Falabella

Stakeholder engagement
The company discloses an overview of the issues raised in stakeholder engagement activities, as well as its engagement process.

Sustainability strategy and accountability
The company discloses its process for identifying and prioritising its most relevant sustainability impacts, reports progress against all the targets it has set, and provides evidence of linking senior executives’ remuneration policies to the company’s sustainability targets and objectives.

GHG emissions
The company actively reduces its scope 1 and 2 greenhouse gas emissions and has a time-bound target to further decrease them. It consistently reports progress against these scope 1 and 2 targets. Additionally, the company has set a time-bound target to reduce its scope 3 emissions, demonstrating its commitment to reducing emissions across its entire value chain.

Solid and air pollution
The company reports on the proportion of non-hazardous waste, hazardous waste treated to reduce pollution compared to total waste, hazardous waste diverted from disposal, and directed to disposal. The company partakes in activities related to plastic use reduction.

No leading practices were identified in the social inclusion and community impact area.

Act ethically
The company enforces a strict anti-bribery and corruption policy outlined in its Integrity Code, which prohibits associates from engaging in bribery under any circumstances, including courtesy gifts. It incorporates anti-bribery clauses in contracts with its business partners, demanding adherence to ethical standards and compliance with its Practical Compliance Guide for Suppliers. Additionally, the company provides a confidential and anonymous channel for stakeholders to raise concerns about bribery and corruption without fear of reprisal, accessible via multiple communication methods.

Provide and promote decent work
The company publicly commits to the health and safety of workers, with a policy statement available and expects its suppliers to respect International Labour Organisation guidelines for a safe working environment. Supplier evaluations, including audits, assess compliance with health and safety standards. The company calculates a living wage for entry-level employees based on the Dow Jones Sustainability Indices (DJSI) definitions of basic expenses. Additionally, it supports gender equality and women’s empowerment, disclosing a target of having 40% of women in senior and junior management positions in income-generating areas by 2023. Programs like High Performance Women and Connected Women Network promote female professional development and leadership.

Respect human rights
Falabella has a publicly available policy, endorsed by its highest governance authority, mandating respect for internationally recognised human rights. The company performs rigorous human rights due diligence processes across various business units, initiated with external consultancy support. It assesses potential human rights impacts using diverse methodologies, including data analysis and stakeholder engagement through interviews and surveys. This systematic approach integrates findings into risk matrices, which are updated triennially or as required, ensuring ongoing compliance and risk management related to human rights impacts within its operations and value chain.

Lobbying
The company does not report on its lobbying and advocacy practices on nature-related issues, nor whether these activities align with its sustainability strategy.

Sustainability strategy and accountability
While the company has set some targets, it does not disclose group-wide targets on all key sustainability topics for the most material parts of its value chain. The company does not disclose whether its highest governance body has expertise regarding nature-related topics.

Ecosystem conversion and restoration
No evidence was found regarding the company’s efforts to avoid ecosystem conversion, including deforestation, or promote restoration. The company has an opportunity to develop a strategy and publicly report on specific, time-bound targets.

GHG emissions
The company has an opportunity to disclose a time-bound target to reduce its scope 3 greenhouse gas emissions and report progress against these targets. The company has an opportunity to align its targets to a 1.5-degree trajectory.

Impact and dependencies assessment
The company has not holistically assessed its impacts or how it depends on nature, including biodiversity. It has an opportunity to start such an assessment across its value chains, focused on quantification of its impacts or dependencies.

Invasive species
The company has not identified any activities that could lead to the introduction of invasive alien species in its own operations.

Key areas and species
The company does not disclose key species or areas important for biodiversity affected by its operations or suppliers. It has an opportunity to increase its transparency.

Resource exploitation and circularity performance
No evidence was found regarding the company’s efforts to work towards a circular economy or which organisms it exploits. The company has an opportunity to develop a strategy and publicly report on specific, time-bound targets.

Solid and air pollution
The company is not reducing the production of hazardous substances. No evidence found that the company has a commitment not to develop or market new chemicals or products with SVHC (substance of very high concern) properties. The company is not reducing the production of hazardous waste. The company has an opportunity to disclose quantitative evidence regarding plastic use reduction and use of sustainable packaging. The company does not report on the amount of plastic waste generated and proportions directed from or to disposal. It also does not report metrics on air pollutants, nor set time-bound targets to reduce them.

Water
The company does not disclose relevant information related to water, in its operations or supply chains.

Indigenous Peoples’ and land rights
The company does not show if it is committed to respecting Indigenous Peoples’ rights or land rights of local communities.

Safe, clean, healthy and sustainable environment
The company has an opportunity to commit to respecting local communities’ right to a safe, clean, healthy and sustainable environment, and to zero tolerance for acts of violence, threats, intimidation or judicial harassment committed against land and environmental rights defenders. Moreover, it should track its actual or potential negative impacts on the health of local communities.

Act ethically
While promoting good business conduct through its Crime Prevention Model and anti-corruption week, the company has not described its process for identifying bribery and corruption risks. It has no publicly available policies on political engagement or lobbying. The company has an opportunity to disclose detailed processes for corruption risk assessments and create clear policies on political engagement and contributions.

Provide and promote decent work
While the company provides some injury frequency data, it lacks comprehensive disclosures on all work-related injuries and the specifics of such incidents. Although it aligns employee remuneration with local standards, there is no clear evidence that this equates to a living wage or the company’s support for living wage standards in its supply chain. The company reports a gender representation of 22.22% women on its board, falling short of the 30% target. The company has an opportunity to disclose a clearer commitment to health and safety, a definitive living wage target, and enhanced measures for gender equality, including the pursuit of equal remuneration across genders.

Respect human rights
The company commits to respecting ILO fundamental rights at work; however, it specifies adherence to “current legislation” for freedom of association and collective bargaining, which suggests a limitation based on jurisdiction. While it engages in due diligence with the aid of external consultants, there is no clear public disclosure of how it assesses or prioritises human rights risks or the outcomes of these assessments. The company has an opportunity to enhance transparency by clearly defining what it considers as salient human rights issues and by establishing a transparent global system to address these issues comprehensively.