Rich. How does it Work? 250

16. GRI Content Index 254

17. Contacts 271

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01. About the Report

About the Report 0 0 2

Scope and Boundaries 0 0 3

Disclamer 0 0 4





05. Business Ethics and Partnerships

06. Product Quality and Safety

07. A Balanced Lifestyle

08. Caring for our Employees

09. Workplace Health and Safety

10. Developing a Culture of Volunteering

11. Sustainable Agriculture

12. Protecting the Environment

13. A Country Without Waste

14. Social Programs


16. GRI Content Index

17. Contacts


About the Report

In 2018, Coca-Cola in Russia has finally completed the transformation of its sustainability strategy into an effective set of processes that are both fully integrated into all aspects of the company's business and designed to address socially significant issues. In this report, for the first time ever, we are discussing our new sustainability commitments and talking about the various ways, in which we are moving towards fulfilling these commitments in Russia. Improving waste management, building an inclusive society and creating opportunities for young people, reducing sugar consumption and developing sustainable agriculture — all these and other crucial public issues that we are focusing on do not have simple solutions. However, we believe that the power of the Coca-Cola brand can draw attention to socially significant issues and bring people together to resolve them consistently.

The report takes a closer look at how our sustainability programs and business practices are linked with the system's strategic priorities, our specific commitments, and the needs of society. This is the key theme of the sustainability report that you are about to read.

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Scope and Boundaries

The 2018 Sustainability Report of Coca-Cola in Russia (hereinafter — the Report) contains a summary of efforts to promote sustainable development made by three companies — Coca-Cola Soft Drink Consulting LLC, Coca-Cola HBC Eurasia LLC (also Coca-Cola HBC Russia) and JSC Multon. The report covers sustainability performance of these three companies, collectively known as the Coca-Cola in Russia, from January 1 to December 31, 2018, and outlines their plans for the near future. The report provides stakeholders with accurate and complete information on the Coca-Cola system’s sustainability priorities in Russia.

The report has been prepared in accordance with the Global Reporting Initiative (GRI) Standards, using the CORE disclosure option. It complies with GRI reporting principles, including balance, comparability, accuracy, timeliness, clarity and reliability. You can find a list of GRI Standards indicators in the GRI Content Index Table.

To define the content of the report, we conducted a special stakeholder survey, in which representatives of various stakeholder groups were asked to rank our material topics in by order of significance. The survey results are presented in the Material Topics Evaluation Matrix. The report covers

all the topics that fall within the matrix. Each topic outlines our management approach and key sustainability performance indicators in accordance with sustainability commitments of Coca-Cola in Russia, GRI Standards and the Food Processing Sector Supplement.

When preparing the report, we have collected information through a series of interviews with senior executives, heads of relevant departments and functions, and sustainability project leaders of the Coca-Cola companies in Russia. We have also carefully considered our stakeholders’ concerns and perceptions, as well as the results of public opinion studies, analysis of internal documents and media publications.

This is the second sustainability report to cover the activities of all three Coca-Cola companies collectively known as Coca-Cola in Russia. The first such report covering 2015–2016 was published in 2016. The companies within the system practice annual sustainability reporting. The previous, 2017 Sustainability


https://ru.coca-colahellenic.com/media/3406/review_13_10.pdf

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Report, was 11th in non-financial reporting series of the Coca-Cola companies in Russia and described relevant activities of Coca-Cola HBC Russia and JSC Multon.

To ensure quality non-financial reporting, the Сoca-Cola in Russia holds annual public hearings where representatives of various stakeholder groups can share their opinions on the report, weighing in on the quality and integrity of disclosed information. A discussion of the 2018 report took place on July 2, 2019. Based on the results of this public hearings, the final version of this report has been prepared.


The plans of Coca-Cola in Russia, as laid out in this report, are preliminary. Successful implementation of these plans depends on external factors, therefore, future results may differ from the plans presented in the 2018 report.

Disclaimer. Forward-Looking Statements

2017 Coca-Cola HBC Russia Sustainability Report, as well as previous reports, are available here

This report is the first part of the 2018 Integrated Report of Coca-Cola in Russia. The second part, describing the contribution of system’s companies to the socio-economic development of the country, will be published in October 2019.

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Top Management of Coca-Cola in Russia Explains how the Business Responded to the Challenges of 2018 and what it does to Maintain Sustainability in 2019 0 0 7














14. Social Programs



17. Contacts

02. Sustainable Growth Strategy 700

Top Management of Coca-Cola in Russia Explains how the Business Responded to the Challenges of 2018 and what it does to Maintain Sustainability in 2019

"We are a Total Beverage Company now", the Coca-Cola associates say, implying that their business must be able to deliver a beverage suitable for any occasion to anyone on the planet. At the same time, it is important for the company to achieve its bold vision the right way: creating value for the country in which it operates, reducing its environmental impact throughout the supply chain and resolving common social problems. General Manager of Coca-Cola HBC Russia, Aleksandar Ruzevic, and General Manager of The Coca-Cola Company in Russia, Andy Buckingham, talk about how Coca-Cola is managing to do this in Russia.

Aleksandar Ruzevic, General Managerof Coca-Cola HBC Russia

Andy Buckingham, General Manager of The Coca-Cola Company in Russia

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How is Coca-Cola doing in Russia? Would you call 2018 a successful year?

AR: Yes, it was a strong year for our business in Russia. The soft drinks market is growing again, and this is good news. Thanks to our long-standing partnership with FIFA, we provided almost 3 million servings of beverages to the 2018 FIFA World Cup™ in Russia. We could clearly see that a huge number of people choose and enjoy our beverages and we attracted many new consumers.

This partnership has benefited society, the country and fans from all over the world. Together with the Ministry of Sport of the Russian Federation, we managed to engage over a million young people in the Leather Ball — The Coca-Cola Cup youth tournament; and, together with our partners, we built inclusive playparks with football pitches — our contribution to creating a barrier-free environment. We also supported the collection and subsequent recycling of 100% of plastic packaging at the stadiums that hosted the matches of the 2018 FIFA World Cup™.

Coca-Cola in Russia did everything in its power to make everyone in Russia feel part of this historic sporting celebration. For example, we organized the FIFA World Cup™ Trophy Tour by Coca-Cola, the longest and largest in the history of the event: more than

700,000 football fans got to see the Trophy with their own eyes.

And the weather was great help to us — Russia had its best summer in 60 years!

Most of the problems that we have been facing for years now have been external to our business. The global geopolitical context, the state of the Russian economy and depreciation of the Russian ruble — these are challenges beyond our control, but we can learn to live with them, because they are not going anywhere in 2019 either. We are much better prepared for them as a business now, and this is another important result of the past year.


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Coca-Cola has gone beyond being a manufacturer of classic soda. What is going on with its Russian brand portfolio?

AB: We certainly had a year of innovation. In addition to the efforts of our team, we must thank the Russian consumers for this — most of them are interested in innovation. We are expanding our beverage portfolio guided by "Our Way Forward" global strategy: we are listening carefully to the consumers and we offer them what they would like to buy, not just what we can produce and sell.

AR: Andy is right: we were moving forward by leaps and bounds in this direction in 2018. We want to be a company that offers soft drinks for all occasions. We call this vision a Total Beverage Company: any consumer can find his or her favorite non-alcoholic drinks in the Coca-Cola offering. I don’t think that we have ever launched so many new products in one year before. We have introduced truly innovative products to the Russian market: Smartwater, AdeZ milk substitute, FUZETEA ready-to-drink teas with unusual flavors, and many new versions of already popular drinks.

