q132/random_k2/random_2.md

ENVIRONMENTAL SOCIAL
GOVERNANCE REPORT

2020

Table of

Contents

Table of Contents

Letter

Compassion

Products

People

Planet

Community

Future of ESG

ESG Governance

Company Facts

2

6

8

14

18

22

26

30

34

38

A year of

Transformation

Le�er

from our CEO

Vivek Sankaran | Chief Executive Officer

2020 was a year of transformation for many, and
our company was no exception. The events of last
year brought to the surface the positive impact our
company has on our customers and communities.
I would like to thank each of our 300,000 associates
for their unwavering commitment to serving our
communities during such unprecedented times.

Throughout the pandemic, our teams acted swiftly
to implement in-store safety measures, keep food
and supplies on the shelves for customers, and
distribute COVID-19 vaccinations in partnership with
the Department of Health and Human Services.

As our communities faced rising food insecurity,
Albertsons Companies, the Albertsons Companies
Foundation Nourishing Neighbors program, and our
customers stepped up to help those in need. We set a
record $260 million in food and monetary donations to
aid hunger relief organizations in our local communities.
This helped us reach 13 million individuals and over
3,000 organizations.

When acts of racism and inequity shook our
communities, we came together as a company to
support one another and stand united in the face of
prejudice, hatred, and intolerance. We are committed
to equality and are driven by our guiding principle to be
a diverse and inclusive team.

Letter

I’m proud that over the past year we have not only
increased our diverse representation at all levels of
the company, but have also prioritized Diversity, Equity,
and Inclusion training, created opportunities to have
courageous conversations, and outlined a framework
to continue to improve. As part of these efforts, we
committed $5 million to social justice & equality causes.

In the face of these challenges, our teams still made
meaningful progress to reduce our impact on the
environment. As part of this, we recently announced
our commitment to setting a science-based target to
reduce carbon emissions. This broadens our existing
environmental commitments, which include making
100% of our Own Brands packaging recyclable, reusable,
or industrially compostable by 2025.

Looking Ahead
In 2020, we completed a new materiality assessment,
which will be the foundation for our Environmental
Social Governance (ESG) strategy and initiatives going
forward. Through this process we identified high priority
areas that align with our long-term company strategy
and are most critical to our stakeholders, including
Climate Action, Community Stewardship, Diversity,
Equity & Inclusion, and Waste Reduction & Circularity.
I am encouraged by the progress we made in 2020,
as it established a framework from which we can
accelerate our efforts.

We have a bold vision for the future and will soon
be launching commitments with specific metrics to
measure our progress. I invite you to learn more about
our progress in 2020 in this report, and I look forward
to sharing more with you in the coming months.

Vivek

Environmental Social Governance Report 2020

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6

Compassion
core
business

is at the

our

of

2020 was an unprecedented
year, and we are proud of the
unwavering commitment our
teams showed to supporting
each other, our customers,
and our communities.

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8

COVID-19
Times of extraordinary need require an
unprecedented response, and we’re
thankful to our associates for their
commitment to safety and supporting
our neighbors during the COVID-19
pandemic. Their amazing work and
dedication created hope within our
communities during uncertain times.
Ensuring the health and safety of our
associates, customers, and communities
was our top priority in 2020.

COMMUNITIES: There has never been
a more important time to help our
neighbors than during the COVID-19 crisis.
As hunger relief programs were stretched
to capacity, we pledged $53 million and
started a fundraising campaign through
the Albertsons Companies Foundation
Nourishing Neighbors program.
Additionally, our generous customers
donated more than $67 million
to our Nourishing Neighbor hunger relief
campaigns throughout 2020.

We developed new partnerships to
support businesses and their employees
as companies had to close or scale back
operations. We offered streamlined job
application processes to employees that
were furloughed or had hours reduced at
other hospitality and retail companies. We
purchased supplies from the restaurant
and service industries to keep food from
going to waste and ensure our customers
could find the products they needed.

Compassion

CUSTOMERS: Our stores offered
senior citizens and vulnerable
customers dedicated shopping
hours to ensure all customers had
the opportunity to get the items
they needed. Additionally, we
expanded our Grocery Delivery,
Drive Up & Go, and Pharmacy Delivery
services so customers could have
contact-free shopping experiences.

