MODERN SLAVERY POLICY STATEMENT

This statement is made pursuant to section 54(1) of the UK Modern Slavery Act 2015 (the “Act”)
and constitutes the slavery and human trafficking statement of Grafton Group plc (“Grafton”; the
“Group”) in respect of the financial year ending 31 December 2020.


POLICY ON SLAVERY AND HUMAN TRAFFICKING
Grafton is committed to acting ethically and with integrity in all of its business dealings and
relationships, and to taking appropriate and proportionate steps to ensure that modern slavery
or human trafficking does not occur in any part of its business or in its supply chains. The Group’s
overall commitment to ethical conduct is set out in the Group Code of Business Conduct and
Ethics (the “Code”), which all colleagues and individual business units are required to apply. The
Code states that Grafton does not tolerate forced or involuntary labour in any form.


GRAFTON’S BUSINESS
Grafton Group plc is an international distributor of building materials to trade customers and has
leading regional or national positions in the merchanting markets in the UK, Ireland and the
Netherlands. Grafton is also the market leader in the DIY retailing market in Ireland and has
manufacturing operations in the UK and Ireland, including the largest manufacturer of dry mortar
in the UK.


This statement applies to the following UK subsidiaries of Grafton Group plc:
Grafton Merchanting GB Limited, Selco Trade Centres Limited, CPI Mortars Limited, The Timber
Group Limited, Macnaughton Blair Limited, Frontline Bathrooms Limited, Bathroom Distribution
Group UK Limited, TG Lynes Limited, LSDM Limited, GDC Paints Limited, Harvey Steel Lintels
Limited, Direct Builders Merchants Limited, Crescent Building Supplies (Ruislip) Limited, AVC
(Stairbox) Limited.


While the Act does not apply to the Group’s businesses outside the UK, Grafton has adopted a
Group approach to the legislation and this policy statement applies to Grafton’s businesses
outside the UK to the greatest extent practicable.


As a distributor of building materials and related products, the key areas of the Group’s operations
that may be impacted by this legislation are (1) its supply chain and (2) its colleagues and any
other persons working on its behalf. Set out below are the steps that the Group takes to mitigate
risk in these areas.


SUPPLIER AND SUPPLY CHAIN ACTIVITY
A significant proportion of the Group’s products are sourced directly from suppliers in the UK and
Europe. Taking a risk based approach, the Group has put in place particular safeguards to
mitigate the risk of modern slavery in its supply chain in relation to materials sourced from
outside the UK and Europe which may not be subject to an EU-equivalent standard of legislation
relating to employment rights and forced labour.


The Code states that Grafton will not purchase from suppliers that procure products for Grafton
from countries subject to trade sanctions, or if the supplier or its sources are listed in connection
with a trade sanctions program or other list of proscribed individuals or entities relevant to the
countries in which the Group operates.


Under its terms of trade, Grafton requires all its suppliers to comply with its anti slavery
policy. The Group has continued to roll out its Supplier Quality, Ethical and Environmental Manual
(the “Manual”) which outlines the quality standards expected of our suppliers, including
adherence to an Ethical Code of Conduct incorporating the Modern Slavery Act. All of the Group’s
non-EU/UK suppliers are signed up to the Manual, which is aligned to the internationally
recognised Ethical Trading Initiative (ETI) Base Code.


The Group has engaged an external due diligence screening solution to assist with prioritising,
monitoring and mitigating the risks associated with supplier relationships. Non-EU suppliers are
screened annually against relevant sanctions lists, watch lists, PEP lists or adverse media reports.
During 2020 the Group implemented a Group Sustainability Strategy which includes specific
targets relating to supplier risk-assessment, compliance and assurance.


As part of the Sustainability Strategy, the Group commenced a process for the implementation of
a third-party risk management and compliance management solution with a view to developing
a consistent, risk-based approach to managing supplier compliance across all of its business
units. It is intended that the solution will be developed and rolled out by the end of 2021.
The supplier contracts used by our UK businesses are updated on renewal to include specific
prohibitions against the use of forced, compulsory or trafficked labour.


RECRUITMENT AND HR
The Group’s policy is to comply fully with the relevant employment laws and regulations in the
countries in which it operates. Grafton has in place stringent HR processes and controls to
ensure that all colleagues are assessed for their right to work in the relevant jurisdiction, that
workplace equality processes are in place and that wages, benefits and working hours comply
with relevant legislation in each jurisdiction. Each business unit regularly reviews and develops
its HR policies and controls. The Group also adheres to the ETI Base Code, the internationally
recognised code of labour practice.


SPEAKUP POLICY
The Group has in place a SpeakUp policy, which sets out the duty of Group colleagues, external
consultants, contractors and agency staff to report any concern they may have about suspected
wrongdoing. The policy sets out how colleagues can report concerns and how those reports
and the individuals making them will be treated. An independent third-party reporting service is
available to allow colleagues to raise concerns with someone outside the Group should they
wish to do so.


COMPLIANCE WITH THIS POLICY
All Group colleagues, officers and directors, as well as anyone acting on behalf of the Group or
any Group company must comply with this policy. Any Group colleague who breaches this policy
may face disciplinary action, which could result in dismissal for gross misconduct.
Within its sphere of influence, Grafton strives to ensure that its suppliers follow its commitment
to ethical conduct, including the Group’s approach to forced and involuntary labour. Where non-compliance is identified, Grafton will engage with the relevant supplier and promptly take appropriate action, which may include not appointing or re-appointing the supplier.


Approved by the Board of Directors on 23 February 2021

Gavin Slark
Chief Executive Officer
Grafton Group plc