1886 ATLANTA USA LIGHT

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1 1886 ATLANTA USA

2 Our Route to Sustainability LIGHT Coca-Cola HBC Switzerland Ltd Sustainability Report 2011

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4 Contents Overview Editorial 2 Our Business 4 Our Product 8 About this Report 12 Our Approach Systematic 14 Cooperative 16 Ambitious 18 Our Seven Strategic Priorities Consumer Health 20 Employees 28 Water Stewardship 40 Energy and Climate Protection 46 Packaging and Recycling 54 Supplier Relations 60 Social Commitment 62 Annex GRI Index 64 Memberships 69 Key Links 70 Glossary 71

5 2 Overview Editorial Dear Ladies and Gentlemen, You have in your hands the Coca-Cola HBC Switzerland Sustainability Report the first of its kind! Anyone thinking at this point that sustainability is a new topic for us would be mistaken: we published our first environmental report in 2002, and another in Our endeavours in environmental management and industrial safety have moreover been officially certified since 2001 and 2003 respectively. Our intention in producing this report is to build on this tradition and to give you regular updates on our sustainability management activities in the future. Already we can look back on 75 successful years in business thanks to our strong commitment to sustainability and our clear strategic focus. A period during which, while still being part of the international Coca-Cola System, we have become firmly anchored in the Swiss communities in which our sites are based. We have also had many other reasons to celebrate in our anniversary year. Our Swiss organisation was one of the key high performers within the whole Coca-Cola Hellenic Group, and we achieved best-ever results in terms of volumes, market share, collaboration with our customers and profit. Socially and environmentally our performance also speaks for itself. Here I would like to mention just a few points: With Nestea Green Tea Citrus we successfully launched our first product containing the natural sweetener stevia, with 30 % less sugar. We expanded our employee recruitment process to include an innovative new tool: the Job Dating Day which gives us a platform for meeting future employees face-to-face through a series of dates. In 2011 we achieved the highest level of occupational safety at our three bottling plants in Bolligen, Dietlikon and Vals since our records began. In the reporting year we reduced the weight of our PET and reusable glass bottles by between 2 and 3 grams, without impairing their stability or quality. Furthermore, now for the first time ever our bottles contain more than 20 % recycled PET. And lastly, through our newly developed Group-wide values of authenticity, excellence, learning, caring for our people performing as one and winning with customers we are laying the foundations for the next 75 years of successful business. Of course we also faced a fair number of challenges in These are shared with

6 3 you in our report, in keeping with our commitment to transparent and straightforward reporting based on the principles of materiality and balance. We hope that this is also expressed in the layout of our report. My thanks go to all of our customers, partners and employees and to the Coca-Cola Hellenic Group and The Coca-Cola Company who have enabled us to achieve our successes this year and who have thus ultimately made this report possible. Best regards, Tomas Gawlowski Country General Manager I am confident that you will find plenty of interesting, exciting and possibly even surprising information about our business on the following pages. I wish you pleasant reading, and together with my colleagues look forward to receiving your greatly valued feedback.

7 4 Overview Our Business Our Business Coca-Cola HBC Switzerland is Switzerland s largest producer and supplier of alcohol-free branded beverages by volume. Besides carbonated soft drinks, we also bottle iced teas and mineral water. We import fruit juices and sports and energy drinks from neighbouring countries. In all, our range comprises 22 different brands including Coca-Cola, Fanta, Sprite, Valser, Nestea and Powerade. The majority of our beverages are trademark brands of The Coca-Cola Company, based in Atlanta, USA, which we produce exclusively in Switzerland. At our three bottling plants in Bolligen, Dietlikon, and Vals we produce beverages around the clock and distribute them to over 60,000 catering sector and retail customers throughout Switzerland via our distribution centres in Bolligen, Bussigny, Dietlikon, and Zizers. Overall across these sites and our headquarters in Bruettisellen we employ around 1,000 staff members. Our company is a wholly-owned subsidiary of Coca-Cola Hellenic Bottling Company S.A., the largest bottler of products from The Coca-Cola Company in Europe and the sec ond largest in the world. Based in Athens, the company is present in 28 countries in Europe and Africa and supplies over 560 million people with beverages. The shares of the Coca-Cola Hellenic Bottling Company S.A. are listed on the stock exchanges of Athens, London and New York. Kar-Tess Holding S.A. Headquarters Bottling plant Distribution center Dietlikon Bruettisellen Bolligen Zizers Bussigny Vals

