Good morning, ladies and gentlemen. My name is Helen Kapalos, and I'm your MC for today's annual general meeting of Coles Group Limited. My role is to help you understand how the meeting will work, how you can ask questions, and how you can vote, and to put your questions to the chairman at the relevant time. I would like to begin by thanking the Coles team members for that wonderful acknowledgment of country. Coles is extremely proud to be Australia's largest private sector employer of Aboriginal and Torres Strait Islander peoples. I would also like to take this opportunity to acknowledge the traditional custodians of country throughout Australia and pay my respects to elders past, present, and emerging. I'd like to extend that respect to all Indigenous Australians joining us today.
In light of the evolving circumstances regarding the COVID-19 pandemic and the state and federal government's health advice and guidelines, Coles made the decision to conduct its Annual General Meeting virtually this year in the interests of health and safety. While we will not be able to meet in person, a virtual meeting enables all shareholders, regardless of where you live, to participate in the meeting. I will explain how this will work shortly. Before I hand over to the Chairman to formally open the meeting, I would like to explain the technology we are using to conduct the meeting and the procedures which will be adopted for this meeting. Coles team members, together with our share registry and technology providers, have worked hard to ensure that Coles provides you with a seamless virtual experience.
Along with a notice of meeting, Coles has prepared an online meeting guide as well as answers to frequently asked questions to help you. These documents can be found on the AGM page of the Coles website, a link to which is on the left-hand side of your screen. If you experience any issues watching or participating in our meeting today, please call our share registry, Computershare Investor Services, on 1300 171 785, t hat's within Australia o r +613 9415 4078 if you are outside of Australia. Both these numbers are also shown on the left-hand side of your screen. Now, if we experience a major technical difficulty which results in it being impracticable to continue the meeting, we will adjourn the meeting and make an announcement on the ASX regarding further details of the meeting. Now to questions.
At the top of the left-hand side of your screen, there are three icon buttons: an icon with the letter I for instructions, a middle speech bubble icon representing questions, and an icon at the far right representing voting, which will appear when the chairman opens the poll. If you would like to ask a question during the meeting, please click on the question icon at the top of the screen. Then type your question in the text box on the bottom of that screen. To submit your question, click the small arrow on the right-hand side of the text box. Once you have submitted your question, it will disappear from your screen, and your question will be placed in a queue. When submitting your question, please state in the text box which item of business your question is in relation to so we can order them accordingly.
In order to enable all shareholders a reasonable opportunity to be heard, we will ask that shareholders restrict themselves to no more than two questions or comments initially. Please ensure that your questions are as clear and succinct as possible, as we will not be able to clarify aspects of your question directly with you once it has been submitted. As there is a 1,000-character word limit for each question, please submit each of your questions separately. If we receive a number of questions that are similar, we may answer those questions collectively. If the questions are too lengthy, we may need to summarize them in the interests of time. When questions for each proposed resolution are ready, I will, where possible, identify the shareholders who have asked the relevant questions so that shareholders are aware that we are addressing their question.
I will then read the questions for the Chairman to answer. As there is a short time lag in the broadcast of these proceedings to you, we will pause at the end of discussion time for each item of business to check if any further questions have been submitted before moving on to the next item. Questions must relate to an item of business under consideration and to the company as a whole. If your question is of a personal nature relating to your shopping experience at any Coles Group business or in relation to your personal shareholdings, these questions will not be put to the meeting. Coles will instead contact you after the meeting to separately ensure that you receive individual support. Coles Customer Care number is also available and shown on your screen if you wish to call them for questions in relation to your personal shopping experience.
Representatives from Coles Share Registry, Computershare, are also available for questions in relation to your personal shareholdings. The numbers to contact Coles Customer Care and Computershare are shown now on your screen. We encourage you to please submit all of your questions now to assist us in getting through as many of your questions as possible. We will ensure that there is a reasonable opportunity for shareholders as a whole to ask questions and make comments at this meeting. However, there may not be time to answer every question or address every comment received. Shareholders were encouraged to submit their questions prior to the meeting. Thank you to those shareholders who have done so. We have sought to address common themes in these questions throughout the formal Chairman's and Chief Executive Officer's addresses, which will be made shortly.
Coles will also contact some shareholders who submitted questions of a more specific nature. Now to voting. Once the Chairman has opened the poll, a voting icon will appear at the top of the left-hand side of your screen. Each proposed resolution will be shown on the screen. Click on this voting icon to submit your vote on each proposed resolution. You can then vote for, against, or abstain on each proposed resolution. Once the Chairman formally declares the poll open, you may vote on a proposed resolution at any time during the meeting. You do not need to wait for the proposed resolution to be considered before submitting your vote. And please note there is no submit or send button, and your selection is automatically recorded. You may change your vote at any time prior to the poll being closed.
If you require any assistance, please contact Coles Share Registry, Computershare Investor Services, whose contact details are again shown on your screen. The contact details are also available at any time during the meeting if you click on the information i icon on the left-hand side of your screen. And just another reminder to please submit your questions now. But remember, there is a limit of 1,000 characters to your question. It is my great pleasure to now introduce you to James Graham, your chairman.
Thank you, Helen, and good morning, ladies and gentlemen. My name is James Graham, and as the Chairman of Coles Group Limited, it is my pleasure to welcome you to our 2020 virtual annual general meeting, certainly a first for Coles. As we have a quorum, I declare the meeting open. The notice of today's meeting has been distributed, and I will take it as read. Voting on items two to five will be conducted by a poll. I am declaring the poll now open to allow shareholders the maximum time to vote and so that shareholders who cannot stay for the whole meeting have the opportunity to vote. You can vote at any time until the meeting closes.
Before introducing my colleagues on the board, I would also like to acknowledge all Aboriginal and Torres Strait Islander peoples as the traditional custodians of our lands and pay my respects to elders past, present, and emerging. Joining me from the board here in Sydney this morning are Richard F reudenstein and Jacqueline Chow.
Good morning.
Attending in Melbourne are Wendy Stops, Paul O'Malley, who we were very pleased to welcome to the board in October of this year, and our Managing Director and Chief Executive Officer, Steven Cain, together with our company secretary, Daniella Pereira, and a lso Abi Cleland, who is joining us from Darwin via teleconference line, and David C heesewright, who is joining us from Toronto, Canada, also via teleconference line. We will separately hear from Paul, Wendy, and David later in the meeting. I also note that Fiona Campbell, representing the company's auditor, Ernst & Young, is attending via telephone and will be available to answer questions. The 2020 financial year at Coles has been a year like no other.
Starting the year with severe floods and droughts adversely affecting many of our suppliers, then extraordinary bushfires threatening many communities and our supply chains during the summer months, followed by the national and international impacts of the global pandemic. It has been quite an extraordinary year. Through each of these events, with the exceptional support of our 118,000 team members, we have adapted our business to support our communities, our suppliers, and our customers as we seek to fulfill our purpose of sustainably feeding all Australians to help them lead healthier, happier lives. This 2020 year was our first full financial year as an ASX-listed company and marked the commencement of many new processes and strategies as we sought to advance our vision of becoming Australia's most trusted retailer and growing long-term shareholder value.
With the support of all our stakeholders, we have been able to respond to increased customer demand while improving our safety performance, changing processes in stores and distribution centers to ensure that our health and hygiene processes were aligned with the best advice on minimizing the risks of virus transmission, and responding to elevated levels of need for community support, especially through our long-established relationships with food rescue organizations, SecondBite, and Foodbank. In coordinating our responses, we have worked closely with governments and particularly through the Supermarkets Task Force, an early initiative of the Home Affairs Minister, Mr. Peter Dutton. For the 2020 financial year, it was pleasing to report that despite these elevated pressures, we saw a 6.9% increase in group sales, and we reported the first increase in earnings before interest and tax in four years, with an improvement of 4.7%.
As a result, we were able to declare fully franked dividends totaling AUD 57.5 per share for the full year, comprising the interim dividend of AUD 0.30 per share and the final dividend of AUD 27.5 per share. These results were struck after our record levels of direct and indirect support to communities across Australia, totaling some AUD 139 million, the net hiring of over 5,000 additional team members year on year, providing support to over 6,000 rural fire brigades whose dedication and courage was so evident during the year, and substantially expanding our online capacity to meet increasing customer demand and to ensure food availability to those in special need through our Coles Online Priority Service.
During the year, we also saw considerable progress on our two significant step-out technology commitments, with Witron in automated distribution centers in New South Wales and Queensland, and with Ocado through our commitment to two highly automated online customer fulfillment centers in Melbourne and Sydney. Across all elements of what we do, we recognize the need to adapt our operations by increasingly using digital information and advanced technology to lower our costs of doing business and improve our product offering. As a large Australian company, we recognize that we have a responsibility to demonstrate high standards of business practices and to measure and reduce our impact upon our environment. Since our 2019 Annual General Meeting, we have worked closely with our suppliers, unions, and industry bodies to improve the transparency and effectiveness of all elements of ethical sourcing in our supply chain.
We have achieved further reductions in our Scope 1 and Scope 2 greenhouse gas emissions. We have focused upon minimizing the amount of waste we generate, and we have continued to improve the recyclability of packaging in our own brand products, which now account for more than 30% of our total supermarket sales. These are important areas of our business where continued focus will remain and where we will transparently report on our initiatives and our progress. During the year, your board has worked as a cohesive team in support of management, and this has required high levels of engagement from my fellow directors, to each of whom I express my appreciation. On September 30 just passed, Zlatko Todorcevski stood down from the board in the context of his appointment as Chief Executive Officer at Boral Limited.
Over the last two years, Zlatko has made a most significant contribution to the board, and as chairman of our audit and risk committee, he has worked closely with our management team overseeing the establishment of our robust finance, accounting, and risk management functions. On behalf of the board and shareholders, I record our special thanks and best wishes to Zlatko. Pleasingly, on the 1st of October, we were able to welcome Paul O'Malley to the board to fill this vacancy, and Paul's election will come before the meeting under agenda item two later today.
