Compliance, Ethics and Governance

The company has a governance, ethics and compliance structure that appropriately manages its regulatory risks, which is based on compliance programs in areas such as crime prevention, ethics, free competition, the environment, personal data protection and consumer rights protection.

TAll our compliance programs contain standards that describe the behavior expected of our employees, as well as the consequences of non-compliance. They describe how we publish the behavior expected of our employees, which must begin with senior executives and then be cascaded throughout the entire organization. They describe how these standards are applied in practice, and they describe the checks that verify correct execution.

We use this structure to continually manage our compliance risks and every quarter we report the management indicators that measure the effectiveness of our programs.

 +Ethics Program

FFalabella is firmly committed to ethically and conscientiously managing its business, and recognizes that it must promote a culture of integrity and compliance that guides the behavior of all its employees. Accordingly, Falabella S.A. has an Ethics Program, which contains the associated internal regulations, including the Integrity Code and the Handling Conflicts of Interest Policy and the Gifts and Invitations Policy.

The company has an Integrity Channel for any employee, supplier, customer or individual who wishes to register an ethical inquiry or complaint, or register doubts or concerns related to non-compliance with the law or internal regulations.

The Integrity Channel's means of communication are i) by e-mail sent to the following address contactochile@gerenciadeetica.com; ii) by telephone, to 800 726 100; iii) through the link to the Integrity Channel on each Company's website and intranet; and iv) in person at the offices of Falabella's Ethics department.

EThe Integrity Channel is unique for all of Falabella’s businesses, and investigations are referred by the Ethics department to investigators trained in these issues, who then submit a report to the Ethics department, who consult with each business to determine the appropriate course of action.

EThe Integrity Channel identifies the most frequent issues, it suitably resolves the reported problems, and identifies any required training or communication. It includes investigative processes that secure due process, confidentiality and non-retaliation for whistleblowers in good faith. The Channel anonymously receives complaints and inquiries, except when the regulations require the complainant to be identified.

Our Integrity Code can be found here..

+ Crime Prevention and Anti-Corruption Program

CThe size, structure, diversity and multiplicity of Falabella’s markets require that appropriate behavior standards are defined, to prevent behavior that could result in bribery. Accordingly, Falabella approved a Crime Prevention Model (CPM) and a corporate Anti-Bribery Policy that categorically prohibits the commission of any illegal act within the organization, particularly bribery between private individuals and domestic or foreign public officials.

A campaign called "I play fair" was implemented to address this important issue, which establishes the minimum standards that apply to all company employees when interacting with any public official. This campaign is reinforced throughout the year using bulletins and training courses for every position exposed to this risk within the Falabella group.

FaFalabella is firmly committed to respecting and complying with all the relevant laws and regulations. The Integrity Code describes this commitment to promote a culture of compliance and integrity that guides the behavior of all its employees, regardless of the country or place where they work.

DTherefore, Falabella proactively prohibits the commission of any crime, especially those related to money laundering, financing terrorism, bribery of public officials or private parties, inappropriate business dealings, and any that may involve criminal or administrative liability for any of Falabella's companies.

How do we do it?

  • Anti-corruption awareness: dinformation is provided during the year on the duties and obligations of all employees with regard to anti-corruption. The company posts Infographics in the media for all employees, and people working in positions exposed to this risk are invited to training sessions that explain the checks to prevent corruption. Random evaluations verify the scope of these communication and training measures. Anti-corruption initiatives include the “Yo Juego Limpio” (I Play Fair) campaign to prevent bribes being offered to public officials and corruption among private individuals. The “Un millón de gracias, pero no” (A million thanks, but no thanks) campaign describes everything related to receiving and giving gifts.

  • Training for people working in positions exposed to this risk: training is provided at least once a year to everyone working in positions exposed to the greatest risks according to their duties. They are trained in anti-corruption issues covering the crime, its scope, its history and the company’s measures to prevent it. They are instructed how to behave if they become the passive subjects of this crime and they are also reminded that there is an Integrity Channel and a mailbox to request advice from the lawyers at the Compliance department.

  • Compliance risk analysis: Falabella has developed a Compliance Risk Management Procedure for compliance risk assessment and analysis, which aims to:
    • i. Establish guidelines that identify, analyze, assess and manage Falabella's compliance risks.
      ii. ii. Contribute to optimizing and standardizing the compliance culture throughout the organization.

