Santam Ltd

The SES committee is responsible for ensuring group stakeholder relationships are managed in line with policy, governance codes and best practice. [...] The head of market development, responsible for stakeholder relations, reports material stakeholder matters to the executives and SES committee. [...] The SES committee has oversight of ESG considerations. The Santam board is responsible for the overall governance of risk and is assisted by the risk committee in discharging this responsibility, which includes considering sustainability risks and opportunities. The board's investment committee assists the board and provides oversight on responsible investment practices that promote good governance and value creation.

The SES committee, a board subcommittee with oversight of ESG, including climate change, met four times this year and discussed climate-related topics in addition to sustainability matters [...] The board approved the group's position statement on coal [...] Implemented ESG-related performance measurement indicators for executive management [...] The board engaged with and shared our approach to managing climate risk and organisational resilience with prudential authority in May and November 2023.

The Santam board and executive committee recognise and support the Task Force on Climate-related Financial Disclosures (TCFD) recommendations. We present to you our first stand-alone climate-related disclosures report. It is aligned to the TCFD recommendations and anchored on the TCFD's four core pillars i.e., Governance, Strategy, Risk Management, and Metrics and targets. [...] The social, ethics and sustainability committee (SESCO) of the board is responsible for overseeing the response to ESG matters and climate-related risks and opportunities. The SESCO charter has been updated to reflect the board's adoption of the TCFD recommendations and the group's efforts to align with the TCFD recommendations. The review of the charter included an update of our ClimateWise principles in line with TCFD recommendations. [...] The board's investment committee provides oversight on responsible investment practices that promote good governance and value creation in companies that Santam invests in. The group Investment Policy incorporates ESG considerations impacting the long-term sustainability of Santam's portfolio investments, including climate risk, which has been identified as a key material matter for the Santam group. [...] The board's risk committee assists the board in fulfilling its governance duties from a risk and control perspective including identifying and evaluating all significant risks. The Santam group chief risk officer (CRO) has an independent line of accountability to the Santam board through the risk committee. The CRO role assists the board in its implementation, review, and approval of the enterprise-wide risk governance framework which includes Santam's risk culture, risk appetite, risk limits and corresponding capital and liquidity needs. [...] Below the board level, the individuals responsible for assessing climate-related issues include the group CEO and the executive team (Exco), and the group Strategy Unit in the CEO's office. Since Q3 2021, climate change governance has been enhanced by the establishment of the group-wide climate change committee (CCC) and executive leadership of climate change now sits under the chief risk officer (CRO). The group CRO has an independent line of accountability to the board through the risk committee. The CRO's primary role is to embed an enterprise-wide risk governance framework throughout the group that addresses the needs of all stakeholders. The CRO is assisted by a Financial Risk Management (FRM) and Enterprise Risk Management (ERM) team who contribute to climate risk-related work. [...] The CCC is a senior management committee whose mandate is to support the group's climate change action, and help the executive and the board to assess how the group is evaluating and responding to climate change issues. The group CRO is the executive sponsor for the CCC, and gives climate change oversight at executive level. The CEO and Exco are responsible for implementing the FutureFit strategy, which includes ESG aspects and reports progress to the board quarterly as part of the group FutureFit dashboard. The group's ClimateWise performance, CDP, and the FTSE Russell's ESG rating, are included in the dashboard as key performance indicators. [...] The group Strategy Unit monitors and tracks the progress of the FutureFit strategy and compiles the quarterly dashboard and annual ClimateWise as well as FTSE Russell returns. The Unit coordinates collaboration across the group on ESG-related matters and also chairs the CCC. The Unit is also responsible for the contextual environmental scanning, which includes ESG and climate-related matters. It reports the scan to the CEO, Exco and the Santam Board, and other functional peers regularly.

Since publishing our first standalone climate-related disclosures report in 2021, the Santam board and executive committee (exco) have maintained oversight and management of climate-related risk to the extent of the inclusion of ESG-specific key performance indicators in the performance measurement criteria of the group exco and senior management. In this report, we continue to discuss the progress made thus far in understanding climate-related risks and opportunities in alignment with the TCFD's four core pillars, i.e. governance, strategy, risk management, and metrics and targets. [...] The board has several committees that assist in discharging its duties and responsibilities. However, the ultimate responsibility rests with the board. ESG and climate-related considerations extend to various risks. Therefore, we realise that prioritising ESG and improving transparency can positively impact the group's culture, business performance and public sentiment. As such, the oversight over ESG and climate matters is intentionally spread across the following sub-committees of the board: - The SES committee oversees the response to ESG matters - The group's investment and risk committees also assist the board in their responsibilities for responsible investment and risk assessment, including weather- and climate-related risks and opportunities » The investment committee assists the board's oversight on responsible investment practices that promote good governance and value creation in companies that Santam invests in. The group investment policy incorporates ESG considerations impacting the long-term sustainability of Santam's portfolio investments, including climate risk, which has been identified as a material matter for the Santam group » The risk committee assists the board in fulfilling its governance duties from a risk and control perspective, including identifying and evaluating all significant risks. The Santam group CRO has an independent line of accountability to the Santam board through the risk committee. The CRO assists the board in implementing, reviewing, and approving the group-wide risk governance framework, including Santam's risk culture, risk appetite, risk limits, and corresponding capital and liquidity needs [...] Supervision and oversight on climate-related matters at the exco level is the responsibility of the group CEO and his exco, the CRO, and the Group Strategy and Investor Relations Unit in the CFO's office. Climate change governance is enhanced by the group climate change committee (CCC). The CCC is a senior management committee whose mandate is to assist exco and the board with climate-related oversight by responding to the TCFD recommendations, monitoring the science of climate change, addressing stakeholder inquiries regarding the group's position on climate change and coal/fossil fuels and overseeing the development of ESG in underwriting. The CEO and exco are also responsible for implementing the refreshed FutureFit strategy, which includes ESG aspects and reports progress to the board quarterly as part of the group dashboard. The group's ClimateWise performance and the FTSE Russell ESG rating and progress on climate and ESG-related policies and statements are included in the dashboard as key performance indicators.

