Markerstudy Group Sustainability Report

OUR SUSTAINABLE AMBITIONS

SUSTAINABILITY REPORT 2022

MARKERSTUDY GROUP

MARKERSTUDY GROUP

Established in 2001, the group supports over 1,000 broker partners and protects in excess of six million customers with a comprehensive range of insurance products and services. Having grown organically and through targeted acquisition, Markerstudy includes the UK’s largest Managing General Agent, Markerstudy Insurance Services Limited (MISL). Other sectors within the group are BGL Insurance and Markerstudy Broking –together providing a range of motor, home, SME and pet insurance products in partnership with several of the best-known brands in UK financial services and retail, and through own brands, including Budget Insurance, Dial Direct, Lancaster Insurance and Purely Pets. Complementary businesses include Auto Windscreens, VisionTrack and Vision Vehicle Solutions.

Markerstudy has invested in market leading digital platforms and cutting edge data science and technology to improve the customer and colleague experience, winning 17 awards in 2022 across the group for excellence in technology, contact centres, apprentices, health and safety, risk management, internet of things (IoT) and awarded Broker of the Year.

CEO STATEMENT

OUR SUSTAINABLE AMBITIONS

Throughout 2022 the UK experienced considerable economic uncertainty and lurched from one crises to another, resulting in increases in fuel and energy costs, delays in the supply chain, and a rising cost of living. All of which negatively impacted our customers, our colleagues and our business.

During this period, we remodelled for the future. Having acquired BGL Insurance mid way through 2022, and welcomed a further 1,750 colleagues to our Group, it was an opportune time to reassess our vision and values and outline the strategies to propel us towards a more sustainable future.

Markerstudy is ranked 4th by UK Personal Lines GWP*, a position that I am hugely proud of. However, my vision is for us to be the No. 1. General Insurance Services Provider – and the most innovative provider of insurance solutions – in the UK.

To achieve this challenging vision, our aim is to unite our colleagues to strive to reach their potential and support our goal of putting the customer first.

We endeavour to be a Group that achieves sustainable and profitable growth, nurtures differences, grasps all opportunities and embraces change – with a view to building a legacy for the future.

With a community of over 5,000 colleagues, it is our ambition to build a more diverse, equal and inclusive workplace for everyone, and in doing so nurture positive behaviours to foster a healthy, happy and collaborative workforce. We are committed to being a responsible business, and to embed sustainability into our culture.

*Rothschild & Co

Kevin Spencer Group CEO

OUR VISION IS TO BE THE NO. 1. GENERAL INSURANCE SERVICES PROVIDER – AND THE MOST INNOVATIVE PROVIDER OF INSURANCE SOLUTIONS – IN THE UK

OUR PURPOSE AND VALUES

We’re passionate about improving our customer and colleague experience; Refreshing our Vision, Mission and Values in 2022 played a vital role in reinforcing behaviour and objectives, supporting us in achieving our ambitions.

OUR PATHWAY TO A MORE SUSTAINABLE FUTURE

We recognise that supporting our colleagues to live a healthy and balanced life is part of our responsibilities. In 2022, we created an agenda to deliver a host of new benefits, including the launch of:

• MyBenefits hub housing all individual benefits of employment in one secure place

• MSGr.com our brand new colleague intranet and go-to place for the latest group news and access to tools, as well as a place to share ideas, insights and good news with colleagues

• MyeDrive our electric vehicle salary sacrifice platform

We have communicated wellbeing advice, volunteering opportunities, and numerous financial webinars, regularly throughout the year.

In addition, our by-line is ‘Putting the fun into insurance’ and this has been a guiding principle since the group was founded in 2001. With an awareness of the financial concerns caused by the cost of living crisis, we launched a number of new initiatives to make life a little more enjoyable for our colleagues:

• Monthly Puffins Draw £20,000 giveaway guaranteed every month, with a Star prize of £3,000

• ‘Lunch is on us’ Launched a free lunch offer for colleagues across two sites to help with cost of living crisis

COLLEAGUE SATISFACTION

In October, we held our annual colleague engagement survey, The Pulse. We were pleased with the improvements year-on-year, in particular, the following headlines:

• 72% completed survey

• 80% colleague engagement score

• 91% colleagues received professional development

We have achieved a great deal across 2022 in support of our Employee Value Proposition, and we would like to thank all those involved in delivering these new and exciting initiatives.