In this most demanding year, I would particularly like to express my appreciation and that of the board to the leadership of our Chief Executive and Managing Director, Steven Cain, his executive team, and to all of those Coles team members upon whom we have relied to step up, sometimes in periods of great uncertainty, and whose collective efforts and goodwill have underpinned our responses to the extraordinary community events which we have experienced. The impacts of COVID-19 have continued into our 2021 financial year, whereas we noted last week, we saw our total group first quarter sales increase by 10.5% above those of the previous year.
While the patterns of community activity have been fundamentally changed by the pandemic, and there remains considerable uncertainty as to future impacts, at least in the short term, we seem likely to see the maintenance of high levels of community awareness of the importance of health and hygiene standards, higher levels of home consumption of food and liquor, increased focus upon online purchases and digital recipes, and an increase in population numbers during traditional holiday traveling periods so long as international travel is restricted. In these circumstances, we will continue to adapt our business model at pace. I would now like to invite our Chief Executive Officer and Managing Director, Steven Cain, to provide us with his further insights on the year and the business.
But before we hear from Steven, I would like to share with you a brief video presentation highlighting some of our sustainability achievements over the past year.
Coles will be selling the now iconic FightMND beanies for the next six weeks.
Just when our world had been turned upside down and we were in hell, Redkite was there to catch us.
We love Coles because you are making such a difference to families like Christine's.
We will not be able to do what we do without Coles. Every person who opens the store and has the food ready and greets us and makes sure that we get good quality produce, it's just amazing.
It's mind-boggling the impact that this partnership has had.
I've been with Coles for five years. I've really appreciated being able to progress my career within the organization.
Coles sent six semis under police escort to Batemans Bay. They also dispatched a bus full of staff to help.
The RFS needed food. Those people were out there working 20 hours a day. We needed to feed and water them.
We fed the community.
Coles will open its doors for a special shopping hour for pensioners and people with a disability.
It means we can give everybody the best possible chance to get their essentials.
Coles coming to the forefront with this. I applaud you. I thank you. And we'll certainly let Aboriginal people know that Coles has led the way.
We have a legal a nd a moral responsibility to make sure that every team member, every customer who comes into our stores gets to go home safe.
Please make sure when you're at work, you make the social connections count because they are an incredible opportunity you have to feel happier and to improve your mental health.
Welcome to Coles, everybody. You guys are a critical part of our future success.
I feel like I've made an excellent career choice. I feel like the next few years are going to be very good for me.
Our lambs are grazed on knee-deep clover. They're healthy, they're happy, and we think ultimately that flows through to the product on the shelf for the consumer.
Coles just won the Oceania Award for the most sustainable seafood supermarket in the country, which I'm really excited about.
We now contract with our dairy farmers directly, giving them a farm gate price, giving them an option for a one, two, or three-year contract.
That's one of the things we take great pride in. There's nothing better than going to the supermarket and saying, "That's my milk.
Mum's Sause.
A jar of home cooking that can help kids suffering a little bit feel that little bit better.
At Coles, we're trying to help people live healthier and happier lives. And that's exactly what this partnership's about, getting kids inspired by fruits and vegetables and into a garden and then into a kitchen.
At Coles, we've done a fantastic job of giving out over a million dollars worth of equipment.
Australians are recycling more soft plastics than ever before. Coles runs an in-store program Australia-wide to recycle plastics that can't be placed in yellow household bins.
Coles has agreed to purchase a bulk of the renewable energy produced at the facility to power stores around the country.
Down, down, wastage is going down. Coles at Wentworth Point, becoming the first supermarket in Australia to go 100% waste-free.
You actually have to think what's going in the bin. Can it be donated? Can it be composted? Otherwise, can it be recycled?
I'm extremely proud to be here as the Chief Executive for this business and wanted to thank all 120,000 team members at Coles very much for the job that you've done this year.
Thank you, Chairman, and good morning to our shareholders and guests joining us online today. Last year, we laid out our Refresh Strategy to become the most trusted retailer in Australia and grow long-term shareholder value for you, our shareholders. As part of that strategy, Coles declared that our purpose is to sustainably feed all Australians to help them lead healthier, happier lives. We could not know at the time how immediately important that purpose would soon become, not just to Coles, but to the Australian community as a whole. As James said, the year presented us with a number of unforeseen challenges, including worsening drought, devastating bushfires, floods, and, of course, the ongoing global pandemic of COVID-19.
As a designated essential service, Coles has played an important role not just in keeping Australians safely supplied with food, beverages, and fuel, but in supporting the national economy through the employment of our 118,000 team members and hundreds of thousands more who work for the businesses who supply and support us. We pride ourselves on our ability to adapt at pace, and this year, we had certainly plenty of opportunities to demonstrate just that. As demand for food surged in early March to levels that surpassed even Christmas trading levels, we increased our supply chain capacity in a matter of days by establishing pop-up distribution centers. At the same time, we worked with suppliers to prioritize the production of the most in-demand items.
Through the federal government's Supermarkets Task Force, we were able to work collaboratively with governments and other stakeholders to formulate industry-wide hygiene and distancing protocols to keep our customers and team members safe and remove barriers to increasing deliveries to our stores. To help us manage demand, we introduced community hour to serve the vulnerable and emergency services workers. After product availability issues led us to suspend Coles Online services in March, we reopened in April with almost double the capacity to serve our customers across home delivery and contactless Click and Collect, as well as the new Coles Online Priority Service aimed at those most in need, including the elderly and those living with disability. As the initial rush of panic buying subsided and government restrictions were introduced, many customers adapted to the new normal.
Working from home, sanitizing the home, home schooling, a daily walk from home, home improvement, and MasterChef-inspired cooking from scratch, also at home, supplemented by the odd cocktail, also at home. While travel restrictions meant fuel volumes were down at Coles Express, its role as a local convenience store saw shop sales increase. Throughout it all, safety has been our number one priority, and I'm very proud of the way our team have worked to support our customers safely serving more than 500 million of them with pride since the pandemic began. Despite the many challenges we faced in the 2020 financial year, I'm pleased to report that we have made substantial progress against each of the pillars of our transformation strategy.
It is also important to note that we were beginning to see some early benefits of the strategy prior to the first wave of COVID, and that rather than abandoning our transformation plans while we dealt with the more immediate concerns of daily operations, we actually accelerated the pace of change so that Coles will emerge from the pandemic as a better, more sustainable business, including record team and supplier engagement. In the past year, we have executed one of the largest range updates in Coles' history, using data-driven ranging tools to tailor our customer offer and introduce more than 1,600 new product lines.
With value more important than ever for customers, our campaigns to help lower the cost of breakfast, lunch, and dinner introduced more than 1,500 new products at everyday low prices, while sales of own brand grew by 10% to exceed AUD 10 billion for the first time, more than 31% of supermarket sales. Customer demand for online shopping was already growing strongly before COVID, and this has only accelerated since the pandemic began. In liquor, our exclusive liquor brands continue to collect accolades, bringing home a total of 372 medals and awards during the year, and we have begun the process of transforming our stores to become simpler, more accessible, and relevant to the needs of local customers.
It is testament to the dedication of our team that in some of the most difficult trading conditions in living memory, we recorded an improvement in customer satisfaction across supermarkets, liquor, and express in the fourth quarter. As part of our Smarter Selling strategy to reduce costs by AUD 1 billion, we are increasing our use of technology to manage our business more efficiently. Last year, we delivered cost savings of more than AUD 250 million through a number of initiatives, including streamlining our store support center and implementing new systems in our financial and procurement functions. Transport too became more efficient as we made increasing use of trucks to carry both inbound and outbound loads rather than making their return journey empty.
We also rolled out new technology underpinned by artificial intelligence to help our store teams order the right amount of stock, reducing waste and improving availability for customers, and reduced energy consumption by installing LED lights and refrigeration control systems in our stores. We renewed 70 of our stores, tailoring them to the needs of the local community, including 10 Format A stores, 31 Format C, and three Coles Local supermarkets. One of these was our first Coles Local for New South Wales, our Rose Bay store. For those of you who live in Sydney, we're also opening another Coles Local in Chatswood next week and another in Manly prior to Christmas. So I hope you get a chance to take a look. I'm also hoping to take a look myself soon, particularly with the New South Wales border reopening.
As you have seen in our sustainability video, we have made much progress on many fronts. I would like to recognize the work of our dairy team, who now have long-term own brand contracts in place directly with around 70 dairy farmers in Victoria, New South Wales, WA, and SA, which means these farmers can now plan for a sustainable future. As many of you will know, we have an incredible eight Coles team members who have worked for Coles for more than 50 years each. I salute them, and in particular, Brenda, who received the Order of Australia Medal in June for 53- year service to the Melbourne community here in Victoria. I am also proud that Coles continues to be the largest private employer of Indigenous Australians, with our focus now on creating pathways to management and leadership positions for them.
I will turn now to our financial performance. It is pleasing that the first full financial year of our operations under our Refresh Strategy and the first full year as a listed entity in our own right should also mark a return to our first year of group profit growth in four years. I am also happy to report a total shareholder return, or TSR, of 32% in the year, one of the highest in Australian retail and indeed supermarkets globally. Supermarkets, which remains our largest contributor of sales and earnings, increased sales by almost 7%, driven by increased own brand penetration and the rollout of tailored ranges, as well as greater at-home consumption and pantry stocking seen in response to COVID-19. Supermarkets' EBIT increased by almost 11% as increased sales and Smarter Selling savings were partially offset by COVID health and safety costs.
Coles Online grew sales by 18% and would have been stronger if not for the temporary suspension of operations in March and April. This was necessary due to limited product availability, and so we could reset the business to meet the needs of the most vulnerable in our community with increased capacity and priority service. Our liquor business reported sales growth of 8% as customers responded to our refreshed range in high-growth categories, as well as a shift to home consumption in response to COVID. Liquor EBIT was stable at AUD 120 million, as stronger sales were offset by ongoing clearance activity and mixed changes associated with COVID. Coles Express reported an almost 6% increase in sales from our convenience stores, driven by customers stocking up on items such as toilet paper in the second half of the year.