As of June 19, 2021, we have
administered more than 6 million
COVID-19 vaccines through our 1,700
pharmacies. We continue to offer our
customers new resources to help them
navigate this health crisis, including
digital vaccine records and rapid
antigen self-tests.

ASSOCIATES: For the safety of our
employees and customers, we
implemented social distancing and
face mask requirements, rigorous
cleaning and disinfecting procedures,
health checks before the start of shifts,
and plexiglass barriers at check stands.

To show our gratitude, we gave all
front-line associates temporary
Appreciation Pay, bonuses, and
other benefits.

Through the Albertsons Companies
Foundation's We Care Fund, we also
provided more than $800,000 to support
associates experiencing unanticipated
or unavoidable hardships.

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Social Justice
Courtesy, Dignity, and Respect are core values at Albertsons
Companies. They are the foundation of our associate training,
and by living these principles, we strive to make a difference in
our operations, communities, and beyond. We condemn hate or
discrimination of any kind, and this past year has underscored
the importance of standing together to boldly face inequity and
injustice head on.

SUPPORTING CAUSES TO ADVANCE SOCIAL JUSTICE:
Last year, we formed a Racial Justice & Equity Advisory Group,
which advised us on our $5 million commitment from Albertsons
Companies and the Albertsons Companies Foundation to the
following social justice organizations to help our communities lay
a foundation for racial equity and social justice:

$1 million

donation toward our African
American Associate Resource
Group’s efforts to partner with
local organizations who support
communities and neighborhood
actions in our market areas.

$1 million

donation to the City of Chicago’s
Together Now fund.

$2 million

donation toward the social
justice efforts of the NAACP Legal
Defense and Education Fund
and the National
Urban League Inc.

$1 million

reserve fund for social justice
and diversity initiatives in the
future, including community
outreach, supplier diversity,
and ongoing education.

Compassion

Listening with compassion
and taking action  when it is

needed are critical to ensuring
that racism and hatred have no
place at our company.

– Vivek Sankaran, CEO

SUPPORTING ASSOCIATES:
Last year we seized the opportunity to prioritize courageous
conversations within our teams to achieve meaningful change.
To create a safe and inclusive environment where associates
could share thoughts, feelings, and experiences, we held company-
wide town halls, reenergized our Associate Resource Groups,
and launched an interactive workshop, “Leading with Inclusion.”

We continuously review our Diversity, Equity and Inclusion (DE&I)
practices and training, and are always working to do more
and better. In 2020, we launched a new DE&I aspiration and
accompanying framework to achieve it. Since then, we have
been diligently working on expanding programs and resources
across our company.

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Products

Meeting the demands of
an evolving marketplace

 •

 •

 •

100% of O Organics® and Open
Nature® shell and liquid eggs
are cage-free. All Own Brands
hard-boiled eggs are cage-free

100% of O Organics coffee is
Certified Fair Trade™

100% of our Open Nature® and
Waterfront BISTRO® seafood meets
our Responsible Seafood Policy
and is clearly marked with our
Responsible Choice logo

 • Donated ~$500,000 since

launching debi lilly design™
Extending Smiles bouquets

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Products

Plastics and Packaging Pledge
We made our Plastics and Packaging Pledge in 2019 to advance sustainability
throughout the company, starting with our extensive Own Brands portfolio.

 •

100% of Own Brands packaging will be recyclable, reusable, or industrially
compostable by 2025

 • Own Brands plastic packaging will include 20% recycled content by 2025

 • Own Brands products will have clear recycling communications on packaging

by 2022 via platforms such as How2Recycle© and Smart Label©

We are diligently working toward achieving our Pledge, and customers can find
updated examples of recycling communications on many of our products today.

We put a lot of effort into helping
people live better lives and
strengthening the communities
where we do business. By
responsibly sourcing our O
Organics coffee, Albertsons
Companies is demonstrating
its commitment to improving
livelihoods and the environment.

– Chad Coester, Senior Vice
President, Albertsons Companies
Own Brands

Fair Trade Certified™ Coffee
In 2020, we transitioned our O Organics
coffee to 100% Fair Trade Certified™ sources,
meeting our Sustainable Coffee Challenge
Commitment. Purchases of our Fair Trade
Certified™ coffee generated more than
$650,000 in community development funds
for coffee farmers, their families, and
communities in 2020.

