Johnson Matthey PLC

All our external advocacy is coordinated by our central Corporate Affairs function. The Corporate Affairs Director reports into the Chief Sustainability Officer, who reports directly to the CEO. Our corporate purpose statement is 'catalysing the net zero transition' and all our advocacy is in support of the products that we manufacture to help our customers reduce their greenhouse gas emissions, thus achieving their own net zero ambitions.." [...] "The Sustainability Council, which reports directly to the Group Leadership Team, is responsible for our strategy regards Emission Trading Schemes. It is their responsibility to monitor all existing and forthcoming schemes globally and keep track of which JM sites might be affected by them.

#### Describe the Trustee Board's oversight of climate-related risks and opportunities

Climate-related beliefs
The Trustee maintains an ESG Policy that sets out the Trustee's ESG beliefs and how these are implemented. As part of this, the Trustee has identified two main ESG focus areas, including climate change risk and the transition to a low carbon economy. The aim is to align the investment strategy with being net zero by 2050, or earlier if possible, whilst maintaining sufficient diversification. The Trustee will measure the performance of the Scheme's mandates against this target with quantifiable metrics. Over the year, the Trustee added a stewardship section to direct the stewardship efforts of its investment managers in alignment with the Trustee's ESG beliefs. The below sets out the Trustee's agreed stewardship priorities, which align with the Trustee's ESG focus areas:

Climate change Biodiversity Gender diversity and equality Labour rights, including modern slavery

As part of our ESG Policy we have considered how our ESG beliefs are implemented. Our ESG Implementation considerations include those set out below:

Continue to develop Review our ESG Policy Consider the ESG Policy

Incorporate ESG Annual review of the

our understanding of in line with regulation when making any

criteria as part of all investment managers'

ESG factors, and and industry investment strategy or

manager selection integration of ESG

climate, through progression every 3 asset allocation

exercises. factors.

regular training. years. decisions.

Details on the review of the investment managers can be found on pages 34 and 35. The Trustee also agreed a Climate Delegation framework, further detail provided overleaf.
Oversight responsibilities of the Trustee Board
Overall responsibility for ESG considerations (including climate-related) lies with the Trustee. The Trustee Board meets at least quarterly and receives updates and support from its Scheme Actuary, Investment Consultants, Legal Counsel and Covenant Adviser on ESG and climate change topics. The Trustee ensures sufficient time is spent on ESG and climate change topics to best manage climate-related risks and opportunities, with ESG integration considered in some form at every Trustee Board meeting. This is because the Trustee has strong sustainable investment principles and the Sponsor has ambitious Net Zero commitments, therefore the Trustee believes climate-related risks and opportunities are central to future returns for the Pension scheme, to the beliefs of the Company and to many of the stakeholders in the Scheme. The Trustee will consider the quality of advice the advisors are able to provide from a climate perspective when reviewing their appointments. Where appropriate, the Trustee will challenge the advice provided, however this was not relevant over the reporting year.

Climate-related training
During the year, the Scheme's DB Investment Consultant delivered climate-related training sessions, including on updated TCFD metrics analysis, as well as providing training and support to the Trustee on the new stewardship regulations. This included a paper delivered in Q1 2023, which provided an overview of the regulations and suggested appropriate priority areas for the Scheme. Following this, the Investment Consultant conducted a deep dive to assess the Scheme's investment managers stewardship activities and their alignment to the Trustee's agreed priorities. [...] #### Describe the Trustee Board's role in assessing and managing climate-related risks and opportunities

Climate Delegation Framework
Over 2022, the Trustee agreed a Climate Delegation Framework which sets out the roles and responsibilities of various stakeholders for managing climate-related risks and opportunities. The Trustee has the ultimate responsibility for ensuring Scheme-level climate-related risks and opportunities are governed well. Our Climate Delegation Framework sets out the governance process we have agreed to ensure we have oversight of these risks and opportunities that are relevant to the Scheme. This framework is reviewed, alongside the ESG Policy, on at least a triennial basis. The framework was reviewed and updated in November 2023 with the inclusion of roles and responsibilities with respect to the Trustee's stewardship policies and priorities. The key points from the Climate Delegation Framework are laid out below.

Roles and Responsibilities

DB and DC − Advise on the inclusion of climate considerations in the Scheme's governance

Trustee − Incorporate climate-related considerations into the governance frameworks, ongoing

Investment arrangements, investment strategy, risk management and monitoring.

risk management, strategic decisions and monitoring.

Consultant − Advise how climate-related risks and opportunities might affect the Scheme's

− Identify climate-related risks and opportunities, and set and monitor metrics to

exposure to different asset classes over the short, medium and long term, and the

manage them.

implications for the Scheme's strategy.

− Receive regular training to maintain sufficient knowledge and understanding.

− Assist the Trustee in the selection and monitoring of climate-related metrics and

− Factor in climate-related risk management capabilities into the selection, review and

targets in relation to the Scheme's investments, including engaging with the Scheme's

monitoring of investment managers and the DC Provider.

investment managers regarding the provision of the agreed metrics.

− Review the management of the Scheme's investments against the agreed stewardship

− Provide training and relevant updates to the Trustee on climate-related matters.

priorities.

− Assist with the preparation of the Trustee's TCFD report, including climate metrics

and target, and climate scenario analysis.

Investment − Identify, assess and manage climate-related risks and opportunities.

− Assist the Trustee in reviewing the Scheme's investment managers against the agreed

Managers − Exercise voting rights and engage with portfolio companies in the best interests of the

stewardship priorities and provide a stewardship report assessing their alignment

Scheme's members.
− Provide the agreed climate-related metrics to the Investment Consultants, focusing

on increasing their quality and availability.
− Provide data to assist the Scheme's Investment Consultants in assessing the Legal Advisors − Provide training on climate-related legal matters, including ensuring the Trustee is

management of the Scheme's assets against the agreed stewardship priorities.

aware of its statutory and fiduciary obligations.
− Assist in the documentation of the arrangements with the Scheme's third parties with

Scheme − Assess climate-related risks and opportunities in relation to the DB funding position

respect to climate-related matters.

Actuary over the short, medium and long term and the implications for the DB Scheme's − Assist with the preparation of the Trustee's annual TCFD report.

funding and long-term objective.

Conformity to the Climate Delegation Framework is reviewed on an ongoing basis as well as through the putting in place of climate related objectives where relevant

Describe the process(es) your organization has in place to ensure that your engagement activities are consistent with your overall climate change strategy[…]All our external advocacy is coordinated by our central Corporate Affairs function. The Corporate Affairs Director reports into the Chief Sustainability Officer, who reports directly to the CEO.
Our corporate purpose statement is "catalysing the net zero transition" and all our advocacy is in support of the products that we manufacture to help our customers reduce their greenhouse gas emissions, thus achieving their own net zero ambitions..