While they are not included in sales revenue, commissions received from our alliance partner, Viva Energy, on fuel sales were down in the second half as a result of the stay-at-home restrictions. This led to Coles Express reporting a loss of AUD 16 million for the year. We continue to maintain a very strong balance sheet, which will provide the flexibility to invest for future growth and take advantage of opportunities as they arise. Over the course of the year, we reduced our net debt by AUD 158 million to AUD 362 million, and we diversified our debt portfolio and leveraged our average debt maturity to 5.6 years by issuing AUD 600 million of unsecured fixed-rate Australian dollar medium-term notes during the year. The funds were used to repay bank debt, and at the end of the financial year, we had undrawn facilities totaling just over AUD 2 billion.
On the 28th of October, we released our sales for the first quarter of the new financial year, with sales remaining elevated across all segments, particularly in online and in Victoria under lockdown. This included comparable sales growth of 9.7% for supermarkets, 17.8% in liquor, and 10.2% in Coles Express convenience stores. Pleasingly, fuel volumes are beginning to recover as restrictions ease. Coles online sales growth o f 57% and liquor online sales growth of 80%, and the launch of Coles & Co to replace more than 4 million hand-delivered paper catalogues per week demonstrate that we are committed to a digital and sustainable future. Since our last AGM, our executive leadership team has been strengthened with the arrival of Darren Blackhurst as Chief Executive of Liquor, Ben Hassing, Chief Executive of E-commerce, and George Saoud, Chief Executive of Emerging Businesses.
We presented our refreshed liquor strategy at the full year results earlier this year, and we'll present our refreshed e-commerce strategy at the interim results in February 2021. Christmas and summer 2020 will be like no other. The impossibility of overseas travel has prompted forecasts of more than one million additional Australians spending the holidays at home this year. Meanwhile, the ongoing need for social distancing means large celebrations are likely, in many cases, to be replaced by many smaller gatherings at home. Like the best Christmas guests, Coles is ready to lend a hand in the kitchen. We have more than 270 new or improved products to help our customers lower the cost of easy entertaining.
Following on from our successful Spiegelau crystal glassware giveaway last year, we are rewarding customers with stainless steel MasterChef kitchen knives to bring a little professional flair to their improved home cooking skills. As part of our commitment to looking after the mental health of our team members, we have continued to work with the Resilience Project. One of the practical techniques in this program is to write down three things you're grateful for every day for 21 days. I am grateful for an outstanding board and executive leadership team, their tireless commitment, innovation, and agility to circumstances changing every day. I'm grateful to our 118,000 team members working to keep customers safe and fed, and I'm grateful to our suppliers and community partners without whom none of this would have been possible.
To our customers, on behalf of Coles team members, I thank you for your custom, your feedback, and the respect you have shown and understanding you have shown during COVID. To you, our shareholders, I thank you for the opportunity to continue transforming Coles into the most trusted retailer in Australia so that we can deliver long-term sustainable returns for you and your families. As I hand back to our chairman, I'd like to share with you our new Christmas advert, which forms part of our new Value the Australian Way campaign, celebrating the role we play at the heart of Australian families and communities. Thank you.
I feel like going back home. This Christmas, let's value our hosts, the ones who guard the family recipes. They're the perfectionists who know how to add that finishing touch. We love them for their yarns, and the way they set a table.
They're the ice carriers, happy to shoulder the load, and they'll always find room for one more guest. They'll clean the table quickly and do it all again so we can enjoy Christmas the Australian way. Coles value the Australian way.
Thank you, Steven. I certainly enjoyed that Christmas video, and I hope it brings a sense of cheer and optimism to all of our shareholders and to all of those who are joining us here for the virtual meeting today. I will now turn to the formal items of business at today's meeting. The notice of meeting set out information regarding the five items for consideration at today's meeting, covering the election of Paul O'Malley, the re-election of David Cheesewright and Wendy Stops, the adoption of the company's remuneration report, and the approval of short and long-term incentives to Steven Cain as Managing Director and Chief Executive Officer.
I will introduce each item of business separately and then invite questions for that item. Following discussion on that item, details of the proxies and direct votes received for that item of business will be shown on your screen. I will then ask the shareholders and proxy holders to vote on the item, noting that you may have already done so. Please note that as this is a shareholders' meeting, only shareholders, their attorneys, proxies, and authorized representatives are entitled to submit questions, comments, and vote at this meeting. Item one is to enable any shareholder to raise questions or comments on the company and its performance, but does not require any vote of shareholders. Items two to five at today's meeting require a shareholder vote. Your board supports each of items two to five and recommends that shareholders vote in favour of these resolutions.
As set out in the notice of meeting, I intend to vote all undirected proxies held by me as the chairman of the meeting in favor of items two to five. If you leave the meeting early, please ensure you have submitted your votes. Voting on all resolutions can be done in advance, online, at any time until the meeting closes. Tim H eughan of Computershare will act as returning officer for the poll and will oversee the counting of the votes. The final results will be made available after the meeting to the ASX and will be displayed on our website. I now turn to the first item of business, which is to receive and consider the financial report of the company and its controlled entities and the reports of the directors and auditor for the year ended 28 June 2020.
These reports were circulated as part of the annual report and also published on our website. While there is no requirement to put this item to a vote, this is an opportunity for shareholders to ask questions relating to the company's financial report and the reports of the directors and the auditor. As previously noted, Fiona Campbell, the lead audit partner with Ernst & Young, Coles' external auditor, will be available to answer questions. I would now like to invite questions or comments from shareholders regarding the financial report of the company and the reports of the directors and the auditor. The text of this first item of business is now shown on the screen. I will now move to the first question. Thank you, Helen.
Thank you, Chairman. The first two questions on this item come from Mr. Stuart Byrne from the Australian Shareholders' Association.
I will now read Mr. Byrne's brief introduction and his first question. Good morning. My name is Stuart Byrne, and I'm a volunteer for the Australian Shareholders' Association. We would like to commend the performance of Coles Group under such difficult circumstances and the support it has shown to Australian communities during the pandemic, especially the initiatives in Coles Online, support of indigenous communities, community support, and direct milk sourcing. Mr. Byrne's first question is as follows. The Liquor Group has had poor performance, especially when compared to your direct competitors, i.e., sales 3.2% versus 9.9% and EBIT 3.8% versus 5.7%. Can you detail the strategy to turn this group around?
Thank you very much indeed, Mr. Byrne, for your question and also for your kind opening comments.
We very much appreciate the relationship which has been established with the Australian Shareholders' Association, and we're grateful for the support which you, through your members, provide to Coles. In relation to your question regarding liquor, I think I need to perhaps clarify a matter. It was perhaps touched on by Steven in his address, and that is that the 3.2% sales growth to which you refer is, in fact, the statutory growth rate for liquor. That is inclusive of the comparable period when we owned hotels as part of the liquor business. And as you will remember, in our 2019 year, we sold the hotels business or transferred the ownership and responsibility of the hotels business to our joint venture partners, Australian Venue Co.
The actual liquor sales revenue, which we refer to as being on a retail basis, which is a comparable basis of 2020 against 2019, actually showed an increase of some 8%. In relation to your other questions about how we are addressing the strategy and making sure that liquor moves to continue to be a very positive contributor to Coles. Steven mentioned that in January of this year, we were very pleased to be able to welcome Darren Blackhurst to be the new Chief Executive of our liquor business. Darren is highly regarded globally, having had 25 years of significant international retailing experience, and on arrival in January, he got to work with our team members to review the business in detail and to develop a winning strategy.
That strategy has, in essence, meant looking at how do we make the business simpler, how do we make the business more accessible, how can we find ways of differentiating what we offer, and you'll be aware of our liquor exclusive liquor brands and our commitment to work closely with local suppliers in our business, and then to provide the business with the resources that it needs in order to be able to strengthen its operation and pursue growth. Steven has touched upon, in his opening address, the performance of liquor in the first quarter of the 2021 financial year. Now, those figures are, to some extent, a continuation of the staying-at-home habit of many Australians as a result of the COVID virus, but it was pleasing to see our increase in like-for-like sales in excess of 17% for this quarter compared with the previous quarter.
You will have also noticed, as Steven referenced, that we had a very strong growth in our online liquor business. We're very positive about the initiatives that Darren and the full liquor team are taking and look forward to being able to update you further as we progress. Thank you, Helen.
Thank you, Chairman. I will now read Mr. Byrne's second question. We understand the difficult position that the pandemic has placed on your Express group with a 28% reduction in EBIT. Can you please comment on how you see the future of this group and with changes in people's work practices, i.e., working from home? Does Coles Group consider it will return to a growth scenario?
Thank you, Mr. Byrne, for your question on the business of Coles Express.
You will recall that it was in March of 2019 we reset the Coles fuel business by a strategic alliance with our fuel partner, Viva Energy. Since that time, and Steven referenced this, our position has been in relation to the fuel business, we earn a commission, and in relation to the convenience stores that those are fully operated by us as Coles and the latter are included in our sales. As we were approaching the beginning of COVID, we were encouraged by working with our fuel partner, Viva, that we were seeing the price setting of fuel leading to an increase in market demand, and in fact, fuel volumes were approaching some 70 million liters a week. At that level, the earnings outcome for Coles Express would be very different. Regrettably, with the lockdown, inevitably, people were not driving their cars in any way near the same way.
And we saw in the first four weeks of the fourth quarter of our 2020 financial year a reduction in fuel volumes down to 40 million liters per week. As we've started to see the restrictions ease and more normal travel within a state occur, we are starting to see a recovery. And by the end of June 2020, we were seeing fuel sales in the low 50 million liters per week area. We are encouraged by the way we're working with Viva Energy in setting the fuel price, and as we see further lockdown restrictions ease, that we will see a continuing recovery of those fuel sales. Hand in hand with that, you will have noted that, in fact, our convenience stores have been quite a beneficiary of the local shopping pattern of so many Australians.
