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Reporting our progress towards A Better Tomorrow SUPPLY CHAIN HUMAN RIGHTS1 37 Ethical standards along our supply chains is very important to us. We aim to uphold consistent compliance with labour and human rights standards at all stages of our supply chain. Due to the complex nature of food supply chains, the most salient human rights risks and environmental challenges are typically found upstream, in sectors and geographies far removed from our day to day operations. Challenges associated with upholding human rights are complex and systemic, meaning they can often impact entire sectors. Salient human rights issues such as occupational health and safety hazards, lack of freedom of association, discrimination, inadequate remuneration, child labour or forced labour can often be most effectively addressed through systemic solutions and collaboration.2 ACTION: To ensure we are upholding the rights of people impacted by our business and continually driving improvements, we have adopted a range of approaches and have integrated our targets across the business. Across the Globe At a group level, Lidl is aligned to the below principles: · UN Sustainable Development Goals · UNUniversalDeclarationofHumanRights · UNConventionontheRightsoftheChild · UNConventionontheEliminationofAllFormsof Discrimination Against Women · UNGuidingPrinciplesonBusinessandHumanRights · UN Women’s Empowerment Principles · ILOConventionsandCoreLabourStandards · OECDGuidelinesforMultinationalEnterprises · DhakaPrinciplesforMigrationwithDignity 1 GRI 412-1 - is this referencing 1 or 2 or both? Supplier Code of Conduct Our core standards are outlined in our Supplier Code of Conduct, which is fundamental to the relationship between Lidl and all its contracted suppliers. It defines the social expectations of all global direct and indirect suppliers and forms an integral part of our commercial contracts. We require our direct suppliers to uphold the clauses from our Code of Conduct within their own supply chains as part of our commercial agreements. Lidl takes a zero-tolerance approach towards inaction on forced and child labour and works proactively to tackle these issues as part of its due diligence process. SDG 10 – Reduced Inequalities We support global principles SDG 10.4 Adopt policies, especially fiscal, wage and social protection policies, and progressively achieve greater equality. Way to Go! Chocolate In 2019, Lidl was the first global retailer to design and launch our own-brand chocolate bar Way to Go! with the objective of developing a business model and supply chain approach that directly supports workers, smallholder farmers and local communities by increasing wages for Ghanaian cocoa farmers and promoting income diversification. The project uses the ‘Fairtrade Living Income reference price’, which represents a raw material cocoa price that enables smallholder farmers or workers within the plantations to earn a living income or a living wage. Way To Go! is a Super Fairtrade certified chocolate from 100% traceable cocoa beans grown by farmers from the Kuapa Kokoo co-operative in Ghana. Through Way To Go! Lidl guarantees cocoa farmers the Fairtrade Minimum Price for cocoa and the Fairtrade Premium, which is a sum of money for farmers to invest in their communities. On top of that, Lidl has also pays an additional ‘Lidl Premium’ on every tonne of cocoa which is invested in training for farmers in sustainable cocoa cultivation and other local crops, helping them diversify, improve crop yields and increase their income levels, meaning they are able to support a sustainable future for their families. In the first year, the Way to Go project has reached 440 farmers, a quarter of whom are women. RESOURCES Protection of Ecosystems Animal Welfare Standards Environmental Protection: Supply Chain SUPPLY CHAIN Employment Related Supplier & Market Human Rights Development Corporate Environmental Management OPERATIONS Employee Responsibility Responsible Products CUSTOMER Transparency Social Value Responsible at Point of Sale Creation Communication