S172(1) statement and stakeholder engagement

Barratt Developments PLC – Annual report – 30 June 2021

Industry: real estate

Section 172 statement

On the following pages we have set out how the Board has acted in a way that promotes the success of the Company for the benefit of its members as a whole, in accordance with the requirements of the Companies (Miscellaneous Reporting) Regulations 2018, whilst having regard to the following matters set out in s.172(1) of the Act:

• the likely consequences of any decision in the long term;

• the interests of the Group’s employees;

• the need to foster the Group’s business relationships with suppliers, customers and others;

• the impact of the Group’s operations on the community and the environment;

• the desirability of the Group maintaining a reputation for high standards of business conduct; and

• the need to act fairly as between members of the Company.

We understand that it is important for the business at all levels, including the Board, to engage with its shareholders and wider stakeholder groups. By engaging with our stakeholders we gain a better understanding of what areas they are interested in or concerned about and also how our decisions have impacted them. Healthy engagement with our stakeholders underpins our governance framework, which is embedded throughout our business and helps to ensure we maintain high standards of business conduct. The Executive Directors update the Board on stakeholder engagement on a regular basis and wherever possible, members of the Board engage directly with our stakeholders. Engagement with shareholders and other stakeholders supports the Board’s regard to the likely consequences of any decision in the long term, as explained further in the business model on pages 10 to 11, Key activities of the Board on page 73, Building sustainably on pages 18 to 23 and throughout our Strategic priorities on pages 24 to 33.

The Board appreciates that there may be situations where conflicts will arise between different stakeholder groups. In such circumstances, the Board will seek to understand the needs and priorities of each stakeholder group during its discussions and as part of its decision making process. It manages such conflicts by assessing shareholder and stakeholder interests from the perspective of the long term sustainable success of the business. As an example, during the year the Board had to consider how to meet the increase in demand for new homes (in part due to the end of the SDLT holiday) as the country emerged from the lockdown without compromising the safety of its workforce given that to improve productivity, the workforce would need to work longer hours as well as weekends. Additional reporting requirements and further controls were put in place to enable the Executive Directors to closely monitor movement in build stages. The SHE team undertook more SHE visits across the business to ensure that SHE policies, procedures and working practices continued to be adhered to. Where any areas of improvement were identified, detailed action plans were put in place to safeguard our employees. Such actions and decisions by the Board represent the Group’s culture of customer focus and resilience and adaptability. In addition, the Board ensures that our culture encourages our wider workforce to take pride in what we do, and to do the right thing when in contact with customers and members of the local communities.

Throughout the year, the Board remained mindful of the implications that their decisions would have on our stakeholders as well as potential reputational risk for the Group. This highlighted the continual need for regular, clear and comprehensive engagement with our workforce, suppliers, shareholders and customers throughout various decision making processes to ensure that we continue to do the right thing and protect the reputation of the Group.

The next few pages set out the stakeholders which continue to represent the key resources and relationships that support the generation and preservation of value in the Group, as well as our culture of openness and communication. For each stakeholder we have explained why we engage with them, how we engaged with them, and how we take into consideration, the interests and concerns of our stakeholders who are material to the long term success of the business.