Kroger : Proxy Statement & 2021 Annual Report

Notice of 2022 Annual Meeting of Shareholders

2022 Proxy Statement

and

2021 Annual Report on Form 10-K

Dear Fellow Shareholders:

2021 was a year marked by new victories, new obstacles to be overcome and new milestones achieved. COVID-19 vaccines restored hope in defeating the pandemic; rising inflation presented new challenges; and momentum behind environmental, social, and governance (ESG) trends continued to motivate companies and citizens toward building a better future.

Against this backdrop, Kroger remained focused on our purpose, To Feed the Human Spirit, and our brand promise, Fresh for Everyone™, by providing America with access to fresh, affordable, high-quality food.

I'm proud of the way our associates came together to deliver for our customers during a highly dynamic year. As a team, we navigated an evolving operating environment featuring continued shifts in customer behaviors - including enthusiasm for e-commerce and a renewed excitement for at-home eating. Our competitive moats enabled us to convert these structural changes in customer behavior into lasting competitive advantages that will enable us to drive sustainable growth and profitability for the long term.

Continued execution of our overarching strategy - Leading with Fresh and Accelerating with Digital - helped us to achieve a second consecutive year of record performance in 2021. During the year, we:

• Achieved positive year-over-year identical (ID) sales excluding fuel against very strong ID sales last year, and a two-year ID sales stack of 14.3%;
• Deepened our four competitive moats: Fresh, Our Brands, Personalization and Seamless, through productivity, technology and our focus on sustainability;
• Reached $1 billion in annual Home Chef sales, reinforcing our ability to meet the growing demand for satisfying, restaurant-quality meal options at home that we forecasted years ago;
• Achieved cost savings greater than $1 billion for the fourth consecutive year.
• Invested in our associates to raise our average hourly wage to $17 and our average hourly rate including comprehensive benefits to over $22; and
• Launched our first three customer fulfillment centers powered by Ocado in Groveland, FL (Orlando), Monroe, OH (Cincinnati), and Forest Park, GA (Atlanta).

Our strong results are a testament to Kroger's proven value creation model, which enables us to invest in our associates, provide fresh, affordable food for our customers and support our communities - and all of this allows us to deliver for our shareholders.

The foundation of our value creation model is our market-leading omnichannel position in food

retail, built on Kroger's unique assets, which, combined with our competitive moats, deliver an unmatched value proposition for our customers. By using our free cash flow to invest in our core retail supermarket business, we drive additional traffic into our stores and digital channels. In turn, we generate data

that enables us to diversify with fast-growing alternative profit streams. This flywheel effect creates incredible long-term, sustainable value for shareholders. It gives us confidence to consistently grow earnings of 3% to 5% per year, return capital to shareholders through our dividend and share repurchases, and supports our goal to deliver total shareholder returns of between 8%-11% over time.

Our priorities today reflect our long-term focus. We make decisions on a five-to-ten-year horizon. This is true for our investments and our approach to ESG topics like responsible sourcing. Four years ago, we were dissatisfied with our average hourly wage rate for associates. We decided to take proactive steps to identify cost reductions that would allow us to invest in our associates. We've since raised associate wages by $1.2 billion while also keeping the price of food affordable for our customers.

The sections below highlight the progress we have made across our key priorities and how we intend to continue building on this positive momentum going forward.

Leading with Fresh

As one of our core competitive moats, fresh - and our Fresh for Everyone™ brand promise - fuels our business every day. We know that our customers love Kroger because they crave fresh foods: it is the number one determinant of store choice, with 70% of all customers deciding where to shop based on fresh products. Today, nearly 100% of our customers buy fresh products from Kroger, demonstrating just how critical this area of the business is for us and our customers.

Throughout the past year, Kroger's fresh departments have delivered tremendous success, outpacing total company identical sales excluding fuel during the fourth quarter of 2021. Our fresh sales have increased 15.6% since 2019, demonstrating our ability to lead with the freshest, highest quality products.

In 2022, we aim to widen our competitive moat in fresh. We'll leverage data-driven insights and food science to improve sourcing, ensuring products are always at the peak of their flavor and quality; reduce transit time from distribution centers; ensure optimum assortment, price, and promotion of merchandise; simplify store operations; and more effectively market the freshness of our products to Kroger customers. We'll also work to optimize our supply chain, partnering with our suppliers to improve the distribution process and launching new vendor accountability tools to keep our operations seamless.

Creating a Seamless Customer Experience

We are focused on delivering a seamless experience that requires zero compromise by our customers. And what that means is leading with the freshest products at competitive prices and flexible lead times. Our brick-and-mortar model leverages our existing assets to provide fresh products and meal solutions with proximity and immediacy, while our dedicated facilities can offer a wide assortment of choices alongside scale and reach to target new customers. We have intentionally structured our seamless ecosystem to leverage both of these models, forming a dynamic network encompassing our stores and automated customer fulfillment centers. This approach allows us to capture more trips - from the planned weekly shop to the unexpected and time-sensitive dinner - as we engage with more customers, on more occasions, and in both existing and new geographies.