2022 HIGHLIGHTS

ACHIEVEMENTS

We would like to thank our colleagues for their contribution to our progress on Sustainability and their continued support for our ambitions.

1. First evaluation with EcoVadis, attaining Bronze, with strong results in relation to the Environment and Ethics

2. Produced our first Sustainability Report

1. Conducted our first full scope carbon footprint

2. Switched to 100% renewable energy

3. Agreed our Net Zero strategy

4. Implemented a salary sacrifice EV scheme

5. Confirmed the Group will be Carbon Neutral from 1st January 2023 onwards, supporting REDD+ projects

OVERALL ENVIRONMENT

6. Launched a new initiative with our third party supplier, Vizion (Repair Network), called the Green Earth Initiative

7. Audited all our group websites and social media platforms to assess their carbon footprint

A GROUP THAT ACHIEVES SUSTAINABLE AND PROFITABLE GROWTH, NURTURES DIFFERENCES, GRASPS ALL OPPORTUNITIES AND EMBRACES CHANGE – WITH A VIEW TO BUILDING A LEGACY FOR THE FUTURE

1. Committed to making a positive impact in our local communities through inspiring colleagues to make a personal difference with Helping Hands and Community Heroes schemes via Motiv8 – offering 1 paid volunteering day and 5 unpaid

2. Partnered with Matchable to provide hundreds of volunteering options for colleagues

3. Colleagues raised £23,275 for charity

4. Markerstudy donated over £200,000 to charitable causes

5. Launched #wearemarkerstudy network to deliver on our Diversity, Equality and Inclusion agenda

6. Supported 56 apprentices

7. Introduced post-COVID flexibility for our colleagues

8. To help with the cost of living crisis,

- Launched new MyBenefits platform for colleagues

- Announced Monthly Puffins Draw (£20,000 giveaway guaranteed every month to colleagues) – launching ‘23

- Announced 5% pay rise (2023)

1. Undertook a Climate Change Risk and Opportunity Assessment

2. Began initiatives to support Sustainability in our Supply Chain

4. Provided training to senior leadership on numerous ESG topics, including Carbon Literacy training for key decision makers

SOCIAL GOVERNANCE

5. Ceased printing of policy documents as standard and switched to an online provision

OUR APPROACH

OUR ESG FRAMEWORK

Governance

1. Manage supply chain responsibly

2. Build a stronger community where everyone can succeed and fulfil their full potential

3. Fair pay structure

Embed responsibility and sustainability into our culture

1. Reduce our climate change impact

2. Reduce waste and optimise resources

3. Advance our transition to low carbon

4. Adapt to climate change/manage climate risk

Build a more diverse, equal and inclusive workplace for everyone

1. Support employee wellbeing

2. Train and develop our people

3. Contribute to the communities we operate in

SOCIAL GOVERNANCE OUR SUSTAINABLE AMBITIONS

A

OUR CONTRIBUTION TO THE UN SUSTAINABLE DEVELOPMENT GOALS

UN Sustainable Development Goals

The United Nations created a number of Sustainable Development Goals (“SDGs”). These were developed in 2015 to focus on creating a more sustainable future for the world. They help all of us understand how our actions can have an impact on a global level.

The goals address a number of issues, from climate change, to poverty, to inequality. Our work contributes to a number of the 17 SDGs, and we have outlined here where we make a contribution with our current activities (10 of the 17).

ENVIRONMENT

SOCIAL GOVERNANCE

WITH

COMMUNITY OF OVER 5,000 COLLEAGUES, IT IS OUR AMBITION TO BUILD A MORE DIVERSE, EQUAL AND INCLUSIVE WORKPLACE FOR EVERYONE

ENVIRONMENT

OUR PERFORMANCE

We reduced our scope 1 & 2 emissions year on year between 2020 and 2021 on a relative basis.

This year, we have undertaken a detailed assessment of our carbon footprint, and we are disclosing in this report our baseline emissions for the calendar year 2021.

Scope

The boundary of this footprint is emissions within our operational control.

2021 BASELINE EMISSIONS

Definitions

Scope 1: This covers direct emissions we contribute to the atmosphere. For example, heating systems powered by gas or fuel used in vehicles in our own fleet.

Scope 2: These are indirect emissions associated with the energy we purchase (e.g. electricity).

