PERNOD-RICARD_REGISTRATION_DOCUMENT_2017-2018

3

SUSTAINABILITY & RESPONSIBILITY (S&R) PROTECTING THE PLANET

Actions for the protection of biodiversity 3.5.3.4 In addition to its sustainable agriculture practices, Pernod Ricard is committed to projects aimed at protecting and developing the biodiversity of ecosystems on the agricultural land where the Group operates vineyards. These are areas around the vineyards hosting biodiversity (rivers, forests, hedgerows, native biotope, etc.), that are preserved with the aim of protecting ecosystems.

In addition, the Group has drawn up a list of 32 protected or sensitive natural areas close to its production sites throughout the world, and it is monitoring these closely. These areas are mainly located in Scotland, Ireland, France and Sweden. The table below shows examples of noteworthy measures taken by affiliates related to biodiversity.

Country Scotland

Examples of biodiversity programmes set up by affiliates

Mapping of sensitive ecosystems located near its industrial sites and participation in local reforestation programmes. A research programme aiming at producing yellow gentian from specialised farms ensures the protection of 50,000 wild plants every year. Material and financial support of the Paul Ricard Oceanographic Institute which works to protect marine ecosystems and aquatic biodiversity. Implementation of a biodiversity programme on uncultivated land of Cognac vineyards and making around 1,200 wine growers aware of this programme. Martell also obtained a High Environmental Quality (HQE) certification for all new maturing cellars, contributing to an increase of the site’s ecological potential. With the support of the NGO Accionatura, realisation of a programme to protect biodiversity in the Rioja region, particularly the installation of nesting boxes and feeders for birds, building animal shelters and insect hotels, etc. New Zealand Rehabilitation programme in an area of nine hectares of wetlands in the Kaituna region. Protection of a local falcon species thanks to a fund supported by the donation of one New Zealand dollar for each bottle of wine sold from the “Living Land” series. Australia Reforestation programme and the preservation of indigenous ecosystems in the Jacob’s Creek river basin and on non-productive areas of land of its vineyards with assistance from Trees For Life and the National Resource Management Board. Ireland Plantation of 17,000 trees of 15 different local species and 12,000 undergrowth shrubs and 6,600 wetland plants by the rainwater collection pond for the new whisky maturing cellars. Russia A partnership agreement with the World Wide Fund (WWF) to help protect the snow leopard, a species from central Asia that is threatened with extinction. France France France Spain

In addition to biodiversity protection, the Group is committed to ensuring complete traceability of its products in terms of GMOs (genetically modified organisms) to assure consumers that the labelling regulations for products containing GMOs are strictly complied with. Accordingly, all affiliates conduct a risk assessment to identify potential sources of raw materials, taking the necessary measures to ensure control of these sources. Although the distillation stage removes the risk that GMO material may be present in the distilled products, supply chains for products that are guaranteed GMO-free have been established for certain corn-based alcohols in the United States and Europe.

Other elements of the production chain – including direct water consumption in industrial sites – only represent approximately 1% of the total. At production site level, the affiliates’ actions are based on four levers put in place to optimise the management of water resources and preserve the quality and availability of water: measuring consumption; ● ensuring that water intake does not endanger resources; ● taking measures to save, reuse and recycle water; ● ensuring effective treatment of waste water before its released into ● the environment. These actions are particularly important for sites located in geographical regions where water is a sensitive resource. Indirect water consumption caused primarily by the production of farm raw materials varies significantly from one region to another. They should therefore be dealt with at local level with the suppliers of affiliates, taking specific climatic conditions into account either through sustainable agriculture standards (see the subsection “Promoting sustainable agriculture”), or through the Group’s responsible purchasing policy (see the subsection “Monitoring law 2017-399 on the duty of vigilance”). Pernod Ricard has made water management as one of the five strategic focuses in its environmental policy. The Group has been a member of the United Nations Chief Executive Officer Water Mandate since September 2010, reinforcing its commitment to the protection of the planet’s water resources.

Preserving and saving 3.5.4 water resources

Challenges and strategy 3.5.4.1

Water is an essential component in the products manufactured by Pernod Ricard. It is used at every stage in the life cycle of the Group’s products: irrigating crops, processing raw materials, distilling, blending eaux-de-vie and formulating products, etc. The Group’s water footprint, determined in 2012 according to the methodology developed by consultancy firm Quantis, identified the main challenges linked to the water resource along the production chain. This footprint is valued at approximately 675 million m 3 of water per year, and indicates that 99% of consumption relates to the supply of agricultural raw materials.

108

PERNOD RICARD REGISTRATION DOCUMENT 2017/2018