To all our stakeholders

I am pleased to confirm that N Brown Group Plc reaffirms its support of the 10 Principles of the United Nations Global Compact in the areas of Human Rights, Labour, Environment and Anti-Corruption.

In this annual Communication on Progress, we describe our actions to improve the integration of the Global Compact and its Principles into our business strategy, culture and daily operations. We also commit to share this information with our stakeholders using our primary channels of communication.

Angela Spindler
Chief Executive
N Brown Group Plc

The group has a human rights policy endorsed at board level. We are in the process of updating our corporate website and this will be displayed once this work is completed in July 2015.

HUMAN RIGHTS POLICY

As a multi-channel retailer, we have a responsibility to respect the human rights of our colleagues, our customers, communities that we operate in and for the people who work in our supply chain, wherever they are in the world.

We are fully committed to upholding basic human rights and we fully support both the United Nations Declaration of Human Rights and the International Labour Organisation Core Conventions. We are proud to be members of the Ethical Trading Initiative and also signatories to the United Nations Global Compact. We expect all our suppliers to work to these high standards.

We will investigate any allegations of human rights infringements and take any action deemed appropriate. In addressing human rights issues we consider our potential impacts on the following groups as our priorities:
• Colleagues – We want our people policies to make N Brown a great place to work that is fully inclusive.
• Supply chain – We will build strong partnerships with our suppliers to ensure that our products are of the best quality and are responsibly sourced.
• Customers and communities – Our customers want good quality products that have been sourced safely and responsibly.

We aim to address any and all human rights issue faced in a positive manner. This is a complex area and we believe that openness and responsiveness are essential in the identification and remediation of issues. We also understand that the best way to find solutions for these issues is to work proactively in partnership with relevant stakeholders and other retailers.

Our Corporate Social Responsibility Committee will report back regularly to the Board and we will also report on our human rights impacts in our Annual Report. Key elements of our Human Rights Policy are embedded in our Code of Conduct which is reviewed on a regular basis. We will investigate mechanisms for people within our remit to be able to confidentially report any alleged breaches of our policy. We will report back on progress by using our reporting under the United Nations Global Compact commitments. We will of course also review and amend where necessary both this policy and working practices across the group as and when required.

We also have our supplier Code of Conduct based on the ETI Base Code.

As part of this we joined a BSR Working Group on responsible sourcing from Myanmar. We are working with Gap, M&S, H&M, Primark and The Children’s Place to explore further partnerships in the area of child labour and stakeholder dialogue. We are also exploring partnerships with organisations such as UNICEF, ILO, GIZ and US Aid to ensure this work has impact on the ground.

We have had no specific cases in the past year of human rights breaches discovered in our supply chain.

We will fully investigate all incidents of violations, preferably with partners on the ground in the relevant country. We also work with other retailers through the ETI to gain leverage and momentum where issues are sector wide.

Labour rights are central to us across the group. For our own employees, we have a collective bargaining agreement with USDAW in the UK.

We encourage all our suppliers to have mature industrial relations in their factories whilst recognising in some countries this requires work and support.

We also have our supplier Code of Conduct which is based on the ETI Base Code supporting ILO Conventions.

In Bangladesh, we are signatories of the Bangladesh Accord and practically take up our commitment to working with unions and labour as partners. We support the development of Health and Safety Committees within factories as a mechanism to drive change through.

Also in Bangladesh, we are jointly funding a project with DFID to tackle gender equality and anti-sexual harassment. This is a dialogue based approach to help build capacity within the factories. We aim to tackle gender discrimination by delivering train the trainer modules.

We are also working as part of a group of retailers, together with IndustriALL on establishing a living wage programme within global garment supply chains. This will involve all actors including suppliers and brands and unions working together to establish proper collective bargaining at an industry/country level.

Currently the business employs 3,300 people in the UK. We are one of few FTSE 250 companies to have a female Chief Executive and 3 female board members.

There is a full grievance procedure in place to deal with any violations of labour principles. There is also an employee helpline which can be used to channel issues in an anonymous way.

There is a full review of the policy on an annual basis and reports regularly given to the board as required.
Within our supply chain we have 61% of our factories audited to SA8000/SMETA or similar standard. All new suppliers are required to commit to our Code of Conduct.

Our Green House Gas (GHG) emissions inventory is calculated for the group under the operational control approach, in accordance with the GHG Protocol and GHG emissions factors published by DECC. The inventory is independently calculated by our partner carbon consultants Envantage Ltd.

Since the last inventory period the Group has increased operational hours and activities across its main distribution sites to meet higher demand for products. This higher demand is illustrated in the increased number of dispatched items during the 2014-2015 period. We have also increased the number of facilities and supporting services we operate as we have developed and grown our Simply Be brand. Due to continued investment into carbon reduction and energy efficiency, we have successfully reduced GHG emissions per unit dispatched by 7.6 % since the previous reporting period.

The majority of the Group’s scope 1 & 2 GHG emissions (tCO2e) are associated with electricity, natural gas and diesel (internal haulage) across our facilities and vehicles. Since the last reporting period our actual energy consumption in kWh across electricity, gas and diesel has reduced by 3.7 %, despite a significant increase in business activities. Assessment of energy in kWh on a relative basis to the number of items we dispatched in 2014-15, shows a significant reduction of 16.8 % when compared to the previous year.

Electricity: Although our overall energy consumption in kWh has reduced since the last reporting period, our electricity consumption in kWh has increased by 5.6% due to the growth of the Simply Be high street brand. However, electricity consumption across all other divisions has reduced due to ongoing energy management and investment into new technologies such as LED lighting, despite increased working hours and handled goods. Although electricity consumption has slightly increased since the last reporting period, our electricity GHG emissions (tCO2e) are indirectly higher due to an increase in published electricity emissions factors for 2014. Effectively the electricity grid is less green on average than it was in 2013, making the associated GHG emissions higher per kWh.

As a responsible retailer, we have been purchasing green electricity for a number of years. During the last inventory period our green electricity accounted for 83.5% of our total profile. In addition to purchasing green electricity, we will now be generating our own green energy onsite following the recent installation of a solar PV plant at our main distribution centre.

Diesel (haulage): Diesel consumption has also grown since the last year due to an increase in distance travelled and vehicle utilisation in order to support our growing brand. However, on a relative basis achieved miles per gallon (MPG) has actually improved due to driver training, journey planning and improved load management.

Natural Gas: Our gas consumption has significantly dropped across the group by 21% since the previous period, despite a colder winter and an increase in the number of handled items and steam cleaned returned goods. Gas consumption has successfully reduced due to significant investment into heating controls, energy efficiency boilers and more efficient steam tunnels for returns cleaning.

The group has assessed its corruption and bribery risk and all employees are required to support an anti-corruption/bribery policy.

We have a full policy revised after the introduction of the Bribery Act 2010 in the UK. We have a full whistle blowing policy and helpline to support any staff that may be victims of attempted extortion or bribery. Internal Audit maintain a register of gifts or services whether or not they were accepted. We plan to raise more awareness over the coming year with relevant group staff who have day to day contact with suppliers and are at most risk of experiencing bribery or corruption.

Responsibility for maintaining all anti-corruption policies is delegated from the Board and sits with Group Head of Internal Audit. Cultural sensitivity training is given to all staff directly dealing with suppliers in negotiations. Our standard induction pack contains our policy on anti-corruption and whistle blowing.

A register is maintained by internal audit monitoring activity and use of the whistleblowing helpline. No events were reported on the helpline this year.

We are committed to a periodic review of anti-corruption policies and procedures by the Board.