The COVID-19 health contingency gave us great challenges, left us great experiences and learning, opened opportunities for us, and motivated us to reassess our objectives and priorities.

Without a doubt, the human factor, tireless willpower and commitment of all members of the Grupo Herdez family were key to advance through these challenges and capitalize on opportunities; with innovation in our processes, safety for our personnel and strengthening our commitment with the development of Mexico.

Clients

It is clear for us that union makes strength. This year, our customers played a fundamental role in complying with out commitment to take food of the highest quality to Mexican homes and to the world. We work together to offer safe products and spaces, closeness, adaptation and empathy, through solutions that strengthened the trust of our customers and looked out for the wellbeing of our people.

2020 brought us the opportunity to strengthen our business relationships with our customers, collaborating with them to seek for alternatives, concentrating on what we COULD do.”

Juan Rodríguez del Collado, Food Service Director

Customers

Together with Confidence and Innovation

Brand Initiatives

As a result of the stay-at-home call, supermarket visits decreased. However, safe distancing became an opportunity to enjoy moments with family and carry out activities that promoted creativity, including cooking and preparing new recipes, having as a main ally our broad and varied product portfolio.

Launches

digital ACTIVATIONS AND SOCIAL MEDIA interacTIONS

Barilla® participated in different initiatives to give assistance to chefs, communities and other gastronomy professionals to help them obtain income without closing their establishments and keeping jobs”

Charlotte Oudin, Chief Executive Officer of Barilla México

innovation

GRI: 103-1

2020 challenged our spirit of innovation, but aligned with our strategic pillars, we underpined our ability to hear, to serve the needs of the market and the industry. Together, we exceeded the distance barriers and adapted our product development strategy to present innovations to consumers and customers.

The Research & Development team was key to achieve our 2020 commercial goals, in addition to research agencies. Having great teamwork was of great value to me.”

José Luis Ortega Hernández,

Deputy Director of Marketing Services

Our core strategies:

  1. To maintain and form partnerships through the development of market intelligence.
  2. To implement innovation and transactional technologies that allow the acceleration of communication processes with the consumer.
  3. To promote sustainable management, prioritizing water conservation and efficient use of energy.
  4. To support and generate growth through the development of talent and investment in infrastructure.
  5. To form responsible corporate citizenship that promotes social development initiatives.

Additionally, we also take our transformation capacity to our work and communication dynamics, adapting to the new normal and accelerating the digital transition that we have been promoting since 2019. 2020 represented for us the ideal time to establish the bases and generate important alliances, which will be pillars for our digital culture development onwards.

Alliance with Google Cloud

With an investment of 15 million dollars in the next 5 years, we established our first technological alliance with Google, which will allow us to accelerate the digital transformation of Grupo Herdez by using the tools of Google Cloud Platform such as BigQuery ML and Looker, among others.

Current infrastructure

We modernized our infrastructure with the implementation of tools, such as BigQuery ML, and developed capacities, such as digital listening and growth hacking, as well as to foresee needs in the production chain and demand of the market. Thus be able to continue to take the best of flavors of Mexico and the world to the homes of our customers in a more efficient way.

Knowing our customers

This year, we also strengthened the specialized listening department, through which we may know about new trends and tastes of our customers, which allows us to plan suplply, innovation, inventory and communication strategies.

Digital transformation is about identifying a business process and finding in the disruptive array of technologies, which may potentialize the resolution of business needs and opportunities.”

Miguel Ángel López Pérez, Digital Transformation Leader

We advance with what we learned in 2020 towards a new reality, with the opportunity to be more efficient, innovate in products and processes, look for new channels that bring us closer to consumers, where we continue developing these capacities to maintain our presence in the homes of mexican families and throughout the world.

 

New e-commerce applications

Our Barilla®, Nutrisa® and Cielito Querido Café® brands positioned themselves inside the ranking of 500 digital brands of Merca 2.0.

We also promoted the positioning of 100% of the Blasón brand portfolio, through the e-commerce platforms of some of our customers. Thanks to this initiative, the sales of Blasón grew more than 200% compared to the previous year.

Product health and safety

GRI: 103-1, 416-1, 417-1

The Research and Development is in charge of ensuring that our products adapt to the different tastes and lifestyles of our consumers.

100% of our product portfolio is certified under the FSC22K standard, thanks to the Quality and Inocuity Management System that we have developed to comply with the laws and standards of national government agencies (COFEPRIS, Comisión Federal de Protección contra Riesgos Sanitarios), and international, such as the US Food and Drug Administration (FDA) in the United States.

Our labeling complies with the applicable regulation of the final destination country. Likewise, our labels clearly communicate to our customers the nutritional information of each product, the origin of its components, its content, the safety instructions and the best way to dispose of or recycle packages.

In the case of Mexico, the labeling is designed according to:

  • Reguations for the Sanitary Control of Products.
  • NOM-050-SCFI-2004: Commercial Information; the Official Mexican Standard for the General Labeling of Products.
  • NOM-051-SCFI/SSA1-2010: The Official Mexican Specifications for the Labeling of Prepackaged Food and Non-Alcoholic Beverages – Commercial and Sanitary Information.

Collaborators

Together we TAKE CARE OF OUR FAMILIES

GRI: 103-1, 102-8, 102-41, 401-1

WORKFORCE

We are focused on promoting a work environment that promotes wellbeing, safety and development of personal and professional capacities of each of the 9,867 collaborators that form part of the Grupo Herdez family.

We offer all the members of this great team training plans, performance evaluations and continuous feedback. We recognize their achievements and support the development of competencies and values that foster a culture of ethical and collaborative work.

100% of our staff is hired full-time and 58% of whom are affililiated to a collective labor contract.

EMPLOYEES BY CONTRACT (%)

EMPLOYEES BY REGION (%)

In 2020, 2,930 collaborators joined our team, representing an equal share of 50% men and 50% women.

HIRES BY LOCATION (%)

HIRES BY AGE (%)

We also had 2,690 people that left us, which leaves our turnover ratio at 28%, 10 percentage points more than in 2019. 51% were men and 49% women.

