Lancashire Holdings Ltd

###### Board Oversight

The Board has ultimate responsibility and oversight for the Group's ESG strategy, climate-related risks and opportunities and related sustainability targets that have a material impact on the Company or the Group. The Board oversees the Group's ERM activities and receives quarterly updates on material ESG risks while ensuring appropriate governance, systems and oversights are in place.

[The Group's Board-level Nomination, Corporate Governance and Sustainability](https://www.lancashiregroup.com/content/dam/lancashire/corporate2020/Whoweare/Governance_Documents/Terms%20of%20Reference%20of%20Nomination,%20Corporate%20Governance%20and%20Sustainability%20Committee%20Adopted%2027%20April%202022.pdf)
[Committee oversees the articulation of the Group's ESG strategy; the](https://www.lancashiregroup.com/content/dam/lancashire/corporate2020/Whoweare/Governance_Documents/Terms%20of%20Reference%20of%20Nomination,%20Corporate%20Governance%20and%20Sustainability%20Committee%20Adopted%2027%20April%202022.pdf)
implementation of ESG initiatives by management and the business; and reviews
the ClimateWise report, and ESG, carbon footprint and TCFD disclosures in the ARA;
reporting to the Board on these matters.

###### Nomination, Corporate Governance and Sustainability Committee

Michael Dawson

Non-Executive Director

###### Irene McDermott Brown

Non-Executive Director

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The Board is supported by its committees within their respective core mandates,
with each committee meeting at least on a quarterly basis.

1. [The Nomination, Corporate Governance and Sustainability Committee receives](https://www.lancashiregroup.com/content/dam/lancashire/corporate2020/Whoweare/Governance_Documents/Terms%20of%20Reference%20of%20Nomination,%20Corporate%20Governance%20and%20Sustainability%20Committee%20Adopted%2027%20April%202022.pdf)
direct reports from the management team and monitors issues of sustainability,
including developments in climate change risk management and reporting;
the committee's role also includes the pre-submission review of the Group's
ClimateWise reporting for ratification by the Board and the year-end review
of the ESG, carbon footprint and TCFD aligned disclosures in the Group's ARA;
from this the committee makes recommendations to the Board regarding
the ESG responsibilities of the Group.

2. [The Underwriting and Underwriting Risk Committee receives direct reports](https://www.lancashiregroup.com/content/dam/lancashire/corporate2020/Whoweare/Governance_Documents/Terms%20of%20Reference%20of%20Underwriting%20and%20Underwriting%20Risk%20Committee%20Adopted%2027%20April%202022.pdf)
from the management team and is responsible for monitoring the impacts
of climate change and transition risk on the underwriting portfolio, as well
as the broader ESG risks, and articulating appropriate underwriting risk appetites
and tolerances for the Group.

3. [The Audit Committee principally through its work reviewing the Group's ARA,](https://www.lancashiregroup.com/content/dam/lancashiregroup/corporate2020/documents/Corporate%20Governance/Audit%20Committee%20Terms%20of%20Reference%20-%2026%20April%202023.pdf)
provides oversight of the disclosures on the Group's ESG strategy, carbon
footprint measurement and offsetting, and the TCFD report.

4. [The Investment Committee receives direct reports from the management team](https://www.lancashiregroup.com/content/dam/lancashiregroup/corporate2020/Whoweare/dec-2023/LHL%20Investment%20Committees%20Terms%20of%20Reference%20-%20February%202023.pdf)
and provides oversight of investment risks, including sustainability risks, by
monitoring the climate change risk sensitivity, the ESG profile and the carbon
intensity profile of the Group's investment portfolio.

5. [The Remuneration Committee evaluates the Group's remuneration packages,](https://www.lancashiregroup.com/content/dam/lancashiregroup/corporate2020/documents/Corporate%20Governance/Terms%20of%20Reference/Terms%20of%20Reference%20of%20Remuneration%20Committee%20Adopted%2027%20April%202022.pdf)
including the Group's remuneration structure, ensuring they are in line with the
Group's business and ESG strategy.

The diagram (right) illustrates the responsibilities and reporting lines to the Group
Board, including the Board sub-committees, the Group Executive Committee and
the ESG Committee, and the overall governance structure as it pertains to ESG.