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9 6 Overview Our Business Coca-Cola Hellenic Bottling Company S.A. Athens, Greece The Coca-Cola Company Athens, Greece Coca-Cola HBC Switzerland Ltd Bruettisellen, Switzerland Coca-Cola Switzerland GmbH Bruettisellen, Switzerland Commercial Finance Human Resources Supply Chain IT Legal Public Affairs & Communication Bottling Plant Bolligen Bottling Plant Dietlikon Bottling Plant Vals Valser Service Ltd 100 % Valser Mineralquellen GmbH 50 % 50 % Valser Trading GmbH Coca-Cola HBC Switzerland Ltd Responsibilities: Production and Sales Focus: Catering, Wholesale and Retail Coca-Cola Switzerland GmbH Responsibilities: Branding and Marketing Focus: Consumers Fritz Bärlocher and The Coca-Cola Company have equal holdings of 46 % of the shares. We have always worked hand in hand with Coca-Cola Switzerland GmbH, the Swiss subsidiary of The Coca-Cola Company. Within this close partnership part of the Coca-Cola brand s recipe for success we are responsible for infrastructure, production and distribution as well as for sales and marketing to our customers. Coca-Cola Switzerland GmbH essentially represents the interests of The Coca-Cola Company as the trademark proprietor. In this function, it is responsible, among other activities, for consumer marketing and product innovations for the Swiss market. In 2011, 89 % of the products sold by us across Switzerland were also produced in Switzerland; the remaining 11 % were imported. Imports are typically low volume niche products for which we do not have the production capacity in Switzerland. As volumes of these products grow to levels at where commercial production would be viable, however, we consider producing them within the country. Occasionally, we supplement local production with imported products from neighbouring countries, for example when demand is high during the summer months. Former CEO of Coca-Cola Beverages Ltd Success is a journey that never ends. For Coca-Cola, that means persevering. Keeping the balance between tradition and innovation. Preserving the authentic, while constantly renewing. And never ceasing to improve.

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11 8 Overview Our Product Our Product As far back as the end of the 18th century the first novel formulations of carbonated beverages were already available for purchase, mainly from pharmacies. Over the years, pharmacists began adding medicinal herbs and natural colourings and flavourings to the beverages. The rising demand from customers to be able to enjoy these drinks at home led to their industrial production and bottling in the 19th century. Coca-Cola too owes its existence to a pharmacist, and the world s most popular beverage is still produced to his original recipe today ( 1886 and 1936 two milestones). Today we sell 22 different brands of beverage with a combined sales volume of 486 million litres enough to fill 192 Olympic swimming pools. Our range extends from the classic sweetened and carbonated soft drinks such as Coca-Cola and Sprite and the calorie-free variants such as Coke Zero to the low-calorie ice teas, fruit juices, mineral water and sports and energy drinks and 1936 two milestones Doctor and pharmacist John S. Pemberton from Atlanta was in the habit of visiting the nearby port of Savannah in the early mornings to explore the spice ships docked there. On May 8th 1886 he finally struck lucky in his search for the right ingredients to make an invigorating tonic. He carried a small pitcher of his tonic down the street to Jacob s Pharmacy where it was mixed, somewhat by chance, with carbonated soda water. The mixture was very popular among the modern city-folk of Atlanta and thus the 125-year-old success story of Coca-Cola began. The beverage owes its illustrious name to Dr. Pemberton s bookkeeper and business partner, Frank M. Robinson. Taking its ingredients coca leaves and cola nuts, he created the name which is today unknown to only two in a hundred people worldwide. Incidentally the recipe, one of the best-kept secrets of all time, has never been changed to this day. Coca-Cola is still produced as invented by Pemberton in the 19th century, with no artificial flavours or added preservatives. It is thanks to the pioneering spirit of one Max Stooss that Coca-Cola has fizzed in Switzerland since Stooss signed the first concession agreement with The Coca-Cola Company 75 years ago. He based his business on the principle that Coca-Cola can only be successful if it wins the hearts of the local population. Thus he laid the foundation-stone for the beverage, affectionately known in Switzerland as Coci, which is now firmly anchored in Swiss society.

12 9 Coca-Cola litres Valser litres Coke Zero litres Our top sellers in the reporting year were Coca-Cola, Valser and Coke Zero. Our portfolio has expanded continually over the last 75 years, with particularly rapid growth since We bottle our products in over a dozen different types of containers including PET, single-use and refillable glass bottles and refillable kegs for the catering sector. The value chain of our beverages lies entirely within Switzerland and its neighbouring countries, with a few minor exceptions. From the procurement of the natural raw materials and production at our plants through to the recycling of our packaging waste, we are faced with a number of challenges from the sustainability point of view. Purchasing of raw materials: Coca-Cola HBC Switzerland purchases products and services from a multitude of suppliers. We pay particular attention to key sustainability aspects including local origin. We purchase our strategic raw materials such as PET preforms, carbon dioxide and sugar from a few selected suppliers with whom we maintain very close partnerships. For more information on purchasing, see Supplier Relations. Beverage production: We produce the various branded beverages at our three Swiss bottling plants according to the highest quality and safety standards. At every stage of the process we are constantly seeking to reduce our energy, water and material consumption. For more information, see Water Stewardship, Energy and Climate Protection and Packaging and Recycling. Transport: Our Swiss-wide production and distribution network allows us to be as close to our customers as possible. In the majority of cases, our products are delivered directly from our bottling plants to our customers without additional handling. Our fleet and routes are continuously optimised to allow us to work efficiently and reduce CO₂ emissions. For further information, see Energy and Climate Protection.