TURNOVER BY LOCATION (%)

TURNOVER BY AGE (%)

Diversity and inclusion

GRI: 401-3, 405-1

For more than 100 years, at Grupo Herdez, we have been working for the wellbeing of our teams, inside and outside the Company.

It is for this reason that, our six objectives of the Sustainability Strategy include the Sustainable Development Goal (SDG) 05 Gender Equality, which we have adopted at Grupo Herdez as part of the pillar of Diversity and Inclusion.

Its incorporation into our strategy responds to what we value, diversity as a factor that enriches the way that we operate and promote our growth. It also honors the commitment that we have to contribute to a more inclusive Mexico, with a culture that spreads throughout the entire company, achieving shared prosperity.

We are motivated to create an inclusive environment where human differences are valued and there are equal opportunities for all, regardless of the gender, race, age, religion, nationality or socieconomic status. For this reason, we have had a Gender Equality Policy since 2012, where we reflect our commitment to promote an inclusive and diverse environment, in which all employees fell included, respected and empowered to make decisions.

Our workforce is composed of 45% women and 55% men. The wage for each vacant category or position is established without distinction of gender.

EMPLOYEES BY LABOR CATEGORY (%)

EMPLOYEES BY AGE (%)

Inclusion by gender is also reflected in the Board of Directors, where, of the 9 members, 2 are women (22% of the total)

BOARD OF DIRECTORS BY GENDER (%)

 
Andrea Amozurrutia Casillas
Deputy Director of Finance
“Being a mentor of this first generation of Semillero Nutrisa was a very enriching experience since the learning went both ways. The passion and commitment of the entrepreneurs drives us to continue to promote spaces that generate equality of opportunity for men and women.”
Estuardo Lárraga
Supply Chain Director
"The most important thing is not what we know, but rather what we do with what we know. Under this premise, we share our knowledge with small business people, with whom we are building the future of both organizations.”
Claudia Reyes
Deputy Director of Marketing for Frozen and Retail
"It is gratifying to support these entrepreneurs to strengthen their businesses and achieve their development. For me, Semillero Nutrisa means the joint effort for all women to have the same personal and professional development opportunities."
Alejandro Sánchez
Frozen Process Manager
“Being a Semillero Nutrisa mentor was an enriching experience. The entrepreneurs have extraordinary products that, hand in hand with Nutrisa, will become great companies that drive the participation of women in business.”
Claudia Luna,
General Counsel
"It has been very enriching to prepare our entrepreneurs to grow based on Semillero. Their talent and effort has been an inspiration for those of us that participated in this initiative.”
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Semillero Nutrisa

For the purpose of having an impact throughout our value chain, in 2020 we launched the first edition of Semillero Nutrisa, to promote Mexican entrepreneurs.

Jointly with Nutrisa and the business academy for women Victoria147, we summoned female entrepreneurs to participate in a training program that will improve business management in the food, beverage, personal care and wellbeing sectors, which had the potential to form part of our supplier chain.

In numbers, this initiative represented:

  • 144 applications received
  • 44 candidates were pre-selected
  • 22 candidates were evaluated
  • 12 winners

The 12 winning entrepreneurs received 54 hours of training on critical issues for the management and development of their businesses, such as an analysis of customer experience, finance, innovation, human resources, financial projections, supply chain, as well as legal and tax compliance.

Additionally, Grupo Herdez employees were involved in the training sessions through mentoring.

It feels us with pride to share that 2 of the 12 entrepreneurs already form part of the supply chain of Nutrisa. Congratulations to everyone!

¿How did we stay connected?

The impact and scope of this campaign translated into:

  • 3.7 million people reached
  • 15.3 million impressions
  • 21 thousand views of the launching of the initiative
  • 2 thousand interactions

WORKPLACE Well-being

GRI: 401-2, 401-3, 403-3, 403-4, IP-5

Our policy and commitment with the wellbeing of our family of collaborators is reflected, among other things, in the social benefits package that we offer, which is above what the Mexican Federal Labor Law (LFT, Ley Federal del Trabajo) provides.

This package includes health insurance, public health services, coverage for disability, maternity or paternity leave, provisions for retirement and stock options plan.

There are other benefits, such as:

  • Medical insurance
  • Medical check-up
  • Weight control campaigns
  • Nutritional evaluations
  • Flexible Schedule
  • Days off (additional to those required by Law)
  • Marriage dowry
  • Products pantry
  • Breastfeeding rooms
  • Food vouchers

In the same way, we have a Healthy Eating Program which provides nutritional advice to our employees through balanced meal plans and with monthly consultation follow-ups.

In 2020 we provided 1,217 nutritional consultations, which resulted in the loss of 291 kg among the employees.

This consultations promoted a change in the eating habits of employees of Mexico City, State of México, San Luis Potosí and Sinaloa. The consultations were carried out in person for the first quarter of the year, and later they were retaken remotely.

It was an achievement of the entire company and of the committees to ensure that a large part of our collaborators continue to be healthy, as well as their families; that is the main achievement. Developing internal strength to be able to assist our personnel, not fizzle out, work with resilience, contain the emotional part and show calm by explaining to them the protocols for them and their families.”

José Alberto Rodríguez Cuadras,

Manager of Cash Department | Environmental, Control, Safety and Hygiene

GRI: 403-3, IP-5

Occupational Health

At Grupo Hérdez we are concerned about the integrity and wellbeing of all our collaborators, it is for this reason that we have a solid risk and accident prevention strategy, which has allowed us to obtain positive results.

In our operational departments, we have tours led by medical service personnel, where we seek to identify any unsafe condition and prevent all types of accidents.

Additionally, we carry out general and special tests for our collaborators, such as spirometry, audiometry, vibrations, among others. Medical files are strictly confidential and used solely for doctor-patient knowledge.

Thanks to this continous efforts, during 2020, we managed to reduce the number of accidents by 12%. The rate of workdays lost increased 68%, mainly due to disabilities related to the pandemic.

