Softcat plc are fully committed to the United Nations 17 Sustainable Development Goals and the Ten Principles of the United Nations Global Compact, covering Human Rights, Labour, Environment, and Anti-Corruption.

This annual Communications on Progress shares our plans and progress towards the Sustainable Development Goals. It complements our 2021 annual report and the information publicly available on our website.

We are proud to be taking positive action towards making a better world by 2030 and will continue to share our progress with our stakeholders regularly, as well as taking any opportunity to advocate for others to do the same.

Sincerely yours,

Graeme Watt

Chief Executive Officer

We strive to be a great place to work for Softcat people. We want our employees to be fully engaged with our Company and motivated to give their all and we want their contribution to be recognised and rewarded.

We will therefore not tolerate forced, bonded or compulsory labour, human trafficking and other kinds of slavery within our own operations or within our supply chain and are committed to taking appropriate steps to ensure that everyone who works for Softcat – in any capacity – benefits from a working environment in which their fundamental rights and freedoms are respected.

Our approach to preventing modern slavery forms part of our wider corporate responsibilities. Our CEO is responsible for oversight of Softcat’s corporate responsibilities. We adopt procedures that contribute to ensuring modern slavery does not occur in our business or supply chains and we expect organisations with whom we do business to adopt and enforce policies to comply with the legislation.

Given the nature and locations of our business, we consider ourselves to be at low risk of the potential for slavery or trafficking. Furthermore, our revenues are predominantly derived from countries deemed low risk by conventional sustainability indices, such as The Global SlaveryIndex (http://www.globalslaveryindex.org/index/). We also believe that Softcat’s business model and strategy is unlikely to create material risks of slavery and trafficking.
We have a number of procedures in place which we consider to be appropriate to our business and effective in preventing modern slavery from occurring in our business or supply chains.

• We treat our employees in a fair, lawful and professional manner and provide for fair working conditions, including health and safety, holiday entitlements and benefits.
• Robust recruitment processes are taken in line with employment laws, including: ‘right to work’ document checks; contracts of employment and checks to ensure everyone employed is 16 and above. We also make sure our people are aware of their contractual and statutory employment rights.

We plan to implement the following in 2022 to further guard against the risk of modern slavery and trafficking:

• Additional training within the Procurement function
• A review of our Supplier Code of Conduct, to ensure provisions against the risk of modern slavery remain in line with good practice
• Complete a review of the disclosures made by certain key hardware suppliers to ensure that their products to not contain ‘conflict minerals’. The production of conflict minerals is often associated with poor human rights and unacceptable labour practices.

As part of our initiative to identify and to mitigate risk:

• We have sought confirmation by our top suppliers (who work for us providing products and/or services for our own business use), in terms of spend, of their compliance with the UK Modern Slavery Act
• We operate a Supplier Code of Conduct, used for all new major suppliers or in re-tendering, which addresses the labour rights issues associated with modern slavery and sets out the values and standards we expect of our suppliers. We have included a declaration to confirm support of the Code or where they have their own codes in place, sought confirmation they are complying with the same standards that we adhere to.
• Our Employee Handbook requires all of us to act ethically and we expect employees to comply with legal requirements at all times, putting our values into practice in everything we do.
• We have a speak-up hotline to enable anyone who has concerns (for example, how suppliers, customers, partners or employees behave) to raise their concerns confidentially.

Our performance on human rights is regularly assessed by external bodies, including EcoVadis. Market-related pay and rewards are reviewed annually.

We are in the process of developing dashboards to track and publish any issues relating to human rights, which will be monitored at board level.

Company culture has always been Softcat’s top priority.

Since Softcat was founded nearly 30 years ago, we’ve kept employee engagement at the core of our business model. The link between culture, employee engagement and business results has never been clearer. But how do we maintain our unique culture? Well, it starts right at the top. And with a 99% employee approval rating and number three ranking in Glassdoor’s Top CEOs in the UK, our CEO is showing how it’s done.

Our diversity networks form a major part of our Communities hub, incorporating the Supporting Women in Business, BAME, Family, Pride, Armed Forces Reservists and Veterans, Faith and Disability and Neurodiversity networks, the latter being a new network recently launched with a founding group of 20 people.

Our focus in recent months has been our ground-breaking Allyship programme. Allyship is an awareness programme made up of three modules, two hours in length, that takes place over the course of a month. Cohorts of up to 16 employees from across different departments of the business come together to learn how we can support each other more, and particularly our colleagues who may have a protected characteristic. Our goal is for every employee to sign up to this programme to help make Softcat a more inclusive place to work.

In terms of statistics, we have made progress in our gender diversity, which now stands at 33% female, up almost 3% from last year. This has also had a positive impact on our management team, with 26% female members, an increase of 2% from last year.

We have 50% gender diversity at Board level, achieving the Hampton-Alexander recommendation for FTSE 350 companies to have 33% of their board made up of females by 2020. To further support our efforts in gender diversity, a new programme called TechStarter was introduced this year. The programme comprises five women who have had significant career breaks for personal reasons taking on apprenticeships within technical areas. Subject to the findings from this programme, we will look to expand this further next year.

In disability and neurodiversity, we have brought together 20 employees to be founding members of this new network. We are already a Disability Confident employer and will be consulting with our new network about what areas it would like to focus on in the coming year.
Our ethnic diversity has increased 1% in FY21, up to 13% of our total workforce.
Our efforts to increase employee representation from the BAME community are continuing and several new initiatives have been introduced in this area. These include training BAME employees in interview skills and to ensure balanced interview panels for BAME candidates. This initiative aligns to one of the commitments we made as part of the Race at Work Charter, which is to support ethnic minority career progression.

