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More details on oversight can be found below

Integrating sustainability into our governance practices

Regulatory requirements and stakeholder expectations continue to evolve at speed. Having appropriate governance is key to delivering on our sustainability commitments. The effective oversight and management of sustainability-related risks and opportunities are essential to BAT’s ability to deliver A Better Tomorrow™.

Board oversight

The Board is collectively responsible for the long-term success of the Company and the Group’s strategic direction, purpose, values and governance. This includes responsibility for the Group's strategy and ensuring that resources are allocated appropriately to meet these objectives and to manage risks, including through internal controls.

The Board has strategic oversight of our sustainability matters and takes climate-related considerations into account where applicable when making strategic decisions, including in relation to budgeting, risk management and overseeing capital expenditure.

The Audit Committee receives reports from the Group’s Regional Audit Committees and Corporate Audit Committee, which monitor the effectiveness of business risk management and internal controls across our regions and central functions. The Audit Committee also has oversight of the external assurance of sustainability-related information. The Nomination Committee considers sustainability experience when reviewing Board composition.

Sustainability expertise at the Board level

Our Board members have international experience and present a wide range of leadership expertise in industries such as fast-moving consumer goods, infrastructure, food, beverage and tobacco, among others. Relevant experience includes the oversight of varied companies impacted by a broad range of environmental and social issues.

Non-Executive Directors receive regular briefings on legal and regulatory developments, including the evolving sustainability landscape.

In 2024, the Audit Committee was briefed on developments in sustainability reporting regulations by the Chief Sustainability Officer and KPMG as external auditor (and in the context of their provision of assurance in relation to sustainability reporting). Briefings covered continued reporting in alignment with TCFD recommendations, the European Sustainability Reporting Standards introducing future requirements for disclosures in compliance with the EU Corporate Sustainability Reporting Directive (CSRD) and, development of the UK Sustainability Disclosure Standards.Ìý

Management’s role

The Management Board, chaired by our Chief Executive, is responsible for overseeing the implementation of the Group’s strategy and policies set by the Board, including those relating to sustainability. It also creates theÌýframework for the day-to-day operation of the Group’sÌýsubsidiaries.

Members of the Management Board are responsible for delivery against targets under their individual remit with respect to sustainability, including those relating to Harm Reduction. They are supported by their respective teams who, in turn, work with other functions and markets to make progress towards the Group’s targets.

We continue to integrate the management of sustainability impact areas across relevant business areas at Group, regional and local market levels. This allows for the appropriate flow of information, monitoring and oversight across the Group.

Integrating sustainability considerations into remuneration

Where relevant, the Management Board (including the Director Operations) have individual performance objectives that form part of their responsibilities and are linked to their remuneration. These include delivery against climate-related priorities and metrics.

Performance against personal objectives forms part of the consideration in determining performance ratings of relevant employees, which in turn are reviewed as part of discussions to determine compensation.

The Group retains the discretion to makeÌýdownward adjustments to individualÌýbonus payments in the event ofÌýpersistent underperformance against performance objectives.

The Sustainability objectives within the remuneration of Tadeu Marroco, Chief Executive, and Soraya Benchikh, Chief Financial Officer, are focused on the Group’s progress in achieving its Smokeless Future ambitions.ÌýFrom 2025, a climate metric will be introduced into the Group's Short-Term Incentive Plan, linking compensation of Executive Directors and wider employees with the decarbonisation of our operations.

Governing our material impacts

To manage our material sustainability impacts we have set up topic-specific Centres of Excellence at the middle management level. These include Climate Change, Circular Economy, Nature and Social Centres of Excellence. In addition, individual business functions, such as Legal, Corporate & Regulatory Affairs and HR, manage material sustainability issues relevant to their areas. The management of material sustainability topics is also discussed in various committees and forums, such as:

• Group Sustainability Leadership Team
• Environmental Sustainability Committee,
• Operations Sustainability Committee
• Leaf Sustainability Forum
• Supply Chain Due Diligence Committee
• Responsible Marketing Principles Steering Committee
• Regulation and Science Committee
• Business Integrity Panel; and
• Talent Reward and D&I Leadership Teams.

Issues considered in these forums are raised, where appropriate, at Management Board level or with the Audit Committee or the Board.

More details can be found in the table below: