Strengthening Our investment Escalation Message from Key highlights our stewardship Our progress Our purpose approach and Our approach and exercising Our aspirations for 33 Pension Protection Fund Responsible Investment Report 2022/23 our Chair of the year commitment at a glance and governance incorporating ESG to engagement shareholder rights the coming year Appendices OUR APPROACH TO ENGAGEMENT CONTINUED Examples of EOS corporate engagement on our behalf during the year CASE STUDY CASE STUDY US food processing/commodities US chemicals company trading company Asset class: Equities Asset class: Equities Issue: Board diversity Objective: Challenge deforestation targets Action: In 2020, EOS raised the issue of board gender Action: During Earth Week 2022, an American diversity with a major chemical company. The company multinational food processing and commodities indicated that it was seeking to refresh the board over trading corporation published a commitment to time, with diversity being one of several criteria. In 2021, achieving 100 per cent deforestation-free global board diversity continued to fall short of expectations. supply chains by 2025 – 昀椀ve years earlier than its Through engagement with the company, EOS learned previous 2030 target. it was not in a period of active board refreshment, but In an August 2022 engagement with the chief was being purposeful about adding female directors sustainability o昀케cer and investor relations to the board, which was welcomed. In Q1 2022, EOS representative, the company again reiterated wrote to the company providing its US corporate its accelerated no-deforestation goal. This has governance principles and conveying our expectations been supported by advancements in technology, with respect to board diversity. combining satellite technology with farmer updates. Outcome: In the company’s 2022 proxy, EOS was Given that industry targets for zero deforestation were pleased to read about the nomination of a female missed in 2020 (although the company itself did not director to the board, bringing gender diversity to have a 2020 goal), EOS asked the company in Q1 2023 above 30 per cent. The company also provided how con昀椀dent it was that it could meet its new 2025 information on its enterprise-wide focus on diversity, target. The company said it was con昀椀dent that the equity & inclusion (DEI) and publication of gender, current timeline was possible due to developments race and ethnicity data on a dedicated DEI webpage. in satellite imagery that can now show forest clearing in real time. EOS encouraged the company to remain focused on traceability and supply-chain due diligence. It was also noted that the current targets for sustainable agriculture were not su昀케ciently ambitious, as they focus on a small proportion of wheat production in the US. The company was encouraged to scale up its targets and its approach to include other regions and commodities. EOS also asked for more clarity on how the company encourages farmers to transition to regenerative agriculture, and how it tracks the outcomes on carbon, water, biodiversity and other indicators. Outcome: In March 2023, the company con昀椀rmed that it had engaged 1.2 million acres of farming land in regenerative agriculture practices and announced a seven-year agreement with PepsiCo to engage a further 2 million acres, among other partnerships.