Mandatory escalation process for approval: _Any of the below potential exemptions to new thermal coal risks must be referred to the Chief Executive_ _Officer: Santam Specialist Business for consideration and approval and, where necessary, to New Re for_ _approval._ [...] **ANNUAL REVIEW** This policy will be reviewed annually to ensure that our position on underwriting coal remains aligned to the rapid changes occurring globally, regionally, and domestically.

The head of stakeholder relations reports material stakeholder issues to the social, ethics and sustainability (SES) committee. On behalf of the board, the SES committee is responsible for ensuring group stakeholder relationships are managed effectively and in line with policy, governance codes and best practice. The SES committee monitors the quality and effectiveness of our stakeholder relationships and engagements, and escalates material stakeholder issues to the board. [...] Dedicated efforts were assigned to incorporate ESG principles into the strategy. As a result, ESG-specific key performance indicators were allowed for the performance measurement criteria of Group Exco and senior management. [...] The SES committee has oversight of ESG considerations. The Santam board is responsible for the overall governance of risk and is assisted by the risk committee in discharging this responsibility, which includes considering ESG risks and opportunities. The board's investment committee assists the board and provides oversight on responsible investment practices that promote good governance and value creation.

Working with policymakers

We work with government agencies, private institutions, industry associations, and non-profit organisations to broaden our understanding of transition opportunities. As part of this, we participate in the BSR[TM] Value Chain risk to resilience collaborative initiative, the South African Insurance Association Climate Change forum, serve on the Lewis Foundation-funded financial sector Environmental, Social, and Governance (ESG) and climate risk analytics project advisory committee, and participate in the South Africa-UK Partnering for Accelerated Climate Transitions (UK PACT) project on aligning South Africa's climate-related financial disclosure with global best practice. [...] Governance and reporting

Santam's response to climate risk is integrated throughout all levels of the organisation as part of its broader commitment to address environmental, social and governance considerations of its business.

Our commitment begins at a strategic level. Santam's management and board understand that climate change poses a material risk to the business. This understanding is demonstrated in its annual integrated report. The Social, Ethics and Sustainability Committee of the Board is responsible for overseeing the response to ESG risks as part of the company's strategy and operations.

Sanlam manages the multiple engagement activities around climate change across business divisions and geographies to ensure that the group has a common approach that is also consistent with our strategy on climate change. The Sanlam Board is ultimately responsible for the governing and monitoring of the quality of stakeholder relationships and the effectiveness of our stakeholder engagements in the Group – in line with King IVTM Report on Corporate Governance. In addition, each business entity is given relative autonomy in their positioning and responses but must adhere to the principles outlined in the Group stakeholder management policy. For example, the Sanlam Sustainability Management Office has direct responsibility for Sanlam's partnership with WWF, which includes regular meetings and updates on all project aspects, including advocacy. If there are any differences in strategy, these would be shared with the Social, Ethics, and Sustainability Committee of the Sanlam Board for discussion and decision-making. In a similar vein, Sanlam Investments monitors the strategy direction of the Association for Savings and Investments (ASISA) and the South African Insurance Association (SAIA). If there are any divergences, they will be escalated to the Sanlam Investment Group Board level and subsequently reviewed by the Social, Ethics, and Sustainability Committee of the Sanlam Board. The Social Ethics and Sustainability Committee comprises individuals representing various business functions, many of which fall under the Group Office. The Group Compliance office engages with regulatory bodies, advocating for Sanlam's position on policy-related debates and forums. Key representatives from different business units, including the Company Secretariat, maintain regular engagement with regulators, shareholders, government entities, and business partners on significant policy issues affecting the company, including climate change where relevant.

With the support of Santam's Audit, Risk, and Social, Ethics and Sustainability (SES) Committees, the Board ensures that appropriate controls are in place to verify, enhance and safeguard the quality and integrity of the information in the reporting suite. The Board further appreciates that the Group's core purpose, risks and opportunities, strategy, business model, performance, and sustainable development are integrated and inseparable elements that are being applied to create value for its stakeholders. [...] The SES Committee oversees the Group's response to ESG matters and climate-related risks and opportunities. [...] The Investment Committee assists the Board with its oversight of responsible investment practices that promote good governance and value creation in companies in which Santam invests. To this end, the Group's investment policy incorporates ESG considerations that impact the long-term sustainability of Santam's portfolio investments, including climate risk, which has been identified as a material matter for the Santam Group. [...] The Risk Committee, in turn, assists the Board in fulfilling its governance duties from a risk and control perspective, including identifying and evaluating all significant risks to which the Company is exposed. Santam's CRO has an independent line of accountability to the Santam Board through the Risk Committee. As a result, the CRO assists the Board and the Risk Committee with the implementation, review and approval of the Group-wide risk governance framework, including Santam's risk culture, risk appetite, risk limits and the corresponding capital and liquidity needs. [...] The HRRC exercises an oversight role and it monitors the performance of the members of Group Exco and senior management, by linking the ESG key performance indicators to remuneration. [...] The Audit Committee oversees the mandatory disclosure requirements relating to ESG (and in particular, environmental and climate) related aspects. It further ensures the integrity, completeness and accuracy of the information that is being disclosed and reported to Santam's stakeholders.