And so we saw in the 2020 financial year our convenience store sales increased by 10.4%. So together with the store sales, the recovery in fuel, we have a positive outlook on the future of our convenience business. Thank you, Helen.
Thank you, Chairman. Chairman, we have received several questions on the continued use of plastic bags and packaging in stores. The questions are from shareholders, Mrs. Suzanne Scott, Ms. Lynelle Gibson, and Mrs. Geraldine Bagwell.
Well, thank you, Mrs. Scott, Ms. Gibson, and Mrs. Bagwell. This is a very important issue. And as hopefully you would have noted in our sustainability video, we are very focused upon how do we, as a large supermarket, operate responsibly in relation to plastic and packaging in our stores.
It's a bit of a dilemma because, on the one hand, we don't want to, in any way, lead to waste or to contribute to any environmental residual issues. On the other hand, we have a responsibility to our customers to ensure that the product arrives undamaged, that the product has good availability, that it is safe, and that it meets our customers' requirements. What we have done over the years, and we continue to work very much on this issue, is we're focused upon how do we reduce plastic and how do we reduce any residual impact of the packaging in our supermarkets. We've done quite a few things so far. There's more to do. You will recall that in 2018, we removed the single-use plastic bags. That one step resulted in a reduction of 1.7 billion plastic bags from which would otherwise have been used in supermarkets.
We replaced the single-use plastic bags in two ways. Firstly, we felt it was necessary for a customer who comes to our supermarket, who for one reason doesn't bring a bag with them, they need to have a reusable bag. And so we produced what we call a Better Bag. These bags are available at the supermarket for AUD 0.15. The Better Bag is made 80% from recyclable material and, of course, is multiple-use and, in due course, is fully recyclable in the REDcycle bins included in each of our supermarkets throughout Australia. The second response was to introduce community bags. These have been a great success. The community bags, in fact, have been designed by Australian schoolchildren. And part of the sale of these community bags is being used to provide support to schools, athletic groups, community groups, and they have been very well received by our customers.
In relation to the packaging of the product itself, we're working with many of our suppliers to try and ensure that all packaging is recyclable. It's a big journey. We're on the way, and we're very committed to make sure that we are seen as Australia's most sustainable supermarket. We'll be working very hard on this issue. Thank you, Helen.
Thank you, Chairman. Chairman, we have received a number of questions in relation to the recent IT outage that impacted checkouts in Coles stores. The questions are from shareholders, Mrs. Dahl Harris and Mr. Darryl Wallace.
Thank you, Mrs. Harris and Mr. Wallace, for your question. You can imagine how important an issue this was on the 18th of October when, at 4:30 P.M., without any notice or warning, our point of sale Australia-wide for all of our supermarkets failed to function.
What occurred was a very extraordinary technical malfunction in the software. We have many, many safeguards to make sure that technical malfunctions do not arise. But on this occasion, an extraordinary sequence of events caused it. Pleasingly, within three hours, we were able to identify the fault and fully rectify it and have the supermarkets back up and operating. But we know that that causes massive inconvenience to our customers, for which we have apologized. And in fact, over the ensuing weekend, we offered all customers at our supermarkets a triple the number of Flybuys points in relation to their purchases that weekend. And for those purchasing online with an order of AUD 50 or more for the ensuing week, they had home delivery without charge. This matter is clearly important.
It has been the subject of an independent review, and we are making sure that the issues that gave rise to it are understood and appropriate steps are put in place to ensure this or a similar activity doesn't occur. Your board's audit and risk committee, which has an oversight of all such risks, will be reviewing the details of the steps forward and ahead at its next meeting. Thank you, Helen.
Thank you, Chairman. And another question from Mr. Darryl Wallace. Can Coles detail its current market share of the Australian grocery business or supermarket businesses? Is Coles planning to gain, maintain, or lose share in the coming years?
Thank you, Mr. Wallace. I hope you will not be surprised by my answer.
The benefit of having 106 years of business in Australia addressing the needs of Australian customers through our supermarket activities has been that we've developed a very big footprint. In supermarkets today, we have some 830 supermarkets across Australia, and those are supported by 19 distribution centers. We serve approximately 20 million transactions with customers a week. So we are a very significant participant in the Australian supermarket scale. We are not the largest participant. We are the second largest participant. And at the present time, we have in the order of 30% market share for our supermarkets business. We are heavily focused on strategies, investments, technology, product, service to make sure that in the years ahead, you will see that our ambition of ensuring that we maintain market share and, to the extent possible, take advantage of opportunities to enhance it. Thank you, Helen.
Thank you, Chairman.
The next question is from Mrs. Catherine Rouse and Mr. Steven Gregory. 88.2% for customer satisfaction looks impressive. What is Tell Coles? Can you please provide more information about this process? What does this number actually mean? What was the score last year? And how do we compare with Woolies and Aldi?
Thank you very much, Mrs. Rouse and Mr. Gregory, for your question. I think this is a really important issue in terms of how we assess customer behavior, and I'm going to turn to our Managing Director and Chief Executive, Steven Cain, to provide a more informative insight on how all of this comes together at Coles.
Thank you, James, so Tell Coles has been running for a long time. What we do is every week, we solicit responses from 25,000-30,000 customers to find out how satisfied they are with their weekly shop.
That information comes to us on a Monday morning, and it goes to every store manager as well, and every store manager knows his or her Tell Coles score when you go and talk to them, and that's really important because we serve the vast majority of our customers in our 800 or so supermarkets around Australia, and so one of the first things I do whenever I go to a Coles store is ask the store manager, "How is the Tell Coles survey going?" and "What are the customers saying that's really good about Coles?" and "What are the customers saying that we need to improve?", and there are some things that we need to improve across the country, and there are some things that are very store-specific. The store manager is there to make sure that we continue to improve the store-specific things that need to be addressed.
Sometimes that can be, are the trolleys in the right place, queues at the checkouts, availability of specific lines, and so on. What we do in the store support center is then look at the Tell Coles results and think about what are the things that are common across the network that we need to help with. And as I say, this is something we look at and try and deal with every week. I'm delighted to report that we did improve our customer metrics in the fourth quarter to 88.2%, and that was up from 83.4% in the prior quarter. And what people are saying is that they do see improvements in our checkouts, and they say that we see improvements in our availability, and they're also talking about improvements in our price position.
Unfortunately, we don't run Tell Coles at Woolworths or Aldi, and so that one will have to be addressed to those companies. What we do do is large amounts of research across the whole industry to look at how we stack up on lots of measures. And I'm delighted to say that on many of those measures, we continue to improve. Back to you, Chairman, or Helen.
Thank you very much, Steven, for that reply. Helen, do we have another question?
We certainly do. We have another question from Mrs. Catherine Rouse and Mr. Steven Gregory. And the question is, "Given the change in the increasing proportion of online shopping and other changes in how we shop, do you believe that sales per square meter is still a relevant measure?"
Thank you very much again, Mrs. Rouse and Mr. Gregory.
The efficiency of supermarkets looking at sales per square meter is a really important one because we have a lot of involvement and commitment. In those 830 supermarkets across Australia, that's a really important part of our operation. But to the extent that we can support the growth of our online using those supermarkets, we can have a real winning together. But I'm going to again ask Steven to make some more specific comments in relation to that question.
Thank you, James. While online is growing, and we talked about it growing close to 60% in the last quarter, it is important to recognize that the vast majority of our online sales, whether they are through click and collect or whether they're through home delivery, are all serviced by stores for the vast majority years.
Therefore, it is still very much a relevant measure of the sales we're achieving per meter. However, it's not the only measure. It is important that as we move towards an Ocado, where we will have two automated customer fulfillment centers in a couple of years' time, those will come under separate measures. We also need to make sure that from a sales per square meter point of view, that we keep moving that number forward because we know that costs continue to increase across the industry as well. So yes, it's relevant. We keep a close eye on it.
We look at stores that in particular have a very low sales per meter because as well as opening new stores where we look for better than average sales per meter, we must always as well focus on the other end of the spectrum where we've got stores that have low sales per square meter, and if you've got a low sales per square meter store and the sales are declining, then it's likely that at the next lease renewal, that that lease will not be extended, so we use it a lot to make sure that we are managing our store portfolio effectively now and in the years ahead.
Thank you, Steven. Helen, are there any further questions?
Yes, there are, Chairman. Chairman, the next question is from Mr. Henrik Kay.
His question is, "Last year, I raised the issue of the fuel discount being offered as an option on the Flybuys card. Why are shareholders being discriminated against when staff have this? So why not the Flybuys cardholders?"
Thank you, Mr. Kay, for your question and for bringing that matter to our attention again this year. The way we set prices across all aspects of our operation is that we try to make sure that we've got very competitive price points for customers. And those should be for all customers using our stores and using our Coles Express fuel stations. As I mentioned earlier, the Coles Express business since March of 2019, our position in relation to that is that we only receive a commission.
We are not setting the price of fuel, and we are not in the position of managing that process other than through our strategic alliance with Viva Energy. The discount card for team members is there as a part of their total compensation and part of their engagement and being inside Coles. The 118,000 team members who we are fortunate enough to enjoy show a great sense of passion, a great sense of commitment, and as I said in my opening remarks, have stepped up remarkably in the period which we've just gone through as a community. I think that the issue of the card for team members is very much part of their remuneration. The issues for customers is that they should know that in everything we do at Coles, we try to ensure value.
That's why we have the Value the Australian way, as the way in which we are bringing our message to the market and to customers and to investors at the present time. Thank you, Helen.