This coffee is certified to rigorous standards,
providing safe working conditions, upholding
fundamental human rights, and helping to
protect the environment in our sourcing
regions — including Ethiopia, Peru, Honduras,
and Colombia.

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People

Supporting employees
to reach their full potential

 • First national grocery chain to join the
Business Coalition for the Equality Act

 •

Integrated Diversity & Inclusion goals
into more than 5,000 top leaders’
performance plans

 • Conducted more than 120 “Leading

With Inclusion” sessions, with 4,000+
total participants

 • 70+ women recognized by leading

industry publications

 • We have 6 Associate Resource Groups
to enable an inclusive and welcoming
culture among our associates

Albertsons Companies
Associate Resource Groups

ALLIANCE

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Our Aspiration
Reflect the rich diversity of the communities we serve by offering our associates,
suppliers, and customers equitable access to opportunities and resources.

Diversity, Equity and Inclusion Framework

In 2020, we introduced our Diversity, Equity and Inclusion Aspiration, along with
a 6-part framework to achieve it:

1.

Inclusion & Belonging

4.

Impactful Associate Resource Groups

2.  Hiring & Promotion

3.  Talent Development

5.  Community Engagement

6.  Metrics

We strive to reflect the diversity of our communities within our management and
throughout our company. As part of our framework to achieve this, we are measuring
our progress by tracking metrics, such as representation.

Representation at Albertsons Companies

VP & Above Companywide

U.S.
Demographics2

Women

22%

49%

51%

People of Color1

Black/African American

Hispanic/Latino

Asian/Asian American

Other

4%

5%

8%

4%

10%

22%

6%

3%

12%

19%

6%

5%

1 Associate did not disclose: 3% VP & Above; 4% Companywide
2 2020 U.S. Census Data

People

We formed a National Diversity Council that is chaired by our CEO, Vivek Sankaran,
to advance DE&I within our company. In addition, each of our 12 operating Divisions
have Diversity Councils and we have individual councils for our Technology
& Engineering, Digital & Consumer, and Supply Chain departments. These councils
collectively host monthly town halls and fireside chats to discuss Diversity, Equity
& Inclusion subjects such as anti-Asian hate, the verdict in the George Floyd murder
trial, and other timely topics.

We continue to expand opportunities for our associates to learn more about
DE&I, including:

 • Monthly trainings to top 5,500 leaders to continue their education about how to

be more inclusive

 • Bi-annual store and supply chain huddles to further embed DE&I into our frontline

We must continue to set
the example of Courtesy,
Dignity, and Respect towards
everyone who walks through
our doors.

– Vivek Sankaran, CEO
   Albertsons Companies

Training &
Development
Our associates are the key
component to delighting our
customers. As such, we are proud
to offer a myriad of opportunities
to grow and advance. Over the
last year, our associates from
the frontlines to our offices
completed over 6 million hours
of training through various
programs, including on-the-job
training, mentoring programs,
eLearning, and classroom-style
events. We have also partnered
with industry associations to
provide access to relevant
continuing retail education
opportunities through colleges
around the country.

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Planet

Minimizing our impact
on the planet

 • Completed 800+ energy

efficiency projects that will
annually save 2 million+ metric
tons of CO2e

 • Enabled 160+ electric vehicle
charging stations to date

 • Recycled more than 880 million

pounds of cardboard

 • Recycled more than 26 million

pounds of plastic bags and film

 • Private fleet is 100% US EPA Smart

Way certified

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Reducing Our
Energy Use
Every year, our teams implement
hundreds of energy efficiency
projects to reduce our energy use
in our stores, plants, distribution
centers, and offices. Some projects,
like Energy Management System
or HVAC upgrades, happen
behind the scenes, but installing
doors on refrigerated cases and
transitioning to LED lights are
energy efficiency projects that our
customers can see in our stores.

In fiscal year 2020, we
completed more than 800
energy efficiency projects that
are estimated to annually save
more than 2 million metric
tons of CO2e — an equivalent
savings of taking 430,000 cars
off the road each year!

Generating
Renewable Energy
We have more than 50 on-site
solar arrays and two wind turbines
providing our operations with
renewable energy. Our renewable
energy procurement has made
us a top 30 company in the US
EPA's Green Power Partnership.