13 10 Overview Our Product Purchasing of raw materials Beverage production Disposal Lifecycle Consumption Transport Sales Sales: Our sales are based on the Coca-Cola principles of responsible marketing and we pay particular attention to child protection. We neither advertise our products to children under 12 years nor sell our beverages in primary schools. For more information on these topics see Consumer Health and Energy and Climate Protection. Consumption: Part of our wide range consists of beverages containing sugar, which may contribute to weight problems among those of our consumers who are not following a balanced diet or are physically not very active. For this reason we offer a wide range of calorie-free and low-calorie beverages and natural mineral waters. We also inform our consumers by providing transparent nutritional information about the calorific value of our beverages on all our packaging. We encourage an active lifestyle through our involvement with organisations such as the Schtifti Foundation. For more information see Consumer Health. Disposal: By continually optimising our primary and secondary forms of packaging we direct our efforts towards avoiding waste. We recycle 94.5 % of unavoidable waste. A further 5.2 % is sent to waste-incineration plants with integrated heat recovery, while the remaining 0.3 % is disposed of as special waste. Through our involvement in PET-Recycling Switzerland (PRS) and IGORA we have also played a significant part in making the Swiss glass, aluminium and PET recycling rates among the highest in Europe. For more information see Packaging and Recycling.

14 Illustrated guide to the reusable glass bottle production process using our Dietlikon bottling plant as an example: 1. Supply of empties from the warehouse: crates with empty bottles on a wooden pallet 2. Depalletisation by robot 3. Crate unloader with foreign material detector (straws, labels in bottle etc.) 4. Crate washer, link to step Bottle washing machine (cleaning of bottles with water and alkaline solution) with removal of foreign materials 6. Bottle inspector: inspection of bottles by camera for damage, especially to mouths 7. Tanks containing simple syrup (sugar and drinking water), final syrup (simple syrup and concentrate) and carbonated ready-to-drink beverage 8. Filling machine: bottles filled with beverage 9. Capping machine: crowns screwed on to bottles 10. Fill-level check: detection of under- or overfilling 11. Dating machine 12. Labelling machine 13. Loading machine: bottles loaded into the washed crates (step 4) by robot 14. Palletisation and subsequent transport to warehouse

15 12 Overview About this Report About this Report This is the first Sustainability Report published by Coca-Cola HBC Switzerland. It is aimed at our various stakeholders who are described in more detail in Our Approach. Our company has already published so-called environmental reports in 2002 and 2005 under the name, as we were known then, of Coca-Cola Beverages Ltd. Our intention is to build on this tradition and also to expand the scope of our reporting to include social aspects. It is our professed aim to give our stakeholders regular updates on our sustainability management activities in the future. The information and data in this report basically relate to Coca-Cola HBC Switzerland Ltd. Our environmental reports in the sections Water, Energy and Climate Protection and Packaging and Recycling focus on our three bottling plants in Bolligen, Dietlikon and Vals ( Production) and where applicable, on our fleet of vehicles ( Fleet). Generally we shall be considering the years 2007 to This timeframe will allow us to make a long-term comparison of the way our performance has developed. Any limitations in comparability are mentioned in the text. We report our Scope 1 CO₂ emissions according to the Greenhouse Gas Protocol; these are the direct CO₂ emissions caused by the combustion of heating oil, natural gas and fuels (petrol and diesel). We use the conversion factors of the International Energy Agency (IEA) to calculate the CO₂ emissions in the section Energy and Climate Protection. The following limitations must be taken into account in our environmental reporting: Valser Service AG, the distribution organisation of Coca-Cola HBC Switzerland Ltd which supplies private households and businesses, was separated off into a wholly owned subsidiary during the reporting year for internal reasons. While it still appears in our employee and fleet statistics up until mid 2011, it is essentially no longer part of the environmental report. It is our aim in the medium term however to reincorporate the relevant data in our reporting activities. Apart from our bottling plants, our headquarters in Bruettisellen, our ten regional field depots, our distribution centres in Bussigny and Zizers and the warehouses operated by us or third parties of course also have a direct and indirect impact on the environment. Our warehouses are located at the Burgdorf, Pratteln and Schafisheim sites. At present we do not collect environmental data for any of the above sites. The Winterhur site is an outdoor car park for storage of empties, while Pratteln is a warehouse that is usually unheated, and the warehouses in Burgdorf and Schafisheim are operated by third parties. The efforts to collect data for them would be unreasonably high. For our headquarters in Bruettisellen we have received some initial indications through the data gathered during our Energy Weeks initiative ( Energy and Climate Protection). According to this data the energy consumed by our headquarters accounts for less than 2 % of the energy consumed by our bottling plants.

