Distell : King IV Compliance Statement 2022

Principle 1

Leadership

The Board should lead ethically and effectively.

Distell Board governance philosophy

By consistently adhering to the values of good corporate governance, we provide a platform from which Distell's management and employees can pursue and achieve the Groups strategic ambitions and goals. This leads to long term value creation for all stakeholders. Our governance processes and principles contribute to an ethical culture that stretches beyond compliance to true accountability, transparency and fairness. The board applies integrated thinking as promoted by King IV, and application is achieved through appropriate policies, processes and controls.

The Board of Directors leads ethically and effectively, adhering to the duties of a director by acting with due care and diligence. The Board commits to maintain sufficient working knowledge of Distell and its industry and to remain informed about matters for decision making.

The Board is competent to steer and set the strategic direction of Distell. The board strives to act in the best interests of the Group. Prior to endorsing the strategy, the Board challenge it constructively with reference to, amongst others, the timelines and parameters which determine the meaning of short, medium and long-term respectively, availability of resources and relationships connected to the various forms of capital, the expectations of material stakeholders and the impact on transformation that may result from the execution of the proposed strategy.

The Board is mindful of the impact of Distell's activities on society and the environment, considering key risks and opportunities, and seeks to ensure sustained value creation for all stakeholders.

Principle 1 (continued)

Leadership (continued)

The Board should lead ethically and effectively.

Conflict of interest

The directors are required by the Companies Act to annually disclose their personal financial interests in material contracts or other matters, including interest by persons related to them. This process is facilitated by the company secretary around year- end.

Where a potential conflict of interest exists, directors must recuse themselves from relevant discussions and decisions.

All directors are required to comply with the Code of Ethics and Conduct, the Financial Markets Act, No. 19 of 2012, and the requirements of the JSE Limited and the adopted Group-wide Price Sensitive Information policy, regarding inside information, dealings in securities and the disclosure of such dealings.

Every year employees are required to declare external business interests and potential conflicts of interests. This is assessed by management and the Group Company Secretary. In addition, Distell Internal Audit audits this declaration process and independently performs an extensive review of the potential links and conflicts between employees and vendors and customers. No material conflicts of interest were identified in 2022.

Evaluation & Transparency

The Board, its Committees, its chair and individual members are subject to a formal evaluation process, either externally facilitated or self-evaluation at least every 2 years. The results are discussed and actioned by all concerned and a summary is published in our integrated annual report.

Principle 2

Organisational

Ethics

The Board should govern the ethics of the organisation in a way that supports the establishment of an ethical culture.

The Board ensures that Distell's ethics are managed effectively and provides effective leadership based on an ethical foundation.

An ethical corporate culture is promoted and sustained through:

• endorsing the purpose and values of the Group;
• endorsing the principles documented in the Code of Ethics and Conduct ("the Code");
• monitoring and reporting on the measures taken by the Group to achieve adherence thereof; and
• all business conducted by the Board and management aligns with the values of the Group;
• the Code is published on the website and incorporated by reference in employee contracts;
• the Group has a supplier code of conduct;
• endorsing internal policies, specifically around Anti-bribery and Corruption, Gifts and Entertainment and Whistle- blowing to tackle practices inimical to ethical conduct more efficiently;
• the Board has allocated the oversight of, and reporting on, organisational ethics to the social and ethics committee, whose mandate includes monitoring and reporting on the Group's social performance and bringing material matters to the attention of the board; and
• all business conducted by the Board and management aligns with the values of the Group.

The implementation and execution of the Code of Ethics and Conduct and related policies are delegated to management.

Actions to ensure effective ethics management during 2022 included formulation of an ethics training programme and materials, phased implementation of the training programme focusing on high-risk areas and communication to employees regarding whistle-blowing statistics and investigation outcomes. It starts with the formulation of a statement of strategic intent, which describes an aspirational end-state of ethics Distell wishes to attain.

In accordance with the requirements of King IV regarding ethics management, the Distell Ethics Strategy is imperative to ensure that the social and ethics committee fulfils not only its mandate and responsibilities, but also contributes to the enhancement of Distell's organisational culture. Distell aims to establish an ethical organisational culture that can be categorised as well-developed, in which employees find it easy to do the right thing and embrace and live the organisational values by 2025.

Principle 2 (continued)

Organisational Ethics (continued)

The Board should govern the ethics of the organisation in a way that supports the establishment of an ethical culture.

In order to give effect to our Ethics Vision, Distell has identified four strategic focal areas which will be focused on over the next three years, namely:

• Leadership for an ethical culture
• Sustained ethics awareness/communication
• Ethics risk management
• Independent assessment of the ethics management process and systems

An Ethics Management Plan has been adopted, which contains measurable interventions, responsible functions and target dates.

To increase our ethics awareness and behaviour and in accordance with the requirements of this 2nd principle, the Distell Ethics Strategy is imperative to ensure that the Social and Ethics Committee fulfils not only its mandate and responsibilities, but also contribute to the enhancement of Distell's organisational culture.