AB: It is fundamentally important that we give consumers more choice not only by adding new tastes and categories. "Our Way Forward" strategy is about drinks with less sugar and calories, optimal packaging, and complete and clear information about the ingredients of our products, so that consumers can have better control over their diet. Recently, in June 2019, we took the next logical step to make the information on the packaging even more transparent and user-friendly — we’ve introduced color coded nutrition labelling and became one of the first companies who supported this initiative of Rospotrebnadzor to promote the principles of healthy nutrition. This is a special type of labelling that contains clear and straightforward information about the content of the product, including fat, saturated fatty acids, sugar, and salt. These values are shown both in absolute figures and as a percentage of the recommended daily intake (RDI) per portion, and highlighted in red, yellow and green. We believe that this will help people make more informed and healthier choices without the guesswork, leading to a more balanced, healthy nutrition.


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How long does it take for these innovations to resonate with consumers?

АR: I would not claim that every new product becomes an immediate hit. We are aware that we need to anticipate some trends. But we are ready to take risks and to invest in launching niche products, for which the audience here is quite small at present. Take AdeZ: in other markets, there is a huge category that competes with traditional dairy products; but in Russia it is a very small niche story. But still, we have introduced a non-dairy milk beverage. This category may not bring us big money quickly, but we believe in it. The important thing is that we bring innovations to the Russian market, which will ultimately lead to healthier, more balanced consumption.

Which of the new products do you like most of all?

AR: I absolutely love Schweppes. All the flavors of Schweppes are incredibly bold, trendy, and they cross over into the realm of spirits. We created these flavors in line with consumers’ preferences, for those situations when someone wants a drink that tastes like a cocktail, but without the alcohol.

AB: As for me, now I always have Coca-Cola Zero Cherry in my fridge, right next to my beloved

Coca-Cola Zero. Actually, this is our big victory — to keep the traditional taste of Coca-Cola, but at the same time to give consumers the opportunity to enjoy it without sugar and calories.

Don’t all these bold steps pose a threat to the sustainability of the Coca-Cola system’s business?

AB: On the contrary. "Our Way Forward" strategy, aiming at expanding consumer choice by adding more balanced nutritional alternatives, is actually all about sustainable development.


https://www.coca-colarussia.ru/stories/adez-launch-in-europe

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It is about responsible growth that creates value, not only for consumers, but also for our business partners, employees, countries, regions and local communities, and for the environment. It is a matter of principle for us to do things the right way, rather than doing it the easy way. We want to return to nature in its purest from every litre of water used to make our drinks, and to recycle as many bottles and cans as we sell — all this requires investment and effort. It is very important that our bottling partners share these approaches to sustainability.

AR: I need to say that, thus far, the principles of sustainability have been so well integrated into our business that it has given us the opportunity to transform ourselves with fewer risks. We are striving to create value for the society and for our partners. Our suppliers are also implementing sustainability principles; they would simply not be able to work with us if they didn’t.

How far ahead did you get on "Our Way Forward" in 2018?

AR: Quite far. We added new sugar-free beverages to our portfolio, and we also significantly reduced the sugar content in Fanta, Sprite and Schweppes product lines. Coca-Cola Zero sales grew by 64% in transactions last year.


64% growth of sales of Coca-Cola Zero as measured by transactions in 2018

AB: As of year-end 2018, almost half of our beverage portfolio is non-carbonated. This is an important milestone for us. At the same time, we understand that we are still far behind developed markets in zero-sugar and zero-calorie options, and we have our work cut out for us. In Russia, we are already offering a portfolio of low- or no calorie products: a third of our SSD drinks portfolio in Russia are low- or no calorie.

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Sustainability is also about reducing the impact of business on the environment. Does Coca-Cola in Russia have specific results in this area?

AB: Yes, we do, and we are explaining this in our report. For example, our "Separate With Us" project has grown on a much bigger scale both in technical terms (measured by the number of containers for separate waste collection, and the number of cities involved), and in its outreach. In 2018, the project received wide public recognition, becoming a brand itself. And just this Spring, "Separate With Us" program won 2019 Russian Effie Award for effecting positive changes for the society.

AR: We understand that the farther away from Moscow we go, the harder it gets to find partners in waste management whom we can trust; and the more difficult it is to convince local governments that separate waste collection is important. And yet, we are moving forward to achieve our goal to recycle the equivalent of 100% of packaging that we put on the market.

You talked about creating value for regions and local communities. How does the company invest in solving social problems?

AB: The best example: we are using the power of our brand to build an inclusive society in Russia. We


are developing an inclusive community infrastructure, raising awareness of this problem in society and talking about the need to respect and to treat the others with kindness. To be honest, sometimes it is not easy. But I am sure that the results of our work will lead to positive shifts on the scale of the whole country.

AR: After the 2018 FIFA World Cup RussiaTM, the first inclusive playparks appeared, in which both healthy kids and kids with special needs can play and socialize. We are implementing this project together with Natalia Vodianova’s Naked Heart Foundation. We have built six playparks so far, and we intend to open five more in 2019 and 2020.

3,000,000 people in 11 cities across Russia will be able to enjoy themselves and play sports at new inclusive parks that have been built since 2018 as part of our partnership with FIFA World Cup 2018ТМ

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How realistic do you think is it to implement such ideas as recycling or inclusivity in Russia?

AR: It is not easy to strike a balance between our global goals and the current situation in this country. For example, we have neither sufficient infrastructure nor awareness here in Russia to recycle all packaging waste. But if we take a look at the 2018 results, it becomes clear that we are moving in the right direction. We cannot do this alone: only in cooperation with our clients, other companies, government agencies and non-profit organizations can we achieve our goals and fulfill our sustainability commitments.

AB: In fact, we see other FMCG companies talk about the same topics as we do, yet they focus on different aspects relevant to their business. We have done a lot for separate waste collection and recycling, we are ready to lead and unite everyone in this area, and we can join other leaders in other matters. We are always in favor of uniting the industry to address common social and environmental issues.

What do Coca-Cola employees in Russia think about this? Do they feel ready to engage in these initiatives?

AR: This is a good question, because without the support of our people, no global ideas and initiatives would make any sense. And here the sustainability principles that we have been implementing in recent years also make themselves felt. The level of engagement of the Coca-Cola employees is one of the highest in Russia; and this gives us a huge level of support. Every day we are working to create new career opportunities for our staff, to improve their working environment. We are striving to be the best employer in the FMCG industry, and our staff see it and appreciate it — they are ready to support us.


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2018 will be remembered as the year of the 2018 FIFA World Cup Russia™: our employees and their families have received around 2,500 World Cup tickets. Many of our colleagues were able not only to see this huge football event firsthand, but they became its co-creators, participating in the organization and preparation; and, as a result, some even received promotions and moved up the career ladder.

AB: We can see as an indicator of support just how actively the employees of all our companies engage in corporate volunteer programs — they collect waste, work with special-needs teenagers, donate blood, assist in emergency relief efforts. It is very inspiring!

Do you have a special place in your heart for any of the System’s social responsibility initiatives?

AB: All our sustainability programs are important. I would like to highlight our "World Without Waste" strategy, which we have globally announced in 2018. The world is facing the problem of consumer packaging waste and our "World Without Waste" strategy aims to help in solving this issue. Plastic bottles and cans can provide benefits to society if they are properly produced and then recycled.

We believe that a world without waste is possible and we want to do our share. Hence, we’ve announced such an ambitious goal: to collect and recycle the equivalent of every bottle and can sold by 2030. In Russia, through our "Separate with Us" program, we have already collected and recycled 27% of consumer packaging in 2018.