In the spring of 2021, we committed
to setting a science-based
target and our investments in
on-site renewable energy and
the purchase of renewable
energy credits will be important
enablers to achieving our goals.

Planet

Through this program,
Albertsons and Safeway
stores in Arizona will invest
in, and use, renewable
energy while adding
more solar power to
Arizona’s grid. We are
honored to support Salt
River Project's promise
to deliver more clean
energy to customers.

– Michelle Larson,
President of
Albertsons Companies
Southwest Division

Impactful Partnerships
Collaborating with our peers and suppliers helps us to develop and implement best
practices, create innovative solutions, and reduce our impact on the planet.

Utilizing Clean Energy Efficiently: As a longtime partner of the Salt River Project
(SRP), our Southwest Division was awarded SRP’s 2020 Sustained Excellence Award
for our ongoing commitment to energy efficiency. As one of the first companies to
participate in the SRP’s Sustainable Energy Offering, 40 of our Arizona locations are
receiving renewable energy from a new solar plant.

Reducing Food Waste: As part of the Pacific Coast Food Waste Commitment,
we are working together with retailers and local and state governments to reduce
food waste in the Pacific Coast region by 50% by 2030.

Identifying Sustainable Retail Bags: To find sustainable alternatives to the
single-use plastic bag, we joined the Consortium to Reinvent the Retail Bag, a
collaborative group of retailers that launched the Beyond the Bag Initiative and is
piloting innovative solutions.

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Community

Supporting causes that impact our
customers’ lives

 • Donated more than 83 million pounds of food

to our Feeding America partners

 • Administered 6 million COVID-19 vaccinations

through July 19, 2021

 • Won the “Community Hero Award” at Benevity’s

2020 Corporate Goodness Awards for The Albertsons
Companies Foundation’s best-in-class approach to
community investment

 • Earned the silver award in Engage for Good's
2020 America's Charity Checkout Champions
Awards for the Albertsons Companies Foundation's
point-of-sale fundraising

 • Raised more than $11 million for causes important to
our local communities, including education, cancer
research and treatment, programs for people with
disabilities and veterans’ outreach

 • Piloted in-school curriculum to help kids learn

what they can do to help stop hunger within their
own communities

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We are committed to help feed our neighbors in need.

$95 million

given to our communities

13 million

individuals reached

3,000+

organizations helped

350 million

meals

$9 million

invested in empowering
BIPOC communities through
hunger programs

$10.4 million

invested in schools to feed kids
during the pandemic

$472,000

to support
feeding seniors

$4 million

invested in innovative programs
to unlock new ways to feed
our neighbors

65,000

people connected
with SNAP benefits

Supporting Community Organizations
With a grant from the Albertsons Companies Nourishing Neighbors program, the
LGBTQ Community Center of the Desert in California was able to purchase a cargo van
to help distribute food to those in need in the community.

Having the van has been a HUGE help when we’re prepping for our Thursday night food
distribution every week. In the last month, The Center has converted our van into a mobile
pantry, providing more than 125 families with emergency relief boxes. We’ve been fortunate to
build relationships with community leaders that are dedicated to support these rural areas.

– LGBTQ Community Center of the Desert

Community

We Care is a voluntary associate-sponsored disaster relief and personal hardship fund
providing financial support to our communities and fellow associates in times of crisis.

During 2020, more than 300 grants totaling more than $800,000 were given out to
support our associates and communities during hardships.

Thank you very much. The We
Care program really helps. It’s
been reassuring to know that
I work for a company that
has my back.

– Recipient of We Care grant

We Care was instrumental
in getting me going in a
positive direction. I have since
signed up to donate weekly.
A fantastic program that has
helped many in my division.

– Recipient of We Care grant

Thank you so much, this is
super helpful in this trying
time. As a single dad, it's
been a little overwhelming
during the pandemic and
this is a great help and a
wonderful thing.

