Audit Committee Overview

BAE SYSTEMS Our Approach to Environment & Climate Change We are committed to high standards of environmental management and undertake activities with the aim of reducing the environmental impact of our operations, products and supply chain. • We monitor and report our emissions at Group-level, in compliance with the UK government's Carbon Reduction Commitment and the Australian National Greenhouse Energy Reporting System Our Products Our Operations Maintaining high environmental management standards Reducing emissions & enhancing disclosure https://www.baesystems.com/en/our-company/sustainability Our Actions & Progress • All major manufacturing sites certified to ISO 14001 • Reduction in mains water (14%) and abstracted water(16%) in 2019 • Recycling of waste increased by 18% in 2019 • Our global carbon footprint in 2019: 1.103 million tonnes of CO2 equivalent (-5% vs 2018) • Moving towards 60% sourcing of renewable energy across the UK estate • More than 10,000 solar panels live in UK and Sweden Our Commitments Committed to high standards of environmental management Establish net zero timeline and report by 2022 in line with the recommendations of the Task Force on Climate- related Financial Disclosures (TCFD) Investing in low carbon innovation • Investment in development of hybrid propulsion technologies • Apply lifecycle assessment to maximise potential for reuse and remanufacture of our products • Member of the International Aerospace Environment Group Formal review of environmental and climate related risks this year Copyright 2020 BAE Systems. All Rights Reserved. BAE SYSTEMS is a registered trademark. 35

View entire presentation