Scope 3: These are indirect emissions that occur in the value chain to support our company operations. For example, employee commuting, activities related to the disposal of waste, and goods and services.

ENVIRONMENT

OUR AMBITIONS

To meet the requirements of climate science, we have set out a Net Zero strategy.

We have set an ambition to achieve Net Zero by 2045. We have taken the decision that we will:

1. Take meaningful science based action

2. Disclose our performance

3. Be carbon neutral whilst we reduce our emissions

We have set interim 2030 targets to:

• Reduce emissions by 31% in Scope 1

• Remove Scope 2 emissions entirely by adopting a renewable energy policy

• Reduce emissions by 43% in Scope 3

Our actions mean we are supporting society to keep on track for a 1.5°C emissions scenario where we are aiming to achieve net zero emissions by 2050 at the latest (as a society, our target is 5 years earlier).

NET ZERO BY 2045

CARBON

FROM 2023 ONWARDS ALIGNED WITH CLIMATE SCIENCE

NEUTRAL

WE WANT TO CONTRIBUTE TO OUR SOCIETY, SUPPORTING CHOSEN CHARITIES AND COMMUNITIES WITH FUNDRAISING OPPORTUNITIES

OUR ACTIONS

To deliver on our ambitions, we have taken action. This year we have:

• Supported colleagues in reducing the carbon footprint related to their commute by partnering with Novuna Vehicle Solutions to deliver a salary sacrifice electric vehicle scheme to all colleagues of Markerstudy Group. This was launched group wide on 13/09/22 under the brand of ‘My eDrive’.

• Switched to 100% renewable energy, group-wide.

• Started creating our Green Ambitions ‘Zero Heroes’ taskforce: Being a Zero Hero is integral to helping our organisation reduce our carbon emissions and reach our Net Zero targets. Zero Heroes will be appointed throughout Markerstudy Group, in each department, team or at each site, in order to ensure that they are operated as energy efficiently as possible.

• Continued to deliver on our vision to improve our service to customers. As part of this we’ve:

• Launched a new initiative with our third party supplier, Vizion (Repair Network), called the Green Earth Initiative, which enables our customers to choose to plant a tree rather than take a courtesy hire car during their repair journey.

• Changed process so that we no longer print policy documents as standard; they are all available online (we now provide an option for vulnerable customers to request policy documents in different formats).

• Audited all our group websites and social media platforms to assess their carbon footprint, and have taken appropriate measures to reduce to zero. All new websites are developed as carbon neutral.

Net Zero Strategic Next Steps

1. Transitioning our fleet – We have a significant fleet across the group, and we’ve begun transitioning to low/zero carbon vehicles.

2. Supply Chain - We are implementing a supply chain sustainability programme to engage and influence our suppliers.

3. Buildings – We intend to remove (as part of our Net Zero strategy) fossil fuel heating systems where possible. We have already moved to renewable electricity.

Neutralise whilst we decarbonise

Whilst we reduce our emissions, we will be mitigating our impacts by supporting REDD+ projects. REDD+ is a climate change mitigation solution developed by Parties to the United Nations Framework Convention on Climate Change (UNFCCC). REDD+ goes beyond simply deforestation and forest degradation and includes conservation and sustainable management of forests and enhancement of forest carbon stocks.

SOCIAL

DIVERSITY, EQUALITY AND INCLUSION

What are we doing to help us build a thriving, inclusive community?

Our ambition is to build a more diverse, equal and inclusive workplace for everyone and we have a mission statement in place to reinforce our commitment. However, that’s the easy part!

Our key challenges are…

• How we continue to nurture positive behaviours in our own culture to foster healthy, happy and collaborative colleagues where performance is recognised and differences celebrated.

• How we strive to build our own internal community to better reflect the diverse communities we serve.

To help us achieve this, we established an employee network called #WeAreMarkerstudy – a body of proactive colleagues with diverse interests and experiences, who have volunteered themselves to be part of a driving force for positive change.

The network encourages colleague participation in 5 social groups, Race & Ethnicity, Disability, Gender, Parents & Carers, and LGBTQ+. We support an annual calendar of awareness days/events, and in 2022 promoted numerous events such as Pride, International Women’s Day, Men’s Health Week, National Inclusive Week, International Men’s Day, Black History Month.

