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How we manage sustainability and responsibility

We manage sustainability and responsibility in the same way that we manage all our business operations, at global and local levels. At the highest level, sustainability and responsibility are overseen by the Corporate Citizenship Committee, chaired by the chief executive.

Strategy and governance

Chaired by the chief executive, the Corporate Citizenship Committee is responsible for making decisions or, where appropriate, recommendations to the board or executive committee, concerning our Sustainability & Responsibility strategy, policies and issues. This includes performance, measurement and reporting for the following impacts across Diageo’s value chain: alcohol in society, water, broader environmental sustainability, community, our people and governance and ethics.

Two executive working groups (one on alcohol in society, chaired by the director of corporate relations, and one on environmental performance, chaired by the president of global supply) assist the Corporate Citizenship Committee with decisions on specific issues. Additionally, a newly formed cross-functional leadership team, chaired by Diageo’s global director of corporate social responsibility, advises on the strategy development for each key sustainability and responsibility impact at each stage of the value chain, including supplier management, operations, and relations with customers, consumers and investors.

Beyond this global management, the regions and local markets manage those sustainability and responsibility areas most material for them given their specific operational footprint.

 

Policies and standards

We have global codes, policies and standards covering all aspects of sustainability and responsibility. A note on definitions:

  • Global policies cover the principles we commit to in undertaking various business activities and are relevant to most employees.
  • Global standards are more procedural and apply to specialist activities. These will apply only to individuals in certain specific roles.

Both policies and standards stem from our Code of Business Conduct which defines how everyone at Diageo is expected to do business. Below are those that are particularly relevant to how we manage our sustainability and responsibility programmes although these do not represent the full spectrum of our policies and standards.

Document type SubjectSustainability & Responsibility Programme
Code Code of Business Conduct All
Policy Marketing Alcohol in society
Customers and consumers
Policy Quality Customers and consumers
Policy Competition & Anti-trust Governance and ethics
Policy Anti-Money Laundering Governance and ethics
Policy Tax Governance and ethics
Policy Occupational Health & Safety Our people
Policy Anti-Discrimination & Human Rights Our people
Policy Employee Alcohol Alcohol in society
Policy Environment Environment  / Water
Standard Partnering with Suppliers Our suppliers

To learn more about our policies and standards, visit: www.diageo.com.

 

Risk factors

Our ability to understand and manage risk, including certain sustainability risks that are material to the business, is central to creating long-term shared value for all our stakeholders. A thorough understanding of risk allows us to make more informed and better decisions and thus deliver better business performance.

Diageo has a robust framework of internal controls and risk management, which we describe in detail in our annual report. Our structured approach to addressing social, environmental and economic impacts helps us manage risk more efficiently, strengthen our reputation and brands, avoid or reduce occurrences that could cause loss and build trust with stakeholders. Our ability to manage such impacts well today is crucial to our ability to thrive in the future. To ensure this attitude to risk is understood and managed consistently throughout the business, we have developed the role of our regional risk management committees.

Our annual report contains the full list of risk factors we consider to be material to the business. Risks we consider to be particularly relevant in terms of our sustainability and responsibility impacts include:

  • Alcohol in society, community, customers and consumers: the social acceptability of our products and our ability to address stakeholder concerns about alcohol misuse
  • Environment, water, community, suppliers: the impacts of climate change on resource scarcity including water scarcity, water quality and the price of raw materials
  • Governance and ethics: unwarranted regulation of our business
  • Our people: our ability to attract and retain talent, especially in emerging markets.