National Grid PLC

National Grid is committed to responsible lobbying and engagement with our elected leaders across all jurisdictions in which we operate – the UK, the US, and the EU. Whilst definitions of lobbying vary across these geographies, our engagement with governments, elected representatives and officials is always conducted in a way that is appropriate for the jurisdiction in which we are based. [...] As part of our commitment to transparency, we have conducted a review of relevant organisations and assessed their alignment with climate related policy positions and commitments. Full details on our findings, as well as our process for managing partial alignment moving forward, are in our Trade Association Review. [...] The Corporate Affairs and Legal departments work closely to ensure full compliance with U.S. law, including the engagement of outside counsel with expertise in these matters and the compliance obligations related to them. We require our employees to undergo training and education on both our policies and the laws or regulations specific to the jurisdictions in which they operate. We strictly follow lobbying disclosure laws, campaign finance and gift/ethics rules. We have registered under the U.S. Lobbying Disclosure Act and in each state and local jurisdiction where lobbying disclosure laws to disclose our employees' and vendors' advocacy is required.

Our Global Corporate Policy on Responsible Lobbying and Political Engagement defines our commitment in this space and ensures that we regularly review [...] Governance of specific topics is also managed in a range of other committees, including Remuneration, People and Governance, and Audit and Risk Committees.

ARG1 Lack of climate change management procedure 2x2 [...] ARG2 Lack of specific policies and procedures governing risk assessment process on climate change [...] ARG3 Risk and action owners not identified at senior leadership team level [...] Background Management risks have been identified where there is a potential that company corporate policy, procedure and strategy may not be adequate to realise and address climate change hazards or where the risk is not directly attributed to damage or reduced operation of an asset. Discussion National Grid has a corporate risk for climate change which drives business risk management. It is also driving our commitments under TCFD and its associated climate modelling and risk assessment work. Within NGET, the risk is currently owned by the Head of Engineering and Asset Management. Work is ongoing to ensure that a robust climate change adaptation strategy is in place. Findings of the ENA Met Office Report demonstrate that while existing risk management frameworks are suitable for the present climate, given the potential impacts, this will not always be the case. Action will therefore be required to ensure the network remains resilient. The current risk management framework within NGET are a combination of: - Reactive and proactive mitigation in the form of business resilience. - Risk identification work in the form of 'line walking' and helicopter surveys (to identify erosion, land movement and excessive vegetation growth). - Proactive measures (including Environmental Impact Assessments (EIA)) for new assets and sites where physical impacts of climate such as flooding are accounted for. Local escalation of known issues through existing reporting lines. - Regular emergency planning exercises. Long-term planning has the challenge of not being immediately beneficial and makes justification for potential increased investment problematic under relatively short regulatory period. The time required to respond to particular risks is also an important consideration in planning for climate change. Challenges include: - Time required to undertake more research where needed. - Refinement of risk assessments across numerous sites or assets. - Securing suitable investment (which might require inclusion in the next RIIO cycle). - Undertaking the relevant remedial works or construction activities. The pace of climate change impacts on the business will therefore be kept under review, particularly the output of the TCFD Climate Modelling project. This is in addition to the prevailing regulatory expectations to determine whether a specific procedure would benefit the business.

The Safety & Sustainability Committee (a board-level committee) assists the Board in fulfilling its oversight responsibilities in respect of reviewing and challenging the strategies, policies, initiatives, risk exposure, targets and performance of the Company and, where appropriate, of its suppliers and contractors in relation to safety and sustainability. This includes approving the Company's sustainability strategy and external reporting and audit plans relating to safety and sustainability. It is also responsible for monitoring the demonstration of management commitment to these areas, the resources applied by the Company to ensure compliance, and for driving improvement. In the previous year, the Committee: - Approved the Group's first CTP at its May 2022 meeting (approved by shareholders in July 2022). - Reviewed the RBR and TCFD draft content at its May 2023 meeting. - Received a demonstration of the Group's Climate Change Risk Tool (CCRT), including how this is used to manage the Group's climate change strategy. - Reviewed and challenged the Group's performance against its RBC targets, including net zero commitments. - Undertook a deep dive into the Group's climate change GPR. The Committee is appointed by the Board and comprises of at least two Non-executive Directors and other leaders from across the business. The Chief Sustainability Officer attends this Committee, providing a link between management and Board discussions around climate-related issues.

