Chapters
Annual Report 2019

3.4 We are a responsible corporate citizen

At GrandVision, we prioritize effective corporate governance as well as good company-wide business practices. We comply with regulations and engage with our employees on ethics and good conduct. In doing so, we maintain the value we create.

Ethics and good conduct

GrandVision’s Management Board believes that a respectful working environment creates a company culture focused on long-term value creation across our business and affiliated enterprises. We are proud of our values: integrity, trust, openness, teamwork and a focus on customer service and store performance.

We work tirelessly to keep customer needs and experiences at the heart of all we do. We believe these are the ingredients to continue creating value for the long term. This is why we share a common understanding and guidelines to help reinforce and uphold our values, which are actively promoted by the Management and Supervisory Boards.

In addition, the GrandVision Code of Conduct and our Whistleblower Procedure, described below, enable our employees, customers, suppliers and other stakeholders to detect and alert the organization if a deviation may occur. These codes can be found on our website and have been translated into all local languages to make sure every employee has a thorough understanding of both policies.

Our Code of Conduct

Our Code of Conduct provides everyone with a common understanding and guidelines to reinforce and apply our core values. We require all employees in our stores and offices to take our Code of Conduct training each year on our GV Academy e-learning platform. The training completion is also mandatory for new hires in their onboarding process. In 2019, 87% of our employees signed the Code of Conduct. We are working on improving the completion rate to meet our target.

The training course covers several topics including anti-corruption, bribery and data security. We also send all employees regular reminders and leadership communications about the topic.

You can find our Code of Conduct online at GrandVision.com.

Our Whistleblower Procedure

We encourage everyone to report any infringements of our Code of Conduct by following the GrandVision Whistleblower Procedure. It can be used by employees and contractors, customers, suppliers, business partners and the general public who can share evidence of infringements of our Code of Conduct.

In 2019, our Compliance Officer received eight Whistleblower reports. These were followed up in line with our Whistleblower Procedure and duly reported to the Audit Committee.

You can find our Whistleblower Procedure online at GrandVision.com.

Antitrust and competition law compliance at GrandVision

GrandVision is committed to proactively ensuring full compliance with all legal as well as good-governance principles. This includes all aspects of competition law and antitrust compliance, therefore we established a company-wide policy regarding antitrust and competition law compliance. The Management Board monitors its effectiveness and implements this policy. Meanwhile every GrandVision employee receives mandatory annual awareness training on this topic.

You can find more details about our Competition Law and Antitrust Compliance Policy online at GrandVision.com.

Data compliance

Data protection and cybersecurity are part of our wider compliance program. They ensure compliance with all relevant legislation, including the EU General Data Protection Regulation. Considering greater data security issues, we take our responsibility seriously as an employer and health service provider.

Our program also helps create and maintain a culture of responsible and safe handling of personal, customer and employee data. It includes company-wide policies related to personal data and information protection, data retention, IT end-users, data breach protocol and social media. We have also set up a governance structure to make sure the cybersecurity compliance program is implemented in all GrandVision countries.

We have appointed Data Protection Officers (DPOs) in every country, who are responsible for implementing their respective policies. These DPOs receive training through internal legal webinars and each year, organize calls to facilitate the sharing of best practices. Our cybersecurity training is also mandatory and available on our employee e-learning platform.

Throughout 2019, we continued to make our countries GDPR-compliant while further strengthening our governance structure.

Protecting human rights across all organizations

Protecting human rights across our value chain is of uttermost importance and in line with our Ethics and Compliance programs. It also aligns with our ambition to be a responsible corporate citizen that contributes to the global human rights agenda. This is why we establish policies, commitments and actions to safeguard human rights and manage the risk of incompliance across our entire value chain. Our most relevant areas are:

We have also implemented an annual risk management cycle that identifies key risks and developments during the period, which are addressed in an ongoing process. During our annual budgeting process, country management and central functional teams conduct risk assessments. They update key risks based on these assessments and on an evaluation of the outcomes of the risks already identified. Compliance risks are included in our assessment. Please read more in the 'Risk Management section' of this report in the chapter 'Corporate governance.'

In 2020, we will conduct a human rights due diligence exercise to identify and reassess salient human rights issues: those at risk of the most severe negative impact through our activities and business relationships. We will analyze our current policies, actions and commitments, and based on the outcome, plan further steps and actions to tackle uncovered human rights risks and opportunities. We will remediate existing impacts and strengthen key elements of our company policies and processes, internal and external communications and stakeholder engagement.

Preventing bribery across all operations

Preventing bribery across all of our operations is in line with our Ethics and Compliance programs as well as our ambition to be a responsible corporate citizen that contributes to the global human rights agenda.

We established policies, commitments and actions in place in order to safeguard the respect of international anti-corruption and anti-bribery regulations.

Our Code of Conduct and Supplier Code of Conduct are also online at GrandVision.com. They describe our commitment and our expectations to all employees, suppliers, contractors and competitors to refrain from offering, promising or giving any bribe to GrandVision employees, representatives or agents, whether directly or indirectly.

