Aiming to be the most attractive workplace in the trading sector

Kesko and its chain stores offer motivating and rewarding jobs with products and services valued by customers. Kesko is a good and responsible working community where employees are treated equally and fairly.

At the end of 2008, the total number of Kesko personnel was 24,668 in eight different countries. Of these, 13,651 worked in Finland and 11,017 in other countries. The average number of personnel converted into full-time employees was 21,327. The average decrease in Finland was 95 employees, while in other countries the average increase was 902 employees.

Kesko's most international division is Rautakesko, with 96.5% of its 10,158 employees working outside Finland. In all, Kesko and its chains' retailer entrepreneurs employ some 50,000 people.

Kesko's strengths include providing an opportunity for versatile internal job rotation and for career development. During 2008, some 2,000 people moved to new jobs within the Kesko Group. In 2008, one of the major focuses in HR management was distributing the new guide, “Our Responsible Working Principles”, to all employees in every country in which Kesko operates. The introduction to responsibility was supported, among other things, by an e-learning programme for managers and unit-specific staff events arranged by managers. Another important area of priority was launching the work and productivity programme comprising Kesko and its chain stores. The programme will continue in 2009.

Kesko was highly rated in Universum, the Finnish employer profile survey, in 2008. Among commercial students, Kesko's ranking in the list of ideal employers improved. The ranking among young professionals with a university degree has risen from 28th to 13th in the space of two years, while those with an initial vocational education in commercial studies ranked Kesko 6th.

Kesko carries out close cooperation with students and teachers in different sectors. For example, the job-orientation of Finnish teachers of commercial and technical subjects is promoted in trainings arranged by Kesko.

The most competent and motivated people in the trading sector

Kesko and its chain stores also offer their employees good opportunities to develop their competencies in a target-oriented manner.

In Finland, Kesko's subsidiary K-instituutti is the K-Group's competence development centre. The business model of K-instituutti was revised in 2008. It plans competence development solutions for chain business needs and carries out training programmes together with its partner network. The provision of regional training is also increasing. In 2008, the training programmes implemented by K-instituutti were attended by about 25,000 people.

The 2008 Master Sales Assistant training, Finland's largest adult training programme, had over 16,000 participants in 13 different product lines.

The Rautia chain was named the Master Sales Assistants' trainer chain; 80% of all Rautia chain store employees completed the Master Sales Assistant training. About one hundred business colleges and polytechnics also offered their students an opportunity to participate in the training, and some 6,000 students took this opportunity.

Kesko's second K-trainee programme ended in January 2009. Those who completed the first K-trainee training and recruitment programme were hired for managerial and specialist duties by different companies in the Group during 2008. The car salesmen who completed VV-Auto's car salesman trainee programme were recruited to jobs corresponding to their training.

Management and leadership

Self-control trainingAt Kesko, management is conducted in a responsible manner and in compliance with the corporate values. A developing and motivating working community is a prerequisite for the wellbeing and excellent performance of employees.

The annual personnel survey plays a key role in measuring the quality of management and the internal employer profile at Kesko. The similar survey, revised in 2008, is conducted throughout Kesko and its chain stores. The revised survey provides even more concrete information about the strengths and development targets of working communities. Replies were received from 68.8% of the employees of the companies included in the survey.

One of the key tools in efficient performance management and the motivating leadership of immediate superiors is the annual performance and development review whose implementation is included in the annual personnel survey. Furthermore, the performance of the entire Group's key personnel is assessed separately.

Leadership skills and career progress are supported by Kesko's own three-step superior and management training, the internationalisation of which is under development.

Since 2004, Kesko has implemented a long-term development programme for members of the management and potential management. There are some 200 participants in the programme, whose purpose is to ensure a sufficient supply of managerial resources both in terms of quality and quantity. This is complemented by the chains' own training, such as the “K2-tusen chef” programme by K-rauta AB in Sweden, which combines theory and practice for the needs of future management. The third programme will be launched in 2009.

Kesko's first own K-retail eMBA programme, implemented in cooperation with the Helsinki University of Technology, concluded in January 2009. The programme aims to strengthen the participants' abilities to act in international retail management duties.

Towards the best work productivity in the trading sector

Enjoying work at K-citymarketsThe key objective of the ongoing work and productivity programme is to improve the employees' work productivity, for example by focusing on the competence and wellbeing of people and on better leadership. The programme also involves measures related to increasing operational efficiency and electronic communications. The work and productivity programme applies to all of Kesko and its chain stores.

Long-term projects focusing on wellbeing at the workplace are currently underway in several companies. The aim is to increase work productivity by reducing sickness absences and raising the retirement age. The monitoring of sickness absences will be defined and management's intervention skills will be improved. Improvements to work productivity are also sought by promoting the adoption of different working hour models and by systematic working hours' management.

In Finland, Kesko's Occupational Health Service Unit focuses on operations that maintain work capacity and promote the wellbeing of the working community. Currently 35–45% of the aggregate costs of occupational health are allocated to these activities. In other countries, occupational health services have been arranged according to the local practice and legislation. Support for personnel's recreational activities is provided through joint staff clubs and in the form of company- specific contribution.

Most of Kesko's employees belong to a bonus incentive system. The management's incentive systems are described on page 62.

Kesko's internal communications will become more international and efficient with the completion of the new intranet that is currently under construction. Information about HR affairs is also available in the Corporate Responsibility Report, to be published in spring 2009.