16 13 Scope 2 and 3 emissions according to the Greenhouse Gas Protocol, in other words indirect emissions resulting from electricity drawn and value-chain activities, are not included either. Thus for example the emissions generated by the thirdparty drivers to whom we award logistics contracts in high season, and the contract bottlers who produce the entire range of Valser Viva and Schorle apple juice drink on our behalf, are not included. Also omitted are the emissions of our former Cold Drink Operations business unit previously responsible for managing, placing and maintaining our coolers and vending machines. These tasks were outsourced to IT Service House AG, a subsidiary of Swiss Post, at the start of the reporting year. In 2012, we shall acquire a set of tools that will allow us to calculate, monitor and control our direct and indirect environmental impact as well as to report our scope 3 activities. All social and environmental data contained in this report is collected regularly by our local HSE (Health, Safety & Environment) officials and reported to their national counterparts. At our bottling plants, consumption data (electricity, water, packaging materials etc.) is managed in a central SAP system. Accident and sickness figures relevant for insurance purposes are maintained using data-management software from the insurer Suva. Fleet data is taken from the company fuel cards used by our vehicle users and the vehicles onboard computers. Standard Disclosures Overview of GRI Application Levels Report Application Level G3 Profile Disclosures G3 Management Approach Disclosures G3 Performance Indicators & Sector Supplement Performance Indicators OUTPUT OUTPUT OUTPUT in Swiss commerce and above all among our key customers we also use this term as consistently as possible in our reporting. This and other terms are explained in the glossary at the end of this report. Our reporting is based on the latest guidelines from the Global Reporting Initiative (GRI3.1). The information contained in this report corresponds to Application Level B ( Graphic). In a culture of continual improvement which we foster, we always encourage feedback on our actions. The same applies here. So if you have any comments or queries, please them to us at csr.ch@ cchellenic.com. C C+ B B+ A A+ Report on: , , Not Required Report on a minimum of 10 Performance Indicators, including at least one from each of: Economic, Social and Environmental. Report Externally Assured Report on all criteria listed for Level C plus: , , Management Approach Disclosures for each Indicator Category Report on a minimum of 20 Performance Indicators, at least one from each of Economic, Environmental, Human rights, Labor, Society, Product Reponsibility. Report Externally Assured Same as requirement for Level B Management Approach Disclosures for each Indicator Category Report on each core G3 and Sector Supplement* Indicator with due regard to the Materiality Principle by either: a) reporting on the Indicator or b) explaining the reason for its omission. Report Externally Assured * Sector supplement in final version As part of the Coca-Cola Hellenic Group we do not publish economic indicators at national level. The relevant data for the whole Group (28 production countries) can be found in the business and sustainability reports of the Coca-Cola Hellenic Group. This report can be downloaded from our website at You can also order printed copies from the website while stocks last. In this report the concepts sustainability and Corporate Social Responsibility (CSR) are understood as synonyms. Internally, we use the term CSR. However, because the term sustainability has become established

17 14 Our Approach Systematic Systematic Jens Rupp Corporate Social Responsibility (CSR) is an integral part of our management strategy and encompasses the following seven strategic priorities: Consumer Health: As one of the pioneers of the worldwide Coca- Cola system, Coca-Cola HBC Switzerland has already achieved a great deal in the areas of quality management, environmental management and safety at work. I encourage the company also to use its market presence in Switzerland to promote sustainable lifestyle and consumer habits. We refresh our consumers and support them in leading a healthy lifestyle. Employees: We help our employees to achieve their full potential, to continue to develop and to act responsibly. Water Stewardship: We do everything we can to utilise our most important resource as efficiently as possible. Sustainability Manager Coca- Cola Hellenic Group Energy and Climate Protection: We make every effort to produce our beverages as energy-efficiently as possible. Packaging and Recycling: We are constantly striving to reduce the environmental impact of our packaging. Supplier Relations: We maintain close and sustainabilityoriented long term relationships with our strategic suppliers. Social Commitment: We contribute to the prosperity of the towns in which our sites are located and involve ourselves in charitable projects. We focus primarily on our customers and consumers, the natural environment and our employees. The latter in particular are crucial when it comes to implementing our sustainability commitments, which go beyond statutory provisions. This is why many years ago we declared CSR to be one of the seven fields of competency ( Employees) upon which our company s success relies. Through our Code of Conduct, performance objectives and professional development courses, and by continually raising awareness via the Intranet and other specific projects, we are empowering our employees to act responsibly. At organisational level, our Public Affairs & Communications department is responsible for the interdepartmental topic of CSR. The head of the department is a member of the Coca-Cola HBC Switzerland senior management team. By the very nature of the topic, however, the seven strategic priorities relate to all areas of business and therefore concern the entire senior management team. In

18 15 this context our Operational Sustainability department certainly plays a key role, as it is responsible for quality, safety and environmental management throughout the whole company. We were the first company within the Group to acquire certification for the following standards: ISO 9001 for Quality (1995), ISO for Environmental Impact (2001) and OHSAS for Occupational Health and Safety (2003). The systems are maintained at national level as well as by local HSE officials, and implemented with the aid of the local workforce. Our position within the Coca-Cola Hellenic Group is extremely beneficial to us, not least in the context of sustainability. Every year we agree ambitious sustainability targets with our parent company, report on our progress, and allow ourselves to be assessed and compared with other Group members (benchmarks). In addition, we maintain an active subject-specific exchange based on examples of successful practices.

