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2016 Joint Stakeholder Forum of the Coca-Cola Helle nic Bottling Company and

The Coca-Cola Company Central & Eastern Europe Busi ness Unit

21st November 2016 Athens, Greece

MINUTES OF THE FORUM For the full list of attendees at the forum, please see Appendix . I. Opening speech by Sir Michael Llewellyn-Smith , Former Member of the Board of Directors of Coca-Cola HBC AG, and Former Chairman of Coca-Cola HBC’s Social Responsibility, Nomination, and Remuneration Committees

• There are some recent and forthcoming global events that would or might have an effect on the sustainability agenda worldwide, such as the US elections and the migration crisis.

• Coca-Cola HBC came out as beverage industry leader in Europe, and in the world, on the Dow Jones Sustainability Indices (DJSI) for the third consecutive year in 2016 – good and well-founded external feedback that we are on the rights track.

• We invite our stakeholders to further improve our sustainability strategy and performance. We believe you can help us develop our approach to managing our material issues, and we welcome your views on trends and topics of special interest to you and to the organisations that you represent.

II. Introduction to the Coca-Cola System and its ap proach to sustainability by Éda G. Pogány, Group External Affairs Director, Coca-Cola HBC AG

• Coca-Cola HBC and The Coca-Cola Company (the System) work together in the framework of a global partnership, a unique business model that best serves the interests and sustainability of both entities. The Coca-Cola Company is a significant shareholder of Coca-Cola HBC AG (23.1%) and is represented at the Board of Directors.

• The role sort in the partnership is such that Coca-Cola HBC (and other bottling partners in the world) purchase beverage concentrates and juice bases from The Coca-Cola Company and process these to produce finished products in every country of operations. Coca-Cola HBC invests locally into people, production (facilities, equipment, etc.), logistics and distribution networks, and is responsible for commercial activities (sales and trade marketing) with retail partners across the business. The Coca-Cola Company leads communications to consumers (advertising and promotions). The two entities work in the closest of partnership for mutual success.

• In terms of sustainability strategies, Coca-Cola HBC and The Coca-Cola Company are globally aligned in terms of commitments and focus areas, and can only deliver on these in strong cooperation and through shared governance processes (e.g. the Sustainability Steering Committee). Due to the nature of the businesses, The Coca-Cola Company leads the work related to product innovation and category acceptance, while Coca-Cola HBC leads in operational eco-efficiency (carbon, water, packaging waste management).

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Community affairs are co-lead in every country where we do business. Reporting on sustainability issues is aligned across the System.

III. Keynote speeches

• Anita Househam (United Nations Global Compact)

• Milena Stoycheva (Junior Achievement)

• Eva Paunova (European Parliament) The presentations of Ms Househam and Ms Stoycheva were made available for the participants, as was the link to Ms Paunova’s video message, which is also available on the Coca-Cola HBC Group corporate website here. IV. World Café discussions The World Café method is a creative process to facilitate collaborative dialogue and share knowledge and ideas. Through this method, a live network of conversation and actions is created. A question or issue is introduced and discussed in small groups at each table. From time to time, participants are asked to move from one table to another, however, a host remains at each the table and summarises the previous conversation to the new table guests. In this way, the new conversations may also build on the ideas generated in former conversations. The main ideas are summarised in a plenary session and follow-up possibilities are discussed. Organizers of the Forum applied the World Café method to allow and encourage participants to give feedback concerning some of the most important / material issues of the host companies, selecting four questions as discussion topics. All topics were closely related to the issue briefs prepared for the 2016 Forum. (The issue briefs are publicly available and can be found and downloaded here.)

The topics of the discussions at the tables were as follows:

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Main topics / issues discussed at tables

1. How do you think we, as a business, can best use our resources to positively impact Youth Development in Europe? (Table host: Kristiana Chakarova)

• Collaboration and co-creation is of paramount importance in this field. • We need a meaningful and applicable system for measuring and reporting impact. • There needs to be a central strategy, and the local actions leading into that need to take

into account the possible differences in social contexts. • Corporate volunteering is a significant resource that needs to be put to use effectively in

every country of operations. • We need strategic relationships with higher education institutions such as universities to

learn more and gain a good understanding about the needs of young people, as we are not experts in this field.