During the year, we expanded our loyalty and personalization platform, successfully generating over two trillion relevant recommendations, resulting in 50% of items added to baskets because of personalized search. And, with partners like Ocado, we continue to innovate and bring cutting-edge and industry-leading technology to improve both the customer and associate experience.

In 2021, we set an ambitious goal of doubling digital sales by the end of 2023 and doubling our profitability pass-through rate. We're successfully on track to accomplish these goals thanks to the hard work of our technology teams and associates, alongside strategic and impactful initiatives that continue to help us deliver this seamless experience.

Feeding the Human Spirit

There are many ways companies approach ESG matters today. At Kroger, driving sustainability and social good are not just things that happen alongside our business, they are embedded in the fabric of our business.

Nowhere is this more evident than in Zero Hunger | Zero Waste, our social and environmental impact plan established in 2017, through which we are helping create a more resilient and sustainable future food system. In 2021 alone Kroger directed nearly 500 million meals to feed hungry families across America, reaching a cumulative 2.3 billion meals toward our goal of providing 3 billion meals to people in need by 2025. We've also delivered on our core 2025 impact goals under Zero Hunger | Zero Waste, including: 93% of Kroger-operated stores actively donating surplus food (goal: 100%); 87% of stores have active food waste recycling programs (goal: 100%); and company-wide waste diversion rate of 79% (goal: 95%+).

We have also continued to prioritize fostering an environment of inclusion in the workplace, workforce and our communities where the diversity of cultures, backgrounds, experiences, perspectives,

and ideas are valued and appreciated. We continue to make solid progress on our 10-pointFramework for Action: Diversity, Equity & Inclusion (DEI), which reflects our desire to redefine, deepen, and advance our commitment by mobilizing our people, passion, scale, and resources. One area we are especially proud of our progress on is in supplier inclusion. We are nearly halfway toward achieving our goal in the Framework for Action to spend over $10 billion dollars annually with diverse suppliers by 2030. We also made progress in attracting diverse talent from Historically Black Colleges and Universities and Hispanic-Serving Institutions, increasing from six to 17 our partnerships with these institutions.

Related to our DEI commitments, our Kroger Health practitioners have played an extraordinary role in administering more than 10 million COVID vaccines to communities of every race, age and economic background. We take great pride in the role we play in creating accessible healthcare and helping advance health equity and improved health outcomes for all, including our associates and customers.

Responsible Sourcing

As the nation's largest supermarket retailer, Kroger has an extensive supply chain that is constantly evolving to meet the needs of our customers and communities. This work is guided by our Responsible Sourcing Framework, which includes 13 policies that embed responsible procurement practices throughout our value chain, including policies related to respecting human rights and advancing animal welfare. We implement comprehensive programs to not only hold our suppliers accountable for meeting Kroger's high standards, but also to support their continual improvement. We also rely on the deep knowledge of our category sourcing leaders; the latest data, insights and audit results; and input from our investors, industry groups, NGOs and subject matter experts.

Kroger's Responsible Sourcing Framework includes our Animal Welfare Policy, which expresses our belief that animals should receive proper welfare. Our policy reflects the Five Freedoms, which is the international standard for higher welfare. We are not directly involved in raising or processing any animal. Kroger requires animal protein suppliers to adopt industry-accepted animal welfare standards.

Investing in Our Associates

I'm consistently in awe of the patience, generosity, and spirit of our associate community across the nation. As someone who started my career as an hourly Kroger store associate, I know better than anyone that providing a superior associate experience empowers us to deliver a better customer experience every time. In fact, around 70% of our store leaders start out as part time associates.

Kroger has provided an incredible number of people with their first job, new beginnings, and lifelong careers, and we're proud to play this role in our communities. When we talk about uplifting our associates, it certainly includes compensation. In the past four years, we've raised our average hourly wage by 25.9%, in addition to the comprehensive benefits we offer such as healthcare and retirement plans, customized training and advancement opportunities.

Continuing this growing investment in our associates is a priority for 2022 and beyond, and we expect continued upward movement in the hourly wages in our business model.

We're also tremendously proud of our continued improvement in workplace safety. We believe our leading safety results make our stores, manufacturing plants and distribution centers among the safest places to work in the U.S. As part of our commitment to safe workplaces and a healthy workforce, we've made considerable investments in safeguarding our associates' overall wellbeing, including increasing access to mental health resources and providing personal safety training as well as COVID-19 vaccines administered by our Kroger Health experts.

To 2022 and Beyond

2021 was an incredible year for Kroger, characterized by impressive growth, big change, and restored hope. As we look ahead to 2022 and beyond, I want to take a moment to express my gratitude - for our associates, customers, and all of you. The community that we have built at and