GenderAccidentsRate of accidents*Working days lost due to accidentsRate of working days lost due to accidents**
Women671.241,95636
Men751.122,53138
Total1422.364,48774
(*) The rate of accidents refers to the number of accidents during the year in relation to the total of man-hours multiplied by a factor of 200,000.
(**) The rate of working days lost is expressed by comparing the total of days lost during the year against the total of man-hours worked, multiplied by a factor of 200,000.
Note: The information presented here covers all the employees in the Group, since the Company does not have outsourced personnel.

Environmental Control, SAFETY AND HYGIENE (CASH)

In 2012, the Environmental Control, Safety and Hygiene (CASH) department became a vital piece for the operations of Grupo Herdez, issuing the guidelines for the care of our collaborators, following up on incidents and establishing the guidelines for accident prevention. This department is in charge of continually strengthening the strategies and process to protect, prevent and mitigate incidents that may represent a risk for the continuity of our operations.

  • 5S System, which considers visible standards by departments and regulations to easily understand and identify all personnel.
  • The deployment of information, calls and campaigns through information boards.
  • The evaluation on compliance of the Comprehensive Management System.
  • Development and communication of bulletins, tri-fold brochures and visual aids that contain health, safety, and environmental matters.
  • Occupational health and safety campaigns based on the annual health plan.
  • Operation of the Health and Safety Management Committee that give timely follow-up on relevant matters and formal local agreements with unions.

During the COVID-19 contingency, our CASH team had an outstanding performance, since it kept the wellbeing of all of our collaborators, giving them information and preparing health and sanitation protocols.

In numbers, this initiative represented:

  • 81 members of the Crisis Committees conformed by collaborators in Plants, Distribution Centers and Corporate Offices
  • 62 health and sanitation protocols.
  • 274 Committee sessions.
  • 648 Corporate Crisis Committee sessions.
  • +2,300 Hours of CASH Leaders and Medical Service session.

During the health contingency, we developed specific programs to address the different needs:

Training

GRI: 404-1, 404-2, 404-3

As a result of the digital training platforms as well as the the efforts for our collaborators to have all information and tools required to care for their health and face the contingency, we increased the number of training hours by 50% with respect to 2019.

These hours represented a total investment of $23,343,839.35 MXN.

The average number of training hours in 2020 was 24 for men and 34 for women.

GenderUnionizedNot unionizedTotal
Men24,779105,979130,758
Women26,819120,428147,247
Total278,005

As every year, we continue with our training programs to improve the skills of our collaborators to achieve organic and continuous growth, by developing skills:

  • Nutrisa Stores: All the collaborators of the Nutrisa stores received training on sanitary handling of food and compliance with the protocols that the government and local agencies requested.
  • Herdez Leaders*: 1,220 collaborators participated in this program to define and develop the competencies that a leader at Grupo Herdez must have. Through a theoretical knowledge program, the participants received guidance on how to continue to grow and advance in their professional career within the Group.
  • Trainer of Trainers**: We connected 683 collaborators that are experts in specific departments and functions in the company, to share their knowledge and experience to other collaborators. With this initiative, we seek to share technical knowledge, promoting internal replacement, while we reduce the learning curve of collaborators in new positions.
  • Harvard Manage Mentor Platform: To increase the offering of online courses for our collaborators in management positions, in 2020 we acquired 700 licenses of the Harvard Business School. With this initiative, we increased the available offering of courses at Grupo Herdez University with 12 topics per collaborator.

* For these development programs, we only contemplated full-time personnel for 8 hours per day shifts.

**At Grupo Herdez we do not have assistance programs during the transition period towards work inactivity.

We evaluate the performance of our collaborators on an annual basis, encouraging their professional development. Toward this effct we apply various methodologies, such as:

  • Goal-oriented management (GOA): Goals defined by upper management. In 2020 we evaluated 319 collaborators.
  • Multidimensional performance assesment (nine boxes methodology): In 2020 we evaluated 1,355 collaborators.

4,090 collaborators from our total workforce are non-unionized personnel. 41% were evaluated in reference to their job performance, for a total of 1,674 evaluations, 6% higher than the previous year.

Communities

Together for Mexico

GRI: IP-2, IP-4

Throughout 106 years, we have lived through several situations that have tested us as a company and as a society. The health contingency has been one of the greatest challenges that we have faced as human beings, but at Grupo Herdez we are driven by the commitment to the development of Mexico, the wellbeing of its families and of our communities.

During the year, we participated in different initiatives to encourage and give strength to those that have been most affected by the situation derived from COVID-19, including communities, hospitals, restaurants and mom-and-pop stores, with the confidence that together #MexicoWillOvercomeThis

In 2020 we invested 2.77% of Consolidated Net Income in social projects and initiatives.

  • $57,049,030 MXN corresponding to donations in kind.
  • $8,647,500 MXN corresponding to social programs.

Saber Nutrir

In 2011 we created our social responsibility program Saber Nutrir®, to formalize our commitment to nutrition in Mexico. With this program, we contributed to improving the quality of life of Mexican families that are in a food vulnerability situation, by developing capacities in the community that result in the wellbeing of its children.

The three pillars of our program are:

Food security

Safe water

Productive and marketable projects

To be able to expand our scope and reach more families, since 2009, we added efforts with two civil society organizations: Fundación Pro Mazahua, in the State of Mexico, and ChildFund México, in Tapachula, Chiapas.

Throughout THE years of working together, we have been able to:

Impact

0

communities

(19 with Pro Mazahua and 11 with ChildFund)

Benefit

0

families

(607 with Pro Mazahua and 233 with ChildFund)

Install

0

productive community development projects (1,083 with Pro Mazahua and 735 with ChildFund)

At the end of 2020, 573 families from 30 communities participated in 1,149 productive projects that actively operate.

Saber Nutrir was, is, and will continue to be present providing all training and support to reinforce the Food Health projects, aligned with the three of the Sustainable Development Goals: Zero Hunger, Clean Water and Sanitation, and Decent Work and Economic Growth."

