Marks & Spencer : ESG Report

CEO INTRODUCTION

SOCIAL

GOVERNANCE

ESG DATA

"WE WANT TO BE THE MOST

TRUSTED RETAILER, DOING THE RIGHT THING FOR CUSTOMERS, WITH QUALITY PRODUCTS AT THE HEART OF EVERYTHING WE DO.

STUART MACHIN

Chief Executive Officer

Over the last year we have reset our purpose and vision so we are clear why we exist, who we are and where we are going. We want to be the most trusted retailer, doing the right thing for customers, with quality products at the heart of everything we do. It's a bold vision, but it gets to the heart of what sets M&S apart. It's why, when I joined the business, I talked about the need to modernise the business but always protect the magic

of M&S.

The magic that comes from our heritage of exceptional quality, value, service and innovation; delivered through our deep supplier partnerships, and the lengths that we go to. The magic that means our customers trust us to always source and make products with care, treat our colleagues, growers and farmers well, and help them look after the precious resources we need to serve customers today, and in the future.

Plan A - how we express our commitment to sustainability - is therefore core to our vision and purpose, and integral to our trusted value proposition.

A great example of this is how we source, make and sell milk in our Food business. We are the only retailer who can say all of the milk we sell, coming from 40 dedicated Select Dairy Farmers, is RSPCA Assured - as part of our market-leading approach to animal welfare. We were first to market in

setting up a milk pool, meaning we have paid farmers a fair price for their milk based on their cost of production, for 25 years. Last year we were the first retailer to offer "best before" labelling on fully recyclable milk bottles, following the removal of coloured plastic caps, helping customers to tackle food waste and play their part in a circular economy - two key areas where customers want to make an impact. Just a few months ago, we announced a £1m investment with our supplier partners to alter the diet of our pasture-grazed cows which will remove a projected 11,000 tonnes of GHG emissions annually - reducing our fresh milk carbon tonnes footprint by 8.4%.

In our Clothing & Home business, I saw first-hand just how much care our clothing suppliers take when sourcing and making our garments when I visited Sri Lanka. From innovating to use recycled polyester and new dyeing techniques that use less chemicals and water, to supporting those who find it hardest to get into work through Marks & Start, they are doing fantastic work. It was brilliant to see the way we are working in partnership with our suppliers to reduce our environmental impact and improve livelihoods.

Marks and Spencer Group plc

ESG Report 2024

SOCIAL

GOVERNANCE

ESG DATA

CEO INTRODUCTION CONTINUED

Of course, Plan A and ESG is integrated into our Reshaping M&S for Growth strategy, with accountability for delivery devolved to the Managing Directors and the Executive Committee. You can read the detail of the progress we've made - and we have made

LOTS DONE

LOTS TO DO

LOTS OF

OPPORTUNITY

good progress - as well as the challenges we face in the rest of this report. But, to me as CEO, what matters is that Plan A is core to who we are and what we want M&S to be.

Plan A - because there is no plan b.

STUART MACHIN

Chief Executive Officer

Reduced Scope 1 & 2 carbon emissions by 33% since 2016/17
70% of polyester from verified recycled sources
100% of cotton in clothing from more responsible sources1
Retained our No. 1 position in UK retail for Fairtrade tea and coffee
Launched our Cup of AmbitionTM fund across UK Cafés
Became the only national retailer to sell only RSPCA Assured fresh milk
Launched fully recyclable coffee cups
Successfully lobbied the Government to remove VAT on sustainable period pants
Removed 144m pieces of plastic from our packaging portfolio
Prevented 85m hangers going to landfill though our Reuse and
Recycling Programme
Reached 70m meals donated through our partnership with Neighbourly and 1m fresh meals with FareShare
Raised £1.7m for YoungMinds
693 Marks & Start work placements started, with over 80% leading to an offer of employment with M&S

£5.6m

donated to charities by M&S

Refining the accuracy of our Scope 3 emissions aligned to our near- and medium-term carbon glide path and resubmission to SBTi
Further conversion of preferred materials, especially Man-Made
Cellulosic Fibres (MMCF)
Delivery of our headline charity partnership with
YoungMinds through a series of customer and colleague campaigns

Use data and insight from the ESG Reputation Tracker to better communicate the work we do through Plan A to customers
Integration of ESG strategy as
part of the reset of our international business growth plans
Roll-outof improved customer circularity proposition in
Clothing & Home
Seeing the results of our investment in innovations from the "Plan A
Accelerator Fund"