Our Supervisory Board oversees our overall performance, including the policies pursued, such as our Code of Conduct, and compliance with all applicable laws, including anti-corruption and anti-bribery regulations.

We have a dedicated compliance officer for our Whistleblower Policy to ensure an effective reporting process if bribery may occur. Read more about this policy in the paragraph 'Our Whistleblower Procedure' in this section.

Additionally, our employee and supplier Codes of Conduct include anti-bribery clauses. Please refer to section 'Strategic sourcing and procurement' for more information.

This type of compliance risk is also included in our annual risk management cycle, as previously described. Please read more in the 'Risk management' section of this report in the 'Corporate Governance' chapter.

Our transparent and responsible tax strategy

Giving back to local economies is part of our goal to be a responsible corporate citizen. We embed tax implications into business processes when and where they originate. Even the smallest shifts in the way the business operates, whether it be in new products, services, digitalization or use of technology, can have implications on our national and international tax positions. Our tax strategy is designed to navigate these complexities and ensure we pay the right amount of tax to comply with all legislation.

We created our tax strategy in line with our corporate values of integrity, trust and openness, and by including input from our wide variety of stakeholders. For instance, how we communicate about our tax affairs is further shaped by societal demands for transparency. We are progressing on our tax strategy execution by developing the GrandVision Tax Network and by further tax-enhancing company systems such as Enterprise Resource Planning (ERP) and other technologies. GrandVision’s tax strategy is supported by a Tax Control Framework that allows us to effectively manage and control our tax positions.

We report on our tax risks and execution of the tax strategy to the Audit Committee and the Supervisory Board. Our Audit Committee is also the governance body that is responsible for approving GrandVision’s tax strategy.

The principles of our tax strategy are to:
  • Be compliant at all times
  • Pay the correct amount of taxes across the value chain in the jurisdictions we are present and where value is created
  • Reflect tax implications from business activity accurately in company records in real time at an entity level

Our tax policy

GrandVision’s tax policy lets us pursue a transparent and responsible tax strategy across all countries in which we are present. It aligns the long-term interests of all stakeholders, shareholders, governments and communities. It also helps us realize our tax goals.

For more information, you can find our tax policy online at GrandVision.com.

Tax Control Framework

We ensure compliance with tax regulations through GrandVision’s Tax Control Framework. It enables us to effectively monitor, control and manage group-wide tax positions. It also creates awareness of possible tax exposures and helps us to report our tax positions and, for example, effectively comply with country-by-country obligations.

We strive to maintain strong working relations with tax authorities. In countries where this is possible, it is managed through collaborative working arrangements (horizontal monitoring). For example, we collaborate on an ongoing basis with tax authorities in The Netherlands and the U.K. In addition, our Framework enables the GrandVision global tax network to monitor and manage KPIs such the timely and correct filing of VAT, Transfer Pricing obligations, country-by-country reporting regulations, effective tax rate (ETR) and our position in tax transparency benchmarks.

The Framework also covers the work of the independent Internal Audit function, which provides assurance and validation of the overall internal control frameworks.

GrandVision's four tax pillars

Our contribution to socio-economic development

The taxes we pay contribute to socio-economic development.

Taxes contributed by segment

2019

2018

2017

2016

2015

Total Income Tax in EUR

79,177

81,672

101,055

95,775

103,021

of which income taxes segment G4

72,670

61,190

72,494

77,116

83,468

of which income taxes segment Other Europe

18,946

11,743

16,656

17,528

19,865

of which income taxes segment Americas & Asia

7,983

5,506

7,080

-3,188

1,530

of which income taxes corporate

-20,422

3,233

4,825

4,319

-1,842

In 2019, GrandVision reported €79 million in current and deferred income tax, a 3% reduction compared to 2018. The reduction is mainly related to one off impact in deferred tax accounting while our current tax position increased.

Our effective tax rate

2019

2018

2017

2016

2015

Effective tax rate (income tax as percentage of pre-tax results)

28.9%

25.6%

28.9%

27.5%

30.8%

To gain insight into our relative tax contributions, we use the ETR indicator that divides income tax by total pre-tax results. In 2019, our ETR increased from 25.6% to 28.9%, which was largely driven by the non-tax-deductible impairment of goodwill. The ETR increase was partly offset by positive impacts from business restructuring which led to the recognition of deferred tax assets for unused tax credits from the past in different jurisdictions.

In addition to income tax, GrandVision generates funds for communities through other taxes and levies such as VAT, local and employee taxes.

Tax risks

As an international company operating in more than 40 countries, GrandVision is exposed to a variety of tax risks and uncertain tax positions.

Our Tax Control Framework allows us to keep real-time, up-to-date insights into these tax risks.

In 2019, we conducted the same tax risk management cycles review exercise as in previous years.

This review covered the whole spectrum, starting with risk identification, and ultimately led to uncertain tax positions in financial reporting and reporting to the Supervisory Board and Audit Committee.

Due to the nature of the retail industry, our core business and our international profile, key tax risks and uncertainties may arise in the areas of indirect taxes such as VAT and taxes and levies in the scope of cross-border transactions.