PERNOD RICARD - Universal Registration Document 2019-2020

3. SUSTAINABILITY & RESPONSIBILITY The four pillars of the good times from a good place roadmap

RISK MANAGEMENT The identification of climate-related risks and opportunities takes place in the course of the Group’s global risk mapping: global risk mapping, based on local risks identified by Group affiliates — and functional risks identified by the Group’s functions, is updated every three years by the internal audit team. This team reports to the Chairman and CEO. It also presents its results to the Executive Committee and the Audit Committee. The Group’s major risks are monitored annually;

environmental risk mapping is based on a multi-criteria mapping tool. — Affiliates input the data, which is then monitored at Group level. Affiliates identify and rate environmental risks throughout a product’s life cycle based on two criteria: i) severity (including potential financial impact – scored from 1 to 7) and ii) probability (scored from 1 to 5). In terms of managing these risks, each major risk identified is placed under the responsibility of a Group Director. Environmental risks and their mitigation plans are under the responsibility of the Group Operations Director. The Group’s environmental roadmap also draws up environmental action plans for the main environmental risks.

Help reduce climate change

Policies

Objectives

Achievements and next steps

2020 Environmental Roadmap Focus on reducing the impact of production sites (Scopes 1 and 2): 30% reduction in carbon emissions per unit produced — at production sites, as between FY10 and FY20.

Since FY10, carbon emissions per unit at production — sites have fallen by 32.9%.

2030 S&R Strategy

Through the new S&R strategy, the Group has set itself ambitious new goals to speed up progress and extend its actions (Scopes 1, 2 and 3), as follows: by 2030: 30% reduction in absolute carbon emissions — at production sites (Scopes 1 and 2) (base year 2018). The SBT initiative confirmed it was in line with the well below 2°C scenario; by 2030: 50% reduction in the intensity of the Scope 3 — carbon footprint (base year 2018). The SBT initiative confirmed that it was in line with the 2°C scenario; by 2025: 100% renewable electricity used in production — sites and administrative offices.

Weight reduction for many bottle types has already led — to a significant reduction in the carbon footprint from glass. A taskforce has been set up with the main distilleries — to identify technologies that will help achieve Scope 1 SBTs. Discussions will be held with our main suppliers to set — carbon reduction action plans regarding Scope 3 emissions. A reporting tool and process will be designed and — implemented to better measure progress towards SBT targets. In FY20, the Group has officially become a member — of RE100, a global initiative led by The Climate Group in partnership with CDP which brings together 221 international companies committed to 100% renewable electricity. The proportion of renewable electricity used is 71% for — production sites and administrative offices.

Pernod Ricard generates carbon emissions in several ways. These contribute to climate change: directly, through the use of fossil fuels on sites (Scope 1) and due to — the electricity consumed, which generates greenhouse gases emissions when produced by suppliers (Scope 2); indirectly, through products (agricultural raw materials, packaging, — etc.) and services (transport, etc.) purchased (Scope 3).

To help reduce climate change, the Group follows a two-step approach consisting of: assessing its carbon footprint throughout the supply chain to identify — priorities; implementing relevant measures to reduce direct and indirect — emissions, working with production sites, farmers and suppliers.

Pernod Ricard Universal Registration Document 2019-2020 105