100% of our consumer packaging will be collected and recycled by 2030 — one bottle and one can for each one that we put on the market

1 7002. Sustainable Growth Strategy

AR: I find it difficult to single out any one initiative, since they are all important in the context of Russian reality. Personally, I’m incredibly inspired by our "Youth Empowered" program, which is designed to combat youth unemployment and to help young people make more informed career choices. I’m actively participating in it myself. We will be scaling it up in 2019 and we are confident that it will become bigger and more interesting.

What else are you going to do to improve sustainability in 2019?

AR: To become a Total Beverage Company, we must focus on the development and implementation of innovations. And of course, we will continue to reduce the amount of sugar and calories in our products.

AB: As for corporate social responsibility, we will focus on our key areas — separate waste collection, youth empowerment, and building an inclusive society. We will be scaling up our initiatives, engaging more and more reliable partners to take steps on our way forward.

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Coca-Cola in Russia: 2018 at a Glance 0 2 0

Brand Portfolio 0 2 2

Sustainability Risks and how We Manage them 0 2 3

Supplier Sustainability 0 2 4

2018 Milestones 0 2 5

2018 Awards 0 2 6

Other Initiatives 0 2 8














14. Social Programs



17. Contacts

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Coca-Cola in Russia: 2018 at a Glance

Coca-Cola in Russia includes three separate companies with different ownership structures. Combined together, they form a single value chain that is producing, selling and marketing soft drinks under The Coca-Cola Company’s brands. All three companies work together to ensure sustainability of Coca-Cola in Russia.

This is how the Coca-Cola system operates all over the world: The Coca-Cola Company develops beverages and markets them; the independent bottling companies produce and sell them. Everyone is focused on their own tasks, and it makes the System more efficient and sustainable.

Multon JSC produces juice products within

Coca-Cola in Russia

Coca-Cola Soft Drink Consulting LLC

is a subsidiary of The Coca-Cola Company.

It develops a beverage portfolio for the Russian

market and is responsible for brand development,

consumer marketing and demand creation

Coca-Cola HBC Eurasia LLC (also Coca-Cola HBC Russia)

is a part of the Coca-Cola Hellenic Bottling Company

AG, one of the world's largest bottlers of Coca-Cola products.

In Russia, the company produces beverages and

delivers them to customers


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Geography and Scale

Coca-Cola Soft Drink Consulting LLC 19B, Yartsevskaya street, "Kuntsevo Plaza" Business centre Moscow, Russia, 121552

Coca-Cola HBC Eurasia LLC 6, Kievskoe Highway, bldg. 1, "Comcity" Business Centre, A5 Moscow, Russia, 108811

Multon JSC 7, Plekhanova Street Moscow, Russia, 111141

The Coca-Cola Company

250 countries and territories

Headquarters: Atlanta, USA

Coca- Cola Hellenic Bottling Company AG

28 countries, 600 million potential consumers

Headquarters: Zug, Switzerland

10 plants in 9 Russian regions Moscow and Moscow Region, Saint-Petersburg, Rostov-on-Don, Samara, Yekaterinburg, Novosibirsk, Krasnoyarsk, Vladivostok

Total number of staff in 2018 — 7,750

100 towns and cities. Coca-Cola in Russia has offices and representatives in 100 towns and cities across the country with a total population of > 61 million people

Coca-Cola in Russia Central Offices in Russia:


2 2003. Coca-Cola in Russia

Brand Portfolio

Coca-Cola in Russia produces and markets a wide range of high-quality soft drinks under well-known trademarks. In 2018, the Coca-Cola system portfolio in Russia included 17 brands and 110 products.

2,31 billion litres of finished product were produced by Coca-Cola in Russia in 2018

68 production lines, 29 of them produce juice

The largest plant in Russia is located in Schelkovo, Moscow Region (owned by JSC Multon, 17 production lines total)

Our portfolio by category clusters and sales volume in 2018

In compliance with the corporate reporting practices, the Coca-Cola system’s financial results are not published separately in each country of operation. The financial data can be found in the 2018 Integrated Annual Report of Coca-Cola HBC AG. For more information on financial performance of the Coca-Cola system globally, please see 2018 Business & Sustainability Report of The Coca-Cola Company.

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9%

5%

31%

53% Sparkling drinks: Coca-Cola, Coca-Cola Zero, Fanta, Sprite, Schweppes

Juices, juicy drinks and plant-based drinks: AdeZ, Dobriy, Rich, Moya Semya, Pulpy, Innocent

Ice tea: FUZETEA

Water: BonAqua, BonAqua Viva, Smartwater

Sports and energy drinks: Burn, Black Monster, Powerade

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Coca-Cola in Russia faces a number of risks that are common for global food producers operating in this country, including: legislative regulation, geopolitical factors, changes in consumer demand, etc.

Each of the Coca-Cola companies in Russia has its own risk management system operating at a country level. Risk management programs are managed by risk managers interacting with risk owners within their business units. Risk analysis is performed monthly and is supervised by audit and risk committees. The Board of Directors is responsible for the development and efficient functioning of the risk management and internal control systems.

Key sustainability risks are defined at a global level. Taking into account regionally specific aspects, these risks are relevant for all the countries where the company operates, including Russia. The complete list of the Coca-Cola system sustainability risks in Russia has been presented in last year’s Sustainability report (pp. 30–31) and most of those risks have remained relevant throughout the year.

Sustainability Risks and how We Manage them

In 2018, cyber security threats became more distinct — therefore, we had to improve our risk management programs in this area.

To find out more about the risks that the Coca-Cola system faces regionally and globally, please see 2018 Integrated Annual Report of Coca-Cola HBC AG and 2018 Business & Sustainability Report of The Coca-Cola Company.


https://ru.coca-colahellenic.com/media/10222/cchbc_our_2017_spreads.pdfhttps://coca-colahellenic.com/en/investors/2018-integrated-annual-report/https://coca-colahellenic.com/en/investors/2018-integrated-annual-report/https://www.coca-colacompany.com/content/dam/journey/us/en/private/fileassets/pdf/2019/Coca-Cola-Business-and-Sustainability-Report.pdfhttps://www.coca-colacompany.com/content/dam/journey/us/en/private/fileassets/pdf/2019/Coca-Cola-Business-and-Sustainability-Report.pdfhttps://www.coca-colacompany.com/content/dam/journey/us/en/private/fileassets/pdf/2019/Coca-Cola-Business-and-Sustainability-Report.pdf

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Assessing sustainability indicators when selecting suppliers of ingredients and materials is a standard practice in Coca-Cola in Russia. The Coca-Cola Company’s authorization is the main requirement. To receive such authorization, every potential supplier has to go through a special auditing process, including social audit. This procedure reveals the degree, to which a supplier meets corporate social responsibility and sustainability requirements that are outlined in the Supplier Guiding Principles and are based on shared corporate values and ethical standards.

Coca-Cola HBC Russia has developed additional requirements for the suppliers, such as a quality management system based on the ISO 9001 standards, risk assessment and internal food safety audit; production and quality control system and corporate social responsibility strategy. Current suppliers are evaluated annually or even more frequently, depending on the company’s experience of working with them and on the status given to the supplier during the initial audit.