    PThis procedure was prepared from various relevant international regulations, such as the ISO 31,000:2009 Risk Management standard and the ISO 19,600:2014 Compliance Management Systems standard. Its purpose is to establish a framework that includes the organizational context, the compliance programs, accountability, process integration, and the required resources, communication and reporting.

    A survey collected data on the risk of crimes that could result in criminal liability for the Company, which were included in the CPM compliance matrix, and addresses the risks related to processes and sub-processes that may have a significant impact on reputational, legal or financial issues. Several checks were assigned to each risk, which aims to reduce them to match the company's risk appetite. These checks are found in various regulatory documents such as the Anti-Corruption Policy, the Crime Prevention Control Instructions, the Donor Control Protocol, the Supplier Background Check Procedure, and other documents.

  • Board Oversight: A report on Falabella's compliance programs is submitted to the Board of Directors on a semi-annual basis and emphasizes the Crime Prevention and Antitrust Programs. This report describes the Crime Prevention Program’s prevention, detection, response and monitoring measures, and it focuses on:
    • i. The main issues for the period
      ii. Training and communication
      iii. Audits, lawsuits and investigations
      iv. Action plans to resolve any gaps

  • Procedures to address CPM with brokers: Falabella extends its own internal policies to its third-party brokers to prevent them becoming corrupted. We communicate our standards and provide training on anti-corruption issues to brokers. The same Risk Management Procedure is used to survey and manage these risks, and they are added to the crime prevention matrix for each business. Most importantly, compliance and anti-corruption clauses are added to all of Falabella's third-party contracts.

Our Crime Prevention Model can be found here.

+ Human Rights

Falabella is committed to behaving in a socially responsible manner towards its customers, employees, suppliers, local communities, the environment, and society in general. We understand that our business can impact the quality of life of our stakeholders. Therefore, we have mechanisms that adequately identify and evaluate risks, in order to prevent these impacts and correct them where necessary.

  •  Business and Human Rights Policy: Falabella has a Business and Human Rights Policy, which reflects its commitment to respect and promote the fundamental rights of individuals. Falabella encourages its suppliers to behave in accordance with the standards, guidelines and principles in this Policy.

    It defines the principles and specific measures that guide Falabella's behavior to ensure that it actively and sustainably complies with Human Rights standards with respect to the impact of its business, in accordance with its corporate values, its internal regulations, and the United Nations Guiding Principles on Business and Human Rights.

    Our Policy has established three resources and monitoring mechanisms:
    1. Due Diligence: each business unit must perform Due Diligence to identify and evaluate any Human Rights risks. It should incorporate any gaps into its matrices and prepare appropriate action plans to resolve them.
    2. Business and Human Rights Program: each business unit must adopt an organizational system for modeling corporate behavior under a Business and Human Rights Program. The purpose of this Program is to establish, communicate and guide the behavior expected of employees, in order to:
      • i. Prevent risks to Human Rights.
        ii. Detect any potential violations of the Business and Human Rights Policy or Program, or each company’s associated regulations.
        iii. Promptly respond to such potential violations.
        iv. Monitor, continuously improve and update this Program.
        v. Establish communication channels with stakeholders.

    Our Human Rights Policy can be found here.

  • Protect children's rights: Falabella respects and promotes the principles enshrined in the Universal Declaration of Human Rights and the United Nations Convention on the Rights of the Child, and it complies with all laws and regulations governing child labor and apprenticeship programs. It also adheres to the United Nations Global Compact, and its initiatives are aligned with the Sustainable Development Goals.
    Falabella emphatically rejects human trafficking and the use of child labor. It contractually encourages its suppliers to comply with the law, international treaties, declarations and conventions that promote and protect human rights, and contribute to eradicating child labor.

  • Adherence to fundamental rights: Falabella respects the fundamental rights described in the United Nations Guiding Principles on Business and Human Rights, the International Bill of Human Rights, and the International Labor Organization's Declaration on Fundamental Principles and Rights at Work. This requires it to prevent its own business from causing or contributing to negative consequences for people.

