Sustainability Report 2018

Better every day

Prioritize quality and safety

Prioritize quality and safetyAt Almarai, quality and safety means we are committed to delivering quality products you can trust based on a safe and healthy environment.

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People Governance Almarai Sustainability Report 2018

Prioritize quality and safety

Our promise to all stakeholders is to deliver “Quality you can trust.” Every day.

Food safety and qualityOur promise to all stakeholders is to deliver “Quality you can trust.” Since 1977, we have been committed to providing products that are manufactured to global best practice standards in food safety and quality.

Almarai has direct influence over its supply chain, from feed production to manufacturing, packaging, and distribution. This enables all stages of the product life cycle to be subjected to rigorous testing to ensure compliance to all quality and food safety requirements.

We continue to implement, develop and continually improve our standards across all sectors by applying integrated Management Systems in alignment with International Organization for Standardization (ISO) 9001 and FSSC 22000 principles. These principles include customer focus, engagement of people, leadership and a spirit of continuous improvement.

Our commitment to maintain our certification in these areas underpins our belief that food safety and quality are the cornerstones for sustainable growth.

In 2018, we continued to invest in our people with tailored training, engaging with international experts such as AIB International on Good Manufacturing Practices (GMP), and Campden BRI (UK) for cross functional Hazard Analysis Critical Control Points (HACCP). As a result of this we are currently in the process of utilizing software to develop a common approach to enhance the management of our food safety risks across the business.

We recognize that enhancing our quality culture forms an important part of our efforts to maintain our strong food quality and safety performance record. In 2018, we conducted a survey to better understand our current culture in our Poultry manufacturing plant (Hail, Saudi Arabia) and to identify opportunities for improvement. Over 1,450 people from that division took part. Pleasingly, it confirmed that our employees recognized food safety and quality as being embedded in everything we do, and that the company vision was communicated clearly within the business. There are many learnings from the survey which we are now using to take forward with our continuous improvement approach.

Finally, to keep our company values, ASPIRE, at the forefront of our people’s thoughts, we held a month of activities centered on the theme of “Quality” in support of “World Quality Day.” This was a successful business-wide engagement project and utilized different interventions from simple quizzes to a video communication from the CEO to reinforce the message that our company values align with the principles of quality management.

In 2019, we plan to roll-out the cultural survey across more areas of the business and to upgrade our Quality and Food Safety Management Systems to ISO 9001:2015 and ISO 22000:2018 requirements. In addition, we will continue our journey towards FSSC 22000 certification in our manufacturing facilities.

Material issues Ambitions

Food safety and quality To deliver quality you can trust, always.

Product nutrition and health To set the standard for high quality and improve the nutritional content of our products.

Workforce health and safety To ensure that our employees return home from work safely, every day.

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Prioritize quality and safety

The Global Food Safety Initiative (GFSI) brings together key factors to drive continuous improvement in food safety management systems around the world. Our shared belief in continuous improvement has been a driver in our interest to seek what is the world’s most prominent food safety management accreditation.

In 2018, our Infant Nutrition division was the first within Almarai to achieve this distinction, and over the next two years we will be actively pursuing FSSC 22000 certification for our Dairy, Bakery and Poultry divisions.

Almarai Infant Nutrition achieves Global Food Safety Initiative (GFSI) certification

Zero food recalls in 2018

100%of our production volume is manufactured in sites certified by independent third parties according to internationally recognized food safety management system standards

GCC Egypt Jordan Total

Percentage of production volume manufactured in sites certified by an independent third party according to internationally recognized food safety management system standard (%)

100% 100% 100% 100%

Number of incidents of non-compliance with regulations and/or voluntary codes concerning the health and safety impacts of products and services

0 0 0 0

Number of recalls  0 0 0 0

2018 | Our performance summary

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People Governance Almarai Sustainability Report 2018

Product nutrition and healthAs part of our mission of providing quality and nutritious food and beverages that enrich consumers’ lives every day, we have been supportive of growing consumers demands for more healthful products. We are constantly investing in and developing new technologies and competencies to improve the nutritional profile of our products, and we are incorporating health specific criteria into product innovation and development.

Our internal Nutrition Policy is our roadmap for achieving aims on a wide range of health and wellbeing issues, from product reformulation, including sugar, and salt to fortification.

In 2019, we will focus on continued reformulation work on our product range including reducing sugar in juices and salt in baked goods and foods.

Workforce health and safetyOur greatest asset is our employees, their health and safety are extremely important to us at Almarai. We protect our employees by applying international occupational health and safety standards, introducing policies to stimulate employee engagement, and encouraging communication between employees at all levels.

We have a two-level health and safety policy. Level one operates at the corporate level, from which individual divisions and business units develop their own distinct level two policies, tailored to reflect their particular hazard profile and management structure.

The corporate level one policy includes the Almarai “Safe Person and Safe Place Strategies” which define our approach to the safe management of assets and people. This strategy seeks to drive 1. safety performance, 2. leadership visibility and accountability, 3. continuous safety culture improvement and 4. ensure resources are in place for all sites to improve safety performance. Taking our commitment one step

further, we have a group Health, Safety, and Security (HSS) forum which drives our focus on HSS across the business and who’s role is to develop HSS strategy, performance, standards and guidelines.

Employee engagement is also key to maintaining focus on HSS. Monthly campaigns with different focus areas are ran business wide. In 2018, we ran monthly campaigns focused on our top five corporate hazards. This campaign helped to really ensure management teams and employees worked together in local areas for improvement through workshop forums to identify top down and bottom up actions for their sites, promote visible safety leadership and engage employees at all levels in making safety and health part of their day to day activities. In 2019, we will introduce the Safe and Sound campaign that works on three core values 1. Management Leadership, 2. Employee Participation and 3. Find and Fix Hazards.

In 2018, our Sales, Distribution and Logistics and Farming divisions achieved Occupational Health and Safety Management System ISO 45001:2018 certification, and ten of our senior HSS team members took the Lead Auditors Course.

In 2019, we plan to achieve ISO 45001:2018 compliance for all other divisions across the business. We will also commence the roll out of a Mobile Occupational Health Awareness Service, to screen our employees for signs of ill health. Initially our focus will be on our manufacturing sites as we look to proactively encourage our employees to live a healthier lifestyle. The service will additionally provide our employees with general health awareness and educational advice.

Almarai products contain no artificial colors.

Saudi Arabian Ministry of Labor and Social Development Safety Pioneer award winner 2018 for our strategic approach to the health, safety and wellbeing of our employees and contractors.

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Prioritize quality and safety

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GCC Egypt Jordan Total

Number of employee lost-time injuries 256 4 23 283

Employee lost-time injury rate (per 1 million man-hours) 1.72 2.16 9.48 NIA

Hours of employee health and safety training 155,320 9,603 507 165,430

Average hours of employee health and safety training per employee

4.0 3.0 0.6 3.9

Employee absenteeism rate (%) 6.50% 1.70% Less than 1%

NIA

2018 | Our performance summary

Note: NIA stands for no information available.

People Governance Almarai Sustainability Report 2018

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Almarai Company Exit 7, North Ring Road

Al Izdihar District PO Box 8524 Riyadh, 11492 Saudi Arabia

sustainability@almarai.com www.almarai.com