Notes, table 1

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2. What do you think are the major innovations, trends , partnerships, solutions in Youth Development globally and in Europe? (Table host: Petya Djoneva)

• To more effectively tackle the problem of youth unemployment, we need real, co-working partnerships with different stakeholders centrally, as a Group, and locally in our markets.

• Interested parties should work on being able to provide meaningful platforms for young people to share the wealth of existing knowledge and stories.

• Basic skills training is very important for the less fortunate, marginalised young people. • Stakeholders need to learn to effectively engage young people with relevant content to

capture and retain their attention over time, using digital channels that young people use/spaces they own and turn to.

• Long-term thinking is key (5-10 years), as are investments – societal impacts will take time to show and the course will need to constantly be adjusted as we go ahead.

• Programmes need to be centrally led for the sake of consistency and impact measurement/reporting, and at the same time they need to be flexible enough to effectively react to different socio-economic needs and contexts.

Notes, table 2

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3. How can the Coca-Cola System do more to promote sustainability across the supply chain? (Table host: Panagiotis Vergis)

• There is no common/shared definition/understanding of what sustainable sourcing means; there are a number of different standards and frameworks globally, and even more interpretations. It is paramount that business partners share a common understanding.

• The Coca-Cola System should think about how to directly engage suppliers and customers (value chain, both upstream and downstream) in a process that goes beyond accreditation/certification, and is more about collaboration, working together to find sustainable solutions.

• Horizontal cooperation is important for a tangible impact, that is, working together with our industry peers and competitors, and our suppliers/customers also working together horizontally with their peers in turn.

• The Coca-Cola System has the responsibility of educating suppliers and customers about sustainability issues and approaches and transparent reporting on progress in this area.

Notes, table 3

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4. What do you think are the major innovations, tre nds, partnerships and solutions in sustainable sourcing globally and in Europe? (Table host: Natalya Seregina)

• This issue requires a multi-stakeholder approach: we need to invite our stakeholders (including farmers) to create a roadmap. In some cases, our suppliers may already have the answers for questions that are material to us, so we could benefit from a closer collaboration, which goes beyond a transactional relationship.

• Different markets and different regions require different, customized approaches, so local collaboration with suppliers is key.

• We need to innovate, not only in terms of guiding principles compliance, audits and certification, but also in finding creative solutions and finding informal methods that work for exchanging knowledge.

Notes, table 4

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V. Plenary session: main topics / issues / concerns Youth development Stakeholder comments, questions

• Youth development is the biggest challenge we face in Europe. In this process, everything starts with measurement of output and impact.

• We need also to be mindful of a large number of uneducated young people who have not had any training or employment so far. They have to learn basic skills: how to learn and how to work.

• We should creatively consider approaches to integrating refugees. For example, companies in Denmark employ refugees and teach them basic skills.

• How can we form partnerships to deal with these difficult and long term tasks? How can we get different stakeholders to act faster and work together more closely, trusting each other’s competencies?

• The first question that any company needs to answer is ‘What kind of impact would you like to have as a result of your program, and who can help you deliver / amplify that impact?’

Coca-Cola system representatives

• Beyond youth unemployment, aging population is also a key business issue for our system. Therefore, we could think of how we can best tap into the immense knowledge and work experience elderly people who are still active have, and make that work for our youth development program. Linking these two generations would be highly beneficial for both age groups and would have a greater societal impact. Society cannot afford to lose the knowledge elderly people have acquired and are able to pass on to young people, whilst staying active themselves, continuing to create value, and feeling that they are an important and active part of society.