19 16 Our Approach Cooperative Cooperative As a company, we will only enjoy longterm success if we consciously involve our key stakeholders in our business activities across the entire value chain. By stakeholders we mean everyone who has an influence on us in our daily work or conversely whom we influence, namely our customers and consumers, employees, suppliers, the Coca-Cola Hellenic Group and The Coca- Cola Company, the communities in which we are based, the associations, authorities and the non-governmental organisations, along with our competitors and the media. The following sections show the manner in which we discuss, interact and cooperate with our various stakeholders within the framework of our seven strategic sustainability priorities. In a highly competitive market such as the alcohol-free beverages market, the key to success is the focus on the customer. For this reason, in conjunction with our parent company we began placing our customers even more at the centre of all our activities well over two years ago. We intend to become our customers preferred supplier by continually generating added value, by providing our services to their complete satisfaction the first time and by being an uncomplicated business and trading partner. It is also our great wish to establish this stated aim as a declaration of sustainability after all, it is also through our seven strategic sustainability priorities that we create added value for our customers. To enable us to continually improve our customer focus, we conduct two customer satisfaction studies each year in conjunction with the Coca-Cola Hellenic Group. One is aimed at customers in the catering sector and the other at Key Accounts. Both studies allow us to compare ourselves with the other 27 national Hellenic Group companies as well as with our competitors in Switzerland. The independent market-research institute GfK reviews our customers satisfaction on the basis of two aspects: the health of the customer relationship and the assessment of the quality of service. Among other things, Vals: From family company to family member When we acquired Valser Mineralquellen from its previous owner in 2002, it was very important for us to build on the positive values of the family company. With this background in mind we proceeded starting in 2005 to integrate Valser into our Coca-Cola HBC family and to cultivate the cooperative partnerships with the local stakeholders. As part of a multi-stage process, the focus of the local managers was to strengthen the mutual trust and the family ties through clear management structures and personal commitment. In a second stage we aimed to get involved with our various stakeholders, particularly the Valser authorities, with increased transparency and openness. We pro-actively informed the general public and the local residents about the company s activities and the exciting world of mineral water by holding two open days. Last but not least, we established close and mutually beneficial relationships with the mountain pastures. During the tapping of the St. Pauls source spring, which is the source of Valser Silence, we were able to provide conduits which could also be used to provide electricity to the neighbouring mountain pastures. Moreover, thanks to a connection to the reservoir the pastures have had official mineral water on tap ever since.

20 17 the first includes an assessment of statements such as the company is easy to do business with, the company keeps its promises, and the company does the job right the first time. The quality of service is evaluated based on categories such as business development and support, planning, implementation and agreement. The studies allow us to identify the key drivers behind customer satisfaction or dissatisfaction as well as potential areas for improvement. These identified drivers have remained more or less constant in the last few years. among other things on improving the flexibility of our sales personnel so that they can better accommodate the customers individual wishes. As for our Key Customers, the emphasis in 2012 will be on stronger customer collaboration focused on shared added values, and on creating greater transparency for our customers for example in relation to our promotion strategy. In the reporting year, we improved in both customer groups and aspects and achieved a strong ranking in national and international comparisons. Catering sector customers gave our quality of service in particular an extremely high rating. Among Key Customers, we scored highly on the health of the customer relationship. Nevertheless, we still have much work ahead of us. In 2012, where our catering sector customers are concerned, we shall be working

21 18 Our Approach Ambitious Ambitious Our customer focus, which is so important to us, plays a central role in allowing us to continue growing in the future. However, we must not forget the objectives that we set ourselves every year in close collaboration with the Coca-Cola Hellenic Group regarding the sustainability of our business. These objectives help us to become more efficient, to save costs and to reinvest saved capital in a targeted way, and thus to have a positive influence on our reputation result 2011 target 2011 result 2012 target 2020 target 2020 target (Group) Employees Occupational accidents (OA) > 1 day / full-time positions Days lost (OA) / 100 full-time positions Water Stewardship Water ratio: l/lbp (production) Energy and Climate Protection Energy ratio: MJ/lbp (production) Packaging and Recycling Waste ratio: l/lbp (production) Consumer Health Wide range of beverages offered Adaptation of product portfolio to meet customers and consumers needs Launch of new products using natural sweeteners Supplier Relations Systematic consideration of environmental and social aspects when purchasing raw materials Close partnerships with strategic suppliers. Social Commitment Benefiting the prosperity of the communities in which we are based Supporting social issues in relation to our core business Supporting the voluntary activities of our staff

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23 20 Our Seven Strategic Priorities Consumer Health Consumer Health Our success is heavily dependent on how well and how quickly we adapt to changing consumer needs. In Switzerland, excess weight and obesity have become serious social and economic challenges in the past 15 years. In response to this problem we have greatly expanded our product range since We are also committed to transparent nutritional information and responsible communication. In 2009 the Swiss Federal Office of Public Health (FOPH) commissioned a study into the extent of excess weight and obesity, and the associated health costs. The study examined those people with a body-mass index higher than 25. The findings: in 2007 nearly four in ten people in Switzerland were overweight or obese. Fifteen years ago, that figure was one whole person lower. At the same time the experts established that the proportion of adult males,who are overweight, at almost 50 %, is significantly higher than that of adult females, of whom one in three is overweight or obese. The figures for children and youths aged between 6 and 13 are also alarming: one boy in six and slightly more than one girl in eight are affected. The direct economic costs of obesity and its most frequent complications, such as coronary heart disease, diabetes or asthma, is CHF 3.8 billion equivalent to 7.3 % of the total healthcare cost in Switzerland in As a bottler and producer of the classic soft drink Coca-Cola, we are countering these developments through the following initiatives: a wide selection of beverages, transparent nutritional information, responsible sales and marketing and strong partnerships to raise awareness among consumers. The personal responsibility of our consumers lies at the heart of all our activities: we are helping them to make the right choices to achieve a balanced diet, and encouraging them to lead a healthy, active lifestyle. Wide selection of beverages The market share of low-calorie soft drinks has seen growth in the high single figures year by year for a long time now, making it one of the most strongly growing

