Rathbones: Rathbones : Climate Report 2024

CLIMATE REPORT 2024 CONTENTS Our reporting suite This report forms part of our wider reporting suite where you can find out more about our full activities. 1 OVERVIEW 6 GOVERNANCE Annual Report and Accounts 2024 Gender Pay Gap Report 2024 Responsible Business Update 2024 Responsible Investment Report 2024 On 21 September 2023, following regulatory approval, Rathbones Group Plc completed its planned combination with Investec Wealth & Investment UK (IW&I). Throughout this report figures stated include IW&I, unless otherwise indicated. Where practicable, a like-for-like comparative has been included. FURTHER INFORMATION LINKS Throughout this report we use these icons to indicate where you can find out more. Read more Visit website 13 STRATEGY 26 RISK MANAGEMENT 32 METRICS & TARGETS 38 APPENDICES Entity reports: 40 Rathbones Investment Management 41 Investec Wealth & Investment UK 45 Rathbones Asset Management Voluntary reports: 47 Rathbones Investment Management International 48 Greenbank Investments 51 Methodology and approach 52 Defining our metrics COMPLIANCE SUMMARY This report sets out our approach and response to the climate-related risks and opportunities that we face as a business. As indicated in the table below, the content of our Climate Report is fully aligned with the UK Government's mandatory climate-related financial disclosure recommendations for public quoted companies. In developing the report, we have considered the 11 recommendations of the TCFD, which was disbanded in October 2023 but provides a useful framework for the disclosure. The International Financial Reporting Standards (IFRS) has since taken over from the TCFD, and its recommendations are expected to inform mandatory requirements in the near future. In anticipation of this, Rathbones has conducted a gap analysis informed by IFRS criteria and developed workstreams to improve alignment and compliance against IFRS criteria for future disclosures. RECOMMENDED DISCLOSURES AND MANDATORY REPORTING REQUIREMENTS TCFD THEME TCFD RECOMMENDED DISCLOSURE STRENGTH OF RESPONSE* UK MANDATORY DISCLOSURE REQUIREMENTS ALIGNMENT GOVERNANCE See page 6 Describe the Board's oversight of climate-related risks and opportunities. High A description of the governance arrangements of the company in relation to assessing and managing climate-related risks and opportunities. Full Describe management's role in assessing and managing climate-related risks and opportunities. High STRATEGY See page 13 Describe the climate-related risks and opportunities the organisation has identified over the short, medium, and long term. High A description of the principal climate-related risks and opportunities arising in connection with the operations of the company or LLP and the time periods by reference to which those risks and opportunities are assessed. Full Describe the impact of climate-related risks and opportunities on the organisation's businesses, strategy, and financial planning. Medium A description of the actual and potential impacts of the principal climate-related risks and opportunities on the business model and strategy of the company or LLP. Full Describe the resilience of the organisation's strategy, taking into consideration different climate-related scenarios, including a 2°C or lower scenario. Medium An analysis of the resilience of the business model and strategy of the company or LLP, taking into consideration different climate-related scenarios. Full RISK MANAGEMENT See page 26 Describe the organisation's processes for identifying and assessing climate-related risks. High A description of how the company or LLP identifies, assesses and manages climate-related risks and opportunities . Full Describe the organisation's processes for managing climate-related risks. High Describe how processes for identifying, assessing and managing climate-related risks are integrated into the organisation's overall risk management. High A description of how processes for identifying, assessing and managing climate-related risks are integrated into the overall risk management process in the company or LLP. Full METRICS & TARGETS See page 32 Describe the targets used by the organisation to manage climate-related risks and opportunities and performance against targets. High Description of the targets used by the company or LLPs to manage climate-related risks and to realise climate-related opportunities and of performance against those targets. Full Disclose the metrics used by the organisation to assess climate-related risks and opportunities in line with its strategy and risk management process. High The key performance indicators used to assess progress against targets used to manage climate-related risks and realise climate-related opportunities and a description of the calculations on which those key performance indicators are based. Full Disclose Scope 1, Scope 2, and, if appropriate, Scope 3 GHG emissions, and the related risk. High *TCFD Disclosure: