Environmental, Social and Governance Committee Report

Dear Shareholder

I am pleased to present the Group’s Environmental, Social and Governance (‘ESG’) Committee report covering the work of the Committee during FY2022. This report provides an overview of the Committee’s activities in the year under review and previews our expected activities in the coming year.

Year in Review

ESG is central to the Company’s strategy and forms an integral part of how C&C operates at every level. To reflect C&C’s ongoing commitment to operating a sustainable business, the Board established an ESG Committee in 2020. The ESG Committee has primary responsibility for sustainability and climate change issues.

C&C’s Head of ESG and its Communications and Corporate Affairs Director continue to lead the Company towards our vision relating to ESG targets. A team of six ESG Champions from across the business analyse and appraise the ESG strategy, its six pillars and the initiatives underpinning it. Our ESG Champions have attended the six Committee meetings held during FY2022. ESG Champions are appointed on an 18 month term, allowing them to be involved in the setting of long term and meaningful targets and providing an opportunity to help shape the future of the business at a strategic level through ESG matters. The Committee has been delighted by the Champions’ energy, enthusiasm and, moreover, input as we continue to define the ESG strategy. The ESG Champions report back to their respective teams which ensures an element of alignment on ESG related issues throughout the business.

The Head of ESG, with the support of the Champions and in collaboration with the Board, have worked to establish the Company’s ESG KPIs, which relate to the six pillars of the ESG strategy as detailed on pages 62 to 63, and develop timelines in accordance with legal and regulatory requirements over the coming years.

Alongside the continuous implementation of the Company’s ESG strategy, the Committee was briefed on the Company’s requirement to include a statement in its FY2022 Annual Report and Accounts setting out whether our climate-related financial disclosures were consistent with the recommendations of the Task Force on Climate-related Financial Disclosures (‘TCFD’). The Committee welcomed TCFD as an important step in increasing stakeholders’ and companies’ focus on meeting its obligations on climate change. We have begun the journey of incorporating the TCFD framework into our reporting and risk management processes and are accelerating efforts to mitigate climate change risks and identify opportunities for transitioning to be a carbon neutral business by 2050. The Committee received initial training from an external provider on TCFD and climate change related issues during FY2022. An additional ESG Committee meeting was arranged to provide feedback on and approve the Company’s shortlist of Climate Change Risks and Opportunities, which were recommended to the Board. Protecting and enhancing our environment is an integral part of the Group’s strategy. For this reason, an environmental target was put forward to the Committee during FY2022 and approved by the Remuneration Committee. The environmental target forms a performance condition of the 2021 Long Term Incentive Plan (‘LTIP’). More details can be found in the Remuneration Committee Report on page 117.

A key element of our ESG strategy is to raise the voice of employees in the boardroom. The Board recognises the importance of communication and engagement with the wider workforce as a means of assessing and monitoring our corporate culture. During FY2022, the engagement of the Non-Executive Directors with a range of employees from each business area has provided invaluable insight into the evolution of our culture and values, and their link to strategy, through a series of ‘Our Forum’ meetings. The Committee received updates from departments within the business on a range of issues including mental health, wellbeing and engagement, and health and safety. The meetings, organised by the Head of ESG, allow employees to raise, with the Non-Executive Directors and business units’ Managing Directors, a variety of issues of importance to them, including the Company’s response to the COVID-19 pandemic as it developed, and views on what the Company could improve in its response to help the business and its employees.

The strength of our team is our most valuable asset and we are committed to creating an open and inclusive culture, which enables all of our people to thrive, and to promote diversity and inclusion to ensure we have a balanced pipeline of talent for the future. One of our ESG KPIs approved by the Committee, in collaboration with the Nomination Committee, is linked to diversity and inclusion and we continue to look for ways to expand the Company’s Inclusivity and Diversity agenda.

In terms of corporate responsibility and community engagement, the Board is committed to treating all stakeholders in every area of our business with honesty, fairness, openness, engagement and respect, and to conducting all business ethically and safely. The Group will only work with parties that share these values. Our Code of Conduct (‘our Code’) sets out our expectations for how we do business, clarifying our commitments to ethical, social and environmental performance. Our ESG policies support our Code.

On behalf of the Board

Jim Thompson

Chair of the ESG Committee

17 May 2022

Roles and Responsibilities of the Committee

Role of the Committee

The Committee is required to:-

  • Assist the Board in defining the Group’s strategy relating to ESG matters;
  • Review the policies, programmes, practices and initiatives of the Group relating to ESG matters, including environmental concerns, ensuring they remain effective and up to date;
  • Provide oversight of the Group’s management of ESG matters and compliance with legal and regulatory requirements, including applicable rules and principles of corporate governance, and applicable industry standards;
  • Report on these matters to the Board and, where appropriate, make recommendations to the Board; and
  • Report as required to shareholders of the Company on the activities and remit of the Committee.

The Committee has defined Terms of Reference which can be found in the Investor Centre section of the Group’s website at www.candcgroupplc.com.

Membership and Attendance

The following directors served on the Committee during the year.

Member

Member Since

Number of Meetings Attended

Maximum Possible Meetings

Jim Thompson (Chair)1

24 September 2020

5

6

Jill Caseberry

24 September 2020

6

6

Patrick McMahon

24 September 2020

6

6

Helen Pitcher

24 September 2020

6

6

Andrea Pozzi2

24 September 2020

2

2

1. Jim Thompson was unable to attend the meeting on 27 October 2021 due to a medical procedure.

2. Andrea Pozzi was a member of the Committee until he stood down from the Board on 1 September 2021.

No member of the Committee nor any other Director participates in discussions or votes concerning his or her own re-election or evaluation of his or her own performance. Details of the skills and experience of the Directors are contained in the Directors’ biographies on pages 88 and 89. Their remuneration is set out in the Remuneration Report.

The quorum necessary for the transaction of business by the Committee is two, each of whom must be a Non-Executive Director. Only members of the Committee have the right to attend Committee meetings. The Committee Secretary is the Senior Assistant Company Secretary.

Meeting Frequency

The Committee met on six occasions during the year ended 28 February 2022. All members of the Committee attended each meeting except on one occasion where Jim Thompson could not attend one meeting due to a medical procedure. At the invitation of the Committee, the Chair, the Group CEO, the Company Secretary and General Counsel, the Head of ESG, the Communications and Corporate Affairs Director and the ESG Champions were invited to attend all meetings.

Evaluation of the Committee

The evaluation of the Committee was carried out internally as part of the FY2022 internal Board evaluation process. An explanation of how this process was conducted, the conclusions arising from it and the outcome of that review can be found on page 98.

This report was approved by the Board of Directors on 17 May 2022.

Jim Thompson

Chair of the ESG Committee