Per Una Linen Blend Blazer

(T534403) £79

Per Una Cotton Rich Broderie

Midaxi Dress (T5333784U) £79

M&S COLLECTION Raffia

Jeans Belt (T017043B) £25

M&S COLLECTION Gold Tone

1 More responsibly sourced cotton means sourced through Better Cotton, organic- or recycled-certified.

Bubble Hoop Earrings

(T669807E) £10

Marks and Spencer Group plc

ESG Report 2024

SOCIAL

GOVERNANCE

ESG DATA

HIGHLIGHTS FROM THE YEAR

£1.7m33%144m

raised for YoungMinds	reduction in Scope 1 & 2 emissions vs 2016/17 baseline	pieces of plastic removed
		from our packaging
Read more on page 44	Read more on page 27	Read more on page 23

100%70m70%

of the cotton in clothing from more responsible sources

meals donated through our partnership with Neighbourly since 2015

of polyester used in Clothing & Home products from verified recycled sources

Read more on page 18

Marks and Spencer Group plc

ESG Report 2024

SOCIAL

GOVERNANCE

ESG DATA

PROGRESS OVERVIEW

						Assessment
	Issue	Metric		Target		of progress
	ENVIRONMENT
	NET ZERO	Total location-based Scope 1 & Scope 2 GHG emissions.*		55% reduction by 2029/30
				(vs 2016/17 base year)
		Total Scope 3 GHG emissions.		55% reduction by 2029/30
				(vs 2016/17 base year)
	RESPONSIBLE	RSPO Certified Sustainable Palm Oil with Segregated status (% of all palm oil).*		100% by 2025/26
	SOURCING
Soy sourced from verified deforestation and conversion-free (vDCF) supply chains		100% by 2025/26

		(% of total direct and indirect soy).
		Cotton used in Clothing & Home products from more responsible sources (% of all cotton used).	100% by 2025/26

		Polyester used in Clothing & Home products from verified recycled sources		100% by 2025/26
		(% of all polyester used).**
	WASTE & CIRCULARITY	Number of individual pieces of plastic (units) that have been removed from the M&S own-brand	Remove 1bn units by the end
		packaging portfolio.		of 2027/28 from 2016/17
		Food waste.*		50% reduction by 2029/30
				(vs 2016/17 base year)
		Food not sold that was fit for human consumption which was redistributed to charities,		100% by 2025/26
		community organisations or colleagues.*

		Operational waste to landfill.*		Maintain 0%
	SOCIAL
	ANIMAL WELFARE	Ranking among retailers, with highest number of species within M&S Food product range		Maintain #1 position
		adhering to RSPCA Assured certification.
	PEOPLE	Senior managers who are female.		50% by 2025/26

	COMMUNITY	Funds raised for YoungMinds.		£5m by 2026/27 from 2023/24

	* Assured by DNV		Target missed	Behind or pathway in progress	On track or achieved
	** This data is subject to a discrete assurance process linked to our financing and is scheduled to be published in autumn 2024 see page 49.

Marks and Spencer Group plc

ESG Report 2024


PERFORMANCE SUMMARY	OUR ESG STRATEGY	ENVIRONMENT	SOCIAL	GOVERNANCE	ESG DATA

OUR ESG

STRATEGY

IN THIS SECTION

7 Our ESG strategy

	Image:
Marks and Spencer Group plc	M&S Denim Collection

SOCIAL

GOVERNANCE

ESG DATA

OUR ESG STRATEGY

From the very beginning, M&S has built trust by doing the right thing by our colleagues, customers and the communities which

we serve. This remains the case today - 140 years later - and we express this commitment through our vision to be the most trusted brand, doing the right thing for our customers, with exceptional quality products at the heart of everything we do.

Our approach to ESG - which we badge Plan A - underpins our vision and is our promise to always source and make our products with care, so customers can trust us to do the right thing. It is also an integral enabler of our strategy to Reshape M&S for sustainable, profitable Growth so that we become a net zero business across our value chain by 2040 and conserve the precious resources our business relies on.

Delivery of our ESG strategy and Plan A is embedded across our nine strategic priorities and through our business-unit led operating model. We utilise data, digital and technology solutions and innovation to support the delivery of our ESG strategy, and data aids ESG decision-making so we focus on the issues that are material to our business, and matter most to customers and wider stakeholders.

Plan A. Because there is no plan b.

