Stakeholder Why we engage How we engage How this has influenced our business and shaped our sustainability approach Customers Our customers are at the heart of our business. Our business plan is built around understanding and meeting their needs. We contact customers directly through a quarterly customer survey and ongoing qualitative research with members of Tap Chat, our online community panel. In advance of our business-plan submissions, which occur every five years, we conduct extensive customer engagement. Our latest plan, called PR19, featured our largest and most in-depth programme of insight to date, engaging with over 32,000 customers. This engagement has informed our material issues. We also gather customer sentiment and issues of importance indirectly through media monitoring and social-media tracking. Regular customer engagement has affected a range of our operations and communications, e.g. our Covid and affordability communications. The sustainability issues our customers are most interested in include leakage, climate change, investment in our infrastructure and environmental improvements. Meeting our customers’ needs is critical. COVID-19 customer research shaped our promotion of affordability and vulnerable customer schemes, water-efficiency products and sewer-misuse communications. Investors The importance of the natural environment to the success of our business cannot be understated. We see our investors as our partners in moving our sustainability agenda forward. We work to ensure our shareholders, investors and investment analysts have a strong understanding of our strategy, performance, ambition and culture, to ensure continued access to capital for our business, and to ensure investors and shareholders understand the sustainability value proposition of our business. We have a regular programme of investor engagement, including calls, virtual meetings with Executive and Board, capital markets day and a newsletter, which all include sustainability topics. During the financial year, we held over 140 investor meetings, attended by 56 shareholders, representing c.64% of our register. In 2020, our annual capital markets day was themed on sustainability. We are ranked by ESG rating agencies and sustainability stock indices. We have enhanced our reporting for ESG and sustainability-focused investors. We are reporting to the TCFD, SASB and CDP to provide investor-ready sustainability data and metrics. We have developed a Sustainable Finance Framework based on the following international standards: The Green Bond Principles (‘GBP’), Social Bond Principles (‘SBP’) and Sustainability Bond Guidelines (‘SBG’) as published by the International Capital Market Association (‘ICMA’) in June 2018 The Green Loan Principles (‘GLP’) and Sustainability Linked Loan Principles (‘SLLP’) as published by the Loan Market Association (‘LMA’) in March 2018 and March 2019 Suppliers Along with our employees, our suppliers support us in providing for our customers. We recognise suppliers are key to achieving our ambitious sustainability commitments and we outline our expectations in our Sustainable Supply Chain Charter. Strong supplier relationships ensure sustainable, high-quality delivery for the benefit of all stakeholders. We discuss issues of importance with suppliers monthly. These discussions include sustainability-related issues and occur through our tender process and contract management. We publish supply-chain newsletters throughout the year to inform our suppliers of topics of interest, while providing an opportunity to gather feedback on these topics. We continue to hold regular Supplier Summits, to provide an opportunity to share best practice insights and identify areas for collaboration to achieve shared sustainability outcomes. We have a customised approach to supporting suppliers based on their size, including supplier payment terms for SMEs. We evaluate suppliers for key environmental and social issues. To date, 60 suppliers (representing 56% of our spending) have pledged to act on biodiversity, carbon reduction, resource efficiency and social mobility Our business model means we have significant impacts on a variety of stakeholders. We identify stakeholders to engage with, based on the likelihood and consequence of our activities to have a positive or negative impact on them. We engage with stakeholders to understand these impacts and their views on our company. This process is part of our corporate governance. We aim to report clearly on how we have taken the views of our stakeholders into account, the impact of our decisions on them and any actions we have taken as a consequence. You can read more in our s.172 statement on pages 72 to 74 of our Annual Report and Accounts for more information on our overall stakeholder engagement. Because of the nature of our business, sustainability is already a key topic of conversation with many stakeholder groups. For this year’s report, we have examined the results of our stakeholder engagement throughout the year as an important input into identifying and prioritising our material issues. We use our analysis to help determine what information we should include in our Sustainability Report. In general, we engage with stakeholders continuously throughout the year. How and when we do this depends on different internal and external events. We may engage proactively or reactively in response to these events. Stakeholder engagement and materiality assessment