This year we also voluntarily published our ethnic minority pay gap in conjunction with our gender pay gap. Finally, we have achieved the Parker Review target for FTSE 250 companies to have at least one person of colour on their board by 2024.

Softcat recognises that it can be a better business by taking steps to minimise its impact on the environment.

The Board takes ultimate responsibility for Softcat’s sustainability and the Chief Financial Officer has the lead executive responsibility. Last year the Company formalised its approach to sustainability and this year we have made substantial progress in key areas, including those below. The Board is proud of these achievements, which is part of our wider recognition of Softcat’s responsibilities to the environment.

At Softcat we believe we can be a successful business and do good to protect our people and the planet for future generations to come. We are motivated to drive change within our own organisation whilst working with our partners, our supply chain, and supporting our customers on their socially responsible journey through the services and technology we provide.

We recognise there is an impact of climate change and we have a role to play to mitigate the impact. This also offers opportunities to help our customers to mitigate their impact on the environment.

Our commitment is demonstrated by the ambitious environmental targets we set in 2020. We are a signatory to the Task Force on Climate-related Financial Disclosures (‘TCFD’) and are now starting to make disclosures in this Annual Report structured around the TCFD recommended framework.

We intend to fully comply with TCFD and the associated disclosures in line with the applicable requirements and timescales. We recognise that to successfully evaluate and respond to the challenges and opportunities of climate change, and to fully comply with TCFD, we will need to embed an understanding and awareness of climate change issues further across our business.

Softcat has made commitments and goals on its environmental impact in the business and its supply chain. Last year the Board approved a target over the longer term to become a net zero carbon business and this will be achieved primarily by completing three key stages. We are developing underlying internal milestone targets in respect of the key stages to support our journey to carbon net zero.

On the journey to reduce emissions, Softcat is committed and has signed up to the Science Based Targets initiative (‘SBTi’). This will commit the business to reduce its greenhouse gas (‘GHG’) emissions in line with the Paris Climate Change Agreement. Under the SBTi, businesses are encouraged to commit to setting targets in line with a 1.5°C reduction and to achieve net zero emissions across their value chain by 2050. Softcat is currently developing a Carbon Reduction Plan to support its SBTi, which will be validated and disclosed in next year’s Annual Report.

As well as committing to the use of green energy, Softcat has also started the installation of remotely accessed energy meters across all of its offices which will provide accurate data for power usage across all locations. This will allow Softcat to get real time and accurate energy usage to support its future emission reduction plans and emission calculations.

Our emissions have been calculated using the GHG Protocol Corporate Accounting and Reporting Standard (revised edition), together with the latest emission factors from DEFRA and DECC.
• Scope 1 comprises emissions from our pool cars and natural gas burnt in boilers we control.
• Scope 2 comprises our electricity consumption in leased and owned buildings.

We have chosen to present our total emissions relative to the average number of employees, in order to represent how our emissions are impacted by the growth of our business. In FY21 there was a small increase per employee, but this is still below the level in FY19 and in prior years reported. These figures are provided fully in our annual report.

Underpinning our approach to ethical behaviour is our Code of Conduct, which is applicable to all employees and to those who work for or on behalf of Softcat. The Code of Conduct sets out the expected standard of behaviour.

Softcat also operates a Supplier Code of Conduct (the ‘Supplier Code’), used for all new major suppliers or in retendering, which addresses ethical employment and labour rights issues associated with modern slavery, and sets out the values and standards we expect of our suppliers. The Supplier Code covers compliance with the Human Rights Act 1998, Equality Act 2010, Criminal Finances Act 2017, Bribery Act 2010, local health and safety regulations, anti-bribery and corruption, anti-modern slavery, and minimising environmental damage.
Suppliers are required to declare they support the Supplier Code or where they have their own codes in place, confirm they are complying to a similar standard.

We operate a Speak Up hotline for all employees to widen employees’ channels of raising any issues they may encounter. This provides our employees with an externally provided, secure and confidential channel to voice issues, in addition to internal channels already available.

We also operate an anti-bribery, corruption and tax evasion policy, which has been updated recently along with a review of employee training. The anti-bribery, corruption and tax evasion policy provides that we take a zero-tolerance approach to bribery, corruption and tax evasion and that we are committed to acting professionally, fairly and with integrity in all our dealings. The policy also sets out the types of behaviour which are unacceptable in the conduct of business and procedures to prevent bribery, corruption and tax evasion.

We also operate a register which requires all employees to seek approval from their line manager and to disclose any gifts or hospitality received or given which is valued over the applicable disclosure threshold. Guidance on accepting or giving gifts and hospitality is contained in the anti-bribery, corruption and tax evasion policy and the gifts and hospitality register is reviewed by management.

Softcat publishes twice-yearly details of its payment practices to its trade suppliers. This is reviewed by the Board during the year as part of the Directors’ wider responsibilities to consider how Softcat impacts on its key stakeholders. We take a responsible approach to these responsibilities and during the year management has made further improvements to pay even more invoices within the agreed terms.

The Company adopts an open and honest relationship when dealing with Government agencies. For example, during the year the Board approved an update to Softcat’s tax strategy, which has been published on our website (www.softcat.com/corporate- responsibility). The tax strategy includes an outline of our approach to dealing with HMRC and confirms that Softcat’s primary tax objective is to ensure that it pays the right amount of tax, in the right jurisdiction, at the right time, as dictated by legislation.