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Annual report 2013

Independent Assurance Report

(Translation from the Finnish original)

To the Management of Kesko Corporation

We have been engaged by the Management of Kesko Corporation (hereinafter also the Company) to perform a limited assurance engagement on the corporate responsibility information disclosed in Kesko Corporation’s online report “Kesko’s Integrated Annual Report 2014” and indicated as assured in the Company’s GRI Index 2014, as well as other corporate responsibility information disclosed in the online report and agreed to be assured, for the reporting period 1 January 2014 to 31 December 2014 (hereinafter CR Information).

Furthermore, the assurance engagement has covered Kesko Corporation’s adherence to the AA1000 AccountAbility Principles with moderate (limited) level of assurance.

Management’s responsibility

The Management of Kesko Corporation is responsible for preparing the CR Information in accordance with the Reporting criteria as set out in the Company’s reporting instructions and the G4 Sustainability Reporting Guidelines of the Global Reporting Initiative.

The Management of Kesko Corporation is also responsible for the Company’s adherence to the AA1000 AccountAbility Principles of inclusivity, materiality and responsiveness as set out in AccountAbility’s AA1000 AccountAbility Principles Standard 2008.

Practitioner’s responsibility

Our responsibility is to express a conclusion on the CR Information and on the Company’s adherence to the AA1000 AccountAbility Principles based on our work performed. Our assurance report has been prepared in accordance with the terms of our engagement. We do not accept, or assume responsibility to anyone else, except to Kesko Corporation for our work, for this report, or for the conclusions that we have reached.

We conducted our work in accordance with the International Standard on Assurance Engagements (ISAE) 3000 “Assurance Engagements Other than Audits or Reviews of Historical Financial Information”. This Standard requires that we comply with ethical requirements and plan and perform the assurance engagement to obtain limited assurance whether any matters come to our attention that cause us to believe that the CR Information has not been prepared, in all material respects, in accordance with the Reporting criteria.

In addition, we have conducted our work in accordance with the AA1000 Assurance Standard 2008. For conducting a Type 2 assurance engagement as agreed with the Company, this Standard requires planning and performing of the assurance engagement to obtain moderate (limited) assurance on whether any matters come to our attention that cause us to believe that Kesko Corporation does not adhere, in all material respects, to the AA1000 AccountAbility Principles and that the CR Information is not reliable, in all material respects, based on the Reporting criteria.

In a limited assurance engagement the evidence-gathering procedures are more limited than for a reasonable assurance engagement, and therefore less assurance is obtained than in a reasonable assurance engagement. An assurance engagement involves performing procedures to obtain evidence about the amounts and other disclosures in the CR Information, and about the Company’s adherence to the AA1000 AccountAbility Principles. The procedures selected depend on the practitioner’s judgement, including an assessment of the risks of material misstatement of the CR Information and an assessment of the risks of the Company’s material nonadherence to the AA1000 AccountAbility Principles. Our work consisted of, amongst others, the following procedures:

  • Interviewing senior management of the Company.
  • Interviewing employees from various organisational levels of the Company with regards to materiality, stakeholder expectations, meeting of those expectations, as well as stakeholder engagement.
  • Assessing stakeholder inclusivity and responsiveness based on the Company’s documentation and internal communication.
  • Assessing the Company’s defined material aspects of corporate responsibility as well as assessing the CR Information based on these aspects.
  • Analysing references to the Company from the reporting period in online media.
  • Visiting the Company’s Head Office as well as one site in Norway.
  • Interviewing employees responsible for collecting and reporting the CR Information at the Group level and at the site where our visit took place.
  • Assessing how Group employees apply the reporting instructions and procedures of the Company.
  • Testing the accuracy and completeness of the information from original documents and systems on a sample basis.
  • Testing the consolidation of information and performing recalculations on a sample basis.
Conclusion

Based on our work described in this report, nothing has come to our attention that causes us to believe that Kesko Corporation does not adhere, in all material respects, to the AA1000 AccountAbility Principles.

Furthermore nothing has come to our attention that causes us to believe that Kesko Corporation’s CR Information has not been prepared, in all material respects, in accordance with the Reporting criteria, or that the CR Information is not reliable, in all material respects, based on the Reporting criteria.

When reading our assurance report, the inherent limitations to the accuracy and completeness of corporate responsibility information should be taken into consideration.

Observations and recommendations

Based on our work described in this report, we provide the following observations and recommendations in relation to Kesko Corporation’s adherence to the AA1000 AccountAbility Principles. These observations and recommendations do not affect the conclusions presented earlier.

  • Regarding Inclusivity: Kesko Corporation has processes in place for stakeholder inclusivity, collection of feedback and stakeholder engagement. We recommend that the Company continues to systemise the stakeholder dialogue and pays specific attention to the possibilities for increasingly utilising social media as a channel for stakeholder dialogue.
  • Regarding Materiality: Kesko Corporation has a systematic process in place to evaluate and determine the materiality of corporate responsibility aspects. We recommend that the Company continues the execution of its responsibility programme based on its materiality assessment and pays specific attention to the concretisation of division specific targets and the communication of the progress against targets.
  • Regarding Responsiveness: Kesko Corporation has processes in place for responding to stakeholder expectations. We recommend that the Company further invests in sharing best practices and information within and amongst divisions.

Practitioner’s independence and qualifications

We comply with the independence and other ethical requirements of the Code of Ethics for Professional Accountants issued by the IESBA (the International Ethics Standards Board for Accountants).

Our multi-disciplinary team of corporate responsibility and assurance specialists possesses the requisite skills and experience within financial and non-financial assurance, corporate responsibility strategy and management, social and environmental issues, as well as knowledge of the retail sector, to undertake this assurance engagement.

Helsinki, 17 March 2015

PricewaterhouseCoopers Oy

 

Sirpa Juutinen
Partner
Sustainability & Climate Change

Maj-Lis Steiner
Director, Authorised Public Accountant
Assurance Services