+ Antitrust Program

Falabella has an Antitrust Compliance Program that describes various regulations and measures aimed at mitigating the risk of anti-competitive behavior.

Communication and training activities are focused on people working in positions exposed to the antitrust risks that may arise at Falabella, and explain the checks designed to prevent exposure to them.

Falabella publishes its Antitrust Compliance Program and related materials using various internal communication channels.

We ensure that our employees are kept informed of significant news on antitrust matters.

Our Antitrust Policy can be found here.

+ Environmental Program

An Environmental Program was approved in 2020 that demonstrates Falabella's commitment to caring for the environment and sustainably operating its business.

EThe purpose of this Program is i) to guide the behavior of employees and suppliers in relation to the environment, ii) to establish mechanisms to comply with the legal requirements and Falabella’s environmental commitments, and iii) to manage Falabella’s risks in relation to the environment.

This Program encompasses several internal regulations related to environmental issues, such as the Environmental and Climate Change Policy, the Inspections by Environmental Authorities Protocol, the Environmental Permit Submission and Administration Instructions, the Reporting Information to Authorities Protocol, and the Compliance with Extended Producer Responsibility Protocol.

Our Environmental and Climate Change Policy can be found here.

Personal Data Protection Program

We know that a good shopping experience for our customers includes protecting their privacy. Accordingly, the Personal Data Protection Compliance Program was approved in 2021, which compliments the technological advances that Falabella implemented during the year.

This Program expresses Falabella's commitment to respect the fundamental rights of individuals. Therefore, it focuses on guidelines and measures that protect personal data and prevent behavior that could violate the associated laws.

This Program is led by the Personal Data Protection Compliance Officer, whose main function is to ensure that the Program is correctly executed.

Our Personal Data Protection Policy can be found here.

My Customer Program

We want to provide Falabella’s customers with the best shopping experience, so we have implemented our My Customer Compliance Program. It focuses on guidelines and measures that protect customers' rights and prevent behavior that might contravene the law that protects consumers' rights.

This Program includes training and information on the i) Preparation of Advertising and Promotional Material Policy and Procedure, ii) Guarantee Requirements Procedure, iii) Inspections by Authorities Procedure, iv) Customer Security Procedure, v) Processing and Responding to Customer Complaints Procedure, and vi) Customer Rights Protection Policy.

AEvery year, we present the My Customer Update Report to all our employees, which describes the significant indicators, any new regulations and bills, judicial and administrative procedures, and any related news.

The My Customer Program is led by the Compliance Officer, whose main function is to ensure that the Program is correctly executed.

Our Customer Rights Protection Policy can be found here.

Supplier Engagement

All Falabella’s business partners are assessed and created in our systems by following the guidelines and checks described in the Supplier Validation and Creation Policy and the Background Data Review Procedure. These two regulations govern the process for accepting any supplier that initiates a relationship with Falabella. They require that suppliers sign a compliance declaration, a conflicts of interest declaration and a links with politically exposed persons declaration. All new suppliers are reviewed by compliance software where they are compared to public lists of prohibited people. Finally, they are reviewed for any negative press comments, and a report is submitted on any findings.

Participation in organizations and associations

Falabella participates in many national and international associations and organizations, in order to develop strategic alliances that have common interests and objectives and reinforce sustainability. We do not make contributions to political campaigns, in accordance with our internal regulations and policies.

Contributions in Ch$ millions            2018         2019           2020      
    Lobbying organizations -
    Industry associations1.0771.085 1.200 
   Political campaigns
 Total1.077 1.085 1.200 

The largest contributions to trade associations include the Banks and Financial Institutions Association (Chile, Ch$126 million), the Facatativá Chamber of Commerce (Colombia, Ch$113 million) and the Chilean Chamber of Shopping Centers (Chile, Ch$95 million).

Resource Center

  • Human Rights Policy
  • Integrity Code
  • Crime Prevention Policy and Model
  • Handling Conflicts of Interest Policy
  • Personal Data Protection Policy
  • Corporate Privacy Notice
  • Antitrust Policy
  • Environmental and Climate Change Policy
  • Diversity and Inclusion Policy
  • Sodimac Community Engagement Policy
  • Sodimac Sustainability Policy
  • Tottus Sustainability Policy