Supplier Sustainability

Learn more about how we work with our suppliers


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March

Launch of new Fanta Pear

2018 Milestones

January

Launch of FUZE TEA, a line of ice tea beverages with fruit juices and natural ingredients

April

Inclusive clean-up day (“Subbotnik”) in Novosibirsk

Launch of Sprite Watermelon-Cucumber

Launch of new Rich Magnificent Pomegranate juice

A new Coca-Cola 0.9 litres was introduced in addition to traditional packaging

May

Launch of AdeZ — a completely new beverage for the Coca-Cola system

Opening of an inclusive playpark in Rostov-on-Don in partnership with the Naked Heart Foundation

September

Opening of an inclusive playpark in Nizhny Novgorod in partnership with the Naked Heart Foundation

June-July

Partnership with the 2018 FIFA World Cup™ in Russia

FIFA World Cup™ Trophy Tour by Coca-Cola finale in Moscow

Opening of an inclusive playpark in Kaliningrad in partnership with the Naked Heart Foundation

Launch of Smartwater — the first "smart" water on the Russian market

August

The first training course of the ‘Youth Empowered’ project Inclusive guided tour of the Novosibirsk plant Launch of a of "Moya Semya" new line of juices Presentation of the 29th World Universiade in Krasnoyarsk December

The Coca-Cola Christmas Caravan re-launched as an inclusive initiative

Opening of a new inclusive playpark in Kazan in partnership with the Naked Heart Foundation

Approval of Coca-Cola HBC Russia’s policy on volunteering during working hours

November

Second anniversary of 'Separate with Us' program


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"Dobriy" and "Pulpy" juices and fruit nectars won the National Commodity of the Year — 2018 Award in four nominations

Coca-Cola HBC Russia won an award in the nomination for "The Best Reward System at the All-Russian Competition" The Best of Compensations and Benefits 2018

Changellenge> > Best Company Award 2018: Coca-Cola HBC Russia won third place in "The most attractive company for young professionals nomination in the FMCG sector"

Fifth TOP-COMM 2018 All-Russian Rating of Directors of Corporate Communications and Corporate Relations Departments: Irina Arkhipova, Public Affairs and Communications Director at Coca-Cola HBC Russia made it to the TOP-5 list of "The Best Directors in Corporate Communications and Corporate Relations in Russia". The Public Affairs and Communications Department of Coca-Cola HBC Russia made it to the TOP-9 list of Best Corporate Communications and Corporate Relations Departments in Russia

2018 Awards

The leadership team of Coca-Cola HBC Russia was highly rated in TOP-1000 Russian managers of 2018

Coca-Cola in Russia "Separate With Us" and "Growing Kindness" projects won the nominations for "Environmental projects and initiatives and Social marketing" at The Best Social Projects of Russia national competition

Coca-Cola in Russia "Separate With Us" project won the nomination for "The Best Social Project in Ecology" at the ECO BEST AWARD 2018

During the 8th All-Russian Awards for the Development of Blood Donation So-Uchastiye (Co-Participation) Coca-Cola HBC Russia won second place in the nomination "For Contributing to the Development of Corporate Donation"


http://www.tovargoda.info/old_winners/2018http://auditorium-cg.ru/CBA18http://auditorium-cg.ru/CBA18https://1.changellenge.com/best/best-company-award-2018https://corpmedia.ru/rating/results/2018/https://www.kommersant.ru/theme/3106?from=doc_temahttps://www.kommersant.ru/theme/3106?from=doc_temahttps://www.coca-colarussia.ru/press-center/best-social-projects-in-russia-2017-2018-awardhttps://www.coca-colarussia.ru/press-center/best-social-projects-in-russia-2017-2018-awardhttp://ecobest.pro/laureates/laureates-2018/http://nfrz.ru/news/podvedeny-itogi-viii-nbsp-vserossijskoj-premii-laquo-souchastie-raquo/http://nfrz.ru/news/podvedeny-itogi-viii-nbsp-vserossijskoj-premii-laquo-souchastie-raquo/

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Motivational HR-program of Coca-Cola in Russia "Be a Scout — Be a Champion" came second in the "Team Energy" nomination at the INTERCOMM-2018 Internal Communications Awards

For excellent logistical personnel preparation Coca-Cola HBC Russia together with METRO Cash & Carry and Pyaterochka retailers were awarded a special prize for their program "Supply Chain Leaders" at the National Trucks and Roads awards

Coca-Cola HBC Russia became "The Company of the Year", winning "Food Safety" award at The Best in Russia: Companies, Persons and Projects of the Year Business Awards

Three projects of Coca-Cola in Russia made it to the TOP-3 projects in various categories at the Eventiada IPRA Golden World Awards communication award

Headhunter 2018 Russian Employer Rating awarded Coca-Cola HBC Russia the first in Fast Moving Consumer Goods sector and fourth place overall

Coca-Cola HBC Russia Shared Services Centre came in third in "The Best Customer Service category" at The Best Shared Services Centres of Russia and CIS 2018 competition

Coca-Cola HBC Russia Shared Services Centre won first place in the nomination for Efficient Document Management at the 8th annual Best Shared Services Centres 2019 (MSB Events)

At the Effie Awards Russia, three projects of Coca-Cola in Russia became the TOP-3 projects in various categories


http://intercomm.su/%D0%BF%D1%80%D0%BE%D0%B5%D0%BA%D1%82%D1%8B-%D0%BF%D0%BE%D0%B1%D0%B5%D0%B4%D0%B8%D1%82%D0%B5%D0%BB%D0%B8-2018/http://gidpremia.ru/http://best.ru/kompanii-goda-2017http://best.ru/kompanii-goda-2017https://eventiada.com/news/obyavleny-pobediteli-eventiada-ipra-gwa-2018/https://spb.hh.ru/article/24359https://www.cfo-russia.ru/stati/index.php?article=50018https://www.cfo-russia.ru/stati/index.php?article=50018https://www.cfo-russia.ru/stati/index.php?article=50018https://bosfera.ru/press-release/itogi-biznes-vstrechi-obshchie-centry-obsluzhivaniyahttps://bosfera.ru/press-release/itogi-biznes-vstrechi-obshchie-centry-obsluzhivaniyahttps://effie.ru/past-winners/2019.html

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The Coca-Cola companies in Russia are current members of 22 associations and unions:

Russian Union of Industrialists and Entrepreneurs

RusBrand Association of Producers

Russian Union of Juice Producers

Russian Union of Soft Drinks and Mineral Water Producers

Industry for the Environment Association (RusPEC)

Russian Association of Communication Directors and Corporate Publishing

European Association of Communication Directors (EACD)

National Union of Experts in Transport and Logistics (SEL)

Other Initiatives

National Association of Automated Trading (NAAT)

U.S.-Russia Business Council Non-Government Association (USRBC)

American Chamber of Commerce in Russia (AmCham)

Moscow International Business Association

International Association for Business Cooperation

Moscow Chamber of Commerce and Industry

St. Petersburg International Business Association (SPIBA)

St. Petersburg Chamber of Commerce and Industry

American Chamber of Commerce in St. Petersburg

Rostov Chamber of Commerce

Board of Directors of the Krasnoyarsk Central District

Primorsky Territory Chamber of Commerce

Far Eastern Association of Beverage, Mineral Water and Soft Drinks Manufacturers

Ural Food Industry Association (Uralpischeprom)


In 2018, National Unioun of Experts in Transport and Logistics

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Value Chain 0 3 2

Sustainability Commitments 0 3 4

What We do to Meet Sustainability Commitments in Russia 0 4 0

Sustainability and Corporate Social Responsibility Strategy in Russia: a New Outlook 0 4 3

Who is in Charge of Sustainability of Coca-Cola in Russia 0 5 2

2018 Business And Sustainability Results 0 5 3

Stakeholder Engagement 0 7 1

2018 Material Topics 0 7 3














14. Social Programs



17. Contacts

3 1004. Sustainability of Coca-Cola in Russia in 2018

Many companies claim that they are gradually integrating modern sustainability practices into their business and corporate culture. We are doing more than that: sustainable development is integral to the Coca-Cola system’s business strategy. The activities of the companies within the system are based on the principles of sustainability.

For us, the product itself is as important as how it is produced. We are fully committed to doing business the right way, not just the easy way. We strive to create shared opportunities for every community we serve. As we grow, we will continue to create value for the society and minimize our impact on the environment.