#### Role of the Group Trustee

The Group Trustee is ultimately responsible for oversight of all strategic matters related to the Group and for making Group wide decisions. This includes approval of the governance and management framework relating to ESG considerations and climate-related risks and opportunities.

Given its importance, the Group Trustee has not identified one individual to be specifically responsible for the Group's response to climate risks and opportunities. Rather, the Group Trustee has collective responsibility for setting the Group's climate change risk framework. The Group Trustee is supported by its investment adviser and external support team when undertaking governance activities by developing and reviewing its climate change risk framework.

The Group Trustee has discussed and agreed its overarching approach to managing climate change risk, as part of the Group's wider approach to Responsible Investment. Details are set out in the Statement of Investment Principles ("SIP") and the Responsible Investment ("RI") policy, which is reviewed and (re)approved every year (or sooner in the event of a significant change in investment policy) by the Group Trustee.

#### Role of the Investment Committee

The Group Trustee has delegated implementation and day-to-day oversight of the Group's climate change risk management framework to the Investment Committee ("IC"), which is a sub-committee of the Group Trustee.

The IC seeks to ensure that any investment decisions appropriately consider climate-related risks and opportunities within the context of the Group's wider risk and return requirements and are consistent with the climate change policy as set out in the SIP and the RI policy.

The IC regularly monitors and reviews progress against the Group's climate change risk management approach. The IC keeps the Group Trustee appraised of any material climate-related developments through updates as and when required.

Implementation is detailed later in this TCFD report, but key activities delegated to the IC include:

- ensuring investment proposals explicitly consider the impact of climate risks and opportunities;

- engaging with the investment managers to understand how climate risks are considered in their investment approach;

- working with investment managers to disclose relevant climate-related metrics as set out in the TCFD recommendations;

- ensuring that stewardship activities are being undertaken appropriately on the Group Trustee's behalf; and

- ensuring that actuarial and covenant advice adequately incorporate climate-related risk factors where they are relevant and material.

#### Role of the Group Trustee's external support team

The role of the Group Trustee's external support team, Barnett Waddingham, is to ensure that the Group Trustee has the appropriate governance processes in place to appropriately identify, assess and manage climate related risks and opportunities that are relevant to the Group.

Barnett Waddingham are also responsible for implementing the Group's approach to climate change risk on behalf of the Group Trustee (working with the Group Trustee's advisers as required) and facilitating training to help ensure that the Group Trustee has sufficient knowledge and understanding to make well-informed decisions on the Group's climate change risk management approach.

In addition, Barnett Waddingham ensures that the advice that the Group Trustee and the IC receive appropriately takes climate change considerations into account, where they are relevant and material to the Group, that the advisers are bringing relevant updates and opportunities for the Group Trustee's consideration, and that the advisers have the appropriate capabilities in doing so.

Describe the process(es) your organization has in place to ensure that your engagement activities are consistent with your overall climate change strategy[…]National Grid's position and strategy on climate change are published both internally and externally. National Grid Corporate Affairs coordinates all communication relating to our climate change policy, strategy and material activities, checking our messaging through internal governance processes to make sure we provide clear, coherent and consistent messaging to our various stakeholders.

Describe the process(es) your organization has in place to ensure that your external engagement activities are consistent with your climate commitments and/or climate transition plan?[…]National Grid's position and strategy on climate change are published both internally and externally. National Grid coordinates communication relating to our climate change policy, strategy and material activities, checking our messaging through internal governance processes to enable us to provide clear, coherent and consistent messaging to our various stakeholders.

Does your organization have a public commitment or position statement to conduct your engagement activities in line with the goals of the Paris Agreement?[…]Yes

National Grid Global Corporate Policy on Responsible Lobbying and Political Engagement

National Grid is committed to responsible lobbying and engagement with our elected leaders across all jurisdictions in which we operate – the UK, the US, and the EU. Whilst definitions of lobbying vary across these geographies, our engagement with governments, elected representatives and officials is always conducted in a way that is appropriate for the jurisdiction in which we are based.