Thank you, Chairman. We have another question from Mr. Henrik Kay. His question is, "Mr. Chairman, I raised the issue of the lack of job opportunities for people with disabilities and those over 50. What is Coles going to do about this problem so that the biggest cohort on job seeker can get back into the workforce? These job seekers need help urgently to get back to work. Please get the relevant staff member to contact me as I have some information for them."
Well, Mr. Kay, we have an absolute commitment to assisting people with disabilities to become team members at Coles.
We have special training programs for our team members to ensure that that happens smoothly. And the ability of us to continue to offer employment to all members of our community is really important. During the height of the pandemic, when we had a lot of people who were very suddenly without a job, we went out of our way to work with those organizations who were in a different position to Coles to be able to provide offers to as many new team members as possible as the significant increase in customer demand emerged. We've undertaken those steps.
We have a strong disability program, and I will encourage someone from the Coles Corporate Affairs Office to make contact with you about any additional idea or way in which we can improve our engagement in that area because it's part of what we see as being Coles, is that we want to be involved with the whole Australian community. Thank you, H elen.
Thank you, Chairman. The next question is from shareholder Sophia Fowler. She says, "Congratulations on the recent signing of two major power purchase agreements for renewable energy in Queensland and New South Wales. It's great to see Coles taking this leadership. Given that those two projects will supply 30% of Coles' electricity in the next few years, is Coles now in a position to commit to powering all its operations with wind and solar by 2025 ?"
Thank you very much, Ms. Fowler, for your question.
The issue of our involvement in ensuring that we have renewable energy underpinning our business to the extent possible has obviously been a focus for some while. You're right that in 2019, we entered into three contracts with solar farm operations in New South Wales, which will come online in the current financial year, which in total will provide about 10% of our total electricity requirements, and more recently, we entered into a contract with CleanCo, the Queensland government sustainable energy generator and retailer, and with CleanCo, from 1 July 2022, we will be able to source electricity to meet 90% of our total requirements in Queensland, and together, as you rightly point out, these will represent approximately 33% of our total electricity requirements. This is an area of considerable focus by the board and by the management team.
We are constantly looking at how can we make sure that we are lifting our game in making our contribution in ensuring that we have a sustainable Australia and a sustainable Coles supermarket in the context in which we operate. We will be continuing to work along these lines, and at the right time, we'll be able to provide further clarification of how we can best progress. Thank you, Helen.
Thank you. The next questions are from Mr. Robert John Taylor and Mrs. Belinda Gay Taylor. Their question is, "In the future, are meetings going to continue online to allow more shareholders to attend in a hybrid form, allowing the choice to attend the meeting in person or online?"
Thank you very much indeed, Mr. and Mrs. Taylor, for your question. It's clearly a question which many people are currently addressing.
And I think the Commonwealth Government, who we really are indebted to because they provided us with the capacity to use this technology in the context of the pandemic, are undertaking a review of what is going to be the most suitable and the most appropriate way to ensure meetings with shareholders take place in a way which is constructive and efficient. I think it's a bit early and a bit preemptive for me to be certain in terms of how that review will unfold, but we certainly will work with the government and with shareholder bodies to make sure that our ambition of being transparently available and open to shareholders continues. Thank you, Helen.
Thank you, Chairman. The next question is from shareholder Ms. Catherine Mary Broders.
Her question is, "What are Coles going to do to ensure that they reduce carbon emissions, and what will they continue to do?",
well, this is to some extent akin to the earlier question I addressed. The issue of our impact upon the environment is something which we are consistently focusing upon. Coles started down the journey of addressing carbon emissions in 2009. At that time, we set an ambition of making sure that we reduced our carbon emissions by 30% by 2020. I'm pleased to say that, in fact, we've reduced those emissions by 36.5% at the present time, and as I mentioned previously, we are putting in place new arrangements which will come into effect in 2021 with solar panel-sourced energy and 2022-2023 in relation to the CleanCo renewable energy. We're putting in place those arrangements as a component part of the journey we're on.
There are issues that we address in terms of refrigeration. Refrigeration is an essential component part of a supermarket. It is fundamental to the safety and the presentation of product to our customers. So as we look at refrigeration, we look at ways in which we can enhance their efficiency, minimize their impact upon the environment. You would have seen in many supermarkets, we've redesigned the front of those supermarkets so that there are now doors on fridges to reduce the loss of the cooling and require more electricity. This is an area which is ongoing, is the subject of a detailed review which will continue for a very long period of time as we seek to increase our efforts to be a sustainable supermarket in Australia. Thank you, Helen.
Thank you, Chairman. The next question is from shareholder Sarah Jadrusiak.
Her question is, "Relating to the 2020 sustainability report, recent polling showed 70% of Australian consumers would like to see major companies run on 100% renewable electricity. Major retailers, Aldi, Bunnings, and Officeworks have all recently made commitments to run entirely on renewable electricity between 2021-2025. Given this consumer expectation and the movement from other companies in our sector, including direct competitors, will Coles be committing to 100% renewable electricity?"
Thank you, Ms. Jadrusiak, for your question. I think it's an extension of that which I was already saying. There's one additional element that I should bring to everyone's attention, and that is our commitment to increase solar power through putting solar panels on supermarkets. That is something which we've been committed to for some while. At the end of June, we had 69 supermarkets with solar panels. We now have 72 supermarkets with solar panels.
We are very much on the journey of increasing our responsible engagement in relation to every element of how we impact the environment. And this is something where, together, we will be making progress, and in due course, we will be able to provide more details of how that progress can best take place. Thank you, Helen.
Thank you, Chairman. The next question is from shareholder Ms. Fay Blahl. "Hi, my name is Fay. I live in Melbourne and regularly shop at Coles, and I'm also a shareholder. I'm environmentally conscious and keen to champion positive steps to support a greener future and more circular economy. I was pleased to see that Coles had the softer plastics recycled, which is great, to not negatively impact on the circular economy.
In continuing to explore more sustainable packaging alternatives, such as with toothpaste and their packaging and your meat in plastics as well as fruit, I look forward to hearing about Coles' plans to support a greener, more sustainable shopping solution." Her question is, "What is Coles going to do to support an environmentally greener society for both consumers and shareholders to have more sustainable shopping solutions? What initiatives does Coles have in the process towards this global warming that we're now experiencing? And when will Coles move away from all these plastics seen in your supermarkets for many of its products?"
I think, Ms. Blahl, you will have heard elements of my response in relation to a number of prior questions. We are concerned about waste. We've been concerned about waste for a very long period of time.
We've been very effective in eliminating food waste in our businesses through our partnerships with Second Bite and Foodb ank and through partnerships with our suppliers and farmers in relation to their requirements where they can see food as an input for their business. We are working, as I mentioned earlier, with a number of the multinational firms in relation to their product packaging. How can we work together to ensure that there is greater recyclability of all packaging? On our own brand, we have been very active in trying to ensure that we are reducing waste and that the plastic that is created is capable of being recycled. As I mentioned earlier, we've got recycled bins in each of our supermarkets. There is curbside recycling as well. This is an area which is a very big area.
It's important that we handle it responsibly, and I can assure you that this is something which will continue to be a focus of our attention. Thank you, Helen.
Thank you, Chairman. The next question is from shareholder Mr. Michael Yan Zhou. "Although staff have done an amazing job at all Coles stores, when will the staff discount reduce from 10% to 5%? How much are these discounts costing shareholders?"
The answer in relation to the staff discount, which was brought into all team members during the height of the pandemic, Mr. Zhou, is that that discount ceased at the end of June 30. In relation to the second wave of the pandemic in Victoria, the team member discount was reintroduced, but only for those team members in the Victorian market.
This is something which is part of the total operating costs that we reported upon in terms of the increased COVID costs that we incurred during the height of the pandemic, which covered extra staff, extra cleaning, extra sanitizers, safety screens in stores, distancing arrangements. And we worked with our team members to ensure that rosters were adjusted so that there was better and greater separation, ensured that team members, however, were recognized for what they were doing in very tough and very special circumstances. Those figures have been called out in relation to our 30 June year, and more recently, we've indicated that our COVID-specific costs are running at the present time of approximately AUD 15-20 million per month. Many of those will continue. Those are costs related to cleaning, health, safety, and protecting team members. Thank you, Helen.
Thank you, Chairman.
The next question is from shareholder Mr. George Kariolis. He says, "I would like to congratulate the board, Steven Cain, and his entire team for their incredibly hard work and success during this difficult time. My local Coles is in Southland, and your team on the ground here has been exceptional right through COVID. My question is regarding security. There is a noticeable lack of security in your stores, and I've noticed many instances where a young, often teenage, team member is put in the position of trying to handle a big, confronting, irate customer. This was more noticeable during COVID, and I'm sure that you understand the duty of care all your employees deserve. Please keep up the good work."
Thank you, Mr. Kariolis, and I'd like to ask Steven if he'd care to comment because team member safety is fundamental to our business.
Thank you, James, and thanks for the compliment about Southland, which we will pass on to the store manager there. It is, in fact, one of our best stores, and it's a great team. From the outset, in March of the panic buying, it became very clear to us that we needed to increase the security in our stores, and that was done quite significantly. In the first instance, some of that was provided by local police forces, and we thank them for their support in the early phases of the panic buying when you will recall that toilet rolls were quite hard to get hold of. What happened post that is the police force were then redirected to work on various other matters relating to COVID, not least of all making sure that people were isolating if they had caught the infection.
We then significantly increased our security forces across the country to make sure that where we felt there was any issues, that they were there to help. We might sort of get back to Mr. Kariolis just to sort of double-check what the dates are that he was talking about because it's certainly our view that when stores have required security, that they should be there. Of course, security guards are not the only form of security, and I should highlight that we have put in place a number of security measures over the last year in our stores that are most impacted by these types of issues, and that's things like additional cameras, additional measures at the checkouts, and all of those types of things to make sure our stores are more secure.
What we should also recognize is in a center like Southland, which is one of the largest shopping centers in Victoria, if not Australia, there are security guards from the center management as well who should be on hand if anything happens. But I'd like to reiterate what the Chairman has said, which is team member security and safety is our number one priority. Thanks, Helen.