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Beverages We offer ~ 4,100 beverages nearly a third of which are low- or no-sugar, and we reducing the amount of added sugar in many our beverages.


People and communitiesFrom our employees to our consumers, people are at the centre of everything

we do. We aim to create value for everyone connected to our business,

including enabling the economic empowerment of woman through

programs like 5by20.

The Coca-Cola Systems' Value Chain: Our Approach To Creating Shared Opportunities For People And Communities That We Serve

Packaging collection and recycling Our goal is to collect a bottle or can for every one we sell by 2030, and we are

working to use more recycled materials in our packaging.

Equipment Our coolers, fountain dispensers and vending equipment enable people to

get the drinks they want.

Manufacturing ~ 800 facilities around the world produce and bottle our products.

WaterWe aim to give back the amount of water used in our finished beverages to replenish communities and nature.

Agriculture Agricultural ingredients, along with millions of local farmers, are critical to create our beverages.

Customers~ 27 million customers sell our

beverages to consumers in 200+ countries and territories.

Bottling partners and distribution Together, we manufacture, package and

distribute our beverages.

At Coca-Cola, sustainability starts with creating shared opportunities throughout the value chain, then it is actioned in specific commitments, programs, and projects.

Value Chain

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People and Communities —

are at the core of our value chain. It includes everyone impacted by our work: the consumers, customers, our staff and partners, suppliers, and employees of non-profit organizations.


Sustainable agriculture: it is critically important for us that suppliers of raw materials for our products are environmentally friendly and use land and water resources responsibly

Efficient and safe manufacturing with the strictest system of quality control. The Coca-Cola system includes approximately 800 manufacturing plants worldwide, ten of them are located in Russia. Not only do they have to be profitable and efficient, but they must continuously strive to reduce their environmental impact.

Beverages. We strive to be a total beverage company. Worldwide, we offer 4,000 different products; in Russia we produce 110 types of beverages under 17 brand names. A third of them are low- or no-sugar.

Bottling partners and distribution. The Coca-Cola Company has approximately 250 bottling partners around the world, including Coca-Cola HBC Russia — a part of the Coca-Cola Hellenic Bottling Company AG. We are working together to implement our sustainability strategy across all operations, so that we can create a sustainable future for all.

It is important for us that the customers of the Coca-Cola system also feel the benefits of working with us in line with sustainable development. We share new technologies and ethical business practices and we also implement joint sustainability projects.

We use and we also supply our partners with energy-efficient refrigeration equipment. This way people get the drinks they want at optimal temperature for a better taste, while minimizing environmental impact.

Packaging collection and recycling is a part of our "World Without Waste" environmental strategy which all our bottling partners comply with. Our goal is to collect a bottle or can for every one we sell by 2030.

We aim to give back the amount of water used in our finished beverages to replenish communities and nature.

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Sustainability Commitments of the Coca-Cola Company

As part of the "Our Way Forward" strategy, we are reducing sugar content in our beverages, while maintaining their excellent taste. In addition to this strategic goal, which has already transformed our business, the Coca-Cola system globally sets 7 key sustainability commitments. We plan to achieve these by 2020, and the ambitious goal of recycling packaging by 2030.

World Without Waste: packaging and recycling. By 2030, we will collect and recycle the equivalent of 100% of packaging we introduced into the marketplace. Contribution to the UN SDG 12 Responsible Consumption and Production, SDG 14 Life Below Water and SDG 15 Life on Land

Based on our 2018 results, we’re more than half-way there already (58%).

Water stewardship. We safely return to communities and nature an amount of water equivalent to what we use in our finished beverages and their production. Contribution to UN SDG 6 Clean Water and Sanitation, SDG 12 Responsible Consumption and Production, SDG 14 Life Below Water, SDG 15 Life on Land

The 2020 commitment was achieved in 2016 but we did not stop there. Based on our 2018 results, we have already returned to the environment 155% of pure water from the total amount that we used in production. This has been achieved due to the efficient use of water resources and a number of water stewardship projects.

Giving back. We give at least 1% of our operating profits to help solve social problems. Contribution to the UN SDG 3 Good Health and Well-being and SDG 17 Partnerships for the Goals, as well as the entire range of goals from SDG 1 No Poverty to SDG 16 Peace, Justice and Strong Institutions

Based on our 2018 results, 1.5% of operating profits were invested in social responsibility projects.

Sustainability Commitments


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Women’s empowerment. By 2020, we will empower at least 5 million women entrepreneurs worldwide (5by20). Contribution to the UN SDG 5 Gender Equality, SDG 10 Reduced Inequalities, SDG 8 Decent Work and Economic Growth

2018 result: 3.2 million women

Human and workplace rights. By 2020, at least 98% of our bottling partners and 95% of our suppliers around the world will achieve compliance with the Human Rights Protection and Equal Opportunities Policy (set out in Supplier Guiding Principles) Contribution to the UN SDG 10 Reduced Inequalities, SDG 8 Decent Work and Economic Growth, SDG 5 Gender Equality

2018 result: 89% of our bottling partners and direct suppliers are in compliance.

Sustainable agriculture. We strive to ensure that key ingredients for our beverages (apples, lemons, oranges, tea, sugar beets and sugar cane, coffee and corn) are grown sustainably. Contribution to the UN SDG 12 Responsible Consumption and Production and SDG 15 Life on Land

Information on each of the key ingredients’ sustainability progress can be found in The Coca-Cola Global Business and Sustainability Report 2018.

Climate protection. By 2020, we will reduce our carbon footprint (greenhouse gas emissions) by 25%* across the supply chain. Contribution to the UN SDG 13 Climate Action and SDG 7 Affordable and Clean Energy.

2018 result: 21% reduction

For more information on The Coca-Cola Company sustainability commitments and our results, please see The Coca-Cola Global Business and Sustainability Report 2018.

* Compared to 2010


https://www.coca-colacompany.com/our-company/human-rights-policyhttps://www.coca-colacompany.com/our-company/human-rights-policyhttps://www.coca-colacompany.com/our-company/supplier-guiding-principleshttps://www.coca-colacompany.com/content/dam/journey/us/en/private/fileassets/pdf/2019/Coca-Cola-Business-and-Sustainability-Report.pdf#page=17https://www.coca-colacompany.com/content/dam/journey/us/en/private/fileassets/pdf/2019/Coca-Cola-Business-and-Sustainability-Report.pdf#page=17https://www.coca-colacompany.com/content/dam/journey/us/en/private/fileassets/pdf/2019/Coca-Cola-Business-and-Sustainability-Report.pdf#page=17https://www.coca-colacompany.com/content/dam/journey/us/en/private/fileassets/pdf/2019/Coca-Cola-Business-and-Sustainability-Report.pdf#page=17https://www.coca-colacompany.com/content/dam/journey/us/en/private/fileassets/pdf/2019/Coca-Cola-Business-and-Sustainability-Report.pdf#page=17https://www.coca-colacompany.com/content/dam/journey/us/en/private/fileassets/pdf/2019/Coca-Cola-Business-and-Sustainability-Report.pdf#page=17

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To ensure sustainability of the Coca-Cola system, it is crucial that our bottling partners share our views on the principles of sustainable development. In 2018, the Coca-Cola Hellenic Bottling Company AG which operates in 28 European countries and includes Coca-Cola HBC Russia (10 plants in 9 regions of the country) presented 17 specific sustainability commitments to be achieved by 2025. These commitments take into account the strategic priorities of The Coca-Cola Company, the UN Sustainable Development Goals and the practical realities of the countries in which the company operates.