As a company that supports the 1.5oC global warming ambition of the Paris Agreement Paris Agreement, as set out in our Climate Transition Plan and Responsible Business Charter, our lobbying and engagement with elected leaders is aligned with this and conducted to aid its delivery.

Anti-Fraud and Bribery

National Grid has a zero-tolerance approach to bribery and corruption of any sort, as set out in our Anti-Financial Crimes Policy. We also have strict internal policies in place around gifting and hospitality.

Secondments and Employment of Former Government Officials

Across both the UK and US, National Grid is committed to encouraging all those who may want to work with us to develop their full potential. As part of this, employees may wish to undertake secondments to public bodies, just as those working at public bodies may benefit from a secondment at National Grid. We have a clear policy on this in place, including how we approach cooling off periods and potential conflicts of interest concerning secondments and permanent moves from those working in public bodies, as covered in our Employment of Former Public Officials and Secondment of Employees into Public Bodies Policy. These policies and controls govern all secondments, including the protection of information which is written into agreements. When hiring current or former government officials, we screen every application to ensure compliance with applicable post-government service cooling-off periods, contractual restrictions on who they work for when they leave, and other conflict of interest restrictions.

Political Donations

National Grid does not make donations to political parties or candidates seeking office.

In the US, we have established two Political Action Committees, funded voluntarily by employees and permissible third parties, to support candidates who share our vision, have positive impacts on the communities we serve and are making a difference, as set out in our Global Corporate Policy on Political Contributions.

Further detail on our approach to lobbying and engagement in the jurisdictions within which we operate can be found below.

Trade Associations

National Grid is a member of various trade associations across the UK, US, and EU, where we strive to share our knowledge, expertise, best practices, and insights to inform the work of respective bodies. As part of our commitment to transparency, we have conducted a review of relevant organisations and assessed their alignment with climate related policy positions and commitments. Full details on our findings, as well as our process for managing partial alignment moving forward, are in our Trade Association Review.

UK and EU

Our engagement with government, policy-makers and the regulator, is aligned to the enabling role the company has at the heart of the UK's energy transition and the delivery of the legally binding net zero target, as set out in the amended Climate Change Act 2008. In the UK, we have published Delivering for 2035, which sets out National Grid's view on the actions required to ensure the electricity networks can play their full role in the delivery of a decarbonised power system.

Engagements with Members of the Scottish Parliament and Scottish Government, as defined by the Lobbying (Scotland) Act 2016, are logged with the Scottish Lobbying Register.

In the EU, National Grid is registered on the EU transparency register, described as "a tool to allow European citizens to see what interests are being represented at Union level and on whose behalf, as well as the financial and human resources dedicated to these activities." Our engagement in the EU and work with European partners supports in delivering both UK and European decarbonisation targets, respectively.

US

National Grid engages with officials in the federal government and in the states and local jurisdictions where we have operations. Our political advocacy seeks to share our values, and our expertise in energy delivery systems and how to deliver a fair, clean and affordable Energy Transition that meets the goals of the jurisdictions in which we operate, with officeholders so that all parties may lead the energy transition responsibly. We seek to provide value equitably to our customers, shareholders and the communities we serve. In the US, Our Clean Energy Vision underpins much of our external engagement, setting out our plans to fully eliminate fossil fuels from both our gas and electricity systems, and we regularly engage our elected leaders on legislative and regulatory proposals that could impact our business and our customers. The Corporate Affairs and Legal departments work closely to ensure full compliance with U.S. law, including the engagement of outside counsel with expertise in these matters and the compliance obligations related to them. We require our employees to undergo training and education on both our policies and the laws or regulations specific to the jurisdictions in which they operate.

We strictly follow lobbying disclosure laws, campaign finance and gift/ethics rules. We have registered under the U.S. Lobbying Disclosure Act and in each state and local jurisdiction where lobbying disclosure laws to disclose our employees' and vendors' advocacy is required.