OUR STRATEGIC PRIORITIES ARE SUPPORTED

AND ENHANCED BY OUR ESG STRATEGY

Deliver

Profitable Sales

growth

Improve

Operating

S U

margins

Disciplined

Investment

choices

ESG

STRATEGY

Drive

Shareholder

returns

EFE

FFR

F A

R D

IEO

I O

ENN

NC A

OUR TR

Marks and Spencer Group plc

ESG Report 2024

OUR ESG STRATEGY CONTINUED

SOCIAL

GOVERNANCE

ESG DATA

OUR STRATEGIC PRIORITIES

OUR ESG PRIORITIES

ENVIRONMENT

Our biggest environmental commitment and challenge is to become a net zero business

for workers so their human rights are respected and they are treated with fairness and dignity.

	1. EXCEPTIONAL
Deliver
PRODUCT,
Profitable Sales
growth	RETAILER
	TRUSTED
	2. CUSTOMER
	CENTRIC
	BUSINESSES
	3. EXPANDED
	GLOBAL REACH

	4. STRUCTURALLY
Improve
LOWER COSTS
Operating
margins	PERFORMANCE
	5. HIGH
	CULTURE


	6. ACCELERATING
Disciplined
STORE ROTATION
Investment
choices	7. MODERNISED
	SUPPLY CHAIN
	8. DATA, DIGITAL
	AND
	TECHNOLOGY


Drive	9. DISCIPLINED
CAPITAL
Shareholder
returns	ALLOCATION

GOVERNANCE		OPERATIONAL
		EFFICIENCIES
NET ZERO


		ANIMAL WELFARE

RESPONSIBLE


SOURCING		ETHICAL TRADE

SUSTAINABLE
	HEALTHIER FOOD
MANUFACTURING

		PEOPLE

WASTE &


CIRCULARITY		COMMUNITY


GOVERNANCE		PEOPLE


NET ZERO


WASTE &
CIRCULARITY



GOVERNANCE		ETHICAL TRADE


NET ZERO		COMMUNITY

OPERATIONAL
EFFICIENCIES



GOVERNANCE


NET ZERO

across our entire value chain by 2040. Six per cent of our emissions are Scope 1 & 2 emissions that sit within our own operations and our operational efficiencies section outlines how we are reducing these emissions. The remaining 94% are Scope 3 emissions, that sit within our supply chain. To reduce these emissions, we will need to change the way we operate our business, how we source and how we make our products. This report provides an update on our activity and progress on our journey to net zero, including:

Responsible sourcing - sourcing responsibly to mitigate our impact on the environment and protecting biodiversity and nature (Scope 3 emissions).
Sustainable manufacturing - collaborating with supply chain partners to tackle environmental issues (Scope 3 emissions).
Waste & circularity - designing products that are simply too good to waste, and using innovation to improve resource use (Scope 3 emissions).
Operational efficiencies - investing to reduce energy usage in our stores and logistics network (Scope 1 & 2 emissions).

SOCIAL

As a product-led business, sourcing and making our products with care is at the heart of how we deliver exceptional product so customers can trust us to do the right thing. This report provides an update on our activity and progress over 2023/24, including:

Healthier food - helping our customers make healthier choices when they buy our food.
People - creating a high performing culture where everyone can be themselves and be their best.
Community - using the power of our brand to champion good causes with charity partners and taking an active role in our communities.

GOVERNANCE

Good governance is at the core of how we do business. We expect every colleague to play their part through living our behaviour to "act selflessly" - always acting in the best long-term interests of M&S and respecting their colleagues and our customers so we can win together - and by doing the right thing through compliance with our policies and standards.

PRIORITISING MATERIAL ISSUES Assessing the priorities of our ESG strategy and disclosures is based on data and impact, so that we focus on the environmental and social issues our stakeholders are most concerned with. The process of engagement with stakeholders is a continuous one, starting primarily with our customers through our ESG Reputation Tracker, and with our colleagues via "Straight to Stuart", our colleague feedback portal.

We also engage a wide and diverse group of organisations and experts, including supply chain partners, investors, policy- makers and campaigners. The rich mix of feedback and views helps us aim higher

Read more on our strategy in our	Environment Social
Annual Report

Animal welfare - continuing to be number one in upholding the welfare of animals.
Ethical trade - raising supply chain standards to improve working conditions

in balancing different and sometimes competing expectations.

Marks and Spencer Group plc

ESG Report 2024