Imperial Brands ESG Webinar

Sustainability Strategy

Farmer Livelihoods and Welfare

2 |

Agenda

• Introduction: Peter Durman, Director of Investor Relations

• Sustainability Strategy: Alison Cooper, Chief Executive

• Farmer Livelihoods and Welfare:

– Alex Parsons, Director of Group Communications – Surinder Sond, Group Head of Sustainability– Warwick Evans, Senior Manager Leaf Agronomy & Sustainability

• Q&A

ESG | Webinar January 2020

3 |

Disclaimer

Certain statements in this presentationconstitute or may constitute forward-looking statements. Any statement inthis presentation that is not a statementof historical fact including, withoutlimitation, those regarding theCompany’s future expectations,operations, financial performance,financial condition and business is ormay be a forward-looking statement.Such forward-looking statements aresubject to risks and uncertainties thatmay cause actual results to differmaterially from those projected orimplied in any forward-lookingstatement. These risks anduncertainties include, among otherfactors, changing economic, financial,business or other market conditions.

These and other factors couldadversely affect the outcome andfinancial effects of the plans andevents described in thisannouncement. As a result, you arecautioned not to place any reliance onsuch forward-looking statements. Theforward-looking statements reflectknowledge and information available atthe date of this announcement and theCompany undertakes no obligation toupdate its view of such risks anduncertainties or to update the forward-looking statements contained herein.Nothing in this presentation should beconstrued as a profit forecast or profitestimate and no statement in thisannouncement should be interpreted tomean that the future earnings per

share of the Company for current orfuture financial years will necessarilymatch or exceed the historical orpublished earnings per share of theCompany. This presentation has beenprepared for, and only for the membersof the Company, as a body, and noother persons. The Company, itsdirectors, employees, agents oradvisers do not accept or assumeresponsibility to any other person towhom this presentation is shown orinto whose hands it may come and anysuch responsibility or liability isexpressly disclaimed.

ESG | Webinar January 2020

4 |

Our sustainability

strategy is central to our

growth aspirations

MAXIMISE SUSTAINABLE SHAREHOLDER RETURNS

LONG-TERM QUALITY GROWTH

ENABLING THE BUSINESS TO GROW AND CREATE VALUE

HIGH STANDARDS OF GOVERNANCE

TOBACCO MAXIMISATION NEXT GENERATION PRODUCTS COST AND CASH

TOBACCO SUSTAINABLE SUPPLY

NEXT GENERATION PRODUCTSREDUCED HARM

BEHAVING RESPONSIBLYPEOPLE AND OPERATIONS

TOBACCO SUSTAINABLE SUPPLY

ESG | Webinar January 2020

Group Strategy

5 |

UN Sustainable Development Goals and TCFD

ESG | Webinar January 2020

6 |

Our Sustainability Strategy

• maintaining sustainable agricultural practices to ensure a consistent, quality supply of tobacco

• developing alternative products that are potentially less harmful to health

• behaving responsibly at all times and providing a safe and rewarding work environment for our employees

ESG | Webinar January 2020

7 |

Governance and Employees

ESG considerations are:

• Integrated into business decisions

• Embedded in our risk framework

• Overseen by the Board and senior leadership forums

• Actively managed across the Group

• Supported by employees

ESG | Webinar January 2020

8 |

E

S

G

NEXT GENERATION PRODUCTSREDUCED HARM

BEHAVING RESPONSIBLYPEOPLE AND OPERATIONS

TOBACCO SUSTAINABLE SUPPLY

Climate and Energy Waste Water

Youth Access Prevention Business Conduct

Farmer Livelihoods and WelfareHealth and Safety

Human Rights

Consumer Health Health and Safety

Human Rights

Key Environmental (E), Social (S), Governance (G) Responsibilities

Health and Safety Human Rights

ENABLING THE BUSINESS TO GROW AND CREATE VALUE

Climate and Energy Deforestation

Water

Climate and Energy WasteWater

ESG | Webinar January 2020

ESG Mapping

9 |

Stakeholder Panel

ESG | Webinar January 2020

10 |

Consumer Health

Climate and Energy

Farmer Livelihoods and Welfare

Human Rights – Modern Slavery

Waste

Priority ESG Focus Areas

ESG | Webinar January 2020

11 |

Farmer Livelihoods and Welfare

ESG | Webinar January 2020

12 |

Responsible long term tobacco sourcing

partnerships

Tobacco Sourcing

97%Sourced from third parties

ESG | Webinar January 2020

13 |

Fair Pay for Farmers

• Partnership approach with suppliersand farmers

• Committed to ensuring fair pay

• Farmers understand cost of production, potential crop yields and prices

• Technical advice and support provided through Integrated Production System

ESG | Webinar January 2020

14 |

Alternative Crop Farming

• Support tobacco farmers to growalternative crops

• Vegetables, sunflowers, nuts, maize,honey, beans

• Consumed by families/communitiesor sold for extra income

ESG | Webinar January 2020

15 |

Addressing Child Labour

1. Sustainable Tobacco Programme (STP)

2. Leaf Partnership investment projects

3. Eliminating Child Labour in Tobacco Growing(ECLT)Foundation

ESG | Webinar January 2020

16 |

Sustainable Tobacco Programme (STP)

• Aims to drive consistently highagricultural practices

• Industry-wide initiative for continuousimprovement

• Informs supplier rating, focuses interventionsand supports dialogue

• STP2.0 currently being developed

ESG | Webinar January 2020

17 |

Leaf Partnership Programme

• Support farming communities with themost needs

• Focus on providing access to clean waterand water storage facilities

• Reducing child labour as children often involved in fetching water

ESG | Webinar January 2020

18 |

Leaf Partnership Programme: Borehole Project

• Identified Malawi village with no access toclean drinking water

• Financed provision of borehole

• Responsibility of maintaining boreholehanded over to community

• Reducing child labour; enabling childrento go to school

ESG | Webinar January 2020

19 |

Eliminating Child Labour in Tobacco Growing (ECLT) Foundation

• Facilitating stakeholder engagement tocollectively address child labour

• Transitioning vision to encompass a broader remit

• From ‘combatting the root causes of childlabour in tobacco-growing communities’

• To ‘creating thriving agricultural communitieswhere tobacco is grown’

ESG | Webinar January 2020

20 |

Safe Chemical Use

• Promote safe working environment forsuppliers and farmers

• Farmers trained to use, store, dispose ofcrop protection agents

• Crops purchased from our suppliers havevery few and low chemical residue levels

ESG | Webinar January 2020

21 |

Our Sustainability Strategy

• maintaining sustainable agricultural practices to ensure a consistent, quality supply of tobacco

• developing alternative products that are potentially less harmful to health

• behaving responsibly at all times and providing a safe and rewarding work environment for our employees

ESG | Webinar January 2020

22 | ESG | Webinar January 2020

23 | ESG | Webinar January 2020

Sustainability pages on our website

Stakeholder Panel Statement 2019

Sustainability Contacts

Ctrl + click to follow links

Read more about sustainable supply

Imperial Brands ESG: For More Information…

Sustainability review from 2019 ARA