Strength of Response: Rathbones Group meet and align with the requirements of the TCFD. However, for 2024, we have included an assessment of our strength of response to each requirement, recognising that improvements can be made. ABOUT RATHBONES Wealth management Asset management Where we do it INVESTMENT MANAGEMENT Clients of this discretionary service can expect a tailored investment strategy that meets individual objectives backed by an investment process that aims to provide risk-adjusted returns to meet clients' needs today and in the future. OUR SPECIALIST CAPABILITIES - Charities and not-for-profit organisations - Our specialist ethical arm, Greenbank - Personal Injury and Court of Protection - Ability to service international clients through Rathbones Investment Management International (RIMI). OUR SERVICES Bespoke service Provides clients access to a dedicated investment manager who will construct and manage a bespoke portfolio that is specifically tailored to their needs. Managed service Provides clients with access to a dedicated investment manager who will invest in a range of ready-made, diversified multi-asset portfolios managed by Rathbones Asset Management (RAM). Select Provides clients direct access to a range of ready-made, diversified multi-asset portfolios managed by RAM. Select does not come with a dedicated investment manager; it is a more appropriate and cost-effective solution for smaller value portfolios. FINANCIAL PLANNING AND ADVICE We provide financial planning and advisory services through Rathbones Financial Planning and Vision Independent Financial Planning. We also offer UK trust, tax and legal services through the Rathbones Trust Company. Clients can choose a financial planning service as a standalone offering or combine it with one of our Investment Management services. We can deliver our financial planning services to clients in one of the following ways: - Initial advice, which could be delivered as a one-off service - Ongoing advice and planning. COMPLEMENTARY SERVICES As a licensed deposit taker we are able to offer our clients a range of banking services including currency and payment services, fixed interest term deposits and loans to existing clients. We are now able to offer SIPP administration services to clients. Rathbones Asset Management is a UK fund manager, offering actively managed equity, fixed income and multi-asset capabilities for retail- and institutional-type investors. Our range of single-strategy and multi-asset funds are designed to potentially meet investors' core investment needs, or provide 'building blocks' for wealth solutions, with distribution primarily through UK advisors. International clients may also access our funds through the Rathbone Luxembourg Funds SICAV, which allows access to a similar range of actively managed funds. 23 1 LOCATIONS IN THE UK AND CHANNEL ISLANDS £109.2bn MANAGED BY US FOR OUR CLIENTS FTSE 250 COMPANY LISTED ON THE LONDON STOCK EXCHANGE With offices throughout the UK and the Channel Islands, clients are never far away from high-quality, personalised wealth management services. 1. Includes Vision Independent Financial Planning INTRODUCTION A statement from our CEO PAUL STOCKTON GROUP CHIEF EXECUTIVE OFFICER At Rathbones, we understand our role as stewards of capital, and have a responsibility to our clients, stakeholders, and future generations to drive meaningful change while delivering long-term value. The pace of that change on climate matters will inevitably vary based upon political will together with the economic and technological developments that create opportunities for investment and advancement. The findings in this report continue to indicate that climate change does pose a risk to the investments we make on behalf of our clients and that it is in the financial interests of our clients and stakeholders for us to manage climate risks effectively. The cause however has never been so pressing with 2024 being the first year that global average temperatures rose above 1.5°C compared to pre-industrial levels. With more extreme weather events exposing vulnerabilities and the devastating effects of climate change, it underscores the ongoing need for concerted action from the financial services industry to limit further warming. Critically, the report also outlines the steps we are taking to mitigate risks and realise opportunities. For example, how we engage with our investee companies on climate change - striving for science-based aligned targets, enhanced disclosure and emissions reductions - as well as taking steps to embed climate considerations into our investment decisions. We continue to make progress towards our Science Based Targets initiative (SBTi) investment target, with 24% of our investment holdings now having set SBTi aligned net zero targets. We are therefore reaffirming our commitment to being a net zero business by 2050 as recognition of this responsibility. This report outlines our approach to doing so whilst man