24 21 segments in the Swiss market. This development is reflected in our product portfolio. Our range has been greatly extended over the past decade and the majority of our new products are either sugar-free or low-calorie beverages. The innovation experts in our Business Development area are following these shifts in needs very closely. Working in interdisciplinary teams they follow a five-stage innovation process leading from initial idea through feasibility studies to market launch, evaluating new brands and flavours or modifying existing formulations. We work very closely with The Coca-Cola Company in these three areas. It is conducting intensive research, particularly in the area of natural sweeteners, in order to continually reduce the calorie content of our beverages. In the reporting year, we withdrew our Nestea Vitao product from the market and replaced it with Nestea Green Tea Citrus. Because this iced tea is sweetened with stevia ( Nature s sweeteners), we were able to reduce the sugar content by a full 30 %. Another product containing stevia will be launched in 2012: Sprite Stevia. Furthermore, in 2011 we were actively involved in reformulating the Nestea Lemon and Powerade recipes across Europe. The latter case allowed us to reduce the calorie content of 100 ml of the beverage by around 50 %. In 2010, we also successfully launched our lightly mineralised water Valser Silence, thereby further expanding our Valser portfolio. Sugar supplies our body with energy in the form of calories. However, if more calories are consumed than are burned through physical and mental activity, this results in weight gain. We offer our consumers calorie-free and low-calorie beverages to quench their thirst and, at the same time, make it easier for them to control their weight. Since 2005 we have Nature s sweeteners The sugar we use in our sweetened beverages is sucrose, which is extracted from Swiss-grown sugar beet. Sugar is a carbohydrate. It provides our bodies with a quick supply of energy, thereby helping to improve our concentration and to counter energy slumps. One gram of sugar has just under half as many kilocalories as one gram of fat or 4 kcal. One decilitre of Coca-Cola contains 10.6 g of sucrose (table sugar) per 100 ml, while as a comparison, the same volume of apple juice contains 11.7 g of sugar. Besides sugar, stevia has become increasingly well known in our latitudes in recent years. Stevia rebaudiana is one plant in a genus of over 240 herbs and shrubs native to sub-tropical and tropical regions from western North America to South America. For centuries the leaves and stem of the stevia plant have been used by local populations as a natural sweetener. Steviol glycoside, extracted from the plant s leaves, has also recently been sanctioned for use as a sweetener in the food industry. Depending on the way it is processed, stevia is up to 200 times sweeter than normal sugar and yet without any calories.

25 22 Our Seven Strategic Priorities Consumer Health reduced the calorie content of our beverage portfolio by 3 % per 100 ml, weighted by sales volume. Consequently the average calorie content in this reporting year was 100 kcal. Of course the fact is that as a beverage producer and supplier of beverages it is in our interest to meet the consumers needs ( Vanilla Coke: Detour to Success). If one disregards the weighting by sales volume, we have achieved an 11 % reduction in calorie content per 100 ml across our entire range since Transparent nutritional information Besides a wide selection of beverages, we also offer our consumers clear and easily comprehensible nutritional information on our beverage packaging which extends beyond the legally required nutritional values per 100 ml. Our GDA (Guideline Daily Amounts) Nutritional Compass, introduced in 2008, shows the calorie content and quantities of the four key nutritional values per serving ( Nutritional Compass): sugar, fat, saturated fatty acids and sodium, or salt. These quantities are also shown as a proportion of an average daily calorie intake of 2,000 kilocalories, which gives our consumers the opportunity to control their own calorie intake and thus their body weight. Coca-Cola developed the GDA Nutritional Compass in conjunction with other companies in the European food and beverages industry and with independent experts and organisations active in the field of consumer information. All leading foodstuff producers now voluntarily label their products with this Nutritional Compass. Here in Switzerland, Coca-Cola HBC Switzerland and Coca-Cola Switzerland GmbH began using the Nutritional Compass, along with other local manufacturers such as Unilever, PepsiCo, Nestlé, Master Foods, Kraft Foods and Rivella. Coop and Migros, two of the largest retailers in Switzerland, also adopted the labelling for their own-brand products. The whole campaign was carried out with the agreement of the Swiss Federal Office of Public Health and the overwhelming majority of Swiss consumer organisations reacted very positively to its introduction. In addition to our Nutritional Compass we now also include front-of-pack GDA symbols across our range. This allows customers to see at a glance how many calories are contained in a serving of the beverage they have purchased, and what proportion of their daily intake this represents. Responsible sales and marketing Our creed to providing transparent and responsible information and communication also extends to our sales and marketing Vanilla Coke: Detour to Success In 2003 we added Coca-Cola Vanilla to our range, and then withdrew it in 2005 due to low sales volumes. So we were all the more surprised when a rapidly expanding Facebook group began to form in 2010 followed later by another on Migipedia, the consumer portal of the Swiss retailer Migros both calling for the reintroduction of the cult drink. Quite unbelievable at first, but when a number of consumers wrote to us and to Migros we realised that clearly the time was right for a small-scale relaunch. But we were way off the mark: the production of around 125,000 litres that we commissioned from the Netherlands in spring 2011 as a one-off production for the year lasted only two weeks. Like Migros, we were overwhelmed by the huge demand. Today we produce over 1 million litres of the cult Cola annually, and we have also moved its production closer to home: it is now being filled into cans in Austria.