Thank you, Steven. Helen, are there any further questions?
Yes, there are, Chairman. The next question is from the Australasian Centre for Corporate Responsibility. The question is, "Ernst & Young predict a labor shortfall of 26,000 workers over the next nine months due to COVID-related migration restrictions, with the National Farmers Federation claiming that growers are contemplating plowing harvests into the ground due to a lack of picking labor.
New cohorts of migrant workers have been unable to enter Australia, and undocumented workers who make up a large percentage of the workforce have been unable to move across state borders. Given that the majority of Coles' fresh food is domestically sourced, has Coles analyzed the impact this will have on its supply chains and consumers? And what steps has Coles taken to engage the government on migration reform to address this shortfall?
Well, thank you to ACCR for their question, and also thank you to ACCR for their contribution in the discussions that we had at our annual general meeting in 2019, which focused a lot upon the question of ethical sourcing and how we ensured the protection of all persons in our supply chain, particularly those working in the Australian horticultural industry.
In the intervening year, we have been working very actively with government, with unions, with industry bodies to try and address all elements that make up the safe and sure working environment for persons working in our supply chain with our suppliers. We have an enormous commitment to work with those parties. There was, in fact, a meeting only last weekend at Coffs Harbour with three unions, with the SDA, the TWU, and the AWU, to address new entrants coming in to picking at this time of year, Australian fresh produce, because we know there's great pressure on people.
So what we are trying to do is to work with government, work with industry, and work with unions to ensure that the standards that need to be met are met and that where possible, where we can enhance information and understanding of the entitlements of all persons coming into Australia, we do so. The extent to which the government has been able to provide some flexibility to allow some workers to continue to enter into the Australian marketplace clearly is helpful in ensuring that the produce that we need, our customers need, is going to be readily made available. Thank you, Helen.
Thank you, Chairman. The next question is from shareholder Anna Lindsay Sutar. Her question is regarding Mr. Graham's response to the question on renewable electricity recently. Is there a reputational risk to the company if it doesn't match Aldi's recent commitment to 100% renewable electricity?
Well, Ms. Sutar, the issue you raised about our reputation is absolutely fundamental. Our vision is to be the most trusted retailer in Australia and to grow long-term shareholder value. We know we can only be the most trusted reputation if in every element of how we operate through our team members, through our policies, through our engagement with the community, we have to set standards that others admire and respect. So I can only say to you that I'm extremely conscious of the importance of this issue, and these issues are matters which the board constantly is reviewing to ensure that we are moving forward in a way where we're able to build upon that commitment to be the most sustainable supermarket. Thank you, Helen.
Thank you, Chairman. We have another question from Mrs. Catherine Rouse and Mr. Steven Gregory.
The question is, "Can you describe the role of the newly opened Shanghai office, and how will you manage the diversion of scarce line items to this market at the expense of local customers? Will having this office enable more control?"
I think, again, this is a somewhat operational question, and I'll defer to our Chief Executive, Steven Cain.
Okay, thank you, James, and thanks for the question. We've had a very successful export business at Coles for decades. It started by exporting cuts of meat that are not popular in Australia because quite often we buy the whole carcass in relation to the abattoirs and so on. What then happens is they are exported. Over time, what we've seen is that export business grow as our meat business in Australia has grown. We recognize that the government is trying to grow Australian exports of farm products.
I think they have a target of AUD 100 billion, and we're right behind that program. China is one of our, the Chinese market is one of our largest markets, and last year we took the decision to open an office, as you say, in Shanghai. We will always make sure that the priority is first and foremost Australian customers in our stores, but equally, where we can get surplus, we will try and export as part of growing Australian exports overseas to make sure that more farmers can be more sustainable over time. Thank you, Helen.
Thank you, Helen. Are there any further questions on this item?
There are, Chairman. The next question is from shareholder Benjamin Solity. His question is, "Coles' recent sustainability report indicated the company will soon be setting new climate targets.
When will these new targets be released, and will they include commitments to 100% renewable electricity by 2025 and net zero emissions by 2030, as other major retailers have recently done?"
Thank you very much indeed, Mr. Solity, for your question and, again, your focus upon the importance of this area. As I have mentioned in my previous answers, this is an area which is constantly being evaluated, very clear understanding of the issues around any commitments that we give because it's imperative that in making commitments we understand what they mean and how we can deliver them. So we will responsibly address these issues together with the broader sustainability issues, and as I have said, we will, in due course, make further statements.
It would be totally improper of me to preempt that assessment and review process that continues, but we will take your interest in mind and appreciate your bringing the importance of it to our attention. Thank you, Helen.
Thank you, Chairman. The next question is from shareholder Ms. Fay Blahl. "I was pleased to hear of your recycle of soft plastics and move away from polystyrene meat trays to a recyclable alternative. This is a great way to prevent unnecessary waste going to landfill and negatively impacting our environment. My question is, what can Coles do to influence your suppliers in finding recyclable alternatives for single-use or recyclable packaging? Example, toothpaste. Is Coles looking to stock brands to sell their toothpaste in recyclable packaging? Example, jars instead of tubes?
What conversations is Coles having with big brands like Colgate or Macleans to prompt a shift to recyclable packaging that is more sustainable for our environment? Consumer behavior is easily shifted when change is led by government and supported by corporations like Coles. I look forward to hearing about Coles' plans to support a greener and more sustainable future.
Thank you, Ms. Blahl. It is an extension of some of the comments that I have already made on the importance of this area. We actually refer in our sustainability report to two global companies, one being Unilever and one being Kimberly-Clark, where we're working with them to facilitate an increase in product packaging which is recyclable. This is work in progress.
I think it is cooperative and pleasingly so that our suppliers, as well as ourselves in relation to our own commitments on own brand, are very much focused on how we can improve the outcomes in these areas. It's a very big area. It's very complex. We have at Coles, we have some 10,000 suppliers. So we're working constructively with many of the large operators because together, as you have indicated, I think leadership positions can have an even bigger impact. Thank you, Helen.
Thank you, Chairman. The next question is from shareholder Ms. Catherine Mary Broders. Her question is, "Does Coles follow the Modern Slavery Act Australia guidance?"
Thank you, Ms. Broders, for your question. This is another area which is particularly important.
It's quite closely related to our commitment on ethical sourcing, which I referred to earlier, but you would have seen in October that we published our first modern slavery statement. In that, we outlined all the areas of risk that we see where potentially through our supply chain we could be exposed to risks which would fall within not only the definition under the legislation but under the much wider charter where we feel a sense of responsibility to ensure that we as Coles are setting a very leadership standard. I trust that you will have the opportunity to review that report because it sets out not only the details specifically there but also references that on our website we provide further details of potential risk areas that we are particularly focused on addressing. Thank yo u, Helen.
Thank you, Chairman. The next question is from shareholder Ms. Zoe Rose Robertson.
Her question is, "You have spoken about renewable energy and the plans announced in regard to CleanCo and other PPAs. How will you become Australia's most sustainable supermarket in this climate area and get ahead of competitors?"
Well, thank you, Ms. Robertson. I think I've sought to address that answer in a number of my previous responses, but to be 100% clear, we are committed to leadership in sustainability. We are going to move in a way which reflects the commercial capacity of us to achieve the necessary outcomes. We understand the importance that you're referencing in your question, and over time we will continue to introduce new additional steps building upon those which we've been taking in some cases for over a decade to make sure that our reputation and our achievements are there.
As I committed earlier in this meeting, we will be transparent and accountable in relation to our performance. I look forward to your support in future years as we move forward in this most important area. Thank you, Helen.
Thank you, Chairman. Chairman, I will now read out the final question relating to this item from shareholder Mr. Benjamin Solity. His question is, "The Murdoch Press regularly publishes information which discredits action on climate change. A year on from the worst bushfires in Australia's history driven by climate change, why does Coles continue to give huge amounts of money to the Murdoch Press for advertising? Can you let shareholders know how much money you spend on advertising in Murdoch outlets each year in Australia?"
Thank you very much, Mr. Solity, for your question.
I don't think I'll be providing specific details on our advertising spend because, as you can imagine, that is quite competitively sensitive information. Our task is to work with all outlets that provide access to messages, to information to our customers. And you will be aware that the market is very complex with social media, traditional media, in print and radio and television, and we don't take sides with the political perspective or editorial content of one newspaper or one television or one radio station over another. We work openly with all parties, and we expect them in relation to their dealings with us to adhere to the same standards that we are expected to live by and that we set for our own performance. Thank you, Helen.
Thank you, Chairman. Chairman, there are no further questions or comments on this item.
Thank you, Helen. As there are no further questions, we will now move on to item two of today's agenda. Firstly, item 2.1. This relates to the election of Paul O'Malley as the director of the company. Paul was appointed to the board effective 1 October 2020, and in accordance with the company's constitution, Paul offers himself for election today. The text of the resolution is shown on the screen, and Paul's details are set out in the notice of meeting. I will now invite Paul to address the meeting.
Thank you, Mr. Chairman. Good morning, ladies and gentlemen. I became a director on 1st of O ctober 2020 and seek your support today as I stand for election for my first full term on the board. I have a strong background in business, finance, and accounting, being a chartered accountant and holding a master's in applied finance.
I started my career in auditing, investment banking, and consulting, and had a long executive career before joining Coles. I was formerly the Chief Executive Officer of Dallas-based TXU Energy and held other senior financial management roles within TXU. In 2005, I joined BlueScope Steel as Chief Financial Officer and became the Managing Director and Chief Executive Officer in 2007. I held that position for 10 years until 2017. BlueScope is Australia's largest manufacturing company and Australia's largest manufacturing investor in Asia, with significant operations also in the United States. In January 2019, I became a non-executive director of the Commonwealth Bank of Australia, and from January this year became the chair of their People and Remuneration Committee. I have served as a director of the World Steel Association and as a trustee of the Melbourne Cricket Ground Trust.