Eugenia Ortiz Rubio Valdes, Social Responsibility Manager

Food Security

This year, the families of the Saber Nutrir program demonstrated their great resilience and commitment with the productive projects of each community since, in spite of the hardships due to the health contingency, they obtained products for self-consumption and for marketing.

With Pro Mazahua we were able to install 156 chicken coops and 179 greenhouses throughout 11 years. In 2020, no new projects were installed due to the contingency, but with the existing projects, the beneficiaries obtained an average monthly income of MXN $4,596, an addittional 45% to their monthly average income of $4,000 MXN.

With ChildFund, in 2020 we installed in Tapachula, Chiapas, 14 orchards and 15 farms, adding up to a total of 125 active farms and 95 active orchards. Additionally, we installed 6 ecological stoves, that allows them to reduce wood consumption and reduce cases of respiratory diseases.

Thanks to the production generated in their orchards, farms and water systems, the families in this community had average monthly savings of MXN$1,375, in comparison to the average income of the region, which is $3,080 per month.

Nutritional oversight

In 2020, we carried out nutritional survey* to the children of the participating Mazahua families in the State of Mexico and the findings were as follows:

Nutritional Oversight (%)

*Note: Evaluation carried out with 66 children belonging to 39 families supported since the beginning of the program, 3 chldren less than in 2019.

Since 2013, we have achieved the following:

Reduce malnutrition by 10% as well as overweight and obesity by 2% in the children evaluated.

Keeping the wellbeing of our communities and the health of their members as a priority, during 2020 we suspended face-to-face follow-ups, timely attention and nutritional guidance activities due to the health contingency.

However, we implemented the following actions:

  • Timely stimulation: During the first quarter of 2020, our 5 “Creciendo Contigo” centers provided 33 timely stimulation sessions. These sessions were suspended for the rest of the year as a result of the social distance measures to prevent the spread of COVID-19.
  • Emerging program for children in confinement due to COVID-19: We launched this emerging program during the health contingency, where we shared information brochures with nutrition activities, proper treatment, psychosocial risk prevention and fun activities with families to stimulate the development of 247 children in different growth stages.

Productive and marketing projects

Due to the mobility restrictions resulting from the health contingency, in 2020 we prioritized the continuity of the already active productive projects in the State of Mexico.

Installation of productive infrastructure

We continued with the “Generación de ingresos para familias Mazahuas” Project in 13 communities of the municipality of San José del Rincón, State of Mexico.

We installed 30 projects, 5 more than in 2019, to market tomato, strawberry, sheep, and turkey with the participation of 43 families.

The result of the sum of such efforts, jointly with the commitment and perseverance of the involved communities is reflected in the income obtained for the 55 marketing projects implemented in the area since 2019, which added up to 2.6 million MXN and generate a direct benefit for the 118 participating families.

 
ProjectIncome# of projectsParticipating families
Tomato greenhouse$598,000330
Strawberry greenhouse $321,800315
Cactus greenhouse $59,40015
Sheep production$1.134,0003333
Turkey production$61,5001010
Bird production$187,440210
Sheep fattening$271,500315
Total$2,633,64055118

In Alliance with ChildFund, we worked in 28 projects to market egg, birds, sheep and tilapia in Tapachula, Chiapas, obtaining MXN$449,773 in income for 54 families.

Safe water

Thanks to an alliance with Rotoplas, a leading company in solutions for water storage, conduction and treatment, since 2017 we have installed projects that give access to quality water for communities. During 2020 we installed 15 safe water systems (well, water tank, water purifier, and biodigester) in the state of Chiapas, with which we reached a total of 171 active installed drinking water systems.

With this project, we improve the life quality of families, while we grant sanitary and health conditions for their development.

Padrino Saber Nutrir®

Through the Padrino Saber Nutrir® Program, the collaborators of Grupo Herdez may become godfathers of a child suffering from malnutrition in the Mazahua area, contributing $120 pesos per month, which is used to buy the necessary food supplements for their recovery.

Through this program, we have dedicated ourselves to creating a bond with the families, knowing the needs of the children of the communities, and thus promoting their development and quality of life beyond just nutrition.

Thanks to the participation of 53 godfathers, 92 children from the State of Mexico participated in the program and 12 infants were able to recover from malnutrition and improve their life quality.

SUMMARY OF ACTIONS 2020

This year, 1,017 children under the age of 12 were benefitted by the productive projects and the Padrino Saber Nutrir® Program.
 Pro MazahuaChildFundTotal
Installed projects305080
Benefitted families2929
New communities22

Herdez Foundation

Through the Herdez Foundation, we protect the origins of our cuisine and we incentivize the revaluation of endemic Mexican products with an anthropological, social, historical, nutritional, industrial and biodiversity approach.

For this reason, we carry out promotion, dissemination, research and education activities focused on subjects aimed at food development in our country, which include:

  • 20th anniversary of the “Nuestra Cocina Duque de Herdez” gallery. In 2020, we celebrated two decades of protecting the heritage of Mexican cuisine in our location at Seminario 18 of Downtown Mexico City. Through digital media, we conducted the webinar: A walk through Mexican cuisine through time where, through a permanent digital exposition, divided into four rooms, we showed the changes that Mexican cuisine has undergone:
      • Prehispanic cuisine
      • Colonial cuisine
      • Modern cuisine
      • Future cuisine

    This Project is part of the actions of Museo Galería Nuestra Cocina Duque de Herdez, which we have developed in coordination with Papalote Museo del Niño, Museo Nacional de Antropología and Museo Franz Mayer. Since its inauguration, the exposition has received 179,000 visitors.

    In the first quarter of 2020, we received 495 visitors, adding up to a total of 57,709 since its opening in 2000.