Stakeholder comments, questions

• It is important to bridge the gap between generations. There are exemplary projects where young generations teach digital skills to older people. They take on the role of teachers, and they themselves learn through teaching – so this can actually work both ways. There is immense value in linking these two generations for both age groups.

• At ‘Teach for All’ the core belief is that every child can achieve, regardless of their social or economic background.

Coca-Cola system representatives

• The policy on responsible marketing of the Coca-Cola restricts engagement with children under 12 years of age or as primary school age is defined in the given country. Primary schools are considered a marketing free area, and we respect this everywhere: we do not advertise, promote or directly sell to this age group.

• There was a project administered in Germany, Spain and Scotland where different partners (academic institutions, city councils, voluntary organisations) launched a project to support refugees in starting their businesses. It was an extensive and costly process involving modules on culture, the legal system, entrepreneurship, language skills and gender issues. The project resulted in 150 businesses starting up per year. It is a good example of how to engage this disadvantaged group, worth looking into in more depth.

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• There are a lot of relevant Massive Open Online Courses (MOOCs) courses that are very easy to apply for, and they provide very flexible learning at no charge – use these for your youth development programs, make the countries and your partners aware of the existence and potential of these MOOCs.

• When considering empowering young people, we should first take a closer look at how they are empowered within our companies and learn as much as we can from them in house.

Sustainable sourcing Stakeholder comments, questions

• In this area collaboration and partnership beyond transactional relationship of selling and buying is of immense importance. The supply chain partners need to work together on sustainability issue in order to be effective and fast enough to show relevant progress – link the work stream starting from the farmers growing fruits to the retail store on the corner and the drink in your hand.

• It is a very important to seek and find like-minded companies to advance the sustainability agenda in sourcing.

• Internal integration and educating different functions – and the Board – about the importance of these issues are also important. We should provide platforms for keeping people connected and networked on sustainability issues, where procurement, HR, logistics and other function leaders can talk to each other and find solutions together, raise ideas without being risk aversive and overly cautious.

• Procurement is not in conflict with sustainable sourcing commitments, however, it is important to set targets for procurement people and teams that integrate this perspective into their everyday work, and make these targets a key component of how they are incentivised. All procurement people should have a sustainability target in their work objectives beyond compliance with guiding principles.

• There are companies that help other businesses (supply partners, customers) compile their sustainability reports and they also educate their partners about the importance and benefits of transparency – the Coca-Cola System could help partners in this – workshops, education on business modelling, measuring and reporting relevant results, informing the sustainability strategy, etc.

• Large retailers play a very important role in ensuring a sustainable value chain. For example, one year ago almost all the biggest Austrian retailers printed the carbon footprints of their products directly on the product label. One month ago these retailers asked 10,000 of their suppliers to do the same: that is a huge impact. The Coca-Cola System could affect its supply chain similarly, extending its impact. Also think about displaying the carbon and water footprint of products on labels.

• It would be useful for the System to ask suppliers to talk about their existing solutions and management tools, and build on that, as well as better understand what suppliers do with other progressive companies. We need to be mindful that there is a competition for sustainably sourced agricultural goods, and the companies that first enter this area can have a competitive advantage securing these – or can have a disadvantage of not being able to secure sustainable supplies after a time, or do that only at a significantly higher cost later in the game.

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Coca-Cola system representatives

• At Coca-Cola HBC we do not have a sustainability department as such because we believe that sustainability is the job of everyone, everywhere, every day, whatever function they work in. We believe a sustainable business is here to stay long term, caring for, and ensuring its economic growth whilst working on decreasing the environmental footprint of its entire value chain and safeguarding beneficial effects of the business on society. This cannot be done by a handful of people only, it is done across the business in everything we do – and it is reported and communicated by a handful of people, who work in internal and external communications.

• We are engaging with our suppliers to take our relationships from transactional to the strategic level, a road we started on and admittedly have a long way to go together, which we are committed to doing.