26 23 Nutritional Compass 1. Quantity information 2. The glass symbol gives information about the number of servings in a package. 250 ml is considered a standard serving for beverages. 3. The quantity (g) gives information about the four main nutrients and their energy content (kcal) per serving. 4. The percentages indicate the percentage of the recommended daily intake provided by one serving of the beverage EAN stands for International Article Number (formerly European Article Number) and is a product code for commercial articles. 1 EAN-Code 5 2 activities. Within the worldwide Coca-Cola system, standardised marketing principles aimed to protect children are applied. At the heart of this policy is the belief that parents and caregivers are the best people to decide what their children eat and drink. For this reason: we do not show any advertisements in print media, on TV or in TV programmes, on websites or on smart phone apps that are aimed mainly at children under the age of 12. Mainly means a medium or programme where over 50 % of the audience are children under the age of 12; we do not use personalities for marketing and sponsorship activities aimed mainly at children under the age of 12; we do not hold tasting campaigns and events or any such activities for children under the age of 12, unless the children are accompanied by their parents or other persons with parental authority. Furthermore, we also have clear guidelines on the sale of beverages to schools: We do not sell beverages in primary schools. 1 to 2 litres a day As our bodies are constantly exuding water and water vapor we need to take in two to two-anda-half litres of fluids each day. We retrieve some of the fluids from the food we eat, and the rest one to two litres has to be obtained by drinking regularly in sufficient quantity. Drinking is thus a fundamental part of a balanced diet. A person will only feel physically and mentally fit if he or she takes in sufficient fluid.

27 24 Our Seven Strategic Priorities Consumer Health The classroom is an advertising-free zone. Our diverse range sold at senior schools offers at least three categories of alcoholfree drinks including fruit juices, water and light beverages. As a matter of principle, no promotions are carried out in schools. No financial incentives are offered to schools for installing drinks vending machines. Vending machines are provided only at the express wish of the school management. Strong partnerships As well as a balanced diet, sufficient physical exercise and sport also play an important role in people s health and in their physical and mental development. This is why sport has always been a main part of the strategic sponsorship activities of The Coca- Cola Company. For example Coca-Cola has been a worldwide partner of the Olympic Games ever since However, the most important sport for us is football: The Coca- Cola Company has sponsored the FIFA World Championship for many years. For our part we have also been involved in the game for many years as the main sponsor of FC Vals, supporting the club by providing shirts, beverages and the soccer pitch itself, which was built on our land. In a similar way we also support FC Bruettisellen. To promote an active lifestyle among children and young people we entered into a partnership with the Schtifti Foundation last year. For many years this foundation has successfully dedicated itself to promoting a healthy future for children and adolescents by highlighting the connection between exercise and diet in a way that is focused on the young. Between 2003 and 2009 for example the Schtifti Freestyle Tour gave over 18,000 school pupils a better understanding of nutrition. Coca- Cola HBC Switzerland supplies Valser mineral water for the Foundation s workshops free of charge and also gives financial support. Maximum product safety Food production is one of the most strictly regulated areas of the Swiss economy. A dense network of statutory requirements ensures that foodstuffs pose no harm to health Sodium cyclamate and other such sweeteners We use the sweeteners aspartame, acesulfame K and sodium cyclamate in our calorie-free beverages. These are additives which are subject to very stringent safety controls as part of repeated risk analyses performed by scientific bodies. After more than 200 scientific studies including genotoxicity tests and over 25 years use in the food industry, the compatibility and harmlessness of these substances is beyond doubt. The European Food Safety Authority (EFSA), the Joint Expert Committee on Food Additives of the UN s Food and Agriculture Organisation and the Swiss Federal Office of Public Health support these findings. Thanks to their relatively high level of sweetness and the fact that we use sweeteners in a combination of three, we have also been able to keep well below the maximum permissible concentrations. These maximum permissible values moreover integrate a safety factor of at least 100 to ensure that children and people with weak immune systems are protected.

