CEO’s Statement

Financial year 2015 has been one of significant change at Woolworths Limited. However, as always, we remain absolutely committed to doing the right thing; by our people, by the planet and by the communities in which we operate.

Chairman’s Report

The extent of our commitment is reflected in the fact that for a fifth consecutive year, Woolworths has been recognised as a Sustainability Leader in the Dow Jones Sustainability Indices, Food and Staples Retailing sector. We are the only Australian retailer on the global sector leaders list.

Highlights

As Australia’s second largest private sector employer and New Zealand’s largest private sector employer, Woolworths makes a substantial contribution to employment and the economy.

In Australia, we employed 197,426 people in 2015, including 74,848 young employees under the age of 25 years. For these young people, Woolworths often provides the launch pad to their working lives and sets them up for successful careers, be they in retail or further afield.

In addition to direct employment and the $7.4 billion paid in wages in 2015, our business activities indirectly contributed $114 billion and 771,000 jobs across the Australian economy.

Importantly, safety rates at work improved with a Lost Time Frequency Rate of 10.51, a reduction on 2014. Pleasingly, more than 1,200 of our sites did not record a lost time injury during the year.

We continued to reduce our carbon footprint and reduced food waste to landfill by 60,000 tonnes during the year.

Over the year, Woolworths contributed almost $36 million through community programs with our community partners across Australia and New Zealand.

A strong focus has been assisting Australians struggling with the impacts of natural disasters. Since 2010 working with our customers we have contributed more than $28 million to The Salvation Army.

Sustainability Strategy 2007-2015

This year our Sustainability Strategy 2007-2015 comes to an end. We launched this industry leading Sustainability Strategy eight years ago with ambitious targets. The strategy focused on improving the efficiency of our operations, reducing waste and meeting customer expectations about responsible sourcing.

Woolworths successfully completed 31 out of the 34 key targets and commitments in the Strategy. Of the remaining three, two of these three commitments were found to be unnecessary.

One of Woolworths’ key and most challenging targets from 2007 was reducing carbon emissions from stores, distribution centres and offices by 40% (compared to projected growth levels) by 2015. Our goal was to bring our emissions from facilities back to the baseline year of 2006-2007, despite growing our business. An overall reduction of 42% surpasses our ambitious target. Our carbon reduction initiatives have delivered an estimated saving of $172 million so far. In addition, this year we have increased our distributed solar power generation capacity to 1.2 megawatts.

It is also important to be open and transparent about where we failed to meet our targets. We did not meet our commitment to zero food waste by the end of 2015. However, we recently recommitted to this target by 2020 and put steps in place to achieve this goal including an exciting new partnership with Australia’s leading local food rescue organisation, OzHarvest. This partnership will enable us to divert even more surplus food from landfill and further help Australians in need, addressing the broader issues of food waste, sustainability and food security.

I am very proud of the work the team has done to make Woolworths a more sustainable business over this period.

Setting our future CSR Strategy

To build on the good work of the 2007-2015 Sustainability Strategy, we are currently working on setting our goals and commitments for the next five years to 2020.

Woolworths believes shared prosperity is an essential ingredient of our success. We look forward to updating you on our progress in 2016.

Woolworths is a signatory to the United Nations Global Compact (UNGC). UNGC signatories embrace a set of core values in the areas of human rights, labour standards, the environment and anti-corruption. In this report, we share our performance against the UNGC core values.