Sustainability Commitments of the Coca-Cola Hellenic Bottling Company AG (Including Coca-Cola HBC Russia)

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Emissions Reduction Reduce direct carbon emissions ratio by 30% at all plants

Increase the proportion of energy-saving refrigerators in customer outlets to 50% of the total

Supply 50% of all energy used in our plants from renewable and clean sources

Source 100% of electricity from environmentally friendly and renewable sources (in the European Union and Switzerland)

Water Stewardship

Reduce water use at plants located in water-risk areas by 20%

Increase water availability for communities in water-risk areas that are located within the company's operating regions

Nutrition

Reduce by 25% the calories by 100 ml of sparkling soft drinks

World Without Waste

Reach target of 100% recyclable consumer packaging

Increase the use of plastic from recycled PET or PET from renewable materials to 35% of the total

Help collect the equivalent of 75% of our primary packaging for recycling and reuse

Sourcing

Source 100% of key agricultural ingredients in line with sustainable agricultural principles


Our People and Communities

Ensure safety in the workplace, target zero fatalities and reduce (lost time) accident rate by 50%

Ensure gender equality and increase the number of managerial positions held by women to 50%

Involve at least 10% of communities in our manager training programs in our regions of operation

Train 1 million people under our "Youth Empowered" development program

Engage in 20 Zero Waste partnerships in cities and coastal areas

Involve 10% of staff in volunteer initiatives

More about Coca-Cola Hellenic Bottling Company AG sustainability commitments — 2018 Integrated Annual Report of the Coca-Cola Hellenic Bottling Company AG

Sustainability Commitments of the Coca-Cola Hellenic Bottling Company AG (Including Coca-Cola HBC Russia)

https://coca-colahellenic.com/en/investors/2018-integrated-annual-reporthttps://coca-colahellenic.com/en/investors/2018-integrated-annual-reporthttps://coca-colahellenic.com/en/investors/2018-integrated-annual-report

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UN Sustainable Development Goals Alignment

The priorities of the Coca-Cola sustainability strategy mirror the UN Sustainable Development Goals: we have global and local projects aligned with most of the SDGs. Many of our projects are aligned with multiple UN sustainable development goals.

We consider that our key goals are those, where the greatest positive impact can be achieved. For example, SDG 8 Decent Work and Economic Growth and SDG 12 Responsible Production and Consumption are integrated into the way we operate in all markets. Our efforts to reduce sugar and calories for more balanced nutrition contribute to SDG 3 Good Health and Well-being.

SDG 4 Quality Education is integrated into many of our programs; in particular, our youth support project provides young people with knowledge, skills, and opportunities. In Russia, the Coca-Cola system’s global "Youth Empowered" program supports young people who don’t have access to high-quality higher education.

SDG 17 Partnerships for the Goals is special for us because it is associated with all our initiatives. Our core working principle is based on creating and maintaining effective partnerships with other companies, governmental and non-profit organizations, and with experts. This approach allows us to work on solving complex large-scale problems, such as separate waste collection for recycling or building an inclusive society in Russia.


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What we do to Meet Sustainability Commitments in Russia

Under our overarching sustainability strategy, we are working to make our economic, environmental and social impact as favorable as consistently possible.

The Economic Impact of Coca-Cola in Russia

Coca-Cola in Russia is one of the largest taxpayers and employers in the country. We are striving to increase added value both directly, through our own production and indirectly by supporting our suppliers and customers.

Every two years, we conduct a detailed analysis of the direct and indirect impact of our activities in Russia via an independent study. We know exactly how much added value there is in each ruble within the Coca-Cola in Russia. We also know how many jobs in related enterprises are created per every job in one of our companies. The Coca-Cola system is one of the first large international companies to undergo such comprehensive assessment in Russia.

This part of the report will be published in October 2019.


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The Environmental Impact of Coca-Cola In Russia

Coca-Cola in Russia pays great attention to reducing its environmental impact. With the introduction of new technological solutions, the company succeeds in systematically reducing the volume of its industrial waste output: more than 85% of it is already recyclable. And the All-Russian "Separate With Us" program is designed to create the essential infrastructure and to raise awareness about the culture of separate waste collection.

The company also systematically reduces its carbon footprint, effecting measures to ensure that СO

2 emissions from production, transport and retail

refrigeration facilities are minimal. Reduced energy consumption and the use of energy from renewable sources also act as key indicators for assessing and reducing our environmental impact.

> 85% of industrial waste is already recyclable


We are also concerned about preserving water resources. Each of our plants has implemented a Water Stewardship program. We do not dump untreated water, and our programs for decontamination of coastlines help preserve the ecosystems of the country's most important water reservoirs — the Volga, the Baikal, and the Black Sea.


The Social Impact of Coca-Cola in Russia

The health of our business is connected to the health of the communities we serve, so we invest in the well-being of people and territories of our operational presence.

Each year, The Coca-Cola Company invests at least 1% of its global operating income from the previous year in a bid to combat social problems. There are a number of measures and activities that allow us to create lasting change, including: the strength of our brands, which helps raise awareness of social issues; charitable and social investments; creating and maintaining partnerships to develop and implement effective social programs; sharing best practice and our experience, and staff involvement in solving social problems via our corporate volunteering program.

We do not shy away from taking on complex issues. By interacting with different stakeholders and experts, we understand how to make tangible contributions to solving a variety of problems. And then we act on them. We are actively investing money and time in addressing the most important social issues, such as the education and professional development for young people, as well as building an inclusive society in Russia.

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Sustainability and Corporate Social Responsibility Strategy in Russia: a New Outlook

The year 2018 marked major developments in establishing the priority ranking of the environmental and social responsibilities of Coca-Cola in Russia.


Based on the principles of sustainable growth, we strengthen our business practices across the board: adhering to impeccable business ethics, developing our suppliers and customers, promoting principles of sustainable agriculture, improving the well-being of our staff, and improving the quality of our products.

We are consistently reducing our environmental footprint. We focus on minimizing our impact on the environment by reducing carbon emissions, cutting energy and water use as well decreasing the volume of industrial waste.

We are taking care of our consumers with "Our Way Forward" strategy. In 2019, we will continue to expand our beverage portfolio and introduce low- or no-sugar versions of our most popular soft drinks.


Our Way Forward

In 2016, we introduced "Our Way Forward" — a new strategy designed to radically transform our way of thinking about qualitative improvements and to mark the transition to more responsible manufacturing of beverages.

This new company strategy allowed us to rethink our business priorities and our preconceptions about growth. Now, instead of increasing the volume of output, we strive to offer more choice to the consumers. We are systematically reducing the sugar content of our beverages. We are also actively promoting products in smaller packages, so that the consumer is able to control servings. At the same time, we are introducing innovative categories of beverages with natural plant-based ingredients, added vitamins and minerals.

Putting the consumer first. All around the world, we are reviewing our recipes to reduce the level of sugar — that way we will be able to offer a greater choice of low-sugar alternatives. We are also introducing products in smaller packages, so that our consumers are able to balance their nutrition. We comply with the WHO recommendation to use added sugar moderately, so that it does not exceed 10% of the daily intake of calories.

Innovations. The Coca-Cola portfolio has expanded beyond sparkling beverages. Today, it includes juices, iced teas, water, plant-based drinks and other nutritious and functional beverages. We are becoming a total beverage company: our range of products is expanding to satisfy all possible tastes.

Information transparency and accuracy. In Russia, we were the first company to print nutritional information on the front of our product packages, enabling our consumers to make informed choices.

Responsible marketing. We do not advertise our beverages to children under 12 years old and we do not sell sparkling soft drinks in schools.

Partnerships. Together with government authorities, corporate leaders and healthcare professionals, we strive to support our consumers in their pursuit of a balanced healthy lifestyle.

