WH Smith: WH Smith : 2024 Sustainability Report

Our communities Helpingchildren to develop a love of reading WHSmith has a long-standing commitment to making a positive impact on the planet, the lives of our people and the communities in which we operate. This includes championing literacy, and this year we supported the Gift a Gruffalo campaign alongside our partner the National Literacy Trust ("NLT"). The campaign resulted in 20,000 copies of The Gruffalo going to disadvantaged communities through the NLT's community hubs, so that more children could have the opportunity to discover the magic of reading. Scan to learn more about the Gift a Gruffalo campaign. National Literacy Trust Hubs 17 Donated copies of the Gruffalo 20,000 Strategic report Corporate governance Financial statements Additional information Section 172(1) statement Listening to our stakeholders Stakeholder considerations play an important part in the Board's discussions and decision making to promote the success of the Company. Regular engagement ensures that the Board is aware of stakeholder views and interests and enables it to operate in a balanced and responsible way. The Board carefully considers the diverse needs and priorities of stakeholders in its decision making, while ensuring WHSmith's long-term success and reputation is promoted and preserved. During the year ended 31 August 2024, the Board acted in accordance with Section 172(1) of the Companies Act 2006, with each director performing their duty to promote the success of the Company for the benefit of its members as a whole, and in doing so to have regard to the interests of its stakeholders. Our interactions with key stakeholders and the ways in which their interests have been taken into account by the directors in their decision making are summarised on the following pages. Further examples of how stakeholder views have been considered can be found in our Corporate governance section on pages 66 to 113. Suppliers and business partners Community groups Our people Customers Our purpose: To make every one of life's journeys better Investors Landlord partners WH Smith PLC Annual Report and Accounts 2024 33 Strategic report Section 172(1) statement continued Our people The success of WHSmith depends on the c.14,000 colleagues employed by the Group. It is essential that they feel engaged, motivated and appreciated. What matters to our people What were the key topics raised? • Feeling valued • Reward • Being rewarded fairly • Development and growth for all of our colleagues • Being treated with respect and dignity • Communications • Having opportunities for personal growth • Work/life balance and wellbeing and career development • Culture and authenticity How did we engage? Our designated Non-Executive Director for workforce engagement, Simon Emeny, provided oversight for the Board Simon Emeny and Nicky Dulieu, Remuneration Committee Chair, attended employee forums to discuss, amongst other topics, the Group's approach to remuneration and how this aligns to wider Group pay policy The Chief People Officer updated the Board on employee-related matters, including employee engagement, staff retention rates, learning and development, gender pay gap statistics, diversity and inclusion, and workforce remuneration The Group Chief Executive and other senior executives hosted regular webinars with support centre colleagues to provide strategy and performance updates and answer any questions Board members and senior executives attended business meetings throughout the year, including leadership meetings, trading updates and Risk Committee meetings Our annual employee engagement survey was followed up with meetings with employees to gain further understanding Employees raised issues, questions and concerns through direct mailboxes for senior executives How did we respond? The Board approved an action plan to address actions from the employee survey and monitored implementation throughout the year We relaunched the WHSmith Values based on Customer Focus, Drive for Results, Accountability and Valuing our People, incorporating them into our people polices and processes We relaunched our learning and development proposition giving colleagues access to a wider range of development opportunities We increased our communication and engagement, including more targeted communications for different teams, and continued with webinars and business line specific meetings with senior executives Management acted on feedback from our employee networks, chaired by sponsors from our Executive Committee, giving all colleagues the opportunity to participate and influence our broader diversity, equity and inclusion ("DEI") strategy Management undertook initiatives to increase employee participation in the employee survey 34 WH Smith PLC Annual Report and Accounts 2024 Strategic report Corporate governance Financial statements Additional information Customers Customer loyalty and enthusiasm for our retail proposition are critical to our success. Understanding the needs of our customers ensures that we provide the products and service that they expect. What matters to our customers Availability and range of products Convenience Customer service Value for money Safe and responsibly sourced products How did we engage? Board members visited stores in the UK, US, Australia and Europe to assess and review the customer experience and service standards The Managing Directors of each business unit updated the Board on customer engagement, market trends and commercial responses We used quantitative and qualitative analysis of customer feedback through point of sale, online surveys and focus groups, to provide additional customer insights Store teams and customer service teams are in constant dialogue with customers The Board received regular updates on customer feedback and service standards, and ensured systems were in place to comply with all relevant product safety legislation What were the key topics raised? Convenience of our offering Nature of store environments Customer service levels Product availability Pricing How did we respond? The Board received strategy updates from the Managing Directors of each business unit and approved the customer-facing commercial strategies We extended the roll-out of our one-stop-shop formats for travel essentials providing food, health and beauty, tech accessories, books and magazines under one roof We continued to invest in our retail estate, opening over 100 new stores during the year Each division explored ways to continue to improve its service model to make the customer experience as effortless and efficient as possible Customer feedback was communicated to the relevant parts of the business for further action where needed WH Smith PLC Annual Report and Accounts 2024 35 Strategic report Section 172(1) statement continued Investors Our investors include individual and institutional shareholders, and providers of debt and financial capital, such as banks and bondholders. We maintain an active dialogue with our investors through an extensive investor relations programme. What matters to our investors Long-term value creation and growth opportunities Capital allocation High-performing Board and Senior Executives High standards of business conduct and good governance Transparency How did we engage? Individual meetings, virtual presentations and investor roadshows were hosted by members of the Board The Board received reports and updates about shareholder relations at each meeting to ensure that Board members were informed of investors' and proxy advisers' views on strategy and corporate governance Direct engagement for investors took place via our investor relations team Annual report and interim trading updates with investor presentations were provided by the Group Chief Executive and CFO/COO. These were interspersed by more regular Trading Updates Nicky Dulieu, as Chair of the Remuneration Committee met with investors to discuss remuneration policy An online portal, operated by our registrar, Computershare, provided shareholders with the ability to manage their shareholdings At our Annual General Meeting, the Group Chief Executive gave an update on how the Group is performing and the Board answered questions from shareholders What were the key topics raised? Strategy for business growth Operational delivery More detailed information on the return on capital employed Corporate governance practices ESG strategy, targets and reporting Succession planning How did we respond? The Board dedicated one of its meetings to reviewing and approving the Company strategy Annette Court and Nicky Dulieu held meetings with individual shareholders as part of an investor roadshow The Board approved a share buyback programme in line with the Company's capital allocation policy Returns on capital employed by division are disclosed We conducted investor interactions through meetings with major institutional shareholders, individual shareholder groups and financial analysts, attended by directors and senior management including our Chair, Group Chief Executive and CFO/COO The ESG Committee incorporated investor feedback into the ESG strategy. We also responded to a number of requests from investors for a briefing on our ESG priorities 36 WH Smith PLC Annual Report and Accounts 2024 Strategic report Corporate governance Financial statements Additional information Landlord partners Our landlord partners own the buildings where our retail units are located. They include airport operators, rail infrastructure partners, hospital trusts and other retail estate landlords. Our business success is dependent on retaining and winning new space and in order to do so, we must understand what considerations are important to them. What matters to our landlord partners Store formats and product ranges that are appealing to their customers Customer service and satisfaction Value of revenue and rent paid per square metre of retail space Effective operational implementatio