I believe that my broad operational finance and business leadership experience will enable me to bring a thoughtful and strategic perspective to the board. I'm honored to be a member of the board, and with your support, I look forward to contributing further to Coles. Thank you.
Thank you, Paul. The board, other than Paul, unanimously recommends the election of Paul O'Malley, noting that he brings significant public company and operational experience, as well as extensive financial expertise to the board and in his position as chairman of our Audit and Risk Committee. I would now like to invite any questions that you may have on this item of business. Thank you, Helen.
Thank you, Chairman. We have a question from shareholders, Mrs. Catherine Rouse and Mr. Steven Gregory. Technology and its implementation is a critical differentiator for our company.
Referring to the annual report detailed description of board skills, can you please describe how you will contribute to Coles in this space? In particular, can you share relevant experiences?
Well, Ms. Rouse and Mr. Gregory, thank you for your question. Let me say Paul has joined the board as one of eight board persons. And what is really important in directors is that they do have particular skills and integrity and commercial acumen and work collaboratively with other people. In Paul O'Malley, we have all of those elements. I don't think we need to go into the details of technology. There are a number of people on the board of Coles who have extensive technical qualifications in engineering and the like. The management team have all the technological focus and resources they require.
And I think that in Paul coming into the position as chairman of our Audit and Risk Committee, what's really important is that he's had leadership positions in major Australian public companies. He understands the blend of finance and commerce and investor and community issues, and I'm really positive about his engagement as a fellow director on the board of Coles Group Limited. Thank you, Helen.
Thank you, Chairman. Chairman, there are no further questions or comments on this item.
Thank you. If there are no further questions, we have now finalized discussion of this item. The details of the proxies and direct votes received in relation to this item are displayed on the screen. Please now enter your votes for item 2.1 if you have not already done so.
I now turn to item 2.2 on today's agenda, which relates to the re-election of David Cheesewright as the director of the company. The text of the resolution is shown on the screen. David's details are set out in the notice of meeting. I now invite David to address the meeting.
Thank you, Chairman, and good afternoon, shareholders and guests. As a fellow shareholder in Coles Group, I'm excited about the strategy and plans, and I'm honored to be considered for re-election to the board. For over 30 years, I worked in the retail and consumer goods industry. During my time at Mars and Walmart, I led teams in manufacturing, sourcing, IT, marketing, sales, logistics, operations, e-commerce, and buying. I'm passionate about solving problems, serving customers, and developing talent.
In my last role as President and CEO of Walmart International, I had responsibility for all Walmart's operations outside of the USA. This encompassed over 50 diverse businesses operating in 27 different countries and included Walmart's group global sourcing operations. In total, over 1 million associates and 6,000 stores. In addition, I've served on boards in Europe, China, Africa, Latin America, North America, and Australia. I believe that I bring strong hands-on retail experience as well as an important global perspective in an increasingly interconnected world. I'm proud to be a Coles team member and to have the opportunity to work with such a world-class management team and board. If reappointed, I will continue to bring all of my experience to help ensure the continued success of Coles. Thank you.
Thank you, David.
The board, other than David, unanimously recommends the re-election of David Cheesewright, noting that he makes a significant contribution to the board and whose wealth of experience and knowledge of retail businesses and the industries in which Coles operates is highly valued by both the board and management. I would now like to invite any questions that you may have on this item of business. Thank you, Helen.
Thank you, Chairman. We do indeed have a question, and it is the same question from Mrs. Catherine Rouse and Steven Gregory. I'll just refresh your memory. The last part of the question was referring to the annual report detailed description of board skills. Can you please describe how you have and will contribute to Coles in this space? In particular, can you share relevant experiences?
Well, thank you, Mrs. Rouse and Mr. Gregory.
I presume your question may have arrived before having the opportunity to hear David Cheesewright's address to us today. I think we can see in David a person who has extraordinary experience in the retail sectors globally, whether it's online, product packaging, sustainability, technology, team members. A person who, in his last role as president of Walmart International, had some 1 million team members under his domain, I think, is only achieved as a result of a person who has a breadth of knowledge and also an empathy with people. Fortunately, we on the board of Coles Group Limited have been able to enjoy our work with David firsthand over the last two years since the date of demerger from Wesfarmers in November 2018. Throughout that period, David has made a constructive contribution at all times to the board and to the support of the management team.
He is a person of unusual and somewhat unique skills. We are delighted to have him as a member of the Coles Group Limited board. Thank you, Helen.
Thank you, Chairman. Chairman, there are no further questions or comments on this item.
Thank you. If there are no further questions, we have now finalized discussion on this item. The details of the proxies and direct votes received in relation to this item are now displayed on the screen. Please enter your votes for item 2.2 if you have not already done so. I now turn to item 2.3 on today's agenda, which relates to the re-election of Wendy Stops as the director of the company. The text of the resolution is shown on the screen. Wendy's details are set out in the notice of meeting. I now invite Wendy to address the meeting.
Thank you, Chairman, and good afternoon, ladies and gentlemen. Two of my key criteria for joining any board are that I believe I can become passionate about the business and that it would be an organization that has strong growth potential and opportunities. Over two years ago, when I was approached to join the Coles board, it quickly became very apparent to me that satisfying both of those criteria would be quite easily done. My career to date is a combination of over 32 years in the corporate world and nearly six years as a non-executive director. My corporate expertise is in information technology, where I worked across a number of industries and leadership roles spanning Australia, Asia-Pacific, and globally. In addition to Coles, my non-executive director career has included listed companies, the Commonwealth Bank of Australia, and Altium Limited.
I'm a big believer in how you capitalize on the tough times to become better at what you do, and both my corporate career and non-executive director career to date have certainly provided me with many of these learnings, all of which I bring to Coles. More generally, the key skills and expertise I bring to Coles span four key areas. Firstly, information technology and large-scale program management, which is extremely relevant for the Ocado, Witron, and other programs Coles is undertaking. Secondly, operational management and risk management. With over seven years in COO and global risk management roles, combined with my native expertise, it enables me to be more astute in these areas. Thirdly, Asia-Pacific line management roles and lived experience, giving me valuable insights into the cultural dimensions of our business and suppliers.
And lastly, the HR and cultural challenges that come with continuing to grow a large organization that is highly dependent on its people. I hope to be able to continue to bring these experiences and skills to Coles as a member of the Coles team, with your ongoing support for my re-election. I'm extremely proud to be part of this great Australian-born and bred institution. Thank you. Thank you.
Thank you, Wendy. The board, other than Wendy, unanimously recommends the election of Wendy Stops, noting that she is an excellent contributor to the board and brings a deep background in strategy, digital, and information technology to the board. I would now like to invite any questions that you may have on this item of business. Thank you, Helen.
Thank you, Chairman. Chairman, there are no questions or comments on this item.
Thank you.
If there are no questions, we have now completed this item. The details of the proxies and direct votes received in relation to this item are displayed on the screen. Please now enter your votes for item 2.3 if you have not already done so. I now turn to item 3, which is an advisory vote on the 2020 remuneration report. The remuneration report can be found on pages 73 to 94 of the 2020 annual report. As noted in that report by my fellow director and Chairman of the People and Culture Committee, Richard Freudenstein, this was the first year of operation of our new remuneration framework, designed to attract, motivate, and retain our key management personnel. The 2020 financial year saw considerable progress in bringing together the executive leadership team at Coles, executing our strategy, and delivering strong performance against both financial and non-financial metrics.
Our leadership team is rewarded through the payment of benchmarked fixed compensation, a short-term incentive based 60% upon financial measures and 40% on strategic milestones, and a long-term incentive dependent upon performance over a three-year period by reference to our relative total shareholder return and our cumulative return on capital. The board maintains discretion across all remuneration aspects to ensure that outcomes are appropriate in the context of our performance and our customer, team member, shareholder, and community expectations. For the financial year 2020, the board considered the short-term incentive outcomes for the executive key management personnel, which ranged from 91.7%- 100% of the maximum short-term incentive opportunity.
The board believed that this was an appropriate reflection of the significant achievements delivered by management, noting that 50% of the Managing Director's Short-Term Incentive outcome will be deferred into equity for two years, and 25%, in the case of other Key Management Personnel, will be deferred into equity for one year. In considering the performance metrics to apply for the 2021 financial year, in recognition of emerging business priorities, the board has introduced a specific online sales target in lieu of the cash realization target for all executive KMP, other than in the case of the Chief Financial Officer. Secondly, we have introduced a simplified customer metric, being the single Net Promoter Score, a measure widely accepted as the key customer measurement in the retail industry.
I would also like to take this opportunity to speak to resolutions four and five relating to the allocation of equity to our Managing Director and Chief Executive Officer, Steven Cain. Resolution four relates to the approval sought to allot 75,866 shares to Mr. Cain pursuant to the 50% deferral into equity of the short-term incentive earned in the 2020 financial year. The total short-term incentive earned by Mr. Cain was AUD 2,499,000, or 119% of his total fixed compensation. As previously noted, these shares will be subject to a two-year deferral. Resolution five relates to the approval sought to allot Mr. Cain 223,133 performance rights, being equivalent to 175% of Mr. Cain's total fixed compensation. The terms of this long-term incentive grant are set out in the notice of meeting, and importantly, they are entirely performance-based.
50% of the performance rights are subject to our relative total shareholder return measured over the three-year period, and 50% are dependent upon the company meeting a cumulative return on capital measurement as set by the board in line with the execution of our strategy. This structure of long-term incentive has been set by the board in recognition of the importance of aligning remuneration outcomes with long-term returns to shareholders in accordance with our vision of becoming the most trusted retailer in Australia and growing long-term shareholder value. I would now like to return to item three on today's notice of meeting, the remuneration report. The text of the resolution is shown on the screen. While the vote on this item of business is advisory only, the board takes account of the discussion and voting when reviewing our remuneration practices and policies.