  • Gourmand Awards. We are proud to share that in 2020, the book Cacao: divine food, from our collection Tonacayotl: Nuestro Sustento, was selected as “The best of the best” in the framework of the celebration of the 25 years of the Gourmand Awards. This publication was also displayed in the Alfred Nobel House in Karlskoga, Sweden, from September 01 to November 09, 2020, being the best research of Mexican food.
  • Mexican Food Library of Fundación Herdez. It currently has a collection of 6,669 volumes. In the first quarter of 2020, 2,789 users visited it (54% more than in 2019) and, since its founding in 1997, the library has received 191,186 in-person visits.

    Starting in April, our facilities remained closed due to the social distance protocols to prevent the spread of COVID-19. It is important to note than in 2020 we received a total of 26,593 visits to our virtual library.

  • Education to recover history. Complementing our actions to preserve the value of Mexican cuisine, we digitalized our Memory Game: Fruits, vegetables, and some Mexican spices. The game has a guide Xolín, a Xoloitzcuintle dog, which helps children and their families to develop cognitive skills while they get to know our culture.
    At the end of 2020, its digital version received 242 visits. This educational memory game is available at the website of the Mexican Cuisine Library.

The commitment with Mexico and Mexicans joined us to fight for nutrition and assist in the health of Mexican families”

Héctor Hernández-Pons Torres, Chairman of the Board and Chief Executive Officer of Grupo Hérdez.

Donations for COVID-19 and natural disasters.

Committed to the wellbeing and development of our country, at Grupo Herdez, we joined as a great family through Fundación Herdez and our brands Barilla®, Búfalo®, Cielito Querido Café®, Del Fuerte®, Doña María®, Helados Nestlé®, Herdez®, McCormick®, and Nutrisa® to send a strong message of support to our collaborators of the restaurant industry, members of the medical community and populations affected by the health contingency in 13 states of the country.

We joined forces with different companies, organizations and institutions, amplifying our reach and delivering more than 200 tons of products in food baskets.

Suppliers

Together for a responsible production

GRI: 102-9, 103-1, 204-1

To ensure the supply of our products this year, the collaboration of all those that form part of our value chain was key, ensuring the wellbeing of our collaborators, suppliers, and partners, through prompt reinforcement and communication of the health and safety protocols.

This collaboration reinforced our commitment to the development of Mexican farmers by strengthening long-term relationships based on trust and creating mutual value. Their experience, combined with our best practices, guarantee unique products for our customers in the market of the highest quality.

Agricultural Procurement

To guarantee the quality and safety of all products that we sell, the source of which are farmers, we have the Agricultural Supplies Department that makes an analysis and traceability of each product. Their activities are focused on three fundamental action axes to build an efficient and responsible value chain:

  • Sourcing
  • Supplier development
  • Agricultural auditing

The process that the department follows to fulfill its purpose, consists of six stages:

This year we worked hand in hand with 173 suppliers of agricultural raw materials that were a key piece to obtain the products that we took to the tables of Mexican families.

The investment that we used in 2020 to purchase agricultural inputs was $892,121,573 MXN.

All our agricultural suppliers are domestic and are spread around 20 states of the country:

  • Aguascalientes
  • Baja California
  • Baja California Sur
  • Campeche
  • Chihuahua
  • Ciudad de México
  • Durango
  • Guanajuato
  • Hidalgo
  • Mérida
  • Morelos
  • Nayarit
  • Nuevo León
  • Puebla
  • Quintana Roo
  • San Luis Potosí
  • Sinaloa
  • Sonora
  • Veracruz
  • Zacatecas

Strategic supply

In addition to agricultural suppliers, we have strategic suppliers, which provide us raw materials, packaging materials, maquila services and other indirect services that, likewise, add to the mission of taking high quality products to Mexican families.

All actions implemented in the area are aligned with our Supply Strategy, through which we ensure the necessary resources and quality to give continuity to our present and future operations.

The strategy is focused on 4 basic pillars: risk management, innovation, productivity and usefulness.

Raw Materials
This year, from the total non-perishable raw materials that we acquired 89.49% was carried out with Mexican suppliers*, which is equivalent to MXN$5,165,677,630 and the remaining 10.51%, corresponding to MXN$606,939,646 MXN, was used for overseas purchases.

The total investment in non-perishable raw materials was $5,772,617,276 MXN, which resulted in a 22% increase with respect to 2019.

Packaging Materials
From the total packaging materials that we purchased:

  • 78% was procured from Mexican suppliers*, which is a 1% increase with respect to 2019. This is equivalent to an expense of $2,731,131,980 MXN.
  • 3% corresponds to foreign suppliers, representing $113,939,879 MXN.
  • The remaining 19% corresponds to a mixed supply, equivalent to an expense of $653,516,723 MXN.
    Total packaging material purchases added up to $3,498,588,582 MXN
    which is a 9% increase with respect to 2019.

(*) Local or Mexican suppliers are defined as those that have their manufacturing and transformation facilities in Mexican territory.
(**) Soybean is bought nationally, since, although its main source is the United States, the refining process is carried out in Mexico.

In 2020, the sustainable agricultural program became an important axis of the strategic plan of the supply department, because it has given good results and we want to expand it to suppliers of indirect materials."

Arturo Guzmán Chimeo, Environmental Sustainability Manager

Agricultural Sustainability

GRI: IP-6

As part of our agricultural sustainability efforts, we have two programs focused on minimizing the negative impacts of agricultural production on the environment and Mexican farmers:

McCormick - Member’s Mark Spices

The most important achievement of this category was the launching of 40 products under a cobranding scheme with Sam’s Club. This was an unprecedented launch in our relationship with WalMart.

 

Cielito Querido Café®, Lavazza®,
Moyo® and Nutrisa® Stores

2020 was a challenging year for many sectors, including retail, since the beginning, with the closure of stores and restrictions on mobility, we lived times of uncertainty. Regardless, we kept our staff with 100% of their salary and made different training options available to our collaborators through online platforms.

All establishments of our Cielito Querido Café, Lavazza, Moyo, and Nutrisa brands were converted into 100% safe spaces, aligned with the directives issued by the government in each state of the country to ensure conditions for their correct operation.

Something that we highlight with pride is that the contingency situation boosted our digital transformation. We accelerated the development of digital tools to be closer to our customers, offering delivery services through platforms such as Rappi.

