How has TI Finland influenced the development of

How has TI Finland influenced the development of a cleaner business environment in Finland? Juha Pietarinen TI Finland Chief Risk Officer Kesko Corporation

TI Finland • Established year 2003 • Business Principles for Countering Bribery and Guidance Document for Finnish companies • Close co-operation with The Central Chamber of Commerce • Annual seminars • Interviews and commentaries for the media • Statements for authorities etc. • The Chairman is a member of the national anticorruption working group (Ministry of Justice) 2 TI Finland: Juha Pietarinen, Chief Risk Officer Kesko Corporation 03/10/2020

Annual seminars • Year 2004: How do Finnish companies conduct business in regions with corruption? • Year 2004: Pharmaceutical Industry and physicians - co-operation on healthy basis? • Year 2005: The role of the media in combating and revealing corruption • Year 2006: Responsible partnership on development policy: corruption-free development aid • Year 2008: Political financing – transparent enough? 3 TI Finland: Juha Pietarinen, Chief Risk Officer Kesko Corporation 03/10/2020

Business Principles for Countering Bribery and Guidance Document for Finnish companies 1. 2. 3. 4. 5. Introduction The Business Principles Aims Develop a Programme for Countering Bribery Key Issues • • • 4 Bribes Political Conributions Charitable Contibutions ans Sponsorship Facilitation Payments Gifts and Entertainment TI Finland: Juha Pietarinen, Chief Risk Officer Kesko Corporation 03/10/2020

Business Principles for Countering Bribery and Guidance Document for Finnish companies 6. Implementation Requirements • • Organisation and Responsibilities Business Relationships HR Training Communication Internal and External Audit Monitoring 7. Guidance Document 5 TI Finland: Juha Pietarinen, Chief Risk Officer Kesko Corporation 03/10/2020

The importance to prevent corruption • Why Finnish business wants to tackle corruption and bribery • Maintain Finland’s leading position as one of the least corrupted country; we want to keep good reputation of Finland • Minor corruption gives Finnish enterprises competitive edge operating beyond national borders • Corruption increases the inefficiency of the economy because of extra costs • Corruption makes it easier to blackmail enterprises • Corruption distort basic elements of market economy especially free competition 6 TI Finland: Juha Pietarinen, Chief Risk Officer Kesko Corporation 03/10/2020

Kesko Corporation

Kesko is active in many product sectors % net sales Kesko Food Grocery trade % net sales 41% Rautakesko Building and home improvement trade 27% VV-Auto Car and spare parts trade 8% Anttila Department store trade Kesko Agricultural trade 8% Other operating activities 10% Group’s total net sales € 9, 534 million (2007, IFRS) 8 TI Finland: Juha Pietarinen, Chief Risk Officer Kesko Corporation 6% 03/10/2020

Growth and development in the Nordic, Baltic and Russian market areas Finland 5. 3 m Norway 4. 5 m Estonia 1. 4 m Sweden 9 m St. Petersburg area 5 m Finland: all divisions Sweden: building and home improvement trade Norway: building and home improvement trade Baltics: building and home improvement, agricultural and machinery, and furniture trade St. Petersburg area: building and home improvement trade Moscow area: building and home improvement trade Belarus: building and home improvement trade Latvia 2. 3 m Lithuania 3. 4 m Belarus 9. 8 m Total approx. 56 million consumers Moscow area 15 m

10 TI Finland: Juha Pietarinen, Chief Risk Officer Kesko Corporation 03/10/2020

Our Responsible Working Principles This guide, “Our Responsible Working Principles”, is intended for all employees of Kesko and the K-Group in all the countries in which we operate. The K-Group comprises K-stores, Kesko and Kesko’s subsidiaries. We wish and expect everyone to commit themselves to following the responsible working principles and the Code of Conduct described in this guide To support our growth and international expansion and secure our success, we need a strong common set of values and a common Code of Conduct. Kesko and K-stores exist to serve our customers. To succeed, we must exceed our customers’ expectations every time they visit one of our stores. Each and every one of us can contribute to customer satisfaction and the success and good reputation of the K-Group by acting responsibly and in line with our values. We want to create a good working community, exceed our customers’ expectations, and be the best operator in the trading sector and area. Our goal is to be the winning team in every country in which we operate! Matti Halmesmäki President and CEO, Kesko 11 TI Finland: Juha Pietarinen, Chief Risk Officer Kesko Corporation 03/10/2020

Our Responsible Working Principles, Content 1. Kesko’s Code of Conduct • Responsibility calls for commitment • Acting responsibly internationally • Principles • Corporate Governance Statement • Environmental policy • Risk management policy • Ethical purchasing principles • Security policy • Communications policy and principles • Information security policy • Sponsorship principles • Internal control principles • HR policy • General principles of Kesko’s • corporate responsibility 12 TI Finland: Juha Pietarinen, Chief Risk Officer Kesko Corporation 03/10/2020

Our Responsible Working Principles, Content 2. Day-to-day responsibility • • • We observe the law and regulations We avoid conflicts of interest We cannot be bribed We all contribute to creating a good working community We all have a part to play in ensuring safe operations free from interruptions • We keep customer information confidential • We communicate openly and effectively 13 TI Finland: Juha Pietarinen, Chief Risk Officer Kesko Corporation 03/10/2020

We cannot be bribed • Our policy is that all forms of giving and receiving bribes are strictly forbidden. • Employees can only accept or give personal gifts or hospitality of a nominal value. • We do not pay bribes or make other illegal payments to officials or others to further or secure our business. • Acceptable forms of hospitality or gifts should be of an incidental nature and should not place any obligations, either explicit or implied, on the receiver, or generate any expectation on the part of the giver that he or she will receive any favours as a result. 14 TI Finland: Juha Pietarinen, Chief Risk Officer Kesko Corporation 03/10/2020

We cannot be bribed • Gifts and hospitality should always be given openly respecting the receiver’s organization’s own internal rules governing the acceptance of gifts and hospitality. • Hospitality or a gift that would normally be considered acceptable may in some situations, such as prior to an important decision on the part of the giver, be unethical and therefore unacceptable. • Donations or support given to political parties or organisations or individual candidates in an election must always be approved by the Kesko Group’s senior management, or in the case of a store, by the retailer. 15 TI Finland: Juha Pietarinen, Chief Risk Officer Kesko Corporation 03/10/2020

Questions? 16 TI Finland: Juha Pietarinen, Chief Risk Officer Kesko Corporation 03/10/2020