SOCIAL

WELLBEING

To support wellbeing, this year we have:

• Helped colleagues with a variety of initiatives, including:

• Mental Health Leadership & Management training sessions

• Introduced Mental Health Champions

• Announced post-Covid working flexibility and recognised the need for a more informal dress code in-line with this. Introduced a ‘Dress for your day’ policy.

SKILLS

To support skills development, this year we have:

• Continued to be only 3% of 36,000 companies in 55 countries with the Investor in People standard that have been awarded Gold status.

• Continued to run our annual development programme called ‘Shooting Stars’, designed for high achievers.

• Our apprenticeship programme, ALEX (Aspire Learning Experience) is celebrating its fifth anniversary this year. From an initiative to recruit talented young people, it’s grown to a platform which now caters for those at all stages of their professional development. There are myriad opportunities within insurance services and our associated businesses, and our ALEX apprentices and colleagues are uniquely qualified to give insight to students and share their own experiences. We’ve supported 56 apprentices via our Aspire Learning Experience programme this year.

IDEAS AND OPINIONS TO HELP US GROW

COMMUNITY ACTIONS & CHARITY

To contribute to the communities we operate in, we have:

• Increased our budgets for Motiv8 (our charity committee that supports colleagues by donating a ‘Helping Hands’ (cash bonus) to the charity of their choice) in recognition of colleagues’ personal charity endeavours. We also recognise quarterly community heroes with a cash bonus to the charity of their choice.

• Partnered with Matchable, a global volunteering platform (wearematchable.com) and promoted our free volunteering day available to all employees, whilst advertising the hundreds of opportunities to support a charity or cause via the Matchable platform.

• Committed to adding ‘volunteering’ as an objective in our annual appraisal process, and will measure the uptake of volunteering days via our employee payroll platform, SDWorx.

As an organisation we have supported the following Charity Partnerships:

• Auditory Verbal UK (AVUK.org) We are a corporate partner of AVUK and have created a fundraising page for policyholders of Brightside Insurance and Lancaster Insurance to support this charity (donations per policies).

• FutureFirst (futurefirst.org.uk) We are a corporate partner.

• The Ukraine Humanitarian Appeal - Disasters Emergency Committee (DEC). Colleagues Choice: We have pledged our support via JustGiving, and all proceeds raised from our annual Markerstudy Day (12/10) were donated to the DEC.

OUR CULTURE OF UNDERSTANDING EMPOWERS THE COLLEAGUE VOICE, ENCOURAGES COLLABORATION AND NURTURES

GOVERNANCE

STRUCTURE

Running a successful, sustainable business depends on continually high standards of governance.

Our Board, and its associated committees, oversee the work of our Sustainability agenda.

In 2021, a Director was formally appointed with responsibility for Sustainability across the Group.

This year, the Board has reviewed:

1. Diversity, equality and inclusion

2. Our Net Zero Strategy

3. Discussed Sustainability in the Supply Chain

4. Carbon Literacy

We are focused on good sustainable governance, driven by our Purpose and Values.

The Board continues to oversee our intention to deliver on the following strategic ambitions:

• Build a more diverse, equal and inclusive workplace for everyone

• Nurture positive behaviours to foster healthy, happy and collaborative colleagues

• Embed responsibility and sustainability into our culture

Ongoing Commitments

• Diversity, Equality and Inclusion Statement

• Modern Slavery Statement

• Carbon Neutrality from 2023

• Net Zero by 2045

• Participation in EcoVadis

• Production of an Annual Sustainability Report

GOVERNANCE

ACTIONS

Our planned next actions on Governance are:

Transparency

We intend to operate our ESG matters with transparency, recognising the value of providing reliable, detailed data to our stakeholders to understand our performance on ESG matters.

Management Training

We will continue to deliver training to our management to equip them on ESG matters, ensuring they have the knowledge and skills to respond to the risks and opportunities that ESG presents.

Climate Risk

Within 2023 we will be expanding our existing work on Climate Risk to support our activities in adapting to Climate Change, and to support the quality of our anticipated TCFD disclosure in 2024.

Sustainability in our Supply Chain

We expect to rollout a programme to our suppliers and engage with them as part of our journey to Net Zero. We will be encouraging them to raise their ambitions if they are not already aligned to a 1.5C scenario/climate science.