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Since the opening of its first plant in Russia, the Coca-Cola system has implemented many external social and environmental initiatives. In 2018, our programs were focused on four material topics: recycling consumer packaging waste, empowering young people and tackling complex social issues, such as building an inclusive society and disaster relief. All key projects of Coca-Cola in Russia have been focused in one or more of these areas.

Packaging collection and recycling. Here, our main program is called "Separate with Us" — it is a part of Coca-Cola’s global environmental strategy "World Without Waste". The initiative aims to introduce and promote the culture and the daily practice of separate waste collection in Russia, and includes infrastructure (installation of special containers for separate waste collection and subsequent recycling) and education (environmental lessons and information campaigns to raise awareness among the general public). Our projects on decontamination of the coastal areas of strategic water reservoirs (the Volga, the Baikal and the Black Sea) have also been included in this program. "Separate With Us" also encompasses the Coca-Cola "Green Teams" volunteer project (focusing on separate waste collection and recycling), as well as our support for the Russian National Junior Water Competition. From 2019 we will support the latter’s nomination “Solutions to combat micro plastics in water reservoirs”.


World Without Waste

"World Without Waste" is Coca-Cola's new global environmental strategy. By 2030, we plan to collect and recycle the equivalent of 100% of all the packaging we put on the market. Major changes in the packaging production process have to be implemented to achieve this target. The entire life cycle of packaging in the Coca-Cola system (from the development and production of bottles and cans to their recycling and reuse) complies with our environmental strategy. Our efforts are applied across the following three areas of strategy implementation:

Design. Our goal is to switch to fully recyclable packaging by 2025; and by 2030 we aim to introduce packaging made from 50% of recycled materials. Ten years ago, the company invented PlantBottle — a revolutionary new technology that uses plant-based materials to create fully recyclable packaging. This innovation allows us to increase the volume of packaging containing bioplastic in various industries, creating positive environmental impact.

In Russia, we are working on a roadmap for switching to fully recyclable packaging. At present, the country’s infrastructure does not fully support such initiatives, so we can solve this problem by working together with government authorities and likeminded leaders of the industry.

Collect. By 2030, our goal is to collect and recycle the equivalent of each bottle or can sold.

In Russia, our "Separate With Us" program is dedicated to achieving this target. The program has been in place since 2016, and last year it merged organically with the global "World Without Waste" agenda of the Coca-Cola system. There is still a long way to go to become a Country Without Waste, but we managed to go waste-free at large public events. For example, during the FIFA 2018™ World Cup, we supported plastic packaging collection with a massive communications campaign. As a result, 32 tonnes of plastic were collected — this is as much packaging as we’ve supplied with our drinks throughout the championship. We intend to build on this success at other large events supported by Coca-Cola. We have already had similar positive experiences at the XXIX World Winter Universiade 2019 in Krasnoyarsk, at the Gaidar Forum and at the Olympic figure skating champion Tatiana Navka’s ice show “The Scarlet Flower”. In addition, we intend to work with local governments in order to address the problem of waste collection in Russian cities.

Partner. Here, the goal is to collaborate with large industrial companies, NGOs, local authorities and communities to solve the global problem of plastic waste.

In Russia, we work with the authorities regulating the implementation of the extended manufacturing responsibility program and with the experts in separate waste collection, recycling and environmental education — the ERA Foundation and EcoTechnologies Group.

In 2019, we also intend to develop our partnership programs, dedicated to eliminating waste in cities and coastal areas.

https://www.coca-colacompany.com/our-company/introducing-plantbottle

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Throughout 2018 we have been working on the launch of our flagship project in education and youth development "Youth Empowered". It aims to tackle youth unemployment and to assist young people with their career choices. In Russia, Youth Empowered will also become the springboard for supporting women empowerment — as part of our global 5by20 initiative designed to teach entrepreneurial skills to five million women worldwide.

In 2018, we have also selected twenty Russian universities for integrated collaboration with the Coca-Cola company. Our specialists will present lectures and masterclasses, provide information and business cases, and invite students to volunteer on our social and environmental projects. We plan to transform selected universities into waste-free zones.

"Growing Kindness" is another one of our social responsibility projects. Established five years ago, the program helps teenagers (aged 13–17) without parental care with their social needs and professional development.


Our activities aimed at building an inclusive society hold special meaning for us. In a number of countries where Coca-Cola systems operate there is a history of inclusivity already in place, whereas in Russia the concept is still in its infancy. In terms of infrastructure, we are working on building an inclusive society together with our two partners: Natalia Vodyanova’s The Naked Heart Foundation and The Elena Isinbayeva Foundation. The Christmas Caravan, one of the largest and most renowned social projects of the Coca-Cola system, is also inclusive since 2018. We are continuing to nurture our partnership with The Special Olympics and we will continue to support people with special needs by inviting them to participate in the company's sports and environmental projects.

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Together with the Russian Red Cross, we have been providing help and assistance to victims of emergencies and natural disasters for many years now. In 2018, Coca-Cola in Russia and the Russian Red Cross joined forces to introduce a new initiative — the creation of emergency non-food stocks in high-risk regions. From these inviolable stocks, kept in special storage facilities, we will be able to instantly provide people with the necessary items.

It is important to highlight that our employees regularly participate in a number of initiatives that support local communities and the environment. Corporate volunteering program is at the core of the company's sustainability strategy.

In 2019, we will be drawing up roadmaps for the implementation of our long-term sustainability commitments in Russia.


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On other levels, there are sustainability managers, environmental managers, HR managers, as well as heads of quality control and labour protection services — each responsible for specific sustainability programs and projects. Ensuring sustainable practices in agriculture and plastic recycling is the responsibility of supply and procurement managers. Quality control managers, technical department staff and marketing specialists are responsible for the recipes of beverages and the reduction of their caloric content.

First and foremost, the directors of the Coca-Cola companies in Russia. Reporting to them, the heads of services and departments are responsible for certain aspects of the sustainability strategy, including:

СFO (cost efficiency)

Head of Supply Chain, Head of Procurement, Head of Planning and Logistics (environmental responsibility)

Head of Public Affairs and Communications, Head of HR (social responsibility).

Who is in Charge of Sustainability of Coca-Cola in Russia


We have to consider our economic, environmental and social impact on local communities in its entirety. Thus, most of the externally-facing projects in Russia are implemented by the Coca-Cola system, as a single entity.

Programs associated with industrial safety, product quality and the environmental impact of production are primarily run by the bottling company — Coca-Cola HBC Russia.

The companies in the Coca-Cola system may have slight variations in their internal business practices, including different corporate structures, personnel development and supply chain policies, as well as business ethics. However, all companies are in compliance with our core principle: we conduct our business the right way by setting the highest standard of business ethics for ourselves, our customers and suppliers and by providing equal opportunities and benefits for all.

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we boost efficiency by promoting sustainability principles

2018 Business and Sustainability Results

Key 2018 Results and Highlights:

Beverage output volume, litres

For Coca-Cola Hellenic Bottling Company AG 2018 financial results click here.

Read more about the contribution of the Coca-Cola system to the social and economic development of the Russian Federation in 2017–2018 here.


Sales volume up

4.4%*

* Reported by Coca-Cola HBC Russia in its 2018 full-year results.