Thanks to these efforts, Nutrisa and Cielito Querido Café were recognized in the ranking of The 500 Best Digital Brands of Merca 2.0, demonstrating our ability to generate relevant content and not being unnoticed in the midst of the situation.

Helados Nestlé

Among the competencies that we had to develop, we highlight knowing how to act differently with our customers, understanding their circumstances and concerns, respecting their times, and lacking in-person interactions, being able to maintain a united team that is always ready.”

Andrea Del Rizzo,
Commercial Director

 

One of the challenges we faced during the contingency was understanding, jointly with our customers, the impacts and needs of each sales channel. Demand in supermarkets increased considerably in the months of March and April 2020. Given this, we generated a joint plan to prioritize the key products and comply with procurement at all times, since in some specific cases we assisted in direct delivery to stores.

Traditional (DSD) channel was one of the most affected, with a decrease in sales close to 20%, however, we supported store owners by making promotions to boost their sales. Also, we joined forces with Coca-Cola Mexico, Colgate-Palmolive, Kellogg’s, Mondelēz México and Pepsico in the campaign “Separados somos pequeños, juntos somos gigantes”, to recognize the effort that people in charge of stores and small business in Mexico do, in addition to encouraging consumprion in local or neighborhood busineeses to incentivize the economic reactivation of Mexican families, in the face of the new reality. 

Additionally, to assist our convenience store, pharmacy, and institutional channel stores, we developed payment plans to help the cash flow of the customers in these channels.

Doña María

Cooking sauces: Addressing the trends and needs of our customers for ingredients to prepare home-made dishes, with authentic Mexican recipes, we launched the Cooking Sauces Doña María (Pastor, Pibil and Tinga), taking the flavor of Mexico to their tables.

 

We had several achievements as a team, Herdez was recognized as the second most valuable brand of the 2020 Annual Report, according to the consulting firm Brand Finance, being in the Top 10 brands that consumers mention as proud representatives of what we are as Mexicans.”

Rodrigo Mondragón Campero, 

Deputy Director of Marketing for Herdez Del Fuerte

McCormick Balance

  • McCormick Balance Mayonnaisse

    With the launch of the Balance line, we give our customers a new variety of options with low caloric content, prepared with sesame seed, soy and avocado oil.

  • McCormick Balance Tea

    This year we added teas to the Balance family, composed of Anti-Flu Tea and Good Night Tea, the new Antistress tea, offering a moment of relaxation for our customers.

    In this regard, we did the #sabeabalance campaign on social media to promote the adoption of balanced lifestyles.

  • Balance Jams

    We looked for ways in which consumers may enjoy the same flavor of their favorite jam, but with 50% less sugar, presentations include: strawberry, blackberry, mango and pineapple without preservatives or artificial flavors.

McCormick Mayonnaise

  • Mayosabor BBQ

    With the launch of Mayosabor BBQ we offered the public the perfect combination of sweet and smoky. Given the wide acceptance that it had among our customers, in a short time, this new product reached the same market share as Mayosabor Habanero (2019), representing 5% of the flavored mayonnaisse segment and positioning itself in the Top 5 of the portfolio.

  • Soccer Teams

    To service and pamper our clients in the northern part of the country, we launched a limited edition in three different presentations 190g, 390g and 725g of mayonnaise jars with images of the two most important teams in the Northern region: Tigres de la Universidad Autónoma de Nuevo León (UANL) and Rayados de Monterrey. The sale was carried out exclusively in the retail channel and wholesale stores, with which we gained 2.2 market share points in the city of Monterrey.

    Thus, we entered into an alliance with these two teams to launch two campaigns to assist with the contingency. With the Tigres team, we donated one million facemasks in economically active zones with high affluency and in low-income communities in Monterrey. With the Rayados team, we donated laptops in different communities in Monterrey, helping more than 700 children so that they could continue with their studies remotely.

McCormick Jams with Chili Peppers

We launched three new flavors for our customers: raspberry chipotle, orange pequin and apple with ancho pepper; highlighting the flavors of Mexican food, and adding to a total of 6 varieties to the jams with chili pepper category.

The most valuable resource were our people. Their commitment, puntuality and proactivity; looking for solutions to the challenges that arose, without being physically present.”

Diana Cortina Toledo, Deputy Director of Marketing McCormick

Frozen Food

In 2020, we leveraged the positioning of brands with high recognition in Mexico, such as Bailey’s, Chocolate Abuelita, Kit Kat and La Lechera. This way, we innovated to offer new moments of satisfaction to our customers in our Frozen platform, being able to obtain a 20% market share.

We did these launches in different sizes and formats to be able to offer options to our retail customers, price clubs and mom-and-pop stores.

Thanks to the teamwork of the marketing, sales, and operations teams to transform the strategy of the Frozen division; we have built a new positioning, leveraging on powerful brands and new product platforms.”

Claudia Reyes Cuevas,
Deputy Director of Marketing for Frozen and Retail

Búfalo

  • “A la Búfalo”: In collaboration with the influencer Alex Fernández, this year we made a series of videos with recipes and organic stories that reached more than 118,000 people.
  • Conecta Festival: We held the 1st Online festival in Mexico, where we had 382,000 views, Tweet and Greet with DLD and Alejandro Fernández concert.
  • Extra Hot Classic Sauce We provide a hotter alternative for the most resistant palates.
  • New Image: Salsa Búfalo had an image change in 2020 to achieve a new brand-level alignment and, at the same time, we differentiated ourselves from the other sauce varieties; giving it a rejuvenated and unique identity, maintaining its fun and fresh essence.

McCormick

  • Mother’s Day: On May 10 we surprised all Mexican moms with a very special message in social media, which reached 2.6 million people.
  • Mayosabores, Stand Up Comedy Show: The comedian Sofía Niño de Rivera offered a standup comedy show that was broadcasted on social media, which had over 700 attendees, achieving a sold out for the event.