The board recommends that shareholders vote in favor of the adoption of the remuneration report. I now invite any questions that you may have on the remuneration report. Thank you, Helen.
Thank you, Chairman. We have a question from Mr. Stuart Byrne from the Australian Shareholders' Association. He says, "We thank Coles Group for placing more of Mr. Cain's REM in the at-risk category. Can you please confirm that his total fixed compensation will be AUD 2.1 million for next year and that other benefits, such as the AUD 1.5 million paid this year, will not be paid next year?"
Thank you, Mr. Byrne, for your question, and we are very much aligned with at-risk compensation, and I'm glad that is something which you share that decision and that approach.
Usually, we don't discuss any elements of the 2021 remuneration until we get to next year's remuneration report, where we provide full details. But in the interest of clarity, I will confirm that there is no adjustment being made to Mr. Cain's total fixed compensation in relation to the 2021 financial year. It will remain exactly at the same level as that which applied in the 2020 financial year. In relation to the other matter to which you referred regarding transition awards, as you will recall, these were, in fact, put in place by Wesfarmers at the time Mr. Cain agreed to join what was then the Coles, Wesfarmers Group in March of 2018. And the final one of those payments was, in fact, made in December last, and there are no further commitments or payments of that regard. Thank you, Helen.
Thank you, Chairman.
We have another question from shareholders, Mrs. Catherine Rouse and Mr. Steven Gregory. Their question is, "Can you explain what is meant by the blended approach to a single Net Promoter Score metric? How is this used as a gateway measure? Specifically, what was the gateway score and the actual score?"
Oh, thank you, Mrs. Rouse and Mr. Gregory. You will note that we are, in fact, moving entirely to a single Net Promoter Score in the financial year 2021. But I will invite Richard Freudenstein, my fellow director, who is the chairman of the People and Culture Committee and whose introductory letter accompanies the report to which you are referring to comment upon the matters to which you have raised.
Thank you, Chairman, and thank you for the question. Yes, in the financial year FY 2020, the customer metric score had really three elements.
The team had to hit a certain Net Promoter Score to be eligible to receive compensation under this metric. We don't disclose what that is, but they did meet that gateway Net Promoter Score metric. Then, within the actual metric, there were two tests. One was the customer satisfaction question, which we've referred to earlier in the meeting, and the second was a question around customers being happy with what they paid as the two metrics. We've put out in the Remuneration Report that those metrics were almost met. They were between threshold and target on the overall customer metric. The idea next year is to move in the year we're currently in to a simplified customer score, which is a Net Promoter Score only, which gives a more holistic view of customer satisfaction, and we think is a better metric going forward. Thank you.
Thank you, Richard. Are there any further questions, Helen?
Thank you, Chairman. Yes, there is a further question from shareholder, Mrs. Patricia Anne Sarah Vorchheimer. She says, "I spent hours analyzing the financials, doing all the ratios. Coles is sailing a bit close to the wind in some respects, and I believe in the circumstances the CEO and top executives should take a considerable pay cut for the coming year. Although I have ratified the REM report, I do not see why a CEO of a grocery chain should earn many multiples of our prime minister's salary."
Well, thank you, Mrs. V orchheimer, for your comments. I think what is clear is that this has been a wonderfully successful year for shareholders in the year ended 28 June 2020.
And as has been noted, the total shareholder returns enjoyed during that year, which are a function of both the appreciation of the share price and dividends paid, was some 31.7%. That's a very high level of performance. So it's good to see that shareholders have been well rewarded for their support of Coles in this very unusual year. In looking at remuneration, we take a holistic view. We look at, first of all, what is it that we need to attract, retain, and motivate to execute successfully the Coles strategy from our team members? And we have come to assessments in terms of how best to structure that in a competitive market environment. We undertook the preliminary work of that in 2019. We have expert advice given to us about what it is that will be seen to be relevant and competitive in the broader market environment.
And we set targets which are appropriate to ensure financial performance and strategic initiatives are well executed in accordance with the board's policies and commitment to grow the business. I think as you look at remuneration, it's quite complex. The numbers, I agree, are often in all public companies substantial, but they need to be because we are in a global market competing for talent. Steven referred in his earlier comments to the fact that during this recent period, we've been very fortunate to bring Darren Blackhurst in from the United Kingdom with his outstanding track record in those markets. We've brought Ben Hassing, who had been in a really important role at Walmart with significant operations and responsibility in developing online. These are key people in the future of the execution of our strategy and the growth of your business.
Together, we need to make sure that we have the right framework, the right yardsticks, and to the maximum extent possible, we think that that's pretty much what we've been able to achieve in the year to which this report relates. Thanks, Helen.
Thank you, Chairman. Chairman, there are no further questions or comments on this item.
Thank you. If there are no further questions, we have now finalized discussion on this item. The details of the proxies and direct votes received in relation to this item are displayed on the screen. Please now enter your votes for item three if you have not already done so. I now turn to item four, which is the approval of the grant of short-term incentive shares to Mr. Steven Cain as part of his short-term incentive award for the 2020 financial year. The text of the resolution is shown on the screen.
Details of the proposed grant are set out in the explanatory notes to the notice of meeting. As outlined, the purpose of Mr. Cain's short-term incentive is to provide increased focus on and reward for performance against those areas that most significantly drive the delivery of the company's strategic initiatives. Providing a portion of Mr. Cain's short-term incentive award in the form of equity also ensures that his interests are aligned with those of shareholders. The board, other than Steven, considers the grant of short-term incentive shares to the Chief Executive Officer to be appropriate in the interests of shareholders and unanimously recommends that shareholders vote in favor of item four. I now invite any questions that you may have on the approval of Steven Cain's short-term incentive grant. Thank you, Helen.
Thank you, Chairman.
Chairman, we have received a number of questions in relation to why management should be given incentives for doing their job given the generous salary. The questions are from shareholders, Mr. Bruce and Ms. Sharon Jarman, Mr. Mark Scully, Mr. Elio Menegol, and Mr. John Freeman.
Can I thank each of you for your inquiry on this matter? As I was foreshadowing earlier, setting remuneration is something which is pivotal to the company's success. We need to have the best talent at Coles Group Limited to lead, inspire, execute, and deliver results. We can only do that if we're able to attract and retain the best people. In putting together the senior management team, the company and the management team's interests align. We require their full, wholehearted engagement in our business in every element.
They rightly should be rewarded in a competitive sense having regard to what is the market situation, but in a sense which aligns them with shareholders. And so in relation to the short-term incentives, as I mentioned earlier, as far as our Managing Director and Chief Executive Steven Cain is concerned, 50% of his earned short-term incentive will be reflected in shares in Coles Group Limited for a two-year period. And in relation to the other key management personnel, it'll be for 25% of their interest for a one-year period. This alignment of interests is a component part of ensuring that we have the integration of strategy, purpose, people. And that's what we seek to do through our remuneration structure as reflected in this report and as contained in an outcome sense in this item of business. Thank you, Helen.
Thank you, Chairman.
Chairman, there are no further questions or comments on this item.
Thank you. If there are no further questions, we have now finalized discussion on this item. The details of the proxies and direct votes received in relation to this item are displayed on the screen. Please now enter your votes on item four if you have not already done so. I now turn to item five, which is the approval of the grant of performance rights to Mr. Steven Cain as part of his long-term incentive award for the 2021 financial year. The text of the resolution is shown on the screen. Details of the proposed grant are set out in the explanatory notes to the notice of meeting.
As outlined, the purpose of Mr. Cain's long-term incentive is to ensure that his interests are aligned with those of shareholders by providing him the opportunity to be awarded an equity interest in Coles, subject to the achievement of the performance targets as set out in the notice of meeting. The board, other than Steven, considers the grant of performance rights to the Chief Executive Officer to be appropriate in the interests of shareholders and unanimously recommends that shareholders vote in favor of item five. I now invite any questions that you may have on the approval of Steven Cain's long-term incentive grant. Thank you, Helen.
Thank you, Chairman. We have a question from Mr. Stuart Byrne from the ASA. He says, "We welcome the introduction of the payment of 50% of the STIs in equity.
However, in relation to the LTI, we would have liked a minimum of five years for the measurement of hurdles on the performance rights rather than the three years applied. This would align the performance of the CEO with the longer-term needs of shareholders."
Thank you, Mr. Byrne, and for your support of the structure adopted in the short-term incentive. I think if I remember correctly, we may have discussed this issue in the context of our 2019 annual general meeting when we had just at that time set the framework for our remuneration structure going forward.
The board, in setting that structure, took expert independent advice to have regard to market practice, alternative situations, and have regard also to what was going to be the right element of alignment for Coles Group Limited and its senior team, and in particular, in the matter at hand, our Chief Executive Steven Cain. We have formed the view that three years is, in fact, the right period to have that alignment of long-term involvement in the business, and it is a matter which we will continue to review as market circumstances and market practice may evolve over time. But at the present time, it is the view of the board that this is the approach which best reflects the interests of the company, the team, and the combined success that we aspire to achieve together. Thank you, Helen.
Thank you, Chairman.
Chairman, there are no further questions or comments on this item.
Thank you. If there are no further questions, we have now finalized discussion on this item. The details of the proxies and direct votes received in relation to this item are displayed on the screen. Please now enter your votes on item five if you have not already done so. Before we close the meeting, I would like to pause to address any additional questions which may have been submitted by shareholders after the relevant item of business had been discussed. Helen, are there any additional questions?
Chairman, there are no additional questions.
Thank you, Helen. If there are no further questions, we have now finalized our discussion. That concludes the formal business of this meeting. If you have not already done so, please ensure that you have submitted your vote for each resolution through the online platform.
I will now wish you all well. Keep safe, keep healthy, and I declare the poll closed, and the final note that the final results of the poll will be advised to the ASX later today and published on our website as soon as possible. That concludes our business today. Thank you very much indeed for your attendance at Coles Group's virtual annual general meeting and for your ongoing support of Coles. I now declare the meeting closed.