28 25 and make no misleading claims. Each food company must apply the principle of self regulation. As part of this principle, we too must prove firstly, that we follow good practices and quality assurance systems (for example hazard analysis and critical control points HACCPs) and secondly, that traceability is ensured and that the obligation to recall unsafe foodstuffs is met. Our compliance with the laws is checked annually by means of official audits, generally without prior notice. In these audits, our systems are regularly praised by the officials as outstanding. Besides official audits, our whole company is subjected to a monitoring or recertification audit every year by the world s largest inspection and certification body. Its experts check that we are fully compliant with current ISO standards and the FSSC food safety standard. Last but not least, our bottling plants are also inspected by cross-border auditors from the Coca-Cola System to ensure their compliance with Coca-Cola s own guidelines, which are significantly more rigorous even than the statutory food regulations in Switzerland. Before launching a new product in Switzerland we conduct extensive food safety Beat Seeger Head of Procurement Beverages and Tobacco at Coop Since 2011 Coop is the biggest retailer and wholesaler in Switzerland and offers the largest variety of trademarks in the country. Thanks to the extensive choice of products from leadingbrands, supplemented with well-priced private brands, Coop has enjoyed the clear leadership of the alcohol-free beverage market for years and is able to satisfy the consumers diverse needs. With top brands such as Coca-Cola, Fanta, Sprite, Valser and Nestea, Coca-Cola is our mostimportant supplier in this category by far, and thus takes a share of the credit for our unique market position in Swiss retail. As the leader in this dynamic category we can also claim to lead the way in innovation, again with the help of Coca-Cola: with Vanilla Coke, Nestea Green (containing Stevia), or Valser Silence only a few examples shall be mentioned. Furthermore, Coop distinguishes itself with a wide ecological and socially distinctive assortment as well as its sustainability achievements throughout the supply chain. For these achievements the independent rating agency oekom research Ltd has selected Coop in the year 2011 as the most sustainable retailer worldwide.

29 26 Our Seven Strategic Priorities Consumer Health tests which likewise go beyond the statutory regulations. In these tests, we investigate, among other criteria, the properties of the ingredients, the proposed packaging materials, the production process, the potential consumer group and any possible risks. Another integral part of our system is that we conduct product traceability exercises twice a year. These allow us to ensure that we have complete transparency over the flows of goods extending at least one value-adding level higher and lower. In the case of a PET bottle closure, for example, we can say exactly which company supplied it to us and in which delivery it arrived, when it was used in production, when and to which customer the corresponding bottle was delivered. To guarantee the consistently high quality of our products, our field staff and special mystery shoppers conducting anonymous test purchases regularly check the quality of our products on the shelves. We also receive feedback from our customers and consumers when they complain. We investigate each complaint and generally resolve each case within 72 hours, in discussion with the customer or consumer. Our crisis management system allows us to respond swiftly and competently in the event of a crisis caused by a faulty product, an accident, a threat or similar. At the heart of this system is our IMCR (Incident Management and Crisis Resolution) team a group of specially trained managers from all sections of the business who meet once a month to conduct a situation analysis and discuss current customer and consumer concerns. In an emergency, the team members are able to initiate the necessary measures quickly in their business areas. Additionally, the IMCR team is inspected every two years by the Coca-Cola Hellenic Group and by Coca-Cola Switzerland. During these inspections the team is confronted with various (hypothetical) events over the course of two days and must resolve them appropriately to the situation in each case.

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31 28 Our Seven Strategic Priorities Employees Employees Employees are the greatest asset of Coca- Cola HBC Switzerland. Our 75-year success story would not have been possible without committed, motivated and competent employees who are also team players. To achieve our vision to be the leader in every market in which we operate, we continually invest in our assets, in our employees commitment and power to innovate, in employee development, in occupational health and safety and in the Compatability of family and career. At the close of the reporting year we employed a total of 1,040 staff members, spread across 991 full-time positions, at our various sites. These include 24 apprentices (2.3 %) in five different vocations ( Graphic) who will remain in our employment if possible once they have completed their training. Our workforce comprises 36 nationalities: besides our Swiss employees (73 %) we also employ people who are mainly from neighbouring countries ( Graphic). The share of foreigners across all positions varies from 28 to 37 percent. A glance at our age statistics also reveals that we are a comparatively young company, with the vast majority of managers and senior managers aged between 30 and 50 ( Graphic). Women account for 26 % of our workforce, whether at managerial level or as employees without a managerial function. The share at senior manager level is even greater, at 31 % ( Graphic). As of December 31st 2011, the management team consisted of three women and four men, with one vacant position. Although we treat women and men equally, by tradition far more men work in certain areas such as production and warehousing. A few years ago a salary discrepancy arose in production. Today, however, we can rightly say that there are no longer any gender-specific salary differences. We resolved the discrepancy in production following an extensive review conducted on the basis of comparisons within the industry, across two natural rounds of pay negotiations. Our salaries now are based mainly on performance and position within market salary bands. Naturally, additional factors such as length of service and experience are also taken into account. In addition, we are committed to making jobs traditionally held by men more attractive to women. We place, for instance, targeted advertisements in women s magazines. At the start of 2012, a profile of one of our female field employees will appear in Cosmopolitan magazine with the aim of inspiring women to take up this interesting career. Moreover in the reporting year we developed job advertisements with