CULTURE

SUSTAINABILITY MATERIALITY ASSESSMENT

We have undertaken a materiality assessment on the group to establish the key areas of focus for Sustainability, and where our Sustainability approach needs to address any specific risks. This has been undertaken using the SASB (Sustainability Accounting Standards Board) Materiality Framework, now part of the IFRS. This has been used because this approach means we are assessing risks which are likely to be financially material to the group over time from specific sustainability aspects. This does not mean that we do not believe there is action required in the other areas, and we are taking clear action in areas not identified as material financially based on our values.

SASB MATERIALITY FRAMEWORK ASSESSMENT

parts highlighted in blue are noted as Material based on the SASB Standards

ENVIRONMENT

GHG Emissions

Air Quality

Energy Management

SOCIAL CAPITAL

Human Rights & Community Relations

Customer Privacy

Data Security

HUMAN CAPITAL

Labour Practices

Employee Health & Safety

Employee Engagement, Diversity & Inclusion

BUSINESS MODEL & INNOVATION

Product Design & Lifecycle Management

Business Model Resilience

Supply Chain Management

LEADERSHIP & GOVERNANCE

Business Ethics

Competitive Behaviour

Management of the Legal & Regulatory Environment

Water & Wastewater Management

Waste & Hazardous Materials Management

Ecological Impacts

Access & Affordability

Product Quality & Safety

Customer Welfare

Selling Practices & Product Labelling

Materials Sourcing & Efficiency

Physical Impacts of Climate Change

Critical Incident Risk Management

Systemic Risk Management

WE ARE COMMITTED TO BEING A RESPONSIBLE BUSINESS, AND TO EMBED SUSTAINABILITY INTO OUR

GOVERNANCE

SUSTAINABILITY MATERIALITY ASSESSMENT

The below table states the specific risk identified, and the area of the business from which the risk is presented. As we progress our Sustainability Ambitions, we will continue to develop our Sustainability risk approach and improve the reporting in this area (includes disclosure of specific metrics and targets relating to those where we deem it appropriate).

RATINGS & BENCHMARKS

OUR PERFORMANCE

ECOVADIS

In 2021 we underwent a Corporate Social Responsibility (CSR) analysis by EcoVadis, global leaders in business sustainability ratings. They rate over 100,000 companies worldwide across 200 industries. This was our first assessment, in which we were rated a Bronze medal. We have set out a clear improvement plan to progress to Silver as our next step and then upwards thereafter. For comparison, we have reviewed the Score Distribution in our sector (from a sample of c. 150 companies from EcoVadis).

00-14 – 1.1%

15-24 – 3.4%

25-34 – 14.2%

35-44 – 23.6%

45-54 – 23.6%

55-64 – 21.7%

65-74 – 10.9%

75-84 – 1.5%

Carbon emissions

Details of our performance on carbon emissions can be seen in the Environment section. We have outlined our planned commitments in relation to Science Based Targets overleaf.

OUR SCORE RANGE (2021)

RATINGS & BENCHMARKS

OUR PLANS

We have undertaken a review of ratings/benchmarks in 2022, and we intend to report under the following frameworks. The table below details what the framework is, and our targets in respect of that framework.

ECOVADIS

Global leaders in business sustainability ratings. They rate over 100,000 companies worldwide across 200 industries. Scores organisations out of 100, providing a Bronze, Silver, Gold or Platinum rating.

SCIENCE BASED TARGETS INITIATIVE

Science-based targets provide a clearly-defined pathway for companies and financial institutions to reduce greenhouse gas (GHG) emissions, helping prevent the worst impacts of climate change and future-proof business growth. Targets are considered ‘science-based’ if they are in line with what the latest climate science deems necessary.

TASKFORCE FOR CLIMATE-RELATED FINANCIAL DISCLOSURE (TCFD)

11 recommended disclosures from the Task Force on Climate-related Financial Disclosure (TCFD) across its four key elements (Governance, Strategy, Risk Management and Metrics + Targets). This is a statutory requirement for c. 1,300 organisations, which we expect to be in the scope of.

INVESTORS IN PEOPLE

Investors in People is a recognition that an organisation looks to improve performance and realise objectives through the management and development of its people.

We are targeting Silver in 2023, and Gold by 2025.

TARGETS

Auto Windscreens has already committed and we expect validation of Auto Windscreens in 2023.

Formal commitment by the group in the first half of 2023, and validation as soon as possible thereafter.

We expect to disclose under TCFD in 2024, relating to the calendar year 2023.

Maintain Gold level.