Carlsberg AS

Our Executive Committee (ExCom) is responsible for ESG and our Together Towards ZERO (TTZ) programme, providing strategic guidance and approval for policies and targets. Ultimate accountability for ESG at Carlsberg, including our TTZ programme, lies with our CEO and ExCom. [...] The Executive Vice President, Integrated Supply Chain – responsible for production, logistics, supply chain and procurement operations – owns the TTZ targets on carbon, water and accidents. The Chief Commercial Officer owns the TTZ targets on responsible drinking. [...] TTZ is on the agenda of all Extended Leadership Team meetings, with monthly health and safety updates and engagement on relevant projects throughout the year. Key performance indicators (KPIs) are also tracked monthly in our Group nine-grid of priorities that steers our progress against SAIL'22. Our Group sustainability team drives strategic programmes and partnerships, and supports Sustainability Champions, who help to coordinate local initiatives across the business. [...] Executive remuneration is linked to progress on TTZ and ESG, with 20% of our Executive Board bonus linked to KPIs such as carbon emissions and water usage. In 2021, we broadened this to include KPIs related to responsible drinking (through promotion of alcohol-free brews) and diversity and inclusion. The Remuneration Committee reviews Executive Board performance against these KPIs four times a year.

The implementation of the programme is supported by robust governance, including oversight from our ESG Steering Committee of leaders and experts from across the business. Remuneration for our Extended Leadership Team and many other roles is linked to performance on TTZAB topics (see page 88 for more on ESG governance)." [...] "Our ESG programme, Together Towards ZERO and Beyond (TTZAB), is an integral part of our SAIL'27 corporate strategy to create value for shareholders and society. [...] The enhanced TTZAB programme, launched in 2022, builds on our pioneering Together Towards ZERO (TTZ) programme. [...] The implementation of the programme is supported by robust governance, including oversight from our ESG Steering Committee of leaders and experts from across the business. Remuneration for our Extended Leadership Team and many other roles is linked to performance on TTZAB topics (see page 88 for more on ESG governance)." [...] "Executive remuneration is linked to ESG performance and progress on TTZAB. Previously, 20% of our short-term incentive scheme for the Executive Board was linked to ESG-related KPIs. In 2023, we expanded ESG-linked remuneration to include our global Extended Leadership Team by integrating specific targets related to TTZAB topics into our long-term incentive scheme, approved by the Supervisory Board. ESG performance now accounts for 20% of the LTI scheme for 2023-2025. This shift aims to incentivise the longer-term investments needed across the business to meet our ambitious TTZAB targets for 2030 and 2040 on topics such as carbon emissions, water efficiency and diversity, equity and inclusion. Specific metrics include our value chain carbon footprint, number of carbon-neutral breweries, brewery water usage, water replenishment in high-risk areas and share of women in senior management.

Describe the process(es) your organization has in place to ensure that your engagement activities are consistent with your overall climate change strategy[…]The VP Corporate Affairs at Carlsberg Group oversees all public affairs activity globally. The VP ensures that all engagement is consistent with Carlsberg's sustainability program "Together Towards Zero", while the EVP of Carlsberg Group Integrated Supply Chain is responsible for delivering against the majority of the specific targets set forth in the ambition "ZERO carbon footprint†.

The VP of Corporate Affairs and EVP of Integrated Supply Chain assess the consistency of all direct and indirect activities by reviewing how strategic it is in supporting our Together Towards ZERO program. Our Together Towards ZERO program aims to help us mitigate long-term risks, tackle global challenges such as climate change, water scarcity and public health issues, and make the most of opportunities to develop more sustainable products and healthier choices. The four pillars outlined in this program are: ZERO carbon footprint; ZERO water waste; ZERO irresponsible drinking; and ZERO accidents culture. If the engagement has potential in helping us achieve any of our targets under these areas, the activity will be considered consistent with the strategy and be approved.

Examples of processes: The national corporate affairs/public affairs strategies built on the global strategy and the global VP of Corporate Affairs and the global Public Affairs Director reporting to him have monthly calls with the heads of corporate affairs/public affairs in all markets to jointly review strategic activities. In addition the global Sustainability Director (reporting to the VP of Corporate Affairs) and his team hold bi-monthly calls with the internal "Sustainability Champions Network" to align activities and do best practice sharing. This network is joined by a 'Sustainability Champion' from all countries that Carlsberg Group operates in. Those 'Sustainability Champions' are part of the national corporate affairs department.

The whole production, procurement, logistics, quality, safety, planning, etc. organizations globally report into the EVP Integrated Supply Chain (COO) and the EVP receives monthly reporting on the Scope 1 and 2 emission development from all breweries globally. All major CAPEX investments and strategic activities are approved by the EVP and the contribution to the Together Towards ZERO program of those activities is analyzed.