Sustainability is Good for Business:

2018: 2.31B litres

2017: 2.23B litres

https://coca-colahellenic.com/en/investors/2018-integrated-annual-report/https://coca-colahellenic.com/en/investors/2018-integrated-annual-report/https://ru.coca-colahellenic.com/ru/media/news/итоги-2018-продажи-coca-cola-hbc-в-россии-выросли-на-4-4/

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92% — employee engagement index measured at Coca-Cola HBC Russia. The index has been above 90% for several years

Women hold 44.8% of all management and executive-level positions in Coca-Cola in Russia

100% of staff in Coca-Cola in Russia are familiar with the Code of Business Conduct and company’s anti-corruption policy

Coca-Cola in Russia sources > 96%* of its ingredients and materials from local suppliers

The number of lost-time accidents at company’s plants has decreased threefold in 2017–2018

0 was the number of accidents involving staff of the Coca-Cola in Russia contractors in 2018

The consumer hot line of Coca-Cola in Russia receives ~ 1 complaint per 7 million product units. On average, only one out of 30 complaints is confirmed

Sustainable Business Practices: Key 2018 Results and Highlights:


Goals for 2019:

To maintain high standards in terms of business ethics, compliance with equal opportunities and anti-corruption policies, employee engagement, product quality, and workplace safety

To increase the share of locally sourced agricultural ingredients that can potentially be produced from fruits and vegetables that can be grown in Russia to 35% in 2019 and to 40% by 2020

we promote high standards of business ethics by encouraging suppliers to follow our principles

* Excluding concentrate.


"Our Way Forward" in Russia


Innovation

110 beverages

17 brands

New niche products: Smartwater, AdeZ

46.6% of beverages in the Coca-Cola's portfolio are non-carbonated

Consumer choice

Sales of Coca-Cola Zero (sugar-free, zero-calorie) up 50% in volume and up 64% in transactions compared to 2017

We have reduced by 30–80% the amount of added sugar in Fanta, Sprite, and Sсhweppes*

We have cut calories by 9.6%** in our sparkling beverages and by 10.6%** in our juices in 2018

~ 1/3 of SSD drinks portfolio in Russia are low- or no calorie

~ 1/2 of Coca-Cola-branded beverages are available in small packages (0.33l or less)

Sales of beverages in the smallest size (0.25l) rose by 38%**

Transparent and accurate product labelling

We were the first beverages producer in Russia (back in 2011) to display calorie and sugar content on our product packaging

Responsible marketing

100% compliance with our policy: No advertising to children under 12, including TV and online advertising, corporate websites or sample-tasting activities

We do not sell carbonated beverages in schools and we also do not conduct sample-tasting events there

Partnerships

We support the initiatives of the Russian government to promote healthier and better living; we join forces with industry leaders and healthcare professionals to support consumers in their efforts to have a more balanced, healthier lifestyle

means less sugar, fewer calories, more innovation

* Total reduction over 2017-2018. ** Year-on-year compared to 2017.

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By 2020, We Pledge to:

Reduce sugar by 10% (per 100ml serving) in 2019–2024 across our soft drinks portfolio including juices

In 2019, we will be one of the first companies to support the initiative of Rospotrebnadzor to apply a "traffic light" type of labelling on food and drink packaging — to help the consumers balance their nutrition.


More on how we encourage and promote balanced lifestyle in Russia

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Reduction of Environmental Footprint:

Reduced the volume of direct emissions of greenhouse gases by 1.5% compared to 2017 (81,014 thousand tonnes of CO

2 equivalent in

2018 compared to 82.3 thousand tonnes of CO

2 equivalent in 2017).

We estimate that in the past five years (2014–2018), we reduced our potential contribution to climate change by more than 50% — by using more energy efficient refrigeration equipment


Key 2018 Results and Highlights: We increased the number of energy efficient refrigerators to 51%

We reduced the energy use ratio by 5.6% compared to 2017. In 2018, the energy use ratio per litre of final product fell below our target of 0.52 megajoules per litre to 0.51 megajoules per litre

We reduced the water use ratio by 3% compared to 2017*. The actual 2018 water use ratio fell below the year’s target of 1.86 litre per litre of final product to 1.85 litre per litre of final product

We reduced the total waste ratio by 1.3% compared to 2017. The total waste ratio (measured in grams of waste per litre of final product) stood at 5.9 g/L in 2016 and 2017, and in 2018 we were able to reduce it to 5.85 g/L

We reduced our use of PET materials by 130 tonnes

* The Coca-Cola НВС Russia 2017 Sustainability Report contains a typo here: one should read 1,91 instead of 1,92.

Learn more about our efforts to reduce waste

Learn more about our efforts to protect the environment and reduce waste

we are consistently reducing CO2 emissions at our plants and

we conserve water

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Goals for 2019:

We will reduce the energy use ratio to 0.49 megajoules/L of final product

We will cut water use ratio to 1.84 L/L of final product

We will increase the amount of energy generated from renewables by 30% compared to 2018

We will reduce the total amount of manufacturing waste by reducing packaging weight by 2–4 g


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Distribution of Social Investments Made byCoca-Cola in Russia in 2018

We have identified four material topics: promoting a culture of separate waste collection and recycling, youth empowerment, promoting inclusivity, and emergency relief efforts.

> 193 million RUB* we invested in social projects in 2018

External Social and Environmental Programs

4% Emergency relief

37% Public outreach and youth empowerment

14% Combatting environmental pollution and promoting a culture of separate waste collection and recycling

45% Building an inclusive society


* In EUR, at the Central Bank of Russia exchange rate as of 31.12.2018.

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Russia Without Waste: "Separate With Us"

At the End of the First Year of this Program, We Set the Following Goals for 2018:

Set up 1,500 containers for separate waste collection and recycling

Collect and recycle 10,000 tonnes of consumer packaging waste

After Launching "Separate With Us" in 2016, We Have:

Set up >5,000 containers for separate waste collection and recycling in 50 cities across Russia (including 2,000 containers in 25 Russian cities in 2018 alone)

Collected and recycled ~60,000 tonnes of consumer packaging waste (28,500 tonnes in 2018)

Engaged ~800,000 people via public outreach

Collected and recycled 27% of consumer packaging in 2018

We have helped to collect and send for recycling 32 tonnes of plastic waste during the 2018 FIFA World Cup™, or the equivalent of the total amount of packaging that we have supplied with our beverages to the championship


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Youth Empowerment


We launched "Youth Empowered" — a free educational program for young people aged 18 to 30

We prepared partnership agreements with 20 Russian universities and other higher education institutions

Goals for 2019:

28,000 people will participate in the "Youth Empowered" program; we will also hold outreach events and guided tours of the company’s plants for more than 11,000 undergraduate students

We will be the official supplier of soft drinks to the XXIX World Winter University Student Games in Krasnoyarsk in 2019, and we plan to invest USD 1 million in preparation for the Universiade

We are going to support the RANEPA International Campus for 300 young leaders from around the world and the WorldSkills vocational skills championship in Kazan

By 2025:

We will ensure that more than 1,000,000 young people from 28 countries in the operational presence of the Coca-Cola Hellenic Bottling Company AG master the skills they need to find suitable employment


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Building an Inclusive Society



3 million people in 11 cities across Russia will be able to use (for both sport and leisure) new inclusive play parks, which started construction in 2018

> 7,000 people participated in unified football matches that were organized as part of the FIFA World Cup™ Trophy Tour With Coca-Cola in Russian cities

> 3,000 guests from more than 90 social institutions took part in Christmas Caravan celebrations

Goals for 2019–2020:

We will launch six more inclusive playgrounds: in Sochi, Samara, Yekaterinburg, Moscow, Moscow Region and Saint Petersburg

We will continue to incorporate the agenda on inclusivity in our social and environmental projects and the public events that we support, and to develop our inclusive Christmas Caravan

We will continue to develop and to expand our "Growing Kindness" mentorship program for teens

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Disaster Emergency Relief



We delivered 14,160 litres of drinking water for disaster survivors. Throughout our continuing collaboration with the Russian Red Cross, we have delivered nearly 400 tonnes of clean drinking water to people in affected regions.

We co-sponsored the Russian Red Cross initiative to create

coca-cola in russia sustainability report 2018 · coca-cola in russia, from january 1 to december...

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