RMPP STATEMENT OF COMPLIANCE WITH THE UK STEWARDSHIP CODE

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ROYAL MAIL PENSION PLAN STATEMENT OF COMPLIANCE WITH THE
UK STEWARDSHIP CODE

Principle 1 – Institutional investors should publicly disclose their policy on how
they will discharge their stewardship responsibilities.

The Royal Mail Pension Plan (“RMPP”) takes its responsibilities as a shareholder
seriously. It seeks to adhere to the Stewardship Code, and encourages its
appointed investment managers to do so too. Stewardship is seen as part of
the responsibilities of share ownership, and therefore an integral part of the
investment strategy.

The RMPP states in its Statement of Investment Principles (“SIP”) that it requires
its investment managers to discharge their responsibilities in respect of
investee companies that they invest in accordance with the UK Stewardship
Code drawn up by the Financial Reporting Council.

Principle 2 – Institutional investors should have a robust policy on managing
conflicts of interest in relation to stewardship and this policy should be
publicly disclosed.

The RMPP encourages the investment managers it employs to have effective
policies addressing potential conflicts of interest. In respect of conflicts of
interest within the RMPP, Trustee Directors are required to make declarations
of conflicts of interest at the start of Trustee Board and Sub-Committee
meetings.

Principle 3 – Institutional investors should monitor their investee companies.

Day-to-day responsibility for managing the RMPP’s equity holdings is
delegated to appointed investment managers and the RMPP expects them
to monitor companies, intervene where necessary, and report back regularly
on activity undertaken. Written reports from investment managers on voting
and engagement activity are received by the Trustee’s Investment Sub-
Committee on a quarterly basis.

Principle 4 – Institutional investors should establish clear guidelines on when
and how they will escalate their activities as a method of protecting and
enhancing shareholder value.

As highlighted above, responsibility for day-to-day interaction with companies
is delegated to the RMPP’s investment managers, including the escalation of
engagement when necessary. Their guidelines for such activities are
expected to be disclosed in their own statement of adherence to the UK
Stewardship Code.

Principle 5 – Institutional investors should be willing to act collectively with
other investors where appropriate.

The RMPP is signed up to United Nations Principles for Responsible Investment
(UNPRI) and is currently reviewing its position on acting collectively with other
investors.

Principle 6 – Institutional investors should have a clear policy on voting and
disclosure of voting activity.

The RMPP’s SIP states that it expects the investment managers to have
suitable policies in respect of exercising voting rights. The Trustee holds the
investment managers accountable for their decisions in the use of voting
rights.

The voting records of investment managers are reported to the RMPP’s
Investment Sub-Committee every quarter.

Principle 7 – Institutional investors should report periodically on their
stewardship and voting activities.

All of the RMPP’s investment managers report on their stewardship and voting
activities every quarter to the RMPP’s Investment Sub-Committee.

The Trustee annually reviews and updates its SIP which sets out the RMPP’s
approach to responsible investing and assesses compliance with governance
best practice.

The RMPP is considering its approach to the public disclosure and reporting of
its voting and engagement activities.

Adopted by the Royal Mail Pension Plan in February 2012.