18 July 2022

To our stakeholders:

I am pleased to confirm that Quorn Foods reaffirms its support of the Ten Principles of the United Nations Global Compact in the areas of Human Rights, Labour, Environment and Anti-Corruption.

In this annual Communication on Progress, we describe our actions to continually improve the integration of the Global Compact and its principles into our business strategy, culture and daily operations. We also commit to share this information with our stakeholders using our primary channels of communication.

Sincerely yours,

Marco Bertacca
CEO

We publish a statement on our website in accordance with the Modern Slavery Act 2015.

The business continues to ensures sites are supported by Health, Safety and Environment Managers who are responsible for assessing and addressing any risks, ensuring safety and challenging management on performance.

As well as our standard terms and conditions and agreed supplier contracts, we have in place relevant and robust policies, to help our business combat modern slavery internally and externally across our supply chain, as well as providing suitable support for our colleagues to conduct themselves appropriately while representing the Company. These include:

Equality, Diversity and Inclusion
Modern Slavery, Human Trafficking and Forced Labour
Human Rights
Right to Work
Bullying and Harassment
Bribery and Corruption
Community Relations
Whistleblowing
Procurement, Responsible and Ethical Sourcing

In the coming year we aim to have developed a comprehensive supplier charter which requires our suppliers to adhere to and provide relevant data and evidence on their commitment to and progress on human rights to support further implementation and monitoring.

Quorn Foods has an independent HR team responsible for developing and implementing the policies and procedures to protect workers for harassment, bullying and discrimination. These systems are under constant audit and review to ensure they meets the highest standards and legal requirements.

The business has set up a cross functional team of colleagues who will champion continuous improvement and development across the following areas:
- Mapping of the supply chain to identify high risk geographical, category or supply areas
- Reviewing and updating, where required, all appropriate policies for the management team to adopt, approve, communicate and train throughout the business
- Development and publication of a supplier charter and code of conduct
- Selection of an appropriate supplier management tool that will support monitoring and risk management of modern slavery and other human rights issues

As part of all our tenders, supplier negotiations and contract placements emphasis was placed, as part of the mandatory responses, on the supplier requirements and expectations against modern slavery. This included ensuring that they had a relevant statement and declaration to adhere and support our requirements within this subject matter.

Employees were periodically and continually refreshed with respect to Quorn’s policies, values and expectations. They are provided with a confidential facility to disclose any concerns that they may have about slavery and/or human trafficking or human rights issues in general in our Company or our supply chain by invoking our whistleblowing policy.

A women's leadership group was established, and more recently a wider internal diversity and inclusion network has been set up to foster greater transparency, support mechanisms and implementation of human rights issues into our ways of working.

We use the SEDEX system to promote human and labour rights in our supply chain, and require all suppliers to be members of the scheme.

We carry out an annual timetabled programme of supplier audits, which include include food safety and compliance, legislative and policy compliance and aspects that support our requirements and expectations in terms of modern slavery prevention.

Our modern slavery statement was subject to enhanced review during the reporting period, and progress is reviewed annually by senior management.

The business has committed to the UN Global Compact, and the ETi basecode, and uses it to ensure that workers have freedom of association, safe working practices and no use of child forced or bonded labour in the business.

Written company policies include:
- Equal opportunities
- Whistleblowing and grievances
- Training, development and benefits
- Flexible working
And are subject to regular review by senior HR colleagues

This year the company intends to implement monitoring of ethnicity related factors across the workforce, and perform enhanced screening of labour-related risks across key raw materials.

The business pays above legal minimum wage and working hours are monitored in line with the working time directive. Regular formal and informal checks by the HR team take place to ensure legal minimum wage and working hours are in place.

The new and existing product development teams have implemented a system to identify the countries of origin of new and proposed ingredients so that they may be risk assessed accordingly for labour rights issues.

The business screens its career advertisements for non-discriminatory language, and attempts to balance its interview boards with respect to gender where possible.

We expect to improve on and develop our monitoring of outcomes in the upcoming year. Below are some examples of data gathered in the reporting period.

Demographics:
% females in workforce: 38%
% females in management positions: 43%
% females in leadership team: 34%
% females on senior management team: 18%
% females on the board: 0%

We have had no legal actions or employee grievances involving forced or child labour in the reporting period.

Senior management review gender pay gap report results annually, which has reduced by 4.4% since 2019 and is smaller than the UK average.

Our ambition as a business is to be Net Positive, and we have set a Net Zero target across our full value chain by 2040. We currently measure our Scope 1 and 2 emissions, and also carbon footprint our products

All laws are identified and compliance ensured, and the business has committed to robust goals for carbon, waste and water.

Our goals for the upcoming year include beginning to measure Scope 3 emissions, ensuring our suppliers adhere to the environmental principles of our supplier charter (under development), reducing food waste by 25%, and further increasing the share of green energy used.

The business has begun to provide carbon literacy certified training to its workforce and sustainability champions group. Environmental awareness is also included in all inductions for new starters.

Examples of waste and energy reduction programmes in the reporting period:
- installation of more efficient infrastructure and power correction units
- Invested in bringing one of our brands to gold-standard carbon neutrality
- website optimisation to reduce carbon intensity
- ran trial of water-free cleaning of factories
- introduction of a green car scheme for employees

The business operates ISO14001 certified management systems at two of the sites, and all three sites are covered by regulator approved environmental permits.

The business is actively exploring feasibility of use of green technologies including hydrogen and solar power at 2 of 3 manufacturing sites.

Monthly reporting to the senior leadership team takes place and issues raised. Progress is publicly reported in the company sustainability report.

We have received no monetary / non-monetary fines or sanctions for non-compliance with environmental laws and/or regulations.

Progress made:
- 0% waste to landfill since June 2021 when we implemented new waste contracting
- 0.16 kg CO2e emissions reduction per metric tonne of production YoY
- 20% increase in green energy usage YoY
- 168 products carrying independently certified carbon footprint cradle-to-grave

Corruption is a key part of the risk assessment process of the company and parent company, and controls, policies and procedures are developed, managed and assessed by a member of the finance leadership team.

A key goal for the upcoming year is the creation of a harmonised learning management system which will include anti-corruption, extortion and bribery training to all colleagues in the business, delivered in a standardised way, and reviewing supplier ABC compliance through the new supplier charter system under development.

Anti corruption, legal compliance, ethical trade and human rights are all key parts of commercial agreements.

Steps taken in the reporting period:
- procurement team has started rolling abc policies through entire supply chain
- business owners are building measures on anti-corruption into their strategic risk profile in order to audit from corporate level

We provide office employees with internet security awareness and anti-bribery and corruption training through the company's digital skills hub, including information on how to report grievances and/or suspicious behaviour.

Consistency with anti-corruption commitments is reviewed by the senior financial leadership teams and reported to the senior management / board.

We have had no investigations, legal cases, rulings, fines or other relevant events related to corruption and bribery in the reporting period.

All employees with laptop and network access rights have completed cyber security awareness training within the reporting period.