– Recipient of We Care grant

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The

future

of ESG
at Albertsons Companies

Recognizing the importance of Environmental Social
Governance (ESG) to our customers, associates, and
investors, we refreshed our Materiality Assessment
to prioritize how we address ESG. This assessment
identified our internal and external stakeholder’s
top-ranking ESG topic areas, and the outcome has
shaped our bold vision for the future. In the coming
months, we will release our new ESG strategy and
commitment for the four Tier 1 topics identified:
Climate Action, Community Stewardship, Diversity,
Equity & Inclusion, and Waste Reduction & Circularity.

Our efforts in these areas will support a
healthier planet and vibrant communities,
and I look forward to sharing our new ESG
strategy and commitments soon.

– Vivek Sankaran,
CEO of Albertsons Companies

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Identifying Our ESG Priorities
We analyzed 19 ESG topics specific to our business and industry and worked
with stakeholders to better understand where we should focus our efforts. We
conducted interviews and surveys with internal business leaders, customers,
investors, suppliers, industry groups, and included insights from industry reports
and ESG rating agencies. Based on the responses received we aggregated topics
into ranked, or "tiered," priorities.

Tier 1
Invest time and
resources to set goals,
advance our efforts,
and regularly report
on progress.

Tier 2
Proactively manage
performance and
report on continuous
improvement.

Tier 3
Develop policies,
position statements,
and brand standards as
needed, and report on
activities as appropriate.

Foundational
Focus on internal
excellence to proactively
minimize risk and meet
or exceed regulatory
requirements.

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Importance to Business

We plotted responses into a
prioritization matrix, and the
ranked results are guiding
our new ESG strategy

Future of ESG

Our ESG

priorities

The Results of our Materiality Assessment

Tier 1
 • Climate Action (focus on
energy and emissions)

Tier 2
 • Customer Health

& Wellness

 • Community Stewardship

 • Supplier Environmental

 • Diversity, Equity

& Inclusion

 • Waste Reduction

Stewardship

 • Supplier Social
Responsibility

& Circularity (focus on
food waste, plastics, and
consumer packaging)

 • Sustainable Products

& Ingredients

Tier 3
 • Animal Welfare

 • Product Marketing
& Transparency

 • Water Stewardship

Foundational
 • Data Privacy & Security

 • Employee Attraction,

Development & Retention

 • Employee Health & Safety

 • Governance Ethics & Compliance

 • Product Safety

 • Resilience & Adaptation

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ESG Governance
Overview

Bringing together our dedicated ESG
team with cross-functional business units
ensures our ESG goals and values are
incorporated into our business decisions
and strategic plans. With our operating
divisions’ localized expertise, our corporate
teams’ support, and the oversight by our
Board of Directors, our company is both
locally great and nationally strong.
This helps us to identify and act upon the
greatest opportunities to create a healthy
planet and vibrant neighborhoods.

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ESG Governance

ESG Governance
Albertsons Companies is
committed to responsible
corporate governance. Our ESG
Team collaborates with teams
and leaders across our company
to help drive and report on our
environmental and social impact.
Our ESG Council brings together
leaders that drive initiatives within
our product, people, planet, and
community reporting platforms to
report progress and discuss new
programs, risks, and opportunities.

Our Governance, Compliance &
ESG Board Committee oversees
risks associated with corporate
governance, business conduct and
ethics, ESG, and the management
of compliance and regulatory risks.

Management teams regularly
report on applicable risks and
opportunities to the relevant
Board committees or the full
Board of Directors.

ESG Council
(Cross-Functional Team)

ESG
Team

Governance,
Compliance & ESG
Board Committee

Board
of Directors

Environmental Social Governance Report 2020

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Company Facts

2,277 Retail Stores

22 Distribution Centers

20 Manufacturing Plants

note: all numbers from FY 2020

$70 billion

YE 2020 Sales

30 million+

customers per week

1,727

in-store pharmacies

exclusive billion-dollar Own Brands

4

25 million+

loyalty members

~300,000

jobs provided by one of the
largest retail employers

$260 million+

donated in 2020 through
our Albertsons Foundation

$1 billion

invested in COVID-19
related expenses;
including expansive safety protocols

Environmental Social Governance Report 2020

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Albertsons Companies is a leading food and drug
retailer in the United States, with both a strong local
presence and national scale. Albertsons Companies
is committed to helping people across the country
live better lives by making a meaningful difference,
neighborhood by neighborhood.

38

250 E. Parkcenter Blvd.
Boise, ID 83706

albertsonscompanies.com