Barilla

  • Gastronomic Bonuses: In support of the restaurant sector, we gifted coupons to local restaurants to exchange them for meals and thus help them maintain their income. This time, we helped the restaurant Lalo!.
  • Cooking workshops with Lalo García: We invited this famous Chef to share recipes and cooking tips with us in a Live Stream. We had over 600 thousand visits.

Yemina

With the intention of sharing the energy provided by Yemina pasta, we carried out two activities in 2020, which had a reach of 4 million users:

  • We had free yoga classes with our brand ambassador, Elsy Núñez and we shared delicious recipes that are free to download in the recipe book “More stories with Energy”.
  • Crew Yemina: through influencers from Monterrey, we carried out online activities such as “Yemina Yar Kits at home”, “Feed Your Soul Kits Collection” and “Zoom Session with influencers”.

We advance towards a
culture of Diversity
and Inclusion

Since 2016, we form part of the “Éntrale” alliance, promoted by the Consejo Mexicano de Negocioswhich their main purpose is to create a culture of inclusion, which enables the integration of people with disabilities in the labor market.

At the end of 2020, we had 10 persons with disabilities in our staff, 6 men and 4 women.

We accompany our families

 

As a family we want our collaborators to be able to exercise their maternity and paternity leaves in accordance with the guidelines of the Federal Labor Law in terms of parental leaves. In 2020, 145 female collaborators and 50 male collaborators took their days of leave. 100% of them returned to work after this important period.

We worked on the installation of 3 new breastfeeding rooms in our locations, reaching a total of 8 sites, which correspond to 67% of our plants and corporate offices. This way, we benefit  310 collaborators so that they may exercise their right to breastfeed upon returning to their work centers.

We make sure that these spaces comply with the specifications of the Mexican Social Security Institute (Instituto Mexicano del Seguro Social, IMSS) and the United Nations Children’s Emergency Fund (UNICEF), these being hygienic, private spaces, easy to access and equipped to be used by one person at a time.

Follow-up calls

More than 12,150 calls to 1,446 collaborators that were reported to CASH and Medical Service due to testing positive for COVID.

  • 578 family members of collaborators received medical guidance.
  • We delivered more than 10,240 sanitation kits to collaborators.
  • 1,603 Collaborators received a vaccine against influenza and we distributed 21,298 Vitamin C’s to the personnel of the Company.

Covid-19 Brigades

We integrated 211 collaborators who had previously helped verify compliance with the measures derived from the COVID-19 contingency, to:

  • Prevent agglomerations and promote social distancing.
  • Verify compliance with the use of Personal Protection Equipment (Facemask and facial protection).
  • Perform 1,585 COVID Audits, during 36 weeks in all facilities and locations of the Group, as well as in stores and coffee shops, reaching a 91% average score.
 

Let’s talk Covid-19

Let´s talk Covid-19: training and recommendations

This year we held 20 sessions where more than 650 collaborators heard the recommendations and solved their specific questions with respect to the COVID-19 contingency. We thank our four expert speakers from the medical department.

Supplementary Prevention Activities

  • In addition to the prevention activities, we installed 15 thermographic cameras and sanitizing tunnels in the entrances to plants and distribution centers.
  • We expanded from 64 to 80 the transportation units for our collaborators, we adapted the on-site facilities such as dining tables and we expanded locker rooms.

UNIDOS POR
MÉXICO

 

Union makes us stronger and this year we demonstrated that more than ever. For the first time, two of the most important mexican food companies in Mexico, Grupo Herdez and La Costeña®, jointly with Sanfer®, one of the leading companies in the mexican pharmaceutical market, we assembled more than 35 thousand baskets (equivalent to 770 tons) with food, medication, cleaning and health products, which benefitted more than 175 thousand Mexicans in a vulnerable situation with respect to COVID-19. 

The boxes were distributed in 13 states of Mexico, with the support of 11 civil society organizations, including:  Asociación Mexicana de APAC I.A.P., Asociación Gilberto, Banco de Alimento de México, Cáritas Mexicana, Consejo Nacional Agropecuario, Corporativa de Fundaciones para el Programa Jalisco Sin Hambre, Échale, Fraterna Hoy, Fundación CMR, Fundación Kaluz, Fundación Origen, Fundación Unidos por una Sonrisa, Misioneros del Espíritu Santo, Teletón, Un Mañana and 360 Grados.

UNIDOS POR
MÉXICO

 

La unión hace la fuerza y este año lo demostramos más que nunca. Por primera vez, dos de las compañías mexicanas de alimentos más importantes en México, Grupo Herdez y La Costeña®, de la mano de Sanfer®, una de las compañías líderes en el mercado farmacéutico mexicano, nos aliamos y armamos más de 35 mil canastas (equivalentes a 770 toneladas) con alimentos, medicamentos y productos de limpieza e higiene, que beneficiaron a más de 175 mil mexicanos en situación vulnerable frente al COVID-19.

Las canastas fueron distribuidas en 13 estados de la República Mexicana por medio de 11 organizaciones de la sociedad civil, entre ellas: Asociación Mexicana de APAC I.A.P., Asociación Gilberto, Banco de Alimento de México, Cáritas Mexicana, Consejo Nacional Agropecuario, Corporativa de Fundaciones para el Programa Jalisco Sin Hambre, Échale, Fraterna Hoy, Fundación CMR, Fundación Kaluz, Fundación Origen, Fundación Unidos por una Sonrisa, Misioneros del Espíritu Santo, Teletón, Un Mañana y 360 Grados.

We are Grupo Herdez Family

We developed an internal support program for collaborators who lost an immediate family member due to COVID-19, for each peso donated by one of their colleagues, Grupo Herdez donated another one.