###### Group ESG Governance Structure

**LHL**
**Board**

**Nomination,**

**Group** **Underwriting**

**Corp Governance** **Investment** **Remuneration**

**Executive** **& Underwriting**

**& Sustainability** **Committee** **Committee**

**Committee** **Risk Committee**

**Committee**

**ESG**
**Committee**

###### Key

**DE&I**
**Working Group**
Board

**Audit**
**Committee**

|Col1|Col2|
|---|---|
|Nomination, up Underwriting Corp Governance Investment Remuneration Au utive & Underwriting & Sustainability Committee Committee Comm ittee Risk Committee Committee ESG||

Committee of the Board

Group Executive Committee

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###### Board Level Engagement
The Board's ESG and climate change oversight includes material ESG risks while
ensuring appropriate governance, systems and oversights are in place. The Board
also discusses climate-related issues as part of the annual process when reviewing
and approving the Group's:

- ESG Strategy and Framework;

- Risk appetite statements, including the tolerances for elemental PMLs
and non‑elemental RDSs;

- Group strategy and business plans;

- Climate-related Investment Guidelines;

- Annual Report and Accounts;

- TCFD Report;

- ORSA report; and

- ESG Group Underwriting Guidelines.

###### Board-Approved Risk Tolerances
The actual business underwritten within the Group is monitored against the
strategic plan and the Board-approved risk tolerances (including those linked to
climate-related catastrophe loss events). Risk tolerances are reported to the Board
quarterly within the Group CRO ORSA update report as part of our risk
management framework. In addition, the Group CUO and Group CRO regularly
review current and emerging (re)insurance risks. These Board-level conversations
around risk tolerances set quantitative measures for all risk categories, including
climate, in our operations. Our climate risk culture has been set at the top and,
accordingly, acceptable levels of risk are communicated throughout the business,
which range from risk avoidance to opportunity enablement.

Lancashire Holdings Limited | ClimateWise Report 2022-23 5 [...] The Company's Board has ultimate responsibility and oversight for the Group's environment, social and governance (ESG) strategy, climate-related risks and opportunities and related sustainability targets that have a material impact on the Company or the Group. The Board oversees the Group's Enterprise Risk Management (ERM) activities and receives regular updates on material ESG risks while ensuring appropriate governance, systems and oversights are in place. [...] The Group's Board-level Nomination, Corporate Governance and Sustainability Committee oversees the articulation of the Group's ESG strategy and the implementation of ESG initiatives by the management and the business and reports to the full Board. Aspects of ESG strategy are reviewed and monitored by other Board Committees.

The Nomination, Corporate Governance and Sustainability Committee monitors issues of sustainability, including developments in climate change risk management and reporting. [...] The ESG Committee, which was established by management in 2021, is tasked with the oversight, co-ordination and internal management of the Group's ESG strategy. The ESG Committee reports to the Nomination, Corporate Governance and Sustainability Committee quarterly and regularly to the Group Executive Committee and is supported by the Diversity, Equity & Inclusion Working Group. [...] The Group CRO is responsible for the implementation of the risk management framework, which includes facilitating the identification, assessment, evaluation, and management of existing and emerging risks, and for ensuring these risks are considered and are properly included in management and the Board oversight and decision-making process.

The Nomination, Corporate Governance and Sustainability Committee monitors issues of sustainability, including developments in climate change risk management and reporting. [...] The ESG Committee, which was established by management in 2021, is tasked with the oversight, co-ordination and internal management of the Group's ESG strategy. The ESG Committee reports to the Nomination, Corporate Governance and Sustainability Committee quarterly and regularly to the Group Executive Committee and is supported by the Diversity, Equity & Inclusion Working Group. Key developments are reported to the Nomination, Corporate Governance and Sustainability Committee, as well as the Investment and the Underwriting and Underwriting Risk, Audit and Remuneration Committees as appropriate, and ultimately to the Board via the Group CRO's quarterly reporting and periodic reporting from the ESG Committee Chair.

Describe the process(es) your organization has in place to ensure that your engagement activities are consistent with your overall climate change strategy[…]Lancashire supports the UNEP FI Principles for Sustainable Insurance and the goal of a risk aware world, where the insurance industry is trusted to play an engaged and constructive role in enabling a healthy, safe, resilient and sustainable society. We became a signatory to the Principles for Sustainable Insurance in 2020. In addition, our principal investment managers are signatories to the Principles of Sustainable Investment. Both of these institutions engage with and lobby policy makers on climate-related issues. The Group's Climate Change Working Group plays a role, together with the ESG committee into which it reports, in promoting awareness and coordinated action across the Group. the ESG Committee approved an ESG Framework and an ESG Strategy in 2021 which informs the Group's engagement activities and promotes a consistent approach.

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