VI. Closing speech by Klaske DE JONGE , Public Affairs and Communications Group Director, Coca-Cola HBC AG Summary of key forum points, thanking participants for the open mindedness and constructive criticism as well as acknowledgement, and wrapping up until the next forum. Athens, 30 November 2016

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APPENDIX: PARTICIPANTS OF THE 2016 FORUM

Stakeholders

1. Deborah ATWOOD, AGree – Executive Director 2. Zvonimir CANJUGA, AEGEE Europe – Financial Director 3. Ed CRAIG, Edinburgh Center for Carbon Innovation – Head of Enterprise and Innovation 4. Dr. Sára CSILLAG, Budapest Business School – Vice Rector for Research 5. Dr. Volker DIEHL, Nordzucker Group – Head of Industrial Sales 6. Juliette GAUSSEM, GRI – Manager, Corporate & Stakeholder Relations 7. Konrad HALWAX, AGRANA Zucker – Managing Director 8. Anita HOUSEHAM, UN Global Compact – Senior Manager, Policy & Legal / Supply

Chain Sustainability 9. Erich JAQUEMAR, Vetropack – Key Account Manager 10. Willibald KALTENBRUNNER, denkstatt – CEO, Managing Partner 11. Gennadiy KUZNETSOV, Food Processors League, Ukraine – Head of the Board of

Directors 12. Sanda MARELIC, Works Council, Coca-Cola HBC Croatia – Head of Croatian Works

Council, Member of the EWC Select Committee 13. Neven MARINOVIC, SmartKolektiv / Serbian Business Leaders Forum – Director 14. Anne McTAGGART, Youth Action Ireland – Development Director 15. Spiros MILONAS, Krataion Consulting – Founder & Team Leader of ReGeneration

Project 16. Jeff OATHAM, London Benchmarking Group – Director 17. Evgenia PEEVA-KIROVA, Teach for Bulgaria – CEO 18. Veronika POUNTCHEVA, Metro – Senior Vice President, CR 19. Peter SPAARGAREN, Doehler Holland – Juice Director 20. Panagiota STAVROPOULOU, Erasmus Student Network, Greece – Communication

Manager 21. Marcel STEFANIK, International Federation of Red Cross and Red Crescent Societies –

Global Coordinator 22. Milena STOYCHEVA, Junior Achievement Bulgaria – CEO 23. Marzena STRZELCZAK, Responsible Business Forum, Poland – General Manager 24. Konstantina TOLI, Global Water Partnership Mediterranean – Senior Programme Officer 25. Rosanna TUFO, CSR Europe – Project Manager 26. Arnis VERZEMNIEKS, Institute for Corporate Sustainability and Responsibility, Latvia –

Council member 27. Michiel van WERSCH, Doehler – Group Executive Director

Coca-Cola HBC AG

1. Kristiana CHAKAROVA, Country PA&C director, Coca-Cola HBC Bulgaria 2. Petya DJONEVA, Group Community Affairs Director 3. Sissy ELIOPOULOU, Group External Communications Manager 4. Klaske DE JONGE, Group Public Affairs & Communications Director 5. Sir Michael LLEWELLYN-SMITH, Former Member of the Board of Directors, Former

Chairman of the Social Responsibility Committee of the Board 6. Alexandra PAPALEXOPOULOU, Member of the Board of Directors 7. Éda G. POGÁNY, Group External Affairs Director 8. Natalya SEREGINA, CSR manager, PA&C, Coca-Cola HBC Russia 9. Panagiotis VERGIS, Group Sustainability Communications & Reporting

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The Coca-Cola Company

1. Dieter KOTLOWSKI, Global Key Account Director for the METRO Group 2. Sofia KILIFI, Community & Sustainability Director, Central & Eastern Europe 3. Anastasia SIDERI, External Communications Director, Central &Eastern Europe

Smartlab Consulting

1. Dr. László RADÁCSI, Managing Partner 2. Eva HEIDRICH, Project Coordinator

2016 Joint Stakeholder Forum participants