Giving thanks to healthcare workers (Nutrisa and Cielito Querido Café)

With the intention of showing our recognition and sending a message of solidarity to doctors, nurses, laboratory, administrative and cleaning personnel in healthcare institutions that assisted COVID-19 patients, we wore our facemasks, face shields and gloves to take 40 thousand snacks, ice cream, sandwiches, cookies and bread to first-line workers at the following healthcare institutions in Mexico City and Morelos:

  • Centro Médico Nacional 20 de Noviembre
  • Hospital Carlos Mac Gregor Sánchez Navarro
  • Hospital General de México
  • Hospital General Dr. Manuel Gea González
  • Hospital Infantil de México Federico Gómez
  • Hospital Juárez de México
  • Instituto Nacional de Ciencias Médicas y Nutrición Salvador Zubirán
  • La Casa de la Amistad
  • Sanatorio Durango

#SiviendoaMéxico

 

In Alliance with the restaurant sector, Directores de Cadenas Restauranteras (DICARES), Asociación Mexicana de Restaurantes (AMR), Comida para Ayudar and Vatel Club, we collected more than 60 tons of food that enabled us to benefit 24 thousand collaborators from 146 restaurants in the capital of our country, who saw their income affected due to the partial or total closure of their food establishments.

Additionally, jointly with Vatel Club, our Food Service division donated 850 food baskets to employees of 36 restaurants in Mexico City belonging to this food and tourism civil association.

#SiviendoaMéxico

 

En alianza con proveedores del sector restaurantero, los Directores de Cadenas Restauranteras (DICARES), la Asociación Mexicana de Restaurantes (AMR), Comida para Ayudar y Vatel Club recolectamos más de 60 toneladas de alimentos que permitieron beneficiar a 24 mil colaboradores de 146 restaurantes en la capital del país, quienes vieron afectados sus ingresos debido al cierre parcial o total de los establecimientos de comida.

Adicionalmente, en conjunto con Vatel Club, nuestra división de Food Service donó 850 despensas a empleados de 36 restaurantes de la Ciudad de México pertenecientes a esta asociación civil de gastronomía y turismo.

SEPARADOS SOMOS PEQUEÑOS, JUNTOS SOMOS GIGANTES

Another action that fills us with pride and that marks a chapter in the history of the Mexican food and beverage sector is the alliance that we formed with Industria Mexicana de Coca-Cola, Colgate-Palmolive, Kellogg’s, Mondelēz Mexico and PepsiCo, through which we launched the national campaign called #MiTiendaSegura from June 22 to August 21, 2020. During the campaign we invited consumers to recognize the great work of the persons that own small stores and businesses to incentivize consumption in local businesses and help Mexican families in this new reality. This included specific digital communication actions and others at the point of sale, such as:

    • Installation of transparent acrylic protection screens to protect the health of store owners and clients.
    • We provided information to the owners of small stores and businesses as to how to maintain the continuity of their businesses, delimiting the interaction with clients and suppliers, correct sanitization of spaces and products, personal hygiene protocols and advice to redistribute their space, if necessary.

Together for Mayan communities

In collaboration with México Indígena and ProMaya we carried out actions in immediate response to the floods caused by the tropical storms “Amanda and Cristóbal” in 3 municipalities and 73 indigenous Mayan communities in the State of Campeche.

Additionally, from June 17 to July 2, we donated food from the basic food basket to form 3,498 packages with 9 products each, which were delivered in the municipalities of Hopelchén, Champotón, and Calakmul. 

In future actions, we will also collaborate to rehabilitate productive projects and means of sustenance for the families of these communities.

SABER NUTRIR

In addition to the actions that we usually carry out with this program, in support of healthcare institutions and, as a token of our gratefulness for the great work that they carried out during the pandemic, we delivered 50 kits (equivalent to 177Kg of Grupo Herdez products) with products for the medical, nursing and cleaning personnel at Hospital Regional de Alta Especialidad of ISSSTE Tultitlán, State of Mexico.

We also provided support to Mazahua communities from the municipality of San José del Rincón, State of Mexico, by delivering 7,163 cereal bars and 5,200 mayonnaises bottles of 105g. Additionally, in December, we donated 2 24-inch screens and 300 headphones to promote the continuity of studies of children and young people that currently engage in online studies.

Good Agricultural Practices (GAP) Program

Through this program, we offer tools to our agricultural suppliers, such as the Good Practices Manual, training sessions and environmental audits, so that they adopt good labor and environmental practices.

Once of these practices consists on reducing the use of agrochemicals through integrated crop management, which consists of using biological products such as:

  • Fungicides: for use in organic fertilizer and beneficial microorganisms.
  • Insecticides: for use in fungi, bacteria and beneficial insects.
  • Fertilizers: for use in organic fertilizers (composts, leachate, socas).

Currently, 90% of our agricultural suppliers comply with the internal standards of Grupo Herdez corresponding to Good Use of Agrochemical Management (BUMA) in line  compared to the previous year.

In 2020, 58 of our suppliers (corresponding to 100% of our fresh raw materials suppliers) were evaluated based on Good Agricultural Practices criteria and on the guidelines of the Sustainable Agriculture Program. The foregoing represents an increase of 29% compared to 2019.

The first aspects that we consider in order to monitor the progress in the implementation of the programs described above include:

  1. Providing documentary control at the start of the agreement (frequency: annual)
  2. Periodic oversight of each supplier (frequency: every 15 days)
  3. GAP Audits (frequency: quarterly)
  4. Water, soil and product analysis (frequency: water and soil once; product on a monthly basis)
  5. Tours (frequency: monthly)
  6. Activity reports from the Agricultural Auditors (frequency: weekly)

Sustainable
Agriculture
Program

In order to promote the conservation and improvement of the environment, tha Sustainable Agriculture Program aims to guide, train, supervise, and follow-up on the production practices carried out by our agricultural suppliers of fresh raw materials, especially related to protected areas or zones, efficient use of water, soil conservation and clean air, to obtain raw materials without chemical waste.

This generates two important benefits for the suppliers: cost reduction and high quality products. Withinin the program, we have a Decalogue of compliance that includes specific actions, such as:  

  1. Preservation of biodiversity
  2. Air, water and soil protection
  3. Energy and climate change
  4. Waste management
  5. Integrated crop management
  6. Agrochemical reduction
  7. Health and safety
  